On 15 July 2025, the Financial Conduct Authority (FCA) announced new rules to implement the Public Offers and Admissions to Trading Regulations 2024 (POATR) which will come into effect on 19 January 2026 and replace the UK Prospectus Regulation (UKPR). The rules form part of a wider process of reform of the UK capital markets regime, designed to make it quicker, simpler and more cost-effective for companies to raise capital, reduce regulatory friction, widen market participation, and enhance the UK’s competitiveness as a venue for public offerings and listings.
Key details on how the new rules will differ to the current UKPR are set out below:
- Prospectus threshold for further issues of shares:
- As widely anticipated, the threshold for requiring a prospectus for further issuances of equity securities by listed issuers will be raised from 20% to 75% of their existing share capital in any 12 month period. This significant increase is intended to facilitate more efficient secondary capital raisings and reduce unnecessary regulatory costs for issuers.
- In an interesting development, the threshold will be increased to 100% for closed-ended investment funds (CEIFs) to reflect that information asymmetry is reduced for CEIFs, compared to operating companies, as new capital is predominantly deployed in accordance with the CEIF’s existing investment policy.
- CEIFs will also be able to undertake an initial issue of C shares without the need for an admission prospectus, provided the capital is for deployment in accordance with the CEIF’s investment policy. However, CEIFs must notify the market of certain information relating to the C share issue, and will need to take into account the number of ordinary shares arising from the conversion of a C share issue when assessing the 100% threshold for further issues of shares.
- The new thresholds are significantly higher than the recent changes made by the EU Listing Act, which require a prospectus at a 30% threshold, giving the UK a competitive advantage over rival EU exchanges.
- Where a prospectus is not required, there will be no requirement for issuers to produce an “alternative document”, as previously consulted on.
- Issuers will retain the option to voluntarily produce a prospectus in respect of an admission of shares below these thresholds, and such voluntary prospectuses will not require the appointment of a sponsor.
- Protected forward-looking statements (PFLS):
- In its consultations relating to the POATR, the FCA introduced the concept of PFLS with a proposed liability regime based on a recklessness/dishonest liability standard. For issuers, this reduces the risk of successful investor claims when compared with the existing prospectus liability regime which uses a negligence liability standard and will continue to apply to statements that are not PFLS. This is intended to encourage issuers to include more forward-looking information in prospectuses, aiding investor decision-making.
- The FCA will apply a three-part approach to PFLS: a general definition; category-specific criteria; and broad exclusions with targeted exceptions.
- The general definition includes a ‘reasonable investor’ test and requires that a forward-looking statement can only be a PFLS if it includes an estimate as to when the event or set of circumstances is expected to occur.
- The FCA intends to issue guidance, in the form of a technical note, on the preparation of operational and financial information in relation to PFLS, rather than embedding detailed criteria in the rules themselves.
- Sustainability related disclosures:
- A new climate-related disclosure rule will apply to issuers of equity securities and depositary receipts (excluding CEIFs, OEICs, and shell companies). Where climate-related risks are identified as risk factors in the prospectus, or where climate related opportunities are material to the issuer’s prospects, issuers will be required to disclose information that is aligned with the Task Force on Climate-related Financial Disclosures Recommendations and Recommended Disclosures and International Standards Board Standards. This will include information on governance, strategy, risk management, metrics and targets.
- Where an issuer has published a transition plan and its contents are material, a summary must be included in the prospectus.
- Streamlining listing and admission processes:
- The process for listing further issuances of securities will be simplified by way of a single listing application to cover all securities of a class, including future issuances. Further issuances of the same class will be “automatically listed” without the need for a separate application.
- Market notifications will be required for further issuances, replacing the previous requirement for a pricing statement. These notifications are intended to enhance transparency and support market monitoring.
- Prospectus availability period: The period for which a prospectus must be made publicly available prior to an IPO will be reduced from six to three working days. This aims to increase flexibility for issuers and reduce unnecessary delays in capital raising, while still providing investors with sufficient time to review the document.
- Prospectus summary requirements: Issuers will have greater flexibility in preparing the prospectus summary. The maximum length of the summary is increased from seven to ten pages; the requirement to include an annex of financial information is removed; and cross-referencing within the summary will be permitted. These changes are intended to make the summary more user-friendly and relevant for investors.
- Working capital statements: Whilst the requirement to include a working capital statement in a prospectus has been retained, the FCA plans to consult on proposed amendments to its current guidance in late 2025.
- Content of a prospectus: Except as set out above, the content requirements of a prospectus are mainly unchanged.
- Removal of Listing Particulars: the concept of Listing Particulars as an alternative admission document will be removed, simplifying the process and removing redundancy.
- Primary MTFs (e.g. AIM):
- For initial admissions and reverse takeovers on primary MTFs, a MTF admission prospectus will be required, subject to certain additional exemptions (including simplified routes for admissions to trading on AIM and the Aquis Growth Market).
- Further issuances by issuers already admitted to trading on the same primary MTF will not require an MTF admission prospectus unless the MTF operator decides otherwise.
- The specific content requirements for MTF admission prospectuses will be set by the relevant primary MTF operators, who are expected to consult on any proposed changes to their rules.
- The FCA will not review a MTF admission prospectus.
- Notably, an IPO on a primary MTF will require a MTF admission prospectus whether there is an offer to retail investors or qualified investors only, which may encourage issuers to include retail investors in their IPOs.
Next steps
The rules set out in the policy statement are expected to come into effect on 19 January 2026. The FCA plans to consult later in 2025 on additional guidance for the takeover exemption, climate related disclosures, working capital statements and PFLS. Consequential changes will also be made to the UK Listing Rules, and the Prospectus Rules: Admission to Trading on a Regulated Market Sourcebook will replace the current Prospectus Regulation Rules Sourcebook.
Conclusion
The new prospectus regime represents the final milestone in the regulatory transformation of the UK capital markets, a process initiated with the UK Listings Review Report in 2021 and further advanced by the Secondary Capital Raising Review in 2022. Building on the substantial reforms to the UK Listing Rules in 2024, the new prospectus regime marks a further step towards enhancing the efficiency, flexibility and global competitiveness of the UK equity markets as a destination for IPOs and capital raising.
A key feature of these reforms is the substantial increase in the threshold for triggering a prospectus for further issuances of shares – from 20% to 75% (or 100% in the case of CEIFs) – which should encourage issuers to raise more capital, as it will be quicker and cheaper for them to do so. However, the practical impact will depend on how market participants respond, particularly when issuers plan to market shares in the US. Such issuers may still opt to produce a voluntary prospectus for transactions below the new threshold to satisfy the expectations of US investors and provide sufficient disclosure comfort to the underwriters on those deals.
This article was authored by Jack Shepherd, Alasdair Steele, James Parkes, Paul Blackmore and Anna Compagnoni.
