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Welcome to the latest edition of Corporate Update.

Corporate Update is our fortnightly bulletin offering a quick read of the latest developments which we consider relevant to corporate counsel. Please get in touch with your usual contact or any of the contacts listed below if you want to explore any of the topics covered in more detail. If you would like to subscribe to this bulletin as a regular email, please click here.

Publications

Listed companies issuing shares under a share plan: changes to announcement and process requirements

As a result of changes to FCA Rules made on 19 January 2026, companies need to adjust their processes for issuing shares under a share plan. We have published a client briefing summarising the new rules, highlighting key points and setting out what in our view companies need to do, particularly in relation to processes and what announcements they need to make. The briefing reflects our understanding of the current position. However, as explained in the briefing, the FCA and/or LSE may clarify or change its requirements in the near future. We therefore recommend companies look out for developments in this area and, if in doubt, get in touch with us.

News

FRC updates its Guidance on the Strategic Report

On 4 February 2026, the Financial Reporting Council (“FRC”) published a revised version of its Guidance on the Strategic Report (“Guidance”). Key amendments include:

  • updating to align with the UK Corporate Governance Code 2024;
  • reflecting the removal of certain directors' report disclosure requirements for financial years from 6 April 2025, as well as the new obligation for large companies to report on their supplier payment practices and performance in the directors' report (effective for financial years from 1 January 2026); and
  • a greater emphasis on helping companies meet their reporting obligations in a way that is proportionate to their size and circumstances.

The FRC has also changed the Guidance’s structure to make it more user-friendly. The Guidance is non-mandatory but will nonetheless be of use to both listed and large private companies in the preparation of their strategic reports.

Takeover Code changes relating to Dual Class Share Structures come into effect

On 4 February, the Takeover Panel announced (PS 2026/2) that it has published a revised version of the Code as well as new and revised notes to advisers. The Code changes will apply to transactions that are ongoing as at 4 February 2026 (except where this would give the amendments a retrospective effect).

The changes comprise:

  • an updated version of the Takeover Code, making the changes announced in Response Statement 2025/1. The changes create a new framework for how the Code will apply to companies with a dual class share structure, as well as making other amendments relating to IPOs and share buybacks. The Panel also has made a couple of other minor changes to the Code, as announced in Panel Statement 2025/20;
  • a new Note to advisers setting out the steps to be taken and the disclosure to be included in the relevant admission document where a company is considering an IPO or admission to trading as a result of which the Code will apply to that company;
  • a revised Note to Advisers in relation to Rule 9 waivers, including a revised checklist for Rule 9 waiver circulars; and
  • a Beta test version of the Panel’s Disclosure Table that contains the LEI (legal entity identifier) now required under Rule 2.9 of the Code, which will replace the current version from 1 April 2026.

CLLS publishes updated specimen admission condition

On 12 February 2026, the City of London Law Society (“CLLS”) published a revised version of its specimen Admission Condition wording to be used in takeover documents and also released revised Conditions to and Certain Further Terms of the Offer and Further Terms of the Offer specimen documents.

Private capital: LSE finalises its new PSM rulebooks

On 5 February 2026, the London Stock Exchange (“LSE”) published the final Private Securities Market (“PSM”) Rules and Handbook (Market Notice N04/26) enabling the launch of the PSM as a PISCES platform. The PSM will facilitate the trading of the private companies’ securities via an intermittent auction facility.

PISCES is currently operating in a sandbox until June 2030. As we reported in our 5 December Bulletin, a second operator, JP Jenkins, has been authorised by the FCA following its decision to open the sandbox up to prospective operators.

The LSE noted it received limited feedback on the PSM draft rules, meaning the final documents are substantially unchanged from the drafts. The new rulebooks are effective from 5 February 2026.

FCA fines two individuals for insider trading based on unannounced deal

On 10 February, the FCA announced that it has fined two individuals a combined amount of £108,731 for purchasing shares in Bidstack Group plc while in possession of, and using, inside information in breach of Article 14 Market Abuse Regulation ("MAR"). One of the two persons fined was the interim CFO at Bidstack, and the other was a childhood friend to whom he passed inside information concerning an anticipated announcement about a deal signed between Bidstack and a major video game developer. The purchases were made using a number of broker firms and trading platforms. One point of interest from the case is how the FCA worked together with the brokerage industry in uncovering the market abuse; the FCA was initially notified of the trading through Suspicious Transaction and Order Reports made by one of the firms involved. 

FCA censures Carillion but lowers penalties on former executive directors

On 16 February 2026, the FCA published a Final Notice for Carillion plc (in liquidation) for breaches of MAR and the Listing Rules, and Final Notices for two former finance directors and a former chief executive for being knowingly concerned in the breaches by Carillion.

The FCA formally censured Carillion pursuant to sections 123 and 91 of the Financial Services and Markets Act 2000. Had it not been for Carillion's financial position, the FCA would have imposed a financial penalty of nearly £38 million. In the Final Notice, the FCA highlighted overly aggressive contract accounting judgments and the significant pressure on Carillion’s construction business to meet very challenging financial targets maintained by the former finance directors. These aggressive accounting judgements were used to bridge the gap between the business’s actual financial performance and the performance as budgeted and ultimately reported to the market.

In respect of each of the former executive directors, there was no change to the breaches for which they were penalised in earlier Initial Decisions published in 2022 nor any change to the FCA’s view of the seriousness of their misconduct. The FCA did, however, lower the penalties previously imposed on each of them:

  • the penalty given to former chief executive, Mr Howson, was reduced from £397,800 to £237,700 based on his income being lower than previously considered and on his cooperation with the investigation;
  • the penalties given to the former finance directors, Mr Adam and Mr Khan, were reduced from £318,000 to £232,800 and from £154,400 to £138,900 based on cooperation with the FCA and other investigations.