UK Quoted Company Newsletter Q2 2023

Introduction

Welcome to the most recent edition of our UK quoted company newsletter, the aim of which is to collate and highlight relevant legal, regulatory and topical developments that we have written about primarily in the second quarter of 2023.

Annual General Meetings

1. ICGN published a statement on post COVID-19 AGM practices and shareholder rights

The International Corporate Governance Network (ICGN) published a statement on post COVID-19 AGM practices and shareholder rights in which it highlighted its opposition to 'virtual only' AGMs and reiterated its view that the hybrid format is the optimal approach for AGMs. The statement sets out other principal expectations related to AGMs.

AGC 36(3/5/23) Refer to article 6

2. Pre-Emption Group published terms of reference

The Financial Reporting Council published 'Pre-Emption Group - Terms of Reference' on behalf of the Pre-Emption Group (PEG) which underscores PEG's formal role in best practice in relation to the pre-emption rights regime. Further information is also available in ourupdate.

AGC 36(3/5/23) Refer to article 7

Corporate Governance, ESG and Corporate Reporting

3. FRC consults on revisions to the UK Corporate Governance Code

As part of the package of measures stemming from the government's reforms to restore trust in audit and corporate governance, the Financial Reporting Council published a 'targeted'consultation proposing amendments to the UK Corporate Governance Code. Our overview of the proposals is available by clickinghere. The consultation is open until 13 September 2023 with the revised Code expected to apply to reporting periods beginning on or after 1 January 2025.

AGC 37(1/6/23) Refer to article 1

4. Government launched non-financial reporting information review

The Department for Business and Trade, working with the Financial Reporting Council,issued a call for evidencein relation to a review of the non-financial reporting requirements UK companies need to comply with to produce their annual report and to meet broader requirements that sit outside of the Companies Act 2006, such as gender pay and Modern Slavery Act reporting. The call for evidence is the first stage of the review process and will close on 16 August 2023.

AGC 37(1/6/23) Refer to article 7

5. FRC published minimum standard for FTSE 350 audit committees

The Financial Reporting Council published 'Audit Committees and the External Audit: Minimum Standard', the primary objective of which is to 'enhance performance and ensure a consistent approach across audit committees within the FTSE 350' and which will operate on a 'comply or explain' basis until legislation is brought forward to mandate compliance. This voluntary adoption period is intended to allow audit committees time to 'familiarise themselves with the requirements and proactively enhance their practices'.

AGC 37(1/6/23) Refer to article 2

6. Government published ethnicity pay reporting guidance

The government publishedguidancefor employers on how to measure, report on and address any ethnicity pay differences within their workforce.

AGC 36(3/5/23) Refer to article 9

Rules and Regulation

7. Listing regime reform - FCA consults on proposed rule changes

The Financial Conduct Authoritypublishedits long awaited consultation on changes to the Listing Regime. The proposals, contained inCP23/10 - Primary Markets Effectiveness Review: Feedback to DP22/2 and proposed equity listing rule reforms,建立在葬礼的迹象。中心al to the proposals is the replacement of the standard and premium listing segments with a single listing category for commercial company issuers of equity shares. You can find a detailed overview of the proposed changes and their impact on existing listed companies in our article:UK Listing Reform: a New Chapter?

AGC 36(3/5/23) Refer to article 9

8. Prospectus regime reform - FCA published engagement papers

The Financial Conduct Authority published a new webpage:New regime for public offers and admissions to trading. This sets out the FCA's role in establishing the regulatory framework for public offers and admissions to trading that will replace the existing prospectus regime and outlines the areas on which the FCA will engage and where it is likely to make future rules. To that end, the webpage contains links to various FCA Engagement Papers which represent the initial step in the FCA's wider engagement process including papers addressing: admission to trading on a regulated market; further issuances of equity on regulated markets; protected forward-looking statements; and non-equity securities.

AGC 37(1/6/23) Refer to article 4

Companies House

9. Register of Overseas Entities – keeping personal details off the register

The Register of Overseas Entities (Definition of Foreign Limited Partner, Protection and Rectification) Regulations 2023came into force on 1 June 2023, making it easier to keep personal information of registrable beneficial owners of an overseas entity required to register in theRegister of Overseas Entities从被公众访问。通过way of reminder, non-UK entities which hold certain interests in land and property situated in the UK are required to register with Companies House and provide details of their beneficial owners. In certain circumstances, details of the relevant entity's managing officers and of any trusts within its ownership structure also need to be provided.

AGC 37(1/6/23) Refer to article 6

10. Companies House issued further guidance on register of overseas entities

Companies House published ablogin which it explained how to access and search within the new register of overseas entities.

AGC 36(3/5/23) Refer to article 5

Corporate Crime

11. UK Government published itsEconomic Crime Plan 2023 to 2026

The plan commits the government to reducing money laundering, recovering more criminal assets and cutting fraud, with measures including: limiting the abuse of corporate structures by implementing the Companies House reforms proposed in the Economic Crime and Corporate Transparency Bill (ECCT); and introducing a new 'failure to prevent fraud' offence via the ECCT (see below) under which companies can be criminally liable for fraud. The government has alsopublisheda fact sheet on the new offence.

AGC 35(13/4/23) Refer to article 5

12. The 'failure to prevent fraud' offence: what do companies need to know?

The government announced a new 'failure to prevent fraud' offence as an修正案经济犯罪和B企业透明度ill. Organisations will be criminally liable and could potentially face an unlimited fine if an 'associated person' commits a specified fraud offence with the intention of benefiting the organisation or any person who receives services from it. The proposed offence of 'failure to prevent fraud' offence only applies to 'large organisations' and the government is not proposing to introduce personal liability for directors or senior managers. To qualify as 'large', an organisation must have satisfied two or more of the following criteria in the financial year prior to the year in which the offence took place: more than £36 million in turnover; more than £18 million in total assets; and/or more than 250 employees.

AGC 36(3/5/23) Refer to article 2

13. Insider dealing legislation updated

The UK has both a criminal and civil regime for market abuse, of which insider dealing is one offence. The criminal regime for market abuse is founded on the Financial Services Act 2012 and the CJA 1993 (CJA) and the civil regime is established by UK MAR. The draftInsider Dealing (Securities and Regulated Markets) Order 2023and anexplanatory memorandumhave been published, the draft Order supplementing the CJA and aligning the securities and markets on which the criminal offence of insider dealing can be committed under Part 5 of the CJA with those to which the UK Market Abuse Regulation applies.

AGC 36(3/5/23) Refer to article 3

Other Ashurst Q2 2023 publications

Corporate

14.Ashurst and Practical Law Corporate Update Q2 2023(18/7/23)

This briefing reports on decisions of the High Court involving: (i) a share purchase agreement and the breach of a no MAC warranty; (ii) the conversion of shares and the variation of rights attaching to a class of shares; (iii) the breach of an LLP agreement and the expulsion of members; and (iv) climate risk and a derivative claim against directors.

15.UK Public M&A Update Q2 2023(13/7/23)

This edition covers a news digest featuring relevant public M&A developments that have taken place in the second quarter of 2023 and highlights key features of recent firm offer announcements.

16.Proposed changes to the UK Takeover Code(16/5/23)

This briefing reports on consultation paperPCP 2023/1which was published by the Takeover Panel on 15 May 2023 and focuses primarily on Rule 21.1 of the Takeover Code, which restricts the board of a target company from taking any action which may result in an offer (or possible offer) being frustrated, or an offer being made on less favourable terms. The Panel expects to publish its Response Statement in Autumn 2023 and for the amendments to come into effect approximately one month after the publication.

17.UK Listing Reform - a New Chapter(5/5/23)

This briefing reports on the FCA's proposals for a restructured UK listing regime as set out in its consultation paper -CP 23/10: Primary Markets Effectiveness Review: Feedback to DP22/2 and proposed equity listing rule reforms. The reforms seek to increase the attractiveness of a UK listing for a broad range of companies, whilst protecting market integrity through a focus on disclosure and transparency.

Debt Capital Markets

18.Ashurst Quarterly Debt Capital Markets Update Q2 2023(13/7/23)

This edition summarises key developments in debt capital markets in the second quarter of 2023.

Dispute Resolution

19.Dispute Resolution in need of a "digital makeover?(16/5/23)

This briefing highlights the need for commercial litigators to embrace digital innovation and generative AI if London is to remain a litigation and arbitration destination of choice.

Employment

20.The government plans to grow the economy - how does this impact employers?(12/5/23)

This briefing covers the government's policy paper -'Smarter Regulation to Grow the Economy'- which contains radical proposals affecting non-compete clauses in employment contracts, and also addresses some of the administrative hassles which employers face with TUPE and complying with their working time obligations.

21.Consultation on record keeping, holiday leave and pay, and TUPE(19/5/23)

This briefing addresses the government'sconsultation paperon three areas of retained EU employment law: record keeping requirements under the working time regulations (WTR); simplifying annual leave and holiday pay calculations in the WTR; and the TUPE consultation requirements.

Finance

22.Material adverse change clauses in finance documents(27/4/23)

Is it possible for a lender to rely on a material adverse change clause in circumstances where the borrower is experiencing financial difficulty due to acutely adverse prevailing macroeconomic conditions? This article aims to serve as a brief reminder of the principles underpinning the legal concept of 'material adverse change'.

Restructuring and Special Situations

23.CIGA and the Restructuring Plan – Three Years On(12/7/23)

This briefing addresses the government's recent findings welcoming the permanent Corporate Insolvency and Governance Act 2020 measures while highlighting the need for possible refinements.