UK FCA makes changes to information flows for UK equity IPOs

The UK Financial Conduct Authority (FCA) has published final policy statement PS26/16, on changes to its rules on information sharing during UK equity initial public offerings (IPOs). Following feedback to the April consultation, the FCA found that some of the 2018 reforms had not succeeded in encouraging the production of unconnected research and had instead created additional costs and administrative burdens for issuers, potentially placing the UK at a competitive disadvantage relative to other listing venues.

The FCA has finalised the proposals as consulted on, including amending its Conduct of Business sourcebook (COBs) to: (i) remove the mandatory seven day waiting period between the publication of an approved registration document or prospectus and connected research; and (ii) repeal the related requirements mandating that syndicate banks intending to publish connected IPO research share the same information with a range of unconnected analysts, as they do with their own research analysts. The changes take effect immediately, while noting that firms and issuers remain free to engage with unconnected analysts on a voluntary and commercial basis.

The FCA also implements a technical correction to COBS 12.2.21R to address an inconsistency resulting from earlier changes made to the FCA rules when the UK MiFID Organisational Regulation (on shored Regulation 2017/565) was revoked and its requirements transferred into FCA rules.

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