The Financial Conduct Authority (FCA) has launched a consultation on whether to change the research requirements for companies prior to filing an Independent Public Offering (IPO).

The UK’s financial regulator announced today that it is considering removing the seven-day delay before connected research on an IPO can be published, and getting rid of rules that require firms to provide independent analysts with the same information as their own research analysts.

These rules were introduced in 2018 with the aim of encouraging independent, or unconnected, research, but have failed to achieve this goal, the FCA said. Instead, market feedback suggests that they have added complexity, risk and cost to the IPO process.

The agency believes that their removal would simplify the UK’s IPO process, making listing in the UK a more attractive proposition, supporting the FCA’s work to strengthen the UK’s capital markets and support growth and competitiveness.

“Market feedback has been clear that these rules can introduce additional risk, cost and complexity without delivering the intended benefits,” said Jon Relleen, director of infrastructure & exchanges, supervision, policy & competition division. “We are committed to reducing friction, supporting growth, and ensuring the UK remains a competitive and trusted place for companies to raise capital.”

The consultation helps the authority to fulfil one of the commitments it set out in a letter to the Prime Minister in December of last year setting out its approach to growth.

The consultation will remain open until 29 May.

The London Stock Exchange (LSE), the UK’s largest stock exchange, has faced significant headwinds in recent years as companies look to list elsewhere. EY research shows that in 2024, 88 companies delisted or transferred their primary listing away from the LSE’s Main Market, the largest outflow of companies since the 2008 financial crisis.

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