The financial regulator has confirmed it will simplify listing rules in an attempt to breathe life back into London’s flagging stock market.

The Financial Conduct Authority (FCA) said the reforms, which come into force immediately, will reduce the execution risk for issuers and lower compliance costs.

Banks that act as issuers will also no longer have to wait seven days between publishing an approved prospectus and publishing research on stocks, which the FCA said would ‘lower market risk’.

It came as the junior market said it also planned to make it easier and cheaper for firms to list on AIM and fast-track international public companies looking to join from other markets.

The updated rules would make it ‘easier to undertake large M&A transactions,’ the London Stock Exchange said.

The capital has suffered a slowdown in listings over the last decade as companies either choose to stay private for longer, or move to other markets, such as the United States, which have deeper pools of capital.

In recent months, there has been a series of take-private deals from overseas firms, including laboratory testing firm Intertek, insurer Beazley, City institution Schroders and energy firm DCC.

On Wednesday, Segro became the fifth FTSE 100 firm to fall into foreign hands as it accepted a £14billion takeover by US logistics giant Prologis.

Mid-cap firms have also come under pressure, with Easyjet, Rotork, Mitie and Tate & Lyle all targeted this year – fuelling fears that predators are circling undervalued British firms.

The FCA said it hoped the finalisation of the new rules, on which it has been consulting since late last year, will help to boost the UK’s stock market, making it easier for companies looking to list in Britain.

Jon Relleen, director of infrastructure and exchanges at the FCA, said: 'We want the UK market to be an attractive place for companies to raise capital and grow. By making the UK listing regime more efficient, we are supporting the growth and competitiveness of UK capital markets.'

The City has suffered from a drought of fresh listings, with just seven IPOs in the first half of the year raising £557million.  But there are hopes that several big names will list in the next year or two, including Waterstones and Boots.

Primark is also expected to list in London when it is spun off from owner Associated British Foods.

Inigo Esteve, partner at law firm White & Case, said: ‘These are sensible, targeted reforms that remove unnecessary friction from the UK IPO process.’

He added: ‘Alongside the wider programme of UK capital markets reforms introduced over the past two years, these changes demonstrate the FCA's continued willingness to refine the regulatory framework where it can improve the efficiency and competitiveness of London's public markets.’