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Proposed removal of requirement for shareholder vote on significant transactions and related party transactions: FCA provides update on Listing Rule reforms

03 April 2023. Published by Karen Hendy, Head of Corporate and Connor Cahalane, Partner

The FCA has provided an update on reforms to the Listing Rules proposed last year in its discussion paper DP22/2 (see our summary here). The Chief Executive of the FCA, Nikhil Rathi, confirmed in a speech at the Global Investment Management Summit on 29 March 2023 that the FCA expects to publish soon proposals to make the following changes to the Listing Rules:

  • removing the requirements for compulsory shareholder votes for large transactions and for related party transactions, whilst maintaining a disclosure regime;
  • moving to one listing category for all companies on the Main Market by removing the distinction between the premium and standard segments;
  • removing the eligibility rules requiring a three-year financial track record as a condition for listing; and
  • taking a more permissive approach to dual class share structures.

At this time there is no indication when the changes outlined above would come into effect. The next step for these reforms will be for the FCA to publish a consultation paper, likely to follow in the coming months.