SPACs and listed vehicles: current UK regulatory framework
The UK Listing Rules reform, which took effect on 29 July 2024, represents the most significant overhaul of the listing regime in a generation. The reform collapsed the previous premium and standard segments into a single commercial companies category (UKLR), removed the mandatory shareholder vote requirement for significant and related party transactions (except in limited circumstances), and introduced a new framework for special purpose acquisition companies (SPACs). The changes were driven by the FCA's assessment — informed by Lord Hill's UK Listing Review and the Wholesale Markets Review — that the previous regime was unnecessarily burdensome and was deterring companies from choosing a UK listing.
The new SPAC framework, introduced following the FCA's Policy Statement PS21/10 and updated in the 2024 rules, addresses the previous barrier to SPAC listings in London by providing a revised set of requirements designed to offer investor protection without requiring immediate suspension of trading when an acquisition target is announced. SPACs meeting certain qualifying conditions — minimum size threshold of £100 million raised, a ring-fenced structure, redemption rights for investors, a 24-month acquisition deadline, and shareholder approval for the qualifying acquisition — can now proceed through the acquisition process without automatic suspension. This brings the UK framework broadly in line with US SPAC arrangements, though the specific requirements differ.
For companies already listed or considering listing, the new listing rules affect ongoing obligations significantly. The replacement of the super-equivalent premium requirements with a disclosure-based approach means that shareholders have less structural protection against dilutive transactions, but issuers benefit from greater operational flexibility. DTR (Disclosure Guidance and Transparency Rules) obligations remain largely unchanged: companies must disclose inside information as soon as possible, must maintain insider lists, and must notify major shareholding changes in accordance with the DTR 5 regime. The related party transaction regime under UKLR 8 is narrower than its predecessor, but still requires fair and reasonable confirmation from a financial adviser for transactions above the relevant threshold.
Overseas issuers seeking a UK listing must now navigate the new overseas issuer category (UKLR 15), which provides a route for companies incorporated outside the UK to list in London while applying their home country's corporate governance code rather than the UK Corporate Governance Code. The FCA has signalled that this flexibility is intended to attract high-growth companies from international markets, and several major non-UK companies have listed under this framework. Advisers working with overseas issuers should review the UKLR 15 requirements carefully, as the eligibility criteria and disclosure obligations are more nuanced than in the previous GDR regime.
Continuing obligations post-reform
Issuers that transitioned from the previous premium segment to the new UKLR commercial companies category should review their compliance programmes against the revised rules. While many of the substantive obligations are similar, there are differences in transaction thresholds, board composition requirements, and shareholder communication obligations that require policy updates. The FCA has indicated that it will publish further guidance on areas of uncertainty in the new rules as supervisory experience accumulates.