We responded to the FCA's consultation paper regarding its proposal to create a new premium listing category for sovereign controlled companies.
We supported the proposal; we commented that establishing such a segment will boost Britain’s international competitiveness by providing new global investment opportunities within the UK’s public markets. We noted that it is essential for public markets to be attractive to companies of all sizes as this helps to concentrate liquidity.
We agreed that, in order to join the new segment, a sovereign controlled company should be required to provide the additional disclosures such as producing annual reports, holding shareholder meetings and explaining their performance to analysts using conference calls and public presentations.
However, we also encouraged the FCA to replicate the principle of creating proportionate and appropriate rules and segments to suit particular types and sizes of company by providing a similar arrangement for smaller listed companies. We commented that allowing smaller listed companies to follow an alleviated or transitional regime that still provides investors with the necessary protections would incentivise more small companies to both continue to be listed and seek listing on a regulated market. This would improve overall liquidity, increase the number of companies in the FTSE All-Share Index and enable funds that are restricted to investing only in regulated markets to have more choice.
Click here to download our response (pdf)