Recent Developments for UK PLCs — May 2025

Update on Expected Timings of FCA Regulatory Initiatives

On 14 April 2025, the FCA published its updated regulatory initiatives grid, which sets out its regulatory pipeline — the first update since the new UK government came to power. The new grid outlines the expected timings of existing initiatives, but does not announce any new policy work.

Key initiatives impacting listed companies:

• Prospectus regime reform: The FCA aims to publish its final rules on the new prospectus regime in summer 2025, to take effect in early 2026. For further information on how these reforms could affect the capital-raising processes for listed companies, please see this Latham blog post.
• Sustainability reporting: The UK government is expected to consult on endorsing a UK version of the ISSB disclosure standards in H1 2025. Once this consultation is launched, the FCA intends to consult in Q3 2025 on disclosure requirements for UK listed companies against the UK ISSB disclosure standards, and on transition plan disclosures.
• Stewardship Code: The grid indicates that, following the end of the FRC’s consultation in February 2025, the new Stewardship Code will take effect in 2026. The FRC aims for the revised Stewardship Code to continue promoting effective stewardship through high-quality disclosures based on an “apply and explain” approach, accurately reflect evolving stewardship practices, and uphold the Stewardship Code’s international reputation.

Listed companies should consider these updated timings to plan around the regulatory developments and timing for implementation.

Digital Reporting Challenges That Companies Should Focus on

On 28 April 2025, the FRC published its annual review of structured digital reporting, highlighting key areas for improvement in how UK listed companies present their digital annual reports.

Listed companies should consider the report’s guidance, which addresses persistent challenges identified by the FRC regarding technical aspects of digital reporting. These challenges include the inappropriate use of custom tags, the misapplication of tags from irrelevant accounting standards, and design issues that affect the usability of digital reports.

Additionally, the FRC has announced plans to enhance its review of digital reporting by conducting a sample review alongside its regular monitoring of annual reports. Companies with significant tagging issues may receive direct communication from the FRC.

LSE Opens Discussion on Shaping the Future of AIM

On 7 April 2025, the London Stock Exchange (LSE) released a discussion paper inviting feedback on the design and framework of AIM, along with potential specific rule changes. This initiative aims to strengthen the LSE’s junior market and aligns with broader reforms in the UK capital markets observed in recent years.

Key points:

• Market framework: The LSE is seeking views on ongoing and other proposed initiatives (including fiscal incentives) to increase investment into AIM and enhance liquidity.
• Regulatory design: A high-level discussion on the appropriateness of the AIM regulatory model, including views on the value of the nominated adviser role, overlap between the AIM rules around disclosure of price-sensitive information and MAR, and AIM companies’ choice of corporate governance codes.
• Addressing friction points in the AIM rules: Areas being explored include:
  • the content requirements of AIM admission documents, including whether to introduce the option of a simplified admission document and incorporation by reference;
  • proposals for reforming the approach to working capital statements to alleviate the costs and time burden to support such statements;
  • dispensing with the need for an admission document on reverse takeovers;
  • broadening the list of permitted accounting standards that may be used by overseas AIM companies;
  • explicitly permitting dual-class share structures for AIM; and
  • potential reforms to specific rules around transactions, including exemptions for related-party transactions, increasing the disclosure threshold for substantial transactions from 10% to 25% (by reference to class tests), and certain changes to the class tests themselves.

Stakeholders are encouraged to submit their responses by 16 June 2025. In line with recent changes affecting the main market, we anticipate that the LSE will eventually implement enhancements to its rulebook to make AIM more appealing for companies. Ensuring that AIM evolves in tandem with the main market and reforms to the UK Listing Rules is a crucial goal of the LSE.

Key Takeaways from Primary Market Bulletin 55

On 17 April 2025, the FCA published Primary Market Bulletin 55 regarding updates to its technical and procedural notes following last year’s changes to the UK listing regime. The bulletin provides feedback on its previous consultations and further proposals.

Most amendments described within the bulletin relate to consequential rather than substantive changes, including confirming changes described in prior bulletins. A few points of interest include:

• Structured digital reporting: Amid this reporting season, companies should note that the FCA is proposing to update its technical note on structured digital reporting for annual financial statements (TN/507.1) to reflect the fact that a new European Single Electronic Format (ESEF) taxonomy has been published. The FCA will configure its National Storage Mechanism to accept filings of annual financial reports with accounts that have been tagged using the latest ESEF taxonomies, including the ESEF 2024 taxonomy.
• Dealing with the FCA in an open and co-operative manner: In responding to consultation feedback on TN/209.3 (regarding dealing with the FCA), the FCA reminds companies that certain UK Listing Rules oblige them to notify the FCA without delay if the company is no longer in compliance with certain of their continuing obligations, such as the obligation to maintain independence from controlling shareholders and/or the free float.

FCA Signals Final Regulatory Framework for PISCES

On 10 April 2025, the FCA provided an early update on the regulatory framework for the Private Intermittent Securities and Capital Exchange System (PISCES), following the closure of its consultation in February 2025. PISCES would provide private companies (including potential IPO candidates) with a mechanism for facilitating liquidity for existing shareholders. The final rules, pending FCA Board approval, are expected to adopt a “private plus” approach.

Key post-consultation changes proposed by the FCA, to align PISCES more closely with private market practices, include:

• Core information: A lighter-touch approach will be taken regarding the standardised core information companies must disclose to investors.
• Additional information: The FCA will not adopt the “sweeper model”, which would have required PISCES companies to disclose any other information relevant to investors.
• Post-trade event disclosures: The final rules will not include post-trade disclosures on directors’ transactions and major shareholders’ positions.
• Operator oversight: The FCA intends to clarify expectations that PISCES operators should monitor risks to orderly trading, such as persistent breaches of disclosure rules by issuers.

The final rules are expected to be published in June 2025, shortly followed by the PISCES sandbox opening for applications to operate a PISCES platform.