The consultation paper confirms a radical approach to bolster the international competitiveness of the UK markets and return to a disclosure-based listing framework.

By Mark Austin, Chris Horton, James Inness, Anna Ngo, and Johannes Poon

The FCA today published consultation paper CP23/31 setting out detailed draft rules for the new UK listing regime. The publication represents the final stage of the journey to reshape the UK Listing Rules which started with the launch of Lord Hill’s UK Listings Review in 2020. Most of the key changes reflect proposals in the FCA’s preceding consultation paper CP23/10 published in May 2023 (see this Latham Client Alert for further details).

The FCA reveals its initial thinking on the regulatory framework for primary multilateral trading facilities and public offer platforms.

By Chris Horton, James Inness, Anna Ngo, and Johannes Poon

On 13 July 2023, the FCA published its fifth and sixth engagement papers to solicit discussion and feedback on the regulation of public offer platforms and primary multilateral trading facilities (MTFs) under the new regime for public offers and admissions to trading.

Italian Securities Commission returns to ordinary reporting requirements for listed issuers.

By Antonio Coletti, Isabella Porchia, Guido Bartolomei, and Marta Negro

The Italian Securities Commission (CONSOB), by press release dated April 12, 2021, announced its decision to end the more stringent reporting requirements originally introduced on April 9, 2020, as a response to the impact of the COVID-19 pandemic on financial markets. While the more stringent requirements were renewed in three month increments, they will not be renewed after April 13, 2021. Starting April 14, investors will be required to comply with the pre-pandemic reporting requirements.

More stringent reporting obligations regarding relevant shareholdings and investment objectives for Italian-listed issuers will continue until 13 April 2021.

By Antonio Coletti, Guido Bartolomei, Marta Negro, and Isabella Porchia

On 13 January 2021, the Italian Securities Commission (CONSOB) adopted Resolution 21672 (the Resolution), further extending for three months the more stringent reporting requirements for relevant shareholdings and investment objectives in certain Italian-listed issuers with high current market value and/or spread ownership structure. The more stringent reporting requirements will now end on 13 April 2021. The Resolution extends the provisions of 9 April 2020, which were later extended until 13 January 2021

For the retail and consumer product sector, the high yield market will likely remain an attractive source of capital.  

By Roberto L. Reyes Gaskin and Laurie Tomassian

The retail and consumer products sector has been deeply impacted by the COVID-19 pandemic, both due to physical constraints on brick-and-mortar stores and supply chains, and acceleration of existing trends favoring online purchasing and e-commerce. COVID-19 has reinforced the need to adapt to  existing disruptions relating to how AI and data analytics can be deployed in the sector, advances in logistics, and the shift toward more engaged and responsible consumption.

While the long-terms effects of COVID-19 against the backdrop of an already shifting sector are still uncertain, it is clear that many retailers are under pressure: some have commenced restructuring, while others are facing a tougher liquidity environment. All retailers will likely need to further accelerate their omni-channel activity and adapt business models to new retail conditions. Economic conditions may also encourage consolidation (either in the context of restructuring or otherwise) or take-private activity. A high yield issuance may be an option to raise funds to support acquisitions, capital projects, or refinancing of indebtedness.

UK regulators announce a further package of measures to ease the burden on issuers.

By Chris Horton, James Inness, Rob Moulton, Koushik Prasad, Connor Cahalane, and Charlotte Collins

In response to the COVID-19 pandemic, UK regulators have published further measures affecting issuers, to try to preserve the flow of information to investors and support the continued functioning of the UK’s capital markets. However, the FCA has also noted that issuers will still need to observe their other disclosure obligations, in particular those concerning inside information under the Market Abuse Regulation.

The FRC has published a shorter and sharper Code which clarifies requirements for accountability, workforce engagement, and board diversity.

By Claire Keast-Butler, James Inness, Richard Butterwick, and Anna Ngo

The revised Code will apply to all companies with a premium listing on the London Stock Exchange for accounting periods beginning on or after 1 January 2019.

The key points are:

  • Board leadership and company purpose: The revised Code focuses on regular engagement with major shareholders, with companies

The Financial Conduct Authority has published final rules creating a new category within its premium listing regime for companies controlled by a shareholder that is a sovereign country.

By James Inness, Claire A. Keast-Butler, and Koushik K. Prasad

From 1 July, 2018, an issuer with a sovereign state as its controlling shareholder will be eligible for a premium listing if the issuer complies with all the requirements applicable to premium listed issuers under the Listing Rules, other than:

By Aaron Franklin

The United States has the deepest, most liquid capital markets in the world, attracting issuers from across the globe. To sell to US investors, these issuers must comply with US securities laws, entailing a more rigorous diligence and disclosure process. Issuers must weigh the benefits of increased demand against the additional costs, but the outcome should not depend on whether the bonds will be green or otherwise have sustainability credentials.

The US securities laws that apply to bond deals include a variety of rules on who can issue and purchase bonds, such as the registration requirements in the Securities Act of 1933, the Trust Indenture Act of 1939, and the Investment Company Act of 1940. But the real concern for bond issuers and underwriters is the threat of investors claiming securities fraud under the Securities Exchange Act of 1934, using “Rule 10b-5.” In general, a plaintiff is entitled to damages under Rule 10b-5 if a bond issuer or underwriter misrepresented or omitted a material fact in connection with the purchase or sale of the bond, with the intent to deceive or with recklessness, and the plaintiff lost money by relying on that misrepresentation or omission. This right to litigate for “material omissions” does not exist in most other jurisdictions, even where contractual fraud claims are possible. To avoid lawsuits under Rule 10b-5, issuers and underwriters (and their legal counsel) typically spend more time and effort (relative to deals not sold to US investors) investigating the affairs of the issuer and ensuring the offering disclosure is sufficiently robust.

By Isabella Porchia

The Italian Securities Commission (CONSOB) has approved two handbooks, “Management of Inside Information” and “Investment Recommendations,” which offer guidelines under Market Abuse Regulation no. 596/2014 (MAR) and delegated acts. These publications have implications for a range of market participants, including companies with listed equity and debt securities on both Italian regulated markets and multilateral trading facilities, as well as financial analysts and financial institutions acting as dealer managers and underwriters. In particular, the long-awaited handbooks clarify issues that certain provisions of MAR had raised while offering guidance on MAR’s full implementation.

The handbook on management of inside information provides guidelines for creating and implementing internal procedures involving inside information. In addition, the handbook imparts recommendations for developing and maintaining the insider register, as well as for complying with MAR’s disclosure requirements.