Thera Prins
UK Shareholder Services
The Takeover Code can be extremely complex and a recent consultation by the Code Committee of the Takeover Panel to narrow the scope of companies which the Takeover Code applies to could, potentially, remove certain companies from the obligation to comply with this Code.
The Financial Conduct Authority (FCA) has published its latest Primary Market Bulletin which amongst other matters consults on changes to the FCA Knowledge Base in relation to the listing regime and finalises three technical notes relating to sponsor competence.
Additionally, the FCA has published guidance relating to anti-greenwashing rules which come into force at the end of May. While aimed primarily at FCA regulated firms the contents could be of interest to companies.
Takeover Code Consultation Paper
The Code Committee of the Takeover Panel has published a Consultation Paper (PCP 2024/1) titled 'Companies to which the Takeover Code applies', which proposes a new jurisdictional framework narrowing the scope of companies required to comply with the City Code on Takeovers and Mergers (the "Takeover Code").
Under the proposals, the Takeover Code would only apply to a company which has its registered office in the UK, the Channel Islands, or the Isle of Man ("UK registered") and either:
- any of the company's securities are admitted to trading on a UK regulated market (e.g. the London Stock Exchange's main market for listed securities), a UK multilateral trading facility (e.g. AIM or the Aquis Stock Exchange) or a stock exchange in the Channel Islands or the Isle of Man (e.g. The International Stock Exchange ('TISE')) (a "UK listed company"); or
- the company was a UK listed company at any time during the three years prior to the 'relevant date' (defined as the date on which an announcement is made of a proposed or possible offer for the company or the date on which some other event occurs in relation to the company which has significance under the Takeover Code).
The Takeover Code will continue not to apply to a company which has its registered office outside of the UK, the Channel Islands, or the Isle of Man.
The Takeover Code currently applies to UK-registered companies that are also UK-listed. It also applies to a range of UK-registered companies that are not UK-listed if they satisfy a 'residency' test, meaning that their place of central management and control is in the UK. The Code Committee is proposing to abolish this 'residency' test, and for the scope of companies to which the amended Takeover Code applies to be significantly narrower than under the current Takeover Code.
The full consultation can be viewed via this link: PCP 2024_1 Companies to which the Takeover Code applies (thetakeoverpanel.org.uk)
Financial Conduct Authority - Primary Market Bulletin 48
This edition of the Financial Conduct Authority (FCA) Bulletin provides an opportunity for consultation on changes to documents in the FCA Knowledge Base following the Primary Market Effectiveness Review and resulting proposed amendments to the Listing Rules. This is the first of what is expected to be a phased consultation on guidance in the Knowledge Base in preparation for the revised Listing Rules published by the FCA in draft on 7 March 2024.
These proposals are still subject to the finalisation of the revised Listing Rules consultation, which is expected in June or July 2024.
In the Bulletin, the FCA:
- Confirms the final technical notes relating to sponsor competence rules.
- Consults on changes to existing technical notes to reflect the proposed changes to the listing regime- this consultation closed on 26 May.
- Consults on the introduction of a new technical note relating to the role of a sponsor.
- Publishes a draft of the new Procedures, Systems and Controls form that the FCA is proposing applicants for listing submit with their listing application.
The Bulletin also contains an update on the proposed introduction of a number of new listing categories and the mapping of current standard and premium listed companies into these new categories. Issuers will be notified from mid-May on the category their securities will be included in, should the proposed changes to the Listing Rules be approved. Issuers will have four weeks from the date of this notification to contact the FCA if they believe they have been incorrectly allocated.
The Bulletin is available from Primary Market Bulletin 48 | FCA
Financial Conduct Authority - Anti-Greenwashing Guidance
The Financial Conduct Authority (FCA) has published a press release ahead of the anti-greenwashing rule which will be effective as from 31 May 2024. This new rule applies to financial products and services that FCA authorised firms make available for clients in the UK and are designed to protect consumers by ensuring sustainable products and services they are sold are accurately described. The press release is accompanied by guidance.
The press release can be accessed here: FCA confirms anti-greenwashing guidance and proposes extending sustainability framework | FCA
The guidance here: FG24/3: Finalised nonhandbook guidance on the AntiGreenwashing Rule (fca.org.uk)
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