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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 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.

AGM Season seminar

Invitation to our AGM Season seminar

On Wednesday 25 November 2026 we will host our annual AGM Season seminar. Our governance, sustainability and remuneration teams will highlight key developments, emerging issues and priorities for the 2027 reporting season and reflect on the 2026 season.

The seminar will be a hybrid event, running from 08:30 until 11:00. The morning will begin with a networking breakfast from 08:30, followed by the sessions from 09:00. We would be delighted if you are able to join us either in person or virtually – please RSVP here to attend.

Publications

Employment Rights Act 2025: the next wave of reforms

We have published two briefings outlining the significant employment law reforms coming into force on 30 October 2026 under the Employment Rights Act 2025:

  • A new raft of trade union reforms will increase the visibility of unions and shift the balance of power further away from employers. Our briefing on trade union reform provides an overview of the changes and practical actions for employers.
  • Employers will become subject to a heightened duty to prevent sexual harassment of their employees. Our briefing on the strengthened sexual harassment duties provides an overview of these changes and practical steps for employers to consider.

Navigating ESG in M&A

We have released a podcast in collaboration with JunHe LLP in Shanghai, exploring the evolving role of environmental, social and governance (ESG) considerations in M&A transactions and sharing practical insights for businesses navigating the landscape. The discussion covers evolving ESG risks and regulation; the role of ESG in M&A due diligence and decision-making; and how ESG considerations can be managed at each stage of a transaction.

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News

Government adopts Taskforce recommendations to reduce burden on SMEs

The Small Business Regulatory Taskforce published its report on 23 October 2026, alongside the government’s response. The government has accepted most of the taskforce’s recommendations, which are aimed at identifying practical reforms to reduce the regulatory burden on SMEs.

Among the measures announced, the government has paused implementing the requirement for small companies and micro-entities to file profit and loss accounts with Companies House from April 2028. During this pause, the government will explore options for streamlining Companies House and HMRC filing processes, under the ‘tell Government once’ ambition.

In practical terms, this means companies will continue to be allowed to file abridged accounts and retains the option for smaller companies to remove, or ‘fillet’, their profit and loss information from the accounts filed at Companies House after 1 April 2028. The requirement for UK registered companies to file their accounts in iXBRL format using commercial software is not affected and will still apply from April 2028.

SMEs should monitor these developments as further details of the reforms emerge, including the outcome of the government’s review of Companies House and HMRC filing processes, as outlined in this press release.

ESMA finalises amendments to EU MAR guidelines on delay in disclosure of inside information

On 16 October 2026, the European Securities and Markets Authority (ESMA) published its final report setting out the revised guidelines (the Guidelines) on the delay in the disclosure of inside information under the EU Market Abuse Regulation (596/2014) (EU MAR). The consultation was published in February (see Corporate Update Bulletin - 5 March 2026).

The changes are intended to align the Guidelines with amendments to EU MAR made by the EU Listing Act, which simplified the regime governing delayed disclosure of inside information.

The Listing Act provides that, from June 2026, protracted processes are no longer subject to the obligation of disclosure of inside information until completion. Additionally, the Listing Act provides that in relation to delaying disclosure, the condition that the delay should not mislead the public was replaced with the requirement that the information the issuer intends to delay should not be in contrast with its latest announcement on the same matter.

The revised Guidelines set out a non-exhaustive list of circumstances in which issuers are permitted to delay disclosure of inside information.

A key change is the removal of all references to legitimate interests relating to protracted processes, as protracted processes are no longer subject to disclosure obligations until completion.

The report also introduces additional legitimate interests for delaying disclosure, including where: 

  • a public authority requests the issuer to refrain from disclosure;
  • the issuer needs to collect additional information on the event to be disclosed;
  • disclosure risks the loss of business opportunities;
  • an issuer is appointing a new key manager or senior executive, and delay risks jeopardising the appointment itself, or termination of an existing appointment; and
  • group companies are subject to the same disclosure obligations and a delay by one group company may justify delay by another. 

The revised guidelines will become applicable from the date of their publication on ESMA’s website in the 24 official languages of the European Union.

FCA expresses concerns about brokerage firms' systems to identify and report market abuse

On 14 October 2026, the FCA published issue 86 of Market Watch, setting out its findings from recent supervisory visits to seven UK retail brokerage firms to evaluate the systems, controls and governance arrangements in place to identify and report potential market abuse.

The FCA identified various weaknesses, including:

  • poor decision-making when considering whether suspicious activity should be escalated or reported to the FCA;
  • insufficient knowledge of the surveillance systems in use, and inadequate alert calibration; and
  • weak governance and oversight, including limited knowledge amongst senior management of key surveillance activities, such as alert triage and escalation, and a lack of consistent oversight.

The FCA expresses concern that these weaknesses increase the risk of potentially serious activity being assessed inconsistently or going unreported.

Although the review focused on retail brokers, the FCA notes that its findings may be relevant to other firms, which are advised to consider the points raised by the FCA’s review, and whether any changes to their surveillance arrangements are needed.

SFO creates new route for corporates to self-report

On 13 October 2026, the Serious Fraud Office (SFO) published updated SFO Cooperation Guidance and accompanying press release for corporates considering self-reporting. The guidance sets out the SFO’s key considerations when deciding whether to prosecute a corporate entity or invite it to enter into Deferred Prosecution Agreement (DPA) negotiations, with a prompt self-report weighing heavily in favour of a DPA.

The most significant change is the introduction of a new route for a company’s legal representatives to communicate directly with the SFO’s Director of Legal Services about a possible self-report on an anonymous basis. The legal representative will be invited to a meeting with the Director of Legal Services to discuss the potential self-report, and a note of any such contact will be made and shared with the Intelligence Division.

The updated guidance also confirms that:

  • wherever possible, the SFO aims to conclude DPA negotiations within six months of an invitation to negotiate being accepted;
  • corporates are expected to investigate proportionately and need not complete an investigation before self-reporting. Prompt reporting is expected where there is direct evidence of offending, although less clear-cut cases may warrant further investigation first; and
  • self-reporting is a strong indication that a corporate has co-operated but is not of itself enough. Only corporates that go on to provide genuine co-operation will be invited to engage in DPA negotiations. The guidance provides various examples of what would be considered as good co-operation.

FRC publishes thematic review of reporting on intangible value drivers

On 14 October 2026, the Financial Reporting Council (FRC) published a report setting out findings from its thematic review of corporate reporting on intangible assets and a wider range of intangible value drivers, including workforce and customer relationships, and AI-related investments.

Based on its review of ten companies’ annual reports, the FRC highlights the growing importance of intangible asset drivers as companies invest more heavily in new technologies. In particular, it encourages companies to improve connectivity between the strategic report and financial statements and enhance reporting on intangible value drivers through KPIs, more granular R&D analysis, clearer explanations of AI-related costs and investments, and greater transparency around the accounting treatment of intangible assets. The report will be of interest to companies preparing their next annual reports.

Cyber Resilience Pledge signatories

The government has recently updated the list of organisations that have signed its voluntary Cyber Resilience Pledge which was launched in July 2026. As at 12 October 2026, the Pledge had 186 signatories.

The Pledge is designed to help organisations strengthen their own cyber resilience and that of their supply chains as the cyber threat landscape evolves. By signing the pledge, organisations commit to taking certain actions, including:

  • making cyber a Board responsibility, including adopting the Cyber Governance Code of Practice and requiring directors to undertake regular National Cyber Security Centre (NCSC) cyber security training;
  • registering for the NCSC’s early warning service; and
  • strengthening adherence to the government’s Cyber Essentials scheme across supply chains.

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Case Law

High Court finds that deed which witness failed to sign was invalid 

In 3Kings Holdings Ltd v TCF 1 GP Ltd [2026] EWHC 2620 (BP), the High Court held that an English-law limited partnership agreement had not been executed as a deed because no witness had signed to attest one of the signatures. This was so even though the parties clearly intended the agreement to be executed as a deed, and notwithstanding some evidence that the signature had in fact been witnessed. As a result, a power of attorney contained in the agreement was void.

The case concerned an English private fund limited partnership established by the defendant general partner in 2020 under a document intended to take effect as a deed (the LPA). The claimant, a Maltese company, became the limited partner in 2022 when its sole director and shareholder, Mr Loporto, signed the LPA.

In 2023, the defendant moved the partnership to the Cayman Islands. Relying on a power of attorney in the LPA, it purported to sign a new Cayman law-governed limited partnership agreement on the claimant’s behalf.

The court granted the claimant a declaration that the partnership remained subject to English law:

  • Where a document is signed on behalf of a company by a single director in the presence of a witness, the witness must sign the document to attest the fact of witness in order to execute it in accordance with section 44(2)(b) of the Companies Act 2006. Since no-one who may have witnessed Mr Loporto's signature on the LPA signed it as a witness, the LPA was not executed by the claimant as a deed.
  • If a document on its face fails to satisfy the statutory formalities for a deed, it should not be treated as one even if the parties treated it as one. The invalidity of the deed could not be remedied by estoppel.
  • An instrument creating a power of attorney must be executed as a deed (section 1(1), Powers of Attorney Act 1971). A purported power of attorney contained in a document that is not a deed does not take effect as a simple contractual authority. 
  • Obiter the judge considered that there is no reason in principle why a party signing a deed as a party cannot also by his or her signature certify having witnessed the signature of another party, provided that that is his or her intention.

High Court provides guidance on the limits of de facto directorship in a corporate group context

In Garden House Software Ltd v Marsh & Ors [2026] EWHC 2184 (Ch), Ch D, the High Court found that the non-executive directors of a parent company did not become de facto directors of a subsidiary merely because they routinely discussed issues relevant to the subsidiary at group level board meetings.

The case concerned the assignment by Serisys Limited (in liquidation) (the Company), while it was insolvent, of valuable IP in its financial services software to a sister company. In return, the Company received a one-year, non-exclusive licence, which the court found to be of no real value. Both companies were wholly-owned subsidiaries of Serisys Group Ltd (the Parent).

As well as bringing claims against the Company's directors, the claimant also argued that the Parent's non-executive directors were de facto directors of the Company and so were liable in respect of the assignment, on the basis that they had discussed the assignment at board meetings of the Parent.

The High Court held that the assignment amounted to a transaction at undervalue, in breach of the Company’s directors’ duties.

However, it dismissed the claims against the Parent’s non-executive directors, finding that none of them had personally assumed the functions of a director of the Company. The court noted in particular that:

  • there is an important distinction between acting as a director of a parent company considering strategic matters across the group, and personally assuming the functions of a director of a subsidiary; 
  • decisions that were properly for the Company's board, for example on salaries and bonuses, were not taken at the Parent level; and
  • the Company's operational affairs were overseen and managed by its own directors, not by the Parent's non-executive directors, who did not see the Company's management accounts.

The case offers some reassurance to parent company directors that discussing subsidiary matters at group board meetings will not, per se, expose them to liability as if they were directors of the subsidiary. Groups should nonetheless ensure that decisions properly reserved to a subsidiary's board continue to be taken, and documented, at subsidiary level.

Scottish Court considers the effect of wilful concealment on buyer's time limit to notify sellers of warranty claims

In Jigsaw Bidco Ltd v Allan [2026] CSOH 96, the Scottish Court of Session considered the effect of alleged fraud or wilful concealment on the time limit for the buyer to notify the sellers of warranty claims under a share purchase agreement (the SPA). Although this is a Scottish decision, it may also be persuasive in the English courts.

Under a limitation provision in clause 8 of the SPA, the sellers were not liable for a warranty claim unless the buyer gave written notice with reasonable details of the claim within 18 months of completion. The SPA also contained a carve-out in clause 8.14 that nothing in clause 8 applied to exclude or limit the sellers' liability "if and to the extent that" a warranty claim arose or was delayed as a result of fraud or wilful concealment by any of the sellers.

The buyer alleged that there were breaches of the warranties and that there had been wilful concealment of their claim. It argued that the carve-out meant that the 18-month time limit did not apply as a result.

The court, however, preferred the sellers’ argument that the effect of the carve-out in clause 8.14 was to pause the 18-month period while the concealment was ongoing:

  • the purpose of the 18-month time limit was to provide a cut-off after which the sellers could cut ties with the target business, while recognising an information imbalance existed between buyer and seller with regards to their knowledge of the target business prior to completion. It therefore made sense for the carve-out to suspend the time limit, but it did not follow that the time limit should be disapplied altogether, since its core purpose of providing a cut-off date for sellers still applied; 
  • extending the 18-month period by the time lost to fraud or wilful concealment did not produce an unfair or absurd result, whereas disapplying the limit altogether for any concealment, however brief, might do so; and 
  • adopting a common-sense approach to construction, the court determined that the words “to the extent that”, read with reference to the claim being delayed, meant the notification period was to be extended by the period of concealment. 

The court also held that, because clause 8.14 referred to "any of the Sellers", fraud or wilful concealment by one seller deprived all the sellers of the limitation protections in clause 8, even though their liability was joint rather than joint and several. A practical takeaway from the judgment is that, where there are several sellers, and the conduct of one of them triggers a carve-out to the limitations on liability, this may affect the protection for all of them unless there is clear drafting to the contrary.

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