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On July 29, 2024, the London Stock Exchange (LSE) introduced a revised listing regime that brought significant changes to the regulatory framework governing securities and their eligibility for inclusion in the FTSE UK Index Series. This new framework included the introduction of categories such as Equity Shares (Commercial Companies) and Closed Ended Investment Funds, designed to replace the previous Premium segment.
Under the updated regime, securities listed under the new categories are subject to a set of regulatory requirements tailored to the new framework. Notably, if companies meet the listing requirements for the Equity Shares (Commercial Companies) or Closed Ended Investment Funds categories, they become eligible for potential inclusion in the FTSE UK Index Series. This eligibility reflects a broader approach to index inclusion, aiming to represent a wider spectrum of market participants.
For instance, prominent companies like Diageo plc (DGE) and Vodafone Group plc (VOD), which may transition to the Equity Shares (Commercial Companies) category, would have the opportunity to be considered for inclusion in the FTSE UK Index Series, provided they meet all other relevant criteria. Similarly, Closed Ended Investment Funds such as JPMorgan Global Growth & Income plc (JGGI) and Fidelity Special Values plc (FSV), if listed under the new category, could also be eligible for inclusion in the index.
It is important to clarify that FTSE Russell, the organization responsible for managing the FTSE UK Index Series, has not introduced any additional inclusion requirements beyond those associated with the new listing categories. The criteria for inclusion in the index do not replicate the legacy Premium segment requirements. Instead, the new regime provides a more inclusive framework while maintaining the integrity and relevance of the index.
The absence of additional regulatory obligations means that companies meeting the listing requirements for the Equity Shares (Commercial Companies) and Closed Ended Investment Funds categories are evaluated for index inclusion based on the same principles applied to other securities within the FTSE UK Index Series. This approach ensures that the index continues to reflect a diverse range of market participants without imposing the previous Premium segment's stringent standards.
In summary, the revised listing regime introduced on July 29, 2024, enables companies listed under the Equity Shares (Commercial Companies) and Closed Ended Investment Funds categories to be eligible for inclusion in the FTSE UK Index Series, provided they satisfy the applicable listing requirements. FTSE Russell has not imposed additional inclusion requirements related to the legacy Premium segment, ensuring that the new framework supports a broader and more inclusive representation of the UK market.
