FCA finalizes UK capital markets reforms to boost growth and innovation

The Financial Conduct Authority (FCA) has wrapped up key components of a long-term capital markets reform initiative aimed at bolstering economic growth, competitiveness, innovation, and investment in the UK while preserving market integrity. The reforms, developed in collaboration with HM Treasury, the Bank of England (BoE), and industry stakeholders, drew insights from the Wholesale Markets Review and other ongoing engagements.

The FCA’s strategy centers on “rebalancing risk,” which means maintaining high standards while encouraging informed risk-taking, innovation, and investment. This shift involves moving away from rigid regulation towards a framework focused on outcomes, transparency, and accountability. Notable reforms include a new UK listing regime that lowers costs for issuers, a streamlined public offers framework, and enhanced transparency in bond and derivatives markets.

Additional measures include the creation of PISCES, a regulated market for trading shares in private companies, and simplified transaction reporting. The FCA also plans further reforms in areas like securitisation, listed company disclosures, and clearing and margining rules. Looking ahead, the FCA is prioritizing AI, tokenisation, and digital market infrastructure through initiatives such as the Digital Securities Sandbox and stablecoin regulation.

In the coming weeks, the FCA will publish a joint roadmap with the BoE outlining how UK wholesale markets will adapt to tokenisation and digitalisation. The roadmap aims to ensure the regulatory framework remains flexible as markets evolve, rather than predicting their exact future shape.