For all companies whose shares are listed on the stock exchange and companies listed at retail debt securities, the rules applicable to financial statements are laid down in the Information and Transparency Directives. Annual reports are required within four months of the end of the year and, for a company admitted to trading on a regulated market in the United Kingdom, consolidated financial statements must be prepared in accordance with IFRS. For fiscal years beginning on or after January 1, 2021, these are IFRS applied in the United Kingdom. For issuers with a wholesale listing of debt securities or debt securities listed on the professional securities market, the rules for transactions are set out in Rating Rule 17.3 (link to FCA Handbook). The main difference between the regulations that apply to the majority of listed companies and those that apply LR 17.3 is that the deadline for publication of the annual report is six months (instead of four). LR 5.4A provides a procedure for the transfer of the share listing class and for the transfer of the depository receipt listing class.3 We have issued our statement on Financial Conduct Authority (FCA) consultation paper CP21/18 entitled “Improving climate-related disclosure by listed standard companies and seeking views on ESG issues in capital markets” (“CP”). An issuer that is not an issuer with a Premium Listing 3 must not call itself a Premium Listing or (in no terms) refer to itself as a Premium Listing or make a statement that suggests, or is reasonably likely to be, that it has a Premium Listing or meets or is required to meet the requirements applicable to a Premium Listing. In the case of 3 shares 2 of a trading company or shares or depository receipts of shares of a trading company controlled by the State3, an issuer has the choice, under the listing rules, to have a standard listing or a premium listing. The type of quote for which it is requested therefore determines the requirements it must meet.
Since 2007, advance notice is no longer mandatory. However, if a premium listed company publishes a preliminary notice, it must comply with Registration Rule 9.7A (link to FCA Handbook). There are no preliminary announcement rules for other types of ads. The registration regime provides for two enrolment segments – Premium and Standard. Bonus listed companies are subject to stricter requirements, while standard listed companies meet the minimum standards of the UK provisions implementing the EU`s Consolidated Authorisation and Reporting Directive (CARD) and the EU Transparency Directive. These will remain in force as secondary national EU law even after the UK`s withdrawal from the EU. In one case, shares may be admitted to standard listing for other classes of shares of a closed-end investment fund5 if and only as long as the issuer has a premium share listing. 1The listing rules require each issuer to comply with the requirements of the rules applicable to it and its relevant securities.
In some cases, an ad is called a standard list or premium list. All listed companies, regardless of where they are registered, are required to apply corporate governance listing rules. Companies that have only a standard listing of securities (including debt securities, convertible bonds, preferred shares and securities certificates (i.e. depositary receipts) are not required to apply corporate governance listing rules. However, they may be required to provide certain information in accordance with the disclosure guidelines and transparency requirements relating to audit committees and the main features of the system of internal control and financial reporting risk management systems. The FCA listing rules (link to the FCA Handbook) set out some of the rules that apply to a company listed on the London Stock Exchange (or seeking admission). For most listed securities, these supplement the Disclosure Guidance and Transparency Rules and the Prospectus Rules (link to the FCA Handbook). They do not apply to companies in the AIM or High Growth segment. For a regulated market, the requirements are set out in the FCA prospectus rules (link to the FCA handbook). In the case of a company seeking to list shares at the premium listing, there are additional requirements in Listing Rule 6 (link to FCA Handbook). For the professional securities market (which is listed but not regulated), prospectus requirements are set out in Listing Rule 4 (link to FCA Handbook). For companies listed in shares with premium premiums, additional rules apply to the content of the annual report under rating rule 9.8 and the rating rule for closed-end mutual funds (e.g.
UK Investment Trusts) 15.6 (both links to the FCA Handbook). The FCA has introduced a new rating rule to improve climate-related financial reporting for financial years beginning on or after 1 January 2021. The FCA has also extended the application of its climate-related disclosure requirements for premium trading companies in the UK to issuers of listed standard shares and global depository receipts representing shares (excluding standard listed investment firms and letterbox companies). This applies to entities within scope for financial years beginning on or after 1 January 2022. The FCA also confirmed that it is introducing a new ESG guide in its handbook, which includes rules and guidance for asset managers, life insurers and providers of FCA-regulated pension plans to align disclosure with TCFD recommendations. A quote, known as a standard quote, defines the requirements based on the minimum standards set out in the UK regulations that implemented CARD and TD4. A list called a premium list contains requirements that go beyond the requirements required by UK regulations to implement CARD and TD4. The FCA has recently introduced new listing rules (9.8.6R(9) and 14.3.33R(1)) which require companies to include in their annual financial report a statement as to whether the listed company has met certain board diversity targets on a “comply or explain” basis on a selected date during its accounting period.
If they have not achieved the objectives, why not?. The Financial Reporting Laboratory (“the Lab”) has released a report to help businesses prepare for mandatory reporting by the Task Force on Climate-related Financial Disclosures (TCFD). There are also corporate governance requirements set out in the Disclosure Guidelines and Transparency Rules, complemented by the requirements for a premium listed company to declare compliance with the UK Corporate Governance Code under LR 9.8. The Financial Reporting Council (FRC) has issued a letter to audit committee chairs and CFOs ahead of the 2020/21 reporting season, outlining its expectations for report and financial statement preparers for the coming year. As part of its work on digital reporting, the Financial Reporting Lab (FRC Lab) has launched a survey to understand the impact and progress of digital reporting for companies with securities on a regulated market in the UK.