The regulator has asked for feedback from both investors and issuers on whether the market effectively meets their needs and how best it can ensure it is efficient.
With a focus on the impact of prudential regulation, tax policy, asset allocation decisions and demographic and social trends, the paper, titled ‘Review of the Effectiveness of Primary Markets: The UK Primary Markets Landscape’, also identifies potential gaps in the primary market.
FCA chief executive Andrew Bailey, said: “The FCA has an overarching strategic objective of ensuring markets function well, and a key part of that is ensuring the UK’s primary markets remain effective.
“This review considers some important questions about the primary markets, and some potential enhancements, to ensure they continue to meet the needs of investors and issuers effectively.”
The particular questions raised by the FCA look at whether the current boundary between standard and premium listings are appropriate and the effectiveness of primary capital markets to provide capital for growth, particularly for young science and technology companies.
It also wants to look at whether there is a need for a UK primary debt multilateral trading facility and how it could be structured as well as what measures could be introduced to encourage more retail participation in debt markets.
A consultation on potential changes to listing rules has also been launched by the regulator.
Proposed changes include clarifying the eligibility requirements for premium listing, introducing concessions for property companies, updating how issuers classify transactions and changing the FCA approach to the suspension of listing for reverse takeovers.
