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One of the key modifications made to the regime was to collapse the previous premium and standard listing sectors of the regulated market into a flagship single listing category for Equity Shares in Industrial Companies (ESCC), described as the "commercial company" category. Whilst the intention was to introduce lighter-touch regulation for the industrial business category (compared to the previous premium listing section) the new guidelines still represented a step up from the previous standard listing requirements.

The transition category is closed to brand-new applicants and to transfers from other categories. The FCA has actually not yet set a particular end date for the transition category, however this will be kept under evaluation. The crucial arrangements of the UKLR sourcebook for business companies are set out in the table listed below: Key contents of the UKLR sourcebook for commercial companiesUKLR 1Preliminary: all securitiesThe FCA can give with specific UKLR requirements as it considers suitable.

ANSR July UK PRs

UKLR 2Listing PrinciplesThe Listing Principles need business to, to name a few, establish and preserve adequate procedures, systems and controls to allow them to adhere to their commitments under the UKLR (Listing Principle 1) and deal with the FCA in an open and co-operative way (Listing Principle 2). UKLR 3Requirements for listing: all securitiesShares must be freely transferable, completely paid and devoid of all constraints on the right to move.

An FCA-approved prospectus is required for an IPO.UKLR 4Sponsors: obligations of issuersA sponsor is required for an IPO and for particular other deals involving a commercial company, consisting of associated party transactions and reverse takeovers. UKLR 5Equity shares (business companies): requirements for admission to listingAt least 10% of shares of the listed class must be distributed to the general public (i.e.

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A business must adopt a constitution permitting it to adhere to the UKLR. A business must have the ability to demonstrate its board has strategic autonomy. Limitations apply to shares bring weighted voting rights. UKLR 6Equity shares (business business): continuing obligationsCommercial business are subject to continuing obligations, consisting of: yearly reporting requirements (including compliance with the UK Corporate Governance Code, or an explanation in the occasion of non-compliance); compliance with climate and diversity disclosure requirements; and market announcement requirements.

The substantial transaction announcement need to include specified information, including: the benefits and threats of the transaction; a declaration on the impact of the transaction on the group's earnings, possessions and liabilities; information of any break cost; a "finest interests" declaration by the board; and any other relevant details needed to support investor engagement and market transparency.

UKLR 9Equity shares (industrial business): more issuances, dealing in own securities and treasury sharesPre-emption rights apply to the company's listed shares. UKLR 21Suspending, cancelling, bring back listing and transfer between listing categories: all securitiesThe FCA may suspend the listing of a business's securities if the smooth operation of the market is, or might be, momentarily jeopardised or it is required to secure investors.

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In addition to the new commercial company category, the FCA likewise created new classifications for worldwide secondary listings (UKLR 14) and shell business (UKLR 13). For shell companies and SPACs, in the UKLR, the FCA mainly maintained the rules that had applied to the previous basic listing section, with boosted eligibility requirements setting time limits within which initial deals should be completed by SPACs.

ANSR July UK PRs

In addition, the FCA reverted to a guidance-based approach allowing larger SPACs to voluntarily put in place sufficient investor protections to prevent a presumption of suspension of listing as and when an initial deal is announced. Ahead of publication of the UKLR and to provide impact to the suggestions coming out of Lord Hill's review, the FCA implemented particular changes to eligibility requirements set out in the then Listing Guidelines with result from completion of December 2021, especially to minimize the free float requirement from 25% in "public hands" to 10% and to increase the minimum market capitalization limit for premium and standard listing sections from 700,000 to 30 million (read our summary here). With the UKLR, the FCA made further changes to eligibility criteria consisting of the adoption of a single set of Noting Principles (to show the collapse of the previous premium and standard listing sectors into a single business company category) and got rid of the previous premium listing requirements for a three-year income track record and "clean" working capital statement.