Britain is looking at changes to listing requirement to attract more tech companies and maintain its position in the global financial services market post-Brexit.
Chancellor Rishi Sunak said Lord Hill, a former European Union commissioner for financial services, will lead a review to focus on whether to relax the rules on free float requirements and dual-voting structures.
The review will also look at track record requirements, prospectuses and dual and secondary listings.
Currently, the UK is bound by European rules, but with the EU insisting companies operating there set up offices, the chancellor is said to be keen to protect a sector that contributes GBP130bn to Britain’s GDP.
At present, EU rules require 25% of a company’s share to be held in a free-float but Hill will see if there is any appetite for this to be lowered.
Tech entrepreneurs are said to favour rules that will allow them to keep more control of businesses they have set up, though dual-listing, where there are voting and non-voting classes of shares are seen as more contentious.
Another option under discussion will be blocking shares, which are short of a dual-listed structure but will protect a company from initial takeover threats once going public.
Hill will also look at whether the current three-year track record requirement for a company to list should be relaxed along with the requirement for a prospectus to be issued if a company raises more than EUR8mln.
Changes to the primary listing requirements for the London Stock Exchange will also be discussed to encourage more overseas to have a secondary listing in London.
“More dynamic equity markets will enhance the UK’s position as a world-leading financial centre, and drive growth and innovation across the wider economy,” Britain’s finance minister Rishi Sunak said in a statement.
The Hill review will hear evidence until 5 Janaury 2021 and then report back its findings to the Chancellor and the Financial Conduct Authority.
