- with readers working within the Law Firm industries
- within Intellectual Property and Energy and Natural Resources topic(s)
This week:
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The FCA carries out a light review of the new UK Listing Rules requirements relating to significant transactions
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The Government introduces legislation to strengthen the UK’s modern slavery corporate reporting regime
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Other items of interest
FCA carries out review of changes to significant transactions under UK Listing Rules
The Financial Conduct Authority (FCA) has carried out a light monitoring review of certain changes it made in July 2024 to the UK Listing Rules (UKLR) that govern significant transactions.
Broadly speaking, a significant transaction is a transaction that is not carried out in ordinary course of business and which represents 25% or more in any of the class tests set out in the UKLR.
Before the changes came into effect, a listed company was required to send a detailed circular to its shareholders and obtain shareholder approval for the significant transaction.
Following the changes, a listed company must publicly disclose a significant amount of detail on the significant transaction. However, it is no longer required to send a circular to its shareholders or obtain their approval.
The FCA has reviewed how these changes have been working in practice. It has published Primary Market Bulletin 64, in which it makes the following observations.
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Risk disclosures. Companies are taking advantage of the new flexibility to present risks in an order and with a level of detail that are appropriate to the transaction. However, in some cases, the FCA found risk explanations to be generic. Noting the guidance in UKLR 7.3.5G(2) that a company should consider what information is necessary to support shareholder engagement and market transparency, the FCA states that disclosures should clearly articulate the risk to the company as a result of the transaction and not be generic in nature.
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Board statements on best interests. The FCA noted some instances where the wording of this statement did not track the wording of UKLR 7 Annex 2, rule 1.1R(16). The FCA reminds issuers to use the following prescribed text: “the transaction is, in the board’s opinion, in the best interests of security holders as a whole”. It also notes that the same prescribed wording applies to fair and reasonable statements under UKLR Chapter 8 for related party transactions.
Read FCA Primary Market Bulletin 64 on the FCA’s review of significant transaction requirements
Government proposes changes to UK’s modern slavery reporting regime
The Government has introduced the Immigration and Asylum Bill into Parliament. Clauses 44 to 49 of the Bill are designed to modify the UK’s current modern slavery reporting regime by introducing greater consistency across reports and making enforcement by the Government easier.
The current regime is set out in section 54 of the Modern Slavery Act 2015 (and supplemented by secondary legislation). The regime requires certain commercial organisations to publish an annual slavery and human trafficking statement (more commonly known as a “modern slavery statement”).
For more information on the precise requirements for the regime, see the box titled “What is a modern slavery statement and who must prepare one?”.
What is a modern slavery statement and who must prepare one?
Section 54 of the Modern Slavery Act 2015 requires a commercial organisation to prepare and publish a slavery and human trafficking statement – more commonly known as a “modern slavery statement” – for each year in which certain conditions are met.
The key aspects of the regime are as follows.
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An organisation is subject to the regime if it supplies goods or services and it conducts business in any part of the United Kingdom. The regime applies to both corporations and partnerships, and it does not matter if the organisation is registered or incorporated outside the UK.
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The organisation must publish a modern slavery statement for each year in which its total turnover exceeded a specific amount. That amount is currently set at £36m.
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The statement must set out the steps the organisation took in the preceding financial year to ensure that slavery and human trafficking were not taking place in any of its supply chains or in its own business. If the organisation took no such steps, the statement must say this.
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Section 54 sets out certain areas a modern slavery statement may cover. However, these are effectively suggestions, and there is no prescribed content for a modern slavery statement.
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An organisation must publish its modern slavery statement on its website and include a link to the statement in a “prominent place” on that website. This is generally done by placing a link on the main website landing page (i.e. its homepage). If the organisation does not have a website, it must provide a copy of its statement within 30 days of a request to do so.
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There is no statutory deadline for publishing a modern slavery statement, and no automatic penalty under the Modern Slavery Act 2015 for failing to do so. The Secretary of State can seek an injunction to require an organisation to publish a modern slavery statement, but this is an unusual step that has rarely, if ever, been pursued.
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The Government currently maintains a central register of modern slavery statements. However, there is no requirement to submit a modern slavery statement to that database.
The Bill would make the following changes to the current regime:
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Content of statements. The Bill sets out mandatory content for modern slavery statements. If enacted, all statements would need to include information on specific items listed in a schedule to the Modern Slavery Act. These include the organisation’s structure and supply chains (including which parts are susceptible to slavery and human trafficking), steps the organisation has taken and their effectiveness, its policies and due diligence procedures regarding slavery and human trafficking, and training given to staff on slavery and human trafficking.
In practice, this codifies existing guidance on the content of statements and is not likely to have a significant impact on organisations that already comply with section 54.
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Approval. Parent undertakings would be permitted to certify modern slavery statements on behalf of their subsidiary undertakings. In practice, this should reduce an administrative burden (and source of frustration) by allowing a group of companies to approve a group-wide modern slavery statement by passing a single board resolution.
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Publication. The Secretary of State would gain the power to make regulations requiring organisations to submit a copy of their modern slavery statement electronically to the Secretary of State. In practice, this would give the Government power to require organisations to file their statements in the Government’s central modern slavery registry, something the Government has previously indicated it intended to do.
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Deadline. Organisations would be required to publish a modern slavery statement as soon as possible and, in any event, no later than six months after financial year end. The Government would be able to alter the six-month deadline from time to time. This would introduce a firm deadline for compliance and, in theory, make enforcement easier, addressing what some have criticised as a significant flaw with the current regime.
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Enforcement. The Secretary of State would gain the power to impose financial penalties on an organisation that does not comply with the regime. The Bill would cap a penalty for a given modern slavery statement at either £1m or 1% of the organisation’s total turnover (whichever is higher).
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Public authorities. The Bill would introduce a parallel regime requiring public authorities to produce and publish a modern slavery statement.
There have been several attempts over some time now to amend the UK’s modern slavery statement regime, which some have argued is vague and difficult to enforce. However, most of those attempts failed at an early stage due to lack of Government backing.
This latest Bill, however, which is backed by the Government and which covers other matters relating to immigration and asylum, has a much greater chance of being met with success.
Although the legislation is at an early stage, the Bill’s introduction marks a good point in time for commercial organisations to review their slavery and human trafficking procedures, assess whether they are in scope of the current regime and analyse whether they meet the potential new mandatory content requirements.
Access the Immigration and Asylum Bill (opens PDF)
Other items
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FCA publishes outcome of total voting rights review. The FCA has published Primary Market Bulletin 64, in which it has set out the outcome of a short follow-up review of total voting rights (TVR) disclosures it carried out in 2025. The bulletin sets out the FCA’s recommendation for ensuring that TVR disclosures made under its Disclosure Guidance and Transparency Rules (DTR) are clear and adequately labelled.
Read FCA Primary Market Bulletin 64 on the FCA’s total voting rights review
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Treasury publishes progress report on regulation action plan. HM Treasury has published a report setting out progress towards the key actions in its regulation action plan, published in March 2025. Among other things, the progress report notes the Government’s continued intention to simplify the corporate reporting framework for UK businesses.
Read the Government’s Regulation Action Plan Progress Report (opens PDF)
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EU simplifies CSRD requirements. Following its consultation in May 2026, the European Commission has adopted two delegated regulations relating to sustainability reporting standards under the EU Corporate Sustainability Reporting Directive (CSRD). The first regulation will simplify reporting for entities within the scope of CSRD. The second regulation will (broadly speaking) set out voluntary reporting standards for smaller companies outside the scope of CSRD and for smaller value chain partners. The new regulations apply to financial years beginning on or after 1 January 2027, but entities may adopt the new measures earlier on a voluntary basis.
Read the European Commission’s press release on revised sustainability reporting standards
Access the annexes to Commission Delegated Regulation C(2026) 5010 final (opens PDF)
Access the annexes to Commission Delegated Regulation C(2026) 5011 final (opens PDF)
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