The Financial Conduct Authority (FCA) has confirmed it will continue with the shake-up of the UK’s listing rules, warning that the new regime could lead to an "increased possibility of failures".

The plans have been announced in a bid to revive the UK markets following a disappointing year of IPOs.

The detailed plans, which were initially set out in May, have outlined potential changes to the listing regime with a single listing category, with streamlined eligibility and ongoing requirements.

This is a change from the current system, which includes standard and premium segments of the market.

These changes by the FCA are "aimed at encouraging a greater range of companies to list in the UK and compete on the global stage".

Other changes include scrapping a requirement for firms to get shareholder approval for major deals.

The move comes after the number of IPOs in London have dropped in the past two years, most notably with the decision by the British chipmaker, Arm, to float on the Nasdaq rather than the London Stock Exchange (LSE).

Executive director for markets and international at the FCA, Sarah Pritchard, said: "We are working to strengthen the attractiveness of UK capital markets and supporting UK competitiveness and growth. As we do so, it is important that others consider what they in turn can do, to make sure the UK remains an attractive place for companies to raise capital.

"We welcome feedback on our detailed proposals to make sure that we have the balance right as we seek to set the standards for the years and decades ahead.

"The UK is a world leader for bond and derivative markets, and we want to make it better by ensuring investors have access to better, quicker, clearer and cheaper data."

The confirmation of the plans has come as the London IPO market hit new lows, amid a wider global slowdown.

Currently, 23 firms float on the LSE, down by almost half year-on-year. This is a 62% drop from 2021, when a record number of 119 firms were listed.

Economic secretary at the Treasury, Bim Afolami, added: "The UK is Europe’s leading hub for investment but it’s a competitive world and we are by no means complacent.

"We want to make the UK the global capital for capital, attracting the brightest and best companies in the world. We are strengthening the UK as a listing destination, taking forward reforms to make it quicker to list, improve disclosure and make our capital markets more efficient and open."

The plans are currently under consultation until March 2024, with the FCA expecting to roll out the measures later in the year, should they be adopted.

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