The UK’s Financial Services Authority has published a consultation paper on proposed changes to its listing rules.

The proposed changes include new rules for investment entities —including investment trusts, venture capital trusts and other domestic and overseas investment companies — and would replace the existing regime with a more principles-based approach to determining eligibility for listing, the regulator reports.

This would enable those employing a wider range of investment strategies, including those currently pursued by some hedge funds, to list in the UK for the first time. Appropriate investor protections would be maintained through revised and enhanced disclosure requirements, it adds.

It also proposes changes to implement the Transparency Directive, which forms part of the EU’s Financial Services Action Plan and is designed to enhance transparency across the EU’s capital markets by harmonizing information requirements across the EU. It requires companies whose shares are admitted to trading on regulated markets to produce periodic financial reports and shareholders to disclose major holdings in such companies.

“Our proposed reform of the Listing Rules for investment entities will modernize the UK’s regime, providing companies with greater flexibility over their investment strategies, while maintaining strong disclosure-based investor protections,” said Hector Sants, FSA managing director of wholesale business.

“The Transparency Directive largely replaces existing UK rules which ensure that a high standard of information is provided by listed companies to the market on a continuous basis,” Sants added. ”We are asking market participants whether we should implement the directive’s minimum requirements or if we should retain key features of the existing UK regime for financial reporting and shareholding disclosures, which currently go beyond the directive’s requirements.”