In Changes to information flows for UK equity IPOs (CP26/14), the FCA are consulting on their proposal to remove 2 rules introduced to the UK equity IPO process in 2018 (“the 2018 rules”), which: 

1. Mandated a 7-day waiting period between the publication of an approved registration document/prospectus and connected research (COBS 11A.1.4FR); 
2. Required syndicate banks intending to publish connected IPO research to share the same information with a range of unconnected analysts as they do with their own research analysts (COBS 11A.1.4BR – COBS 11A.1.4ER).  

In our response, our members fully support the FCA’s proposals, agreeing they have introduced unnecessary market risk and costs for issuers listing in the UK. In practical terms COBS 11A.4FR has embedded an extra week into the IPO timetable, whilst in our members’ experience COBS 11A.4BR-ER has not led to any meaningful increase in the production of unconnected research. There is also an opportunity for the FCA to consider going further to fully remove the frictions introduced with the 2018 rules by removing the requirement for a registration document, which has significant cost and time implications for issuers and does not exist in other global listing venues.  

Removing the frictions introduced in 2018 will increase the flexibility and efficiency of the UK equity IPO process, bringing the UK in line with other global listing venues, and support the FCA’s broader objective of ensuring UK capital markets remain an internationally competitive environment in which to raise and invest capital.  

We welcome the FCA’s engagement with industry on this work to date and will continue to provide input as these proposals develop.