The FSA has released a consultation paper (CP 12/2) on proposed amendments to the Listing Rules (with some consequential changes to the Prospectus Rules, Disclosure Rules and Transparency Rules). Click here for our detailed briefing note and here for the full text of the consultation paper.
Key points of note are:
Premium listing standards: will we see changes to enhance the corporate governance regime for premium listed issuers? The FSA has highlighted some potential areas to encourage debate and are seeking comments and ideas as to whether the Listing Rules should be changed by giving a greater say to minority shareholders, for example, either by way of granting them rights of veto over particularly important resolutions or enabling them to determine the governance arrangements of a company. The FSA is at pains, though, to draw a distinction between their power to impose free float requirements (which is for the purpose of enhancing liquidity rather than the free float requirements imposed by the FTSE for the purposes of inclusion in the FTSE indices), and that it is the Financial Reporting Council, through the UK Corporate Governance Code, rather than the FSA, which sets the corporate governance framework. The focus appears to be on empowering minority shareholders – but there is, of course, no guarantee that an empowered minority will act any more selflessly than majority shareholders.
Attacking SPACs (special purpose acquisition companies): The FSA terms these 'externally managed companies' – a slightly less catchy phrase. The FSA is attacking them on two fronts – principals of the external management company will be responsible for any prospectus published by the SPAC and they will need to disclose their own share dealings. Secondly, SPACs will not be eligible for premium listings (and therefore, not eligible for FTSE index inclusion).
Technical guidance notes: there will be no more leafing through old copies of List! nor attempting to navigate the FSA website to find the relevant Technical Note. The Listing Rules will now incorporate the material previously to be found in Technical Notes – a boon to the less technologically savvy of us. Other changes: There are also changes to the sponsor regime, reverse takeovers, requirements for financial information (both on listing as a premium issuer and in connection with the publication of circulars) and in connection with transactions.
Click here for further details.