The changes aim to clarify and simplify existing provisions, codify established Panel Executive practice and ensure the Code remains effective and up-to-date. The Panel has described these as “miscellaneous” but they touch on some important practical areas market participants encounter regularly– particularly acting in concert, reverse takeovers, Rule 9 waivers and frustrating actions.
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Clarifying "Acting in Concert" and Voting Agreements
PCP 2026/1 proposes amendments to Note 5 under the definition of "acting in concert" to clarify that standstill agreements which restrict a shareholder from reducing its shareholding (but do not prevent it from increasing its stake) will generally result in the shareholder and directors being treated as ‘acting in concert’, subject to certain exceptions. Similar clarifications are proposed for voting agreements requiring shareholders to follow board recommendations on director appointments or removals.
This codifies the Panel’s long standing view that arrangements which “lock up” a shareholder beside the board can create a de facto concert party, even if there is no formal joint bid. For companies and private equity sponsors, this proposal underlines the need to take care when negotiating standstill and voting agreements, particularly in the context of PIPE investments and board backed recapitalisations.
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Reverse Takeovers & Equality of Information
The definition of a ‘reverse takeover’ will be broadened to cover any acquisition requiring a Code company to issue more than 100% of its existing share capital as consideration. It would therefore no longer be limited only to acquisitions of other Code companies.
The Panel also proposes clarifying that restrictions under Rule 2.8 (statements of intention not to bid) and Rule 35.1 (post-offer restrictions) may be lifted if a target company announces a reverse takeover.
PCP 2026/1 recommends expanding Rule 21.3 so that, in reverse takeover situations (under the new definition proposed), any information given to a counterparty must also be shared with competing bidders, ensuring equality of information and increased certainty.
This is consistent with the Panel’s broader drive towards “substance over form”. The proposed change recognises that very large deals – even when not with another Code company – can amount to a transformation of the target. Extending the equality of information principle to these transactions should help level the playing field between a “house” deal and a conventional takeover offer.
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Updating UK MTF definition and PUSU deadline
The current “UK multilateral trading facility or MTF” definition will be replaced with a new definition of "UK primary MTF", aligning with Regulation 8 of the Public Offers and Admissions to Trading Regulations 2024. This is a terminology tidy‑up designed to keep the Code in step with the new UK public offers regime.
Rule 2.6(c) will be simplified by removing the list of factors for extending "put up or shut up" (PUSU) deadlines. Similarly, the requirement for the target board to comment on the factors contributing to deadline extensions will also be dropped. The aim is to simplify the process, trust the target board’s judgement and reduce unnecessary procedural requirements.
Practitioner commentary will likely welcome this as a reduction in “formalism”. In practice, the Panel has always taken a flexible approach to PUSU extensions and removing the checklist should make it easier for boards and advisers to focus on the substance of the request (rather than the form of the explanation).
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Simplifying Rule 9.1
The Panel proposes a series of amendments to Rule 9.1 and its Notes to simplify, clarify and reorganise its provisions.
Key changes include shortening and streamlining guidance on when shareholders are considered to be acting in concert and moving parts of the guidance on collective shareholder action (under Note 2) to Practice Statement 26 (though the Panel clarifies that this will not alter its practice in this area).
Furthermore, the Panel’s proposed amendments to Note 10 under Rule 9.1 will formally recognise its existing practice of permitting a Rule 9 waiver to be sought when exercising convertible securities, warrants or options in certain circumstances.
These changes are important for investors who provide funded instruments or equity backstops. “Formalising” the availability of Rule 9 waivers on conversion should give more comfort to lenders and investors who may need to exercise options or convertibles in difficult market conditions. At the same time, the streamlining of concert party guidance reinforces the Panel’s message that shareholders acting together to influence control can be treated as acting in concert even without a formal agreement.
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Management Incentivisation & Special Deals
Rule 16 will be updated to reflect current practice, requiring an independent adviser to confirm that any special deal or management incentivisation arrangements are fair and reasonable “so far as shareholders are concerned.” This confirms the central role of the Rule 3 adviser in reviewing management rollover and incentive arrangements. Recent transactions have underlined that the Panel expects management packages to be justifiable on their merits, and not simply “side deals” to secure recommendations.
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Frustrating Action
The Panel proposes amending the notes under Rule 21.1 to clarify that, when a potential offeror has not been publicly identified, restrictions on frustrating actions will end at 5.00 pm on the seventh day after the target’s board unequivocally rejects their approach. This update provides greater certainty for boards on when they can resume normal business decisions after rejecting an approach.
This codifies the Panel’s approach in recent cases, where boards have been keen to know when they can restart M&A or capital management plans after saying “no” to an anonymous or preliminary approach. It should reduce the risk of disputes about whether a later action was improperly frustrating.
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Investment research and post offer restrictions
The Panel proposes removing the requirement under Rule 28.7 for companies to take down connected investment research from their websites at the start of an offer period, making market information more accessible. It also proposes requiring companies to clearly disclose if any firm, whose forecasts are included in a consensus forecast, is connected to the party publishing the forecast.
Additionally, Note 1(a) on Rule 35.1 will be tightened so that, in the three months following a lapsed or withdrawn offer, a former bidder who made an unqualified no increase statement or an acceleration statement during that offer shall be restricted from purchasing significant assets from the target, (in line with the position under Rule 2.8 relating to a “no intention to bid” statement).
The research change will be welcomed by investors, given that it preserves access to analysis during an offer period (provided connections are clearly identified). The tightening of the post‑offer restrictions is a logical extension of the Panel’s policy that public statements of intent should have real consequences – parties cannot use a no‑increase or acceleration statement as a tactical device and then engage in large asset acquisitions from the target immediately following.
Comments on PCP 2026/1 are invited by 2 October 2026. The Code Committee will consider feedback and publish a Response Statement, together with the final text of the amendments. Parties who regularly deal with standstill arrangements, reverse takeovers, Rule 9 waivers or management incentive packages should consider responding to the consultation, as these proposals will affect the way routine documents and deal structures are analysed under the Code.
