FCA proposals to align retail and wholesale disclosure regimes for debt prospectuses

The FCA’s consultation paper CP25/2¹ proposes to align the current “wholesale” and “retail” disclosure requirements for debt prospectuses such that there will be a single standard of disclosure, based on the current wholesale regime. In addition, the FCA is also proposing to introduce a new category of “non-complex listed corporate bonds” which will benefit from certain alleviations and so may be of interest to firms looking to access the UK retail bond market. This forms part of the FCA’s broader aims to remove any barriers to and encourage greater participation in the retail bonds market in the UK. This consultation paper follows the previous FCA consultation CP24/12 on the new UK Prospectus regime, following the publication of the Public Offers and Admissions to Trading Regulations 2024 or “POATR” in January 2024. 

Single disclosure standard for non-equity securities 

• The FCA is proposing to introduce a single disclosure standard for non-equity securities that will be based on the current wholesale requirements. No summary will be required where the prospectus relates to the admission of non-equity securities to trading on a regulated market even where the denomination of such securities is below EUR 100,000. 
• As currently, there would be additional, tailored requirements for securities with more complex features such as asset backed securities and securities with a derivative element. 
• This means that going forward there will be a single disclosure standard based on the wholesale annexes whatever the minimum denomination of the securities. 

Non-complex listed bonds by UK-listed corporates 

Following feedback received that there is considerable demand including from wealth managers to invest in more simple UK retail bonds, the FCA is planning to add a new category of “non-complex listed corporate bonds” issued by UK corporates. The FCA has said that these would be bonds that are: 

• issued by an issuer that has an existing listing in the equity shares (commercial companies) category; or 
• issued by a wholly owned subsidiary of such a listed company, provided the debt securities are fully, unconditionally and irrevocably guaranteed by the issuer’s listed holding company; 
• bear interest at a fixed or floating rate, subject to certain conditions;
• unsubordinated, unsecured and not subject to bail-in; and 
• not convertible securities, asset backed securities or securities giving rise to payment or delivery obligations linked to an underlying asset or index (other than benchmarks tracking UK inflation). 

Whilst there are no requirements around minimum denominations, it is thought that this type of “simple” product is likely to be suitable for retail investors. Although there are no specific prospectus disclosure requirements for these “non-complex listed corporate bonds”, the FCA is proposing to make certain alleviations for these types of bonds including in relation to product governance, financial promotions and the Consumer Duty. However, where such bonds are offered to retail investors in the UK and the EU, issuers will need to ensure that any such offers also comply with the requirements for retail disclosure or an appropriate exemption under the EU Prospectus Regulation.

Proposals for tap issuances

• The FCA is also proposing to remove the further issuance application process entirely, so an issuer would only need to advise the FCA of the final terms under a programme and the listed status of any individual issued security would be evidenced by the class being recorded in the Official List, once the FCA has announced its decision to admit the securities of that class to listing. 
• The FCA would treat further issuances of the same class of securities as automatically listed when securities are formally issued, without undertaking a further listing application process.
• Issuers would no longer be able to specify an “up to” number of securities to be listed in anticipation of future issuances. 
• Where securities are admitted to trading, the issuer would have a new requirement to make a new market notification announcement via an RIS with a hyperlink to the prospectus. 
• This would apply to further issuances within 60 days of the non-equity securities being issued.

Removing Listing Particulars as an admission document 

• The FCA is also proposing to remove Listing Particulars as an admission document due to the relatively small number of instruments and issuers on the London Stock Exchange's PSM. 
• There would be transitional provisions for issuers who currently have debt securities admitted to trading on the PSM. If such an issuer wanted to conduct a further issuance of such securities they would need to ensure the Listing Particulars and Final Terms are approved by the FCA and have those securities admitted to the Official List (which requires admission to trading) before the commencement of the new rules. 
• Existing issuers with securities admitted to trading on the PSM will be able to keep those securities listed and traded on the PSM for as long as the London Stock Exchange chooses to maintain it.  

Next Steps

This consultation closed on 14 March 2025.

The FCA is expected to publish a combined policy statement on the final rules for the POATR (both in respect of CP 25/2 and CP 24/12) in the summer 2025. The final rules are likely to apply sometime after that, to allow the market time to adapt to the new rules, most likely in early 2026. The POATR will then apply and the UK Prospectus Rules will be simultaneously revoked. 

Authored by Neil Kurzon and Isobel Wright.