FCA Consults on Scrapping 7-Day IPO Research Delay | CP26/14 Analysis

Executive Summary: The FCA is proposing to remove the mandatory seven-day waiting period between the publication of an IPO prospectus and the release of "connected" research (analysis from banks involved in the deal). The regulator admits that the 2018 rules failed to stimulate a market for independent research and instead placed the UK at a competitive disadvantage against international hubs like New York.

The Two Main Regulatory Changes

The FCA is consulting on two primary amendments to the Conduct of Business sourcebook (COBS):

• Removal of the 7-Day Delay (COBS 11A.1.4FR): Under current rules, analysts at syndicate banks must wait seven days after a prospectus is published before releasing their research. The FCA proposes to delete this requirement, allowing research to be published immediately.

• Ending Information Sharing Mandates (COBS 11A.1.4BR – 11A.1.4ER): The FCA plans to scrap the rule requiring syndicate banks to share the same information with unconnected (independent) analysts as they do with their own internal teams.

Why the 2018 Framework Failed

The original intention of the 2018 reforms was to "level the playing field" by ensuring independent analysts had time and access to the same data as the big investment banks. However, the FCA’s review found:

• No Independent Surge: The rules did not lead to a meaningful increase in independent research coverage for IPOs.

• Increased Execution Risk: The mandatory delay extended the "exposure window" for issuers, making them vulnerable to market volatility during the week-long gap.

• High Operational Costs: Issuers and banks faced additional legal and administrative costs to manage the dual-track information sharing process.

Strengthening London’s Competitive Edge

This move is part of a broader "Capital Markets Reform" agenda promised by the FCA in late 2025. By aligning UK research rules more closely with international standards, the regulator hopes to:

• Shorten Time-to-Market: Accelerating the IPO timetable makes London more attractive for high-growth tech and fintech firms.

• Reduce Transaction Friction: Simplifying the flow of information reduces the complexity for companies considering a public float.

• Support Growth: The proposal follows the January 2026 implementation of the new Public Offers and Admissions to Trading (POAT) regime, which replaced the old Prospectus Regulation.

Consultation Timeline & Next Steps

The FCA is moving quickly on these reforms to signal a "pro-growth" regulatory environment.

Who is affected? This consultation impacts prospective issuers, investment banks, institutional and retail investors, and independent research providers (IRPs).