Listing regime – minor changes to the UKLRs and DTRs to reflect the new UK Corporate Governance Code

The Financial Conduct Authority (FCA) has published Handbook Notice 128 (following on from CP24/26) which sets out changes to the UK Listing Rules and DTRs to reflect the latest, 2024, edition of the UK Corporate Governance Code (the Code).

The Financial Reporting Council (FRC) published the 2024 edition of the Code in January 2024 (see our snapshot here). It replaces the 2018 edition with effect from financial years beginning on or after 1 January 2025 (except for Provision 29 of the 2024 Code which applies the following year).

Companies listed in the Equity Shares (Commercial Companies) (ESCC) category are required under the UKLRs to state:

• how they have applied the principles of the Code;
• how they have complied with the provisions of the Code, or where they have not complied with any of the provisions, to explain why not;
• the appropriateness of adopting a going concern basis of accounting (in line with Provision 30 of the Code); and
• the directors’ assessment of the viability of the company (in line with Provision 31 of the Code).

DTR 7 requires in-scope issuers to include certain disclosures about their corporate governance and audit arrangements in their directors’ report, and cross-refers to specific provisions of the Code and to FRC guidance.

The FCA has updated the rules to refer to the 2024 edition of the Code. It has also removed the requirements in the UKLRs and DTRs to prepare disclosures in line with FRC guidance, on the basis that the guidance is not intended to be prescriptive.

The rule changes took effect on 28 March 2025. Under transitional provisions:

• for accounting periods beginning before 1 January 2025, companies must apply the 2018 Code;
• for accounting periods beginning on or after 1 January 2025, but before 28 March 2025 (i.e. when the rule changes came into effect) – notwithstanding the start date of the 2024 Code – the UKLRs provide that a company can apply either the 2024 Code (with the exception of Provision 29) or the 2018 Code. Where it chooses not to apply the 2024 Code, it must disclose that fact; and
• for accounting periods beginning on or after 28 March 2025, they must apply the 2024 Code (with the exception of Provision 29).