The reforms are squarely aimed at encouraging fast growing companies to float on the LSE, which has become a comfortable home for banks, miners and oil companies, but severely lacks the high-growth technology businesses that have propelled other international exchanges to new heights. The FCA will on Wednesday launch a consultation on its proposed reforms, which also include: removing compulsory shareholder votes for large and related party transactions axing eligibility rules that require a three-year financial track record as a condition for listing and easing rules around dual class share structures.

We have to understand that capital markets involve risk and we need to get an insurgent mindset back, otherwise we’ll become a mid-tier regional market.”

Mark Austin, a partner at law firm Freshfields and chairman of the FCA’s independent listings advisory panel, said: “This is a very welcome move by the FCA and is about making our listing rules much less rules based and much more disclosure based - much more like the US system. London’s stock market is battling to remain relevant following an exodus of companies leaving for New York in recent months.īuilding materials giant CRH and gambling giant Flutter are among companies fleeing the London market in favour of the US.Īrm’s decision to snub London earlier this year was a blow to the Government, which had lobbied for Arm to return to the British stock market, and added to growing concerns about the competitiveness of the market. Lord Jonathan Hill, who previously authored a review into London’s stock market rules, said if implemented, the proposed overhaul would enable the City “to stand toe to toe” with its international competitors. The regulator has proposed to replace the City’s current premium and standard listings regime with a “single segment” system with less onerous rules.Īt present, only companies with a premium listing are eligible to be included in the FTSE indexes - which are influential because they are tracked by passive funds - meaning that scrapping the current regime would mark one of the most significant overhauls of London’s stock market rules since the 1980s. The Financial Conduct Authority (FCA) will attempt to lure companies to list in the capital by bringing its rules more in line with the US, just weeks after UK tech darling Arm snubbed the London Stock Exchange (LSE) in favour of New York. The City watchdog is to slash red tape and make it easier for companies to list in London in an effort to rival New York.

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