IIAC recommends certain reforms for fighting financial crime

In an effort to facilitate smaller bond offerings and make it easier for retail investors to participate in corporate bond markets, the U.K.’s Financial Conduct Authority (FCA) is seeking reforms to listing rules, among other regulatory changes.

The FCA issued a pair of consultation papers on Friday, including proposals to align disclosure requirements for low-denomination bonds (under £100,000) with the requirements for larger-denomination bonds, to make it easier for issuers to raise capital. It’s also seeking changes to listing rules, designed to facilitate follow-on offerings.

Separately, the regulator published proposals to support the implementation and operation of its new public offer platform regime, which aims to give companies alternative routes to raising capital, and to enable companies to raise growth capital from retail investors.

That regime “will enable companies to make larger offers of shares or bonds to a broad investor base outside of public markets via an authorized firm, similar to crowdfunding platforms,” the FCA said in a release.

“Having clear and consistent requirements for firms, and setting out what firms need to become authorized, will build confidence in the new platforms and enable firms to access a wider pool of investors.”

Overall, the proposals are intended to enable listed companies to make smaller bond offerings and to expand investment opportunities for retail investors and wealth managers, the FCA noted.

“We’re opening the door for corporates to issue bonds in small sizes so that a wider range of investors can invest in them. That’s more funding for companies, more easily, and more choice for investors too,” said Simon Walls, interim executive director of markets with the FCA, in a release.

“We want to make sure investors have the information they need to make informed decisions about risk while removing unnecessary costs and widening access,” he added.

The FCA said it aims to finalize its rules in this area by the summer, with rules set to take effect by early 2026.