The Financial Conduct Authority (FCA) has just published a consultation paper (Consultation Paper 26/14: Changes to the information flows for UK equity IPOs) on removing rules which require a mandatory waiting period between the publication of an IPO prospectus or registration document, and the release of pre-deal investment research by syndicate bank analysts.
The consultation follows recommendations in Lord Hill's UK Listing Review and Rachel Kent's Investment Research Review, and a range of recent reforms aimed at reducing friction in the UK's capital markets, encouraging companies to list and grow in the UK. If these proposals are implemented, they would speed up the UK IPO process, reduce market risk for companies and selling shareholders, and help further that aim.
What is being proposed?
The FCA proposes to remove the following two requirements currently set out in the FCA's Conduct of Business Sourcebook (COBS):
- The mandatory waiting period requiring syndicate banks (that is, banks involved in the underwriting or placing shares on an IPO) to wait at least seven days after the publication of an FCA-approved prospectus or registration document, before publishing 'connected' research prepared by syndicate bank analysts. It is proposed that connected research can be published simultaneously with the publication of an IPO prospectus or registration document.
- The 'equal information sharing obligation', requiring syndicate banks to identify 'unconnected' analysts at non-syndicate banks and ensure they have the same access to the issuer and its information as their own analysts.
Why is this being proposed?
The FCA has found that the current rules (introduced by the COBS in 2018):
- have not materially increased independent research coverage, which was their original purpose;
- have extended UK IPO timetables by approximately seven days, when compared with other jurisdictions where timelines are shrinking; and
- have increased execution risk and costs for issuers, placing the UK at a competitive disadvantage.
What is not being proposed:
The FCA is not proposing to remove the requirement for an FCA approved prospectus or registration document to be published before the publication of connected research.
Additional matters under consideration:
The FCA is also seeking feedback on further potential reforms, including:
- the timing of publication of a prospectus or registration document during the IPO process; and
- restrictions on connected analysts participating in presentations and interacting with issuers.
The FCA's consultation closes on 29 May 2026. No specific implementation date following its consultation has been identified.
