The Listings Review: New life for the UK's primary market

In the past decade it could be said that a plateau has become evident in the UK's primary market ?upon which private companies issue public equity through an initial public offering (IPO).

While IPOs in Asian markets grow at pace, and higher prices combined with greater flexibility have afforded New York a steady stream of ?blockbuster? listings, London in comparison has not shared a similar dynamism.

Ambitious tech and bio-tech founders are increasingly keen to realise the benefits of public issuance; the number of companies going public in 2020 (1415) increased by over 35 per cent on the previous year (from 1040). In the US, there were more primary market listings in October 2020 alone than in the whole of 2009. The effects of the financial crisis notwithstanding, there is a clear upward trend in the prevalence of IPOs.

In order to competitively capture a decent portion of this demand, the City must sharpen its competitive edge to ensure that its primary markets regime attracts innovative, high-growth companies, while continuing to draw founders with its long established and globally-recognised standards of governance and shareholder protection.

In his November statement the chancellor Rt Hon Rishi Sunak MP announced the formation of a taskforce, led by former EU Financial Services Commissioner Lord Jonathan Hill, to examine the UK's listing rules. The listing rules broadly govern the conditions under which firms can issue public equity in London. The review, which began with an initial Call for Evidence, aims to consider changes to the current regime that could strengthen the attractiveness of the UK as a destination for companies to list. It forms just one facet of a broader drive by the government to support the UK continuing its status as a global financial market.

The banking and financial services industry welcomes this opportunity to consider improvements to the UK's primary market landscape. Working closely with our members, with the support of Linklaters and cross-industry collaboration, UK Finance has identified a suite of targeted recommendations in response to the Call for Evidence. The collective objective of these recommendations is to enhance the appeal of the UK's listings regime while ensuring that London's reputation for regulatory standards is maintained.

We have submitted a number of initiatives with respect to the listing rules for Lord Hill to consider. For example, a more flexible approach to dual class share structures, as well as adjustments to the free float and financial track record requirements might see London considered more favourably alongside its global competitors and regenerate primary market activity. Additionally, greater efforts to publicise or showcase the advantages of the City's public equity markets could support the development of a more positive, forward-looking narrative surrounding listing in the UK.

As the Listings Review develops, we will continue to engage our members to support the evolution of a dynamic and competitive listings regime in the UK. For more information on this work and primary markets in general, please contact