Britain's Financial Conduct Authority has launched a consultation to remove key rules governing research around initial public offerings, signaling a shift in how the UK is trying to revive its weakening listings market. The consultation runs until May 29 and follows a commitment made in December to strengthen UK capital markets. According to the FCA, the original framework introduced in 2018 has not delivered intended outcomes after eight years.
Proposed Changes to IPO Research Rules
The FCA plans to remove two requirements introduced in 2018: a mandatory 7-day delay before banks can publish research on IPO candidates, and a rule requiring firms to provide independent analysts with the same information given to in-house research teams.
Under the proposed changes, banks involved in an IPO would be able to publish research immediately, and the requirement to share identical information with independent analysts would be eliminated. These changes would reverse the "level playing field" structure introduced in 2018, where independent research providers were given access and time to publish ahead of bank-affiliated analysts.
According to Jon Relleen, a senior FCA official, "Market feedback has been clear that these rules can introduce additional risk, cost and complexity without delivering the intended benefits."
In practice, the rollback would simplify the IPO process. Issuers and banks would face fewer coordination requirements, while legal and operational complexity tied to research distribution would be reduced.
Market Context: Competitive Pressure on London Listings
The move comes as London faces increasing competition from global listing venues. Companies have increasingly opted for US markets, where deeper liquidity, broader analyst coverage, and higher valuations are available. European venues such as Amsterdam have also gained ground, particularly after Brexit.
The UK has seen fewer large IPOs, and several domestic firms have pursued US listings or dual-market strategies. Analysts have also pointed to declining research coverage for mid-sized UK companies, limiting visibility among global investors and reducing overall market attractiveness.
The FCA's proposal is aimed at improving execution speed and reducing barriers that can be directly controlled, rather than addressing broader structural challenges.
Trade-Offs of the Proposed Changes
While the changes may accelerate IPO timelines and simplify deal execution, they are likely to shift influence back toward investment banks. Bank-affiliated analysts would regain earlier and potentially more detailed access to company information.
Independent research providers, which have struggled to scale under the current framework, may find it harder to compete without guaranteed access to issuer data. This could further reduce third-party analysis in IPO processes.
The FCA did not propose additional reforms at this stage but included questions on whether broader changes to IPO information flows may be needed in the future. The consultation forms part of a wider effort to recalibrate UK financial regulation post-Brexit, with policymakers prioritizing measures that support capital formation while maintaining market integrity.
