The UK’s Financial Reporting Council (FRC) has launched a consultation on a temporary adjustment to its third country auditor (TCA) policy, aimed at a specific group of Chinese‑registered companies listing in London.

The proposal would, for a limited period, allow auditors of Chinese entities issuing Global Depositary Receipts (GDRs) in London to use Chinese Standards on Auditing (CSAs) for UK listing purposes.

The FRC describes the move as “supporting the flow of capital, enabling investment and growth”.

The consultation follows a request from the UK Government, which is seeking to ease what it views as an obstacle discouraging some Chinese‑registered issuers from choosing London as a listing venue.

The change is intended to encourage eligible Chinese companies to list on the London Stock Exchange via the Shanghai/Shenzhen Stock Connect arrangement between the Financial Conduct Authority and the China Securities Regulatory Commission.

The FRC says the proposal is designed to align with the government’s wider ambition of boosting UK economic growth and enhancing London’s position in global markets, while “ensuring that appropriate safeguards remain in place”.

The amendment is described as narrowly targeted and time‑bound, with safeguards intended to preserve “investor protection and market integrity” until a longer‑term legislative solution is in place.

These safeguards include transparency obligations, continued registration of relevant companies as TCAs, ongoing supervision, and “clear disclosures stating the applicable auditing standards that have been used”.

Auditors of entities using the Stock Connect route would be required to register with the FRC as TCAs and would remain subject to continued oversight.

The FRC also emphasises that the proposal covers only entities listed in the clearly identified Stock Connect segment of the London Stock Exchange International Order Book. It does not extend to other China‑registered issuers and does not alter the broader TCA framework.

The regulator is seeking views on whether this approach balances the UK’s focus on investor protection and audit quality with its aim of supporting economic growth and London’s global market position.