The key proposal in the consultation paper is to create a single listing category for the equity shares of commercial companies, with the following key features (by comparison to the current premium Listing Rules):
- Admission criteria. Companies would still need to have a market cap of at least £30 million and a “free float” (shares not held by insiders) of at least 10 per cent to list on the Official List. However, companies would no longer need to have a three-year financial and revenue-earning track record, or to satisfy the FCA they have at least 12 months’ working capital – potentially enabling suitable high-growth companies to obtain a listing at an earlier stage. At the same time, the FCA proposes to modify its existing requirements for a company to have an independent business and operational control over its main activities, to accommodate a wider range of business models and structures.
- Controlling shareholders. Where a company has a controlling shareholder (30 per cent or more), the FCA proposes replacing the current requirement for a controlling shareholder agreement to be in place with a more disclosure-based regime (but which would otherwise retain some of the features of the existing regime, such as the rules on electing independent directors and cancelling listings).