The Financial Conduct Authority (FCA) has published the final version of its new rules for the public offers and admissions to trading regime, via Policy Statement PS25/9. These new rules form part of the UK's plan to modernise its capital markets, intending to streamline capital raising by making it quicker and easier for listed companies to raise funds.
The new regime will separate the regulation of public offers and the regulation of admissions to trading, with some key changes set out in this insight.
Admissions to trading
The rules build a framework under the Public Offers and Admissions to Trading Regulations 2024 (POATRs).The FCA will have the power under the POATRs to determine whether a prospectus is required on admissions to trading and the new policy statement PS25/9 sets out the FCA's rules made under that power. The starting position will remain that a prospectus is required for the admission of securities to trading for the first time, such as on an Initial Public Offering (IPO).
What is changing?
- The POATRs will replace the UK Prospectus Regulation.
- The FCA's existing Prospectus Regulation Rules Sourcebook in the FCA Handbook will be replaced by the Prospectus Rules: Admission to Trading on a Regulated Market Sourcebook (PRM).
- The threshold for triggering a prospectus will increase from 20% to 75% of those same securities already admitted to trading, over a 12-month period, and up to 100% for equity securities issued by a closed-ended investment. Issuers can still choose to publish a voluntary FCA-approved prospectus if they're below the new threshold.
- The number of days a prospectus needs to be made publicly available will be reduced from six working days to three. The FCA hopes this will mean issuers will no longer have incentives to exclude retail investors from capital raises.
- There will be greater flexibility in relation to the prospectus summary, which will be able to include cross-referencing, will not require the annex of financial information and can be up to a maximum of ten pages (up from the current seven pages).
- A new definition of protected forward-looking statements will be introduced, being statements of financial or operational information relating to events or sets of circumstances that occur after the statement has been published, with a reduced liability regime applying. The criteria for preparing such statements will be set out in non-Handbook guidance at a later date.
- If an issuer has disclosed climate-related risk factors in a prospectus, or where climate-related opportunities are material to its prospects, it will need to provide prescribed climate-related disclosures in its prospectus.
- Issuers will make a single application to list all securities of a class, covering existing securities and further issuances. The FCA will treat further issuances of the same class as automatically listed on issue.
Takeover exemption documents
The current exemption from publication of a prospectus on a takeover will continue to apply, provided an exemption document describing the transaction and its impact on the issuer is made public.
The FCA will publish a Technical Note to provide guidance on the content requirements for the takeover exemption document later in 2025.
Updates for Primary MTFs
Changes coming for primary Multilateral Trading Facilities (MTFs), such as AIM, include:
- An MTF admission prospectus will be required for all initial admissions and reverse takeovers (subject to a few exceptions). The use of an MTF admission prospectus is intended to encourage wider participation in the ownership of public companies by enabling Primary MTF issuers to offer securities to a wide range of investors (i.e. not limited to qualified investors or to fewer than 150 persons) without the burden of having to produce an FCA-approved prospectus.
- No admission prospectus will be required for issuers using the AIM designated market route or the AQSE Growth Market fast-track, nor for admissions of new classes of securities or admissions resulting from a corporate restructuring where a new parent or holding company is added to the group structure of an existing issuer.
- Primary MTF operators will set the detailed content requirements and the process for reviewing and approving these admission documents.
- Primary MTF operators will have discretion to decide whether an MTF admission prospectus is required for further issuances of securities.
Offers to the public
The POATRs will replace the UK Prospectus Regulation with a new regime, under which there will be a general prohibition on all offers of securities to the public unless an exemption applies, rather than the current requirement for a prospectus for a public offer, subject to an exemption applying. Exemptions will include offers of securities admitted to a UK-regulated market (such as the Main Market) or a primary MTF (such as AIM), or for offers made via a public offer platform. Existing exemptions such as offers to qualified investors and to fewer than 150 persons will remain. Offers below £5 million will also be exempt. Private companies seeking to raise over £5 million will need to do so via a public offer platform.
When will the new rules come into effect?
The new rules will come into effect on 19 January 2026, when the UK Prospectus Regulation will be revoked.
What do the new rules mean for investing?
We welcome these changes and believe they will help the UK markets remain competitive in the attempt to attract more domestic and overseas companies. The increase in headroom for secondary fundraises without having to publish a prospectus is particularly good news, and should help to unlock funds from investors for companies to invest in, and acquire, new projects. The changes will also likely encourage issuers to include retail investors in fundraisings, a published goal of the UK Government.
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