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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 - Updated client briefing

On 24 February, we published an updated version of our client briefing about what listed companies need to do when they issue shares under a share plan.

We originally published the briefing on 16 February (see Corporate Update Bulletin - 19 February 2026). Since then, the FCA has published a statement about how it intends to enforce its rules, and we have clarified what the LSE expects. In light of this, it is now sufficiently clear that when a company issues shares under a share plan, provided the shares are covered by an existing block admission, the FCA will not require the company to make an announcement as soon as possible (i.e. every time shares are issued). Instead, an announcement must be made within 60 days.

News

FCA makes statement on overlapping notification requirements on share issues

In welcome news for affected issuers, the FCA issued a statement on 19 February 2026 clarifying that it was not its intention that issuers who regularly issue new listed shares, and who were previously required to notify only every six months under a block listing, should now have to notify an RIS as soon as possible for each individual issue and again on admission to trading. See our updated client briefing above for more information.

The FCA intends to consult shortly on removing UKLR 6.4.4R(4) and equivalent provisions in other chapters of the UKLR. This would leave issuers subject only to the 60 day notification requirement in PRM 1.6.4R for admissions to trading. While these changes are being considered, the FCA will not take supervisory or enforcement action where issuers previously granted a block listing under former UKLR 20.6 do not make notifications under UKLR 6.4.4R(4).

FCA aligns deadlines for notifying market about share buybacks amid other changes to Handbook

The FCA has published Handbook Notice 138 on 27 February 2026, setting out recent amendments to the FCA Handbook. One change of particular note is that listed companies are no longer required to notify purchases of their own shares as soon as possible and must instead make a notification by the end of the seventh daily market session after the relevant transaction.

The change came into force on 27 February 2026 and aligns the deadline for notifying the market about share buyback transactions under UKLR 9.6.6 R (and UKLR 9.7.3 R) with the reporting deadline under the share buybacks safe harbour in Article 5 of the UK Market Abuse Regulation.

The FCA Board also made minor administrative amendments to various modules of the Handbook (see Handbook Administration (No 76) Instrument 2026) including changes to UKLR TP 15 to address situations where securities had been issued before 19 January 2026 but had not yet been admitted to listing by that date. This instrument came into force on 27 February 2026.

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

ESMA has published a consultation paper on 19 February 2026 proposing amendments to its Guidelines on delaying disclosure of inside information under the Market Abuse Regulation (596/2014). This consultation will be of interest primarily to EU issuers, trading venues, and other market participants, who are invited to provide comments up to 29 April 2026. ESMA expects to publish a final report containing a summary of the consultation response and a final version of the guidelines in Q4 2026.

The amendments are intended to reflect changes to the disclosure regime implemented by the Listing Act (for more information see our November 2024 client briefing). For context, the Listing Act amended MAR by stipulating that, from June 2026, an issuer is no longer required to announce inside information relating to an intermediate step in a protracted process. Instead, an announcement is required only when the final step in the process completes. The amended version of MAR also empowers ESMA to update its existing Guidelines on delayed disclosure of inside information to make them compatible with the new regime.

Law Society guidance for solicitors on identity verification

The Law Society has published new guidance on steps that legal advisers could consider taking when notifying the Registrar of Companies that an individual's identity has been verified under the Companies Act 2006. This guidance should be read by any solicitors regularly conducting identity verification on behalf of companies.

Government publishes final UK Sustainability Reporting Standards

The Department for Business and Trade has published the final UK Sustainability Reporting Standards: UK SRS 1 and UK SRS 2 on 25 February 2026, making these standards available for voluntary use in the UK. These standards are based on the standards published by the International Sustainability Standards Board in June 2023. The publication includes feedback to the government's consultation seeking views on the same.

EU Directive narrowing the scope of CSRD and CS3D published

On 26 February 2026 the EU published Directive (EU) 2026/470 in the Official Journal. The Directive narrows the application of Corporate Sustainability Reporting Directive (EU) 2022/2464 (CSRD) and the Corporate Sustainability Due Diligence Directive (EU) 2024/1760 (CS3D) and defers key compliance obligations under the CSRD and CS3D regimes.  

The Directive forms part of the European Commission's ‘Omnibus I’ simplification package. Companies that had been preparing for compliance with these directives may need to consider whether they remain in scope and, where appropriate, reassess their timelines for compliance in light of these changes.

Case law

Supreme Court rules no limitation period for unfair prejudice claims

The Supreme Court has held in THG Plc v Zedra Trust Company [2026] UKSC 6 that there is no statutory limitation period (the period in which a claimant has a right to start proceedings) for unfair prejudice claims under ss994-996 Companies Act 2006. In a majority (4-1) judgment, the Supreme Court has reinstated the decision of the High Court, holding that no limitation period applies to unfair prejudice claims. In such cases, delay is instead managed through equitable bars or limitations on relief.

Zedra, a minority shareholder in THG Plc, brought a claim against THG alleging that THG had conducted its affairs in a way that was unfairly prejudicial to Zedra. Zedra later applied to amend its claim to include allegations that it had been excluded from a bonus issue of shares more than six years earlier. THG opposed the amendment arguing that the amendment was time-barred by s9 Limitation Act 1980, which provides that “an action to recover any sum recoverable by virtue of any enactment” is subject to a six-year limitation period. The Supreme Court held that Zedra’s amendment was not time-barred.

This judgment has some significant implications. In the context of M&A due diligence, the judgment reopens the possibility for claims arising from facts that took place many years, or even decades, ago. Where a target company has minority shareholders who may have been treated unfavourably in the past, this potential exposure should be carefully considered and appropriate exclusions may need to be applied to due diligence reports or other assessments of risk.

Secondly, the decision has broader implications beyond unfair prejudice claims. The majority's judgment suggests that there can be no 6-year limitation period for various claims under the Insolvency Act 1986, including wrongful trading (section 214), transactions at an undervalue (sections 238-241) and transactions defrauding creditors (section 423), and that earlier decisions applying a 6-year limitation period to such claims were to that extent wrongly decided. Companies and practitioners involved in disputes of this nature should consider the potential impact of this decision on any limitation defence.

Court of Appeal considers presumption of due execution under section 44 CA 2006 and limitation period in relation to the conversion of company property

In South Bank Hotel Management Company Ltd v Galliard Hotels Ltd [2026] EWCA Civ 56, the Court of Appeal has provided important guidance on the statutory presumption of due execution under section 44(5) of the Companies Act 2006 and the scope of section 21(1)(b) of the Limitation Act 1980.

One issue in the case concerned whether a Lease and Underlease of a hotel conference annex had been properly executed. The documents appeared to be signed by the company secretary and the director on behalf of each of the relevant parties, all of which were part of the same group at the time. However, although the documents appeared to bear the director's signature, they had actually been signed by his PA on his behalf. Reversing the High Court decision, the Court of Appeal held that the documents had not been validly executed. In doing so, it considered the deeming of due execution by a company under section 44(5) of the Companies Act 2006, which applies in favour of a purchaser where a document purports to be signed in accordance with subsection 44(2).

The court confirmed that section 44(5) of the Companies Act 2006 can only be invoked by a purchaser who wishes to rely on the presumption – a counterparty cannot use it against a purchaser's wishes. Additionally, a purchaser who knows that a document was not signed in accordance with section 44(2) cannot be "in good faith" for the purposes of section 44(5). Since the director knew he had not signed the documents, and as sole director of all relevant companies his knowledge was attributed to them, section 44(5) could not apply.

On the separate limitation point, the court took a broad view of section 21(1)(b) of the Limitation Act 1980. This provision removes the usual limitation period for claims to recover company property that a director has “converted” to his own use. The court made clear that this protection is not limited to cases where property has been directly transferred to the director. It can also apply where a director has dealt with company assets in a way that changes their legal state so as to benefit another entity under that director’s control, even without any formal transfer of title. This broader interpretation significantly widens the scope for bringing claims against directors who have improperly benefited from company property, regardless of how much time has passed and even where title to the property itself has not been transferred.

Court of Appeal confirms test for manifest error in expert determinations

In WH Holding Ltd v London Stadium LLP [2026] EWCA Civ 153, the Court of Appeal has allowed an appeal against a High Court decision that had set aside an expert determination for manifest error, providing important guidance on the applicable test.

The case concerned a payment due under an "anti-embarrassment" clause in the 2013 concession agreement for the London Stadium. London Stadium LLP, the head leaseholder of the stadium, granted a 99-year concession to WHH, the owner of West Ham. In the event of a sale of any shares in WHH by a “Relevant Shareholder”, the Agreement provided for the payment to London Stadium LLP of a “Stadium Premium Amount”, a percentage amount calculated by reference to the consideration paid. The dispute related to a 2021 transaction under which the Relevant Shareholders agreed to sell shares to a purchaser and simultaneously entered a call option giving the purchaser the right to acquire further shares in return for an upfront premium of £18mn.

The dispute centred on whether, under the anti-embarrassment clause, the share sale and call option were to be treated as one single qualifying transaction or (as WH Holding contended) as two, in which case the call option on its own would fall below the threshold at which a Stadium Premium Amount would be payable. WH Holding also contended that since the definition of “Consideration” contained separate limbs applicable to (i) a sale for 100% of the shares, (ii) a partial sale, or (iii) an option, and those limbs were separated by the word “or” rather than “and”, it was not possible to apply different limbs to a single transaction. The parties referred their dispute to expert determination.

In the event, the expert (Terence Mowschenson KC) treated it as a single transaction, to which he applied different limbs of the definition. This resulted in the Stadium Premium Amount being £3.6mn higher. WH Holdings challenged this determination.

At first instance, the High Court set aside the expert determination on the basis that the expert had made a manifest error, but the Court of Appeal reinstated it.

Having considered the authorities, the Court of Appeal outlined the relevant test as: "[a]bsent contractual terms which provide differently when interpreted in context, an error will be manifest if, after investigation limited in time and extent, it is so obvious (and obviously capable of affecting the determination) as to admit of no difference of opinion".

The court clarified that this test involves a two-stage approach: first, identifying whether there was an error, and secondly, determining whether that error was so obvious as to admit of no difference of opinion. Importantly, the "limited investigation" element of the test does not preclude adversarial argument; parties remain entitled to make submissions on whether the test is satisfied in their statements of case and evidence presented at a hearing. The Court of Appeal concluded in this instance that the high bar of manifest error had not been met.  

In particular (a) the overage provisions were not clear and their application was complex, (b) it was not manifestly wrong to treat the share sale and the option as one transaction, and (c) in relation to the different limbs of the “Consideration” definition, the word “or” could be read as providing alternative provisions for different elements of one Qualifying Transaction, but not necessarily exclusive of each other. The word “or” may be used in a conjunctive sense in some contexts (similar to “and/or”). The expert had arrived at an arguably sensible interpretation of how to apply the provisions to the situation.

This decision reaffirms the high threshold for manifest error challenges, confirming that expert determination is intended to produce a final decision, but does not guarantee a "correct" decision. Accordingly, it is insufficient for a party challenging an expert determination to show merely that the expert reached the wrong answer – the error must be so obvious as to admit of no difference of opinion.