Listing of Global Securities on London Stock Exchange

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The London Stock Exchange is one of the world’s most international capital markets, home to approximately 2,200 companies from more than 70 countries around the world.

More than 500 of these companies are Global. The markets of the London Stock Exchange put UK and international companies in touch with one of the world’s deepest pools of global capital. London’s position at the heart of the global financial community is one of the reasons that so many international companies choose to join our markets.

Many of the world’s leading investment houses and financial institutions are based here, while London’s professional investors are known for their outward-looking approach, offering companies from around the world access to a deep and wide pool of investment capital.

London has become synonymous with ‘intelligent regulation’ and is recognised globally for its flexible, principles based approach to regulating its capital markets. The Exchange provides an active and efficient secondary market for trading in a wide range of securities, via a number of different trading services. The appropriate platform for the securities will be determined by a number of factors including whether the issuer is UK based or international issuer.

Main Market :- The Main Market is the flagship market for larger, more established companies, and is home to some of the world’s largest and best known companies. Underpinned by London’s balanced and globally-respected standards of regulation and corporate governance, the Main Market represents a badge of quality for every company admitted and traded on it and an aspiration for many companies worldwide.

It is an EU Regulated Market. The Main Market has four segments that cater for a range of businesses and securities.

  • Premium: Part of the FCA’s (Financial Conduct Authority (FCA) is a financial regulatory body in the United Kingdom) Official List, this segment is home to some of the world’s largest corporations that are subject to the highest standards of regulation and governance.
  • Standard: Subject to EU minimum standards and part of the Official List, open to shares and debt securities.
  • Specialist Fund Segment:-Designed for highly specialised investment entities that wish to target institutional, highly knowledgeable investors or professionally advised investors only.
  • A new addition to the Main Market offering, this segment is specifically designed for equity securities of high growth, revenue generating businesses that are over time seeking to become Premium listed companies.

Alternative Investment Market (AIM):- AIM is the London Stock Exchange’s international market for smaller growing companies. A wide range of businesses including early stage, venture capital backed as well as more established companies join AIM seeking access to growth capital.

NOMAD :- The Nominated Adviser (Nomad), broker and other advisers play a central role in a company’s admission to AIM. It is important that a company is confident that it can establish a good working relationship with the appointed Nomad as they will be working closely together at admission and on an ongoing basis.

 In choosing its advisers, a company will want to ensure that they:-

  • understand its business
  • have appropriate experience in the sector
  • share the company’s vision for the future.

Role of Nominated Advisers Nomads are corporate finance advisers approved by the London Stock Exchange to act in this capacity. To obtain approval as Nomad, a firm must meet the eligibility criteria set out in the AIM Rules for Nominated Advisers.

A Nomad is responsible for advising and guiding a company on its responsibilities in relation to its admission to AIM as well as its continuing obligations once on market.

To help fulfil this role, the Nomad will:-

  • Undertake extensive due diligence to ensure a company is suitable for AIM
  • provide guidance throughout the flotation process
  • prepare the company for being on a public market
  • help prepare the AIM admission document
  • confirm appropriateness of the company to the Exchange
  • Act as the primary regulator throughout a company’s time on AIM.

Professional Securities Market (PSM):- The Professional Securities Market is an innovative, specialised market designed to suit the specific needs of issuers. It facilitates the raising of capital through the issue of specialist debt securities or depositary receipts (DRs) to professional investors. Companies wishing to raise capital may do so without the additional cost of following a retail or equity regime.

As a listed, exchange-regulated market, the Professional Securities Market enables issuers to enjoy the benefits of a flexible and pragmatic approach to regulatory requirements. Issuers of debt or DRs are not required to report historical financial information to IFRS or an equivalent standard, either in listing documents or as a continuing obligation. Instead, issuers can use their domestic accounting standards.

LISTING OF DEPOSITORY RECEIPTS ON THE PSM:- DRs are typically held in US dollars and issued by a depository bank. Several forms of DRs can be listed and traded in London, including Global Depositary Receipts (GDRs) and American Depository Receipts (ADRs). Admitting DRs to the PSM involves a two-step, simultaneous process.

A company submits its ‘Listing Particulars’ to the UKLA, while also applying to the Exchange for admission of its DRs to trading on the PSM.

Trading platform:- All DRs admitted to the PSM are traded on the International Order Book (IOB), the world’s leading electronic order book for DRs.

Luxembourg Stock Exchange The Luxembourg Stock Exchange is well known for its independent and international listing expertise. Instruments that are currently listed are shares, warrants, bonds of many types, depositary receipts and investment funds. Listing in Luxembourg is both relatively straightforward and flexible.

There are three main phases in the process: –

The pre-application and file submission phase.

The application phase.

The approval phase.

Listing with the Luxembourg Stock Exchange is a 5-step process:-

1 Choose a market

2 Prepare a prospectus

3 Submit your prospectus

4 Listing and admission to trading

5 Post-listing reporting

The Luxembourg Stock Exchange offers a choice of two markets, the main EU-regulated market (called “the BdL market” or the Bourse de Luxembourg market”) and an exchange-regulated market (called “the Euro MTF”).

When listing on the Euro MTF (Multilateral Trading Facility) market, the Luxembourg Stock Exchange is in charge of prospectus approval and the prospectus is drawn up according to our own rules and regulations.

When listing on the BdL market, Luxembourg’s financial regulator, the Commission de Surveillance du Secteur Financier (CSSF), reviews and approves a prospectus.

By being outside the scope of EU regulations, issuers on the Euro MTF market benefit from less stringent requirements for financial reporting.

However, only issuers that list on the BDL market have access to EU passporting, meaning that the same prospectus approval can be used to list on other EU exchanges.

Listing a share/GDR on BdL market Listing on the Bourse de Luxembourg (BDL) market will require submission of a prospectus to Luxembourg’s financial regulator, the Commission de Surveillance du Secteur Financier (CSSF).

Once the prospectus has been reviewed and approved, the share or GDR will be listed and admitted to trading:-

  • Choose a listing agent (optional): It is not mandatory to appoint a listing agent. Either the issuer itself or a company acting on its behalf can submit requests for approval.
  • CSSF approval: Before listing a share or GDR on the BdL market, one must first file a prospectus with the CSSF. Note that some issuers may not fall under the scope of the Prospectus Law and should instead send their prospectus directly to Luxse.
  • Listing Requirements: In order to list on the BdL market, an issuer must fulfil the following criteria, among others : −

Minimum capital of €1,000,000, or equivalent value in other currencies

Minimum public free float of 25%

Securities should be eligible for clearing and settlement

Securities should be freely negotiable and fungible.

Listing process: − File a prospectus: An issuer must also file an application with Lux-SE before being admitted to trading on the BdL market with the following documents:-

  1. A copy of your prospectus
  2. Application form
  3. Undertaking letter
  4. Articles of association
  5. Existing agreements/conventions
  6. The last three annual financial reports (if published) –
  7. Final submission:-Listing can take place after receipt of the following items:-
  8. Final version of the prospectus
  9. First listing price (current market price)

Fees: Fees related to the approval of a prospectus are to be paid to the CSSF.

Listing and maintenance fees are to be paid to LuxSE and are priced in euros.

Fees will vary depending on whether or not the company is a “recently established company”, i.e. a company that has not published or registered annual accounts for the three previous financial years.

Continuing Obligations: After listing and admission to trading, issuers are required to fulfil certain reporting obligations, as outlined under the Law of January 2008 (as amended), which implements the requirements of the EU Transparency Directive. Issuers must also file information and scheduled corporate events with LuxSE .

LEI Code: In the context of MiFID II / MiFIR and MAR, the LuxSE is obliged to collect a ‘Legal Entity Identifier’ or ‘LEI’ code from any issuer operating on its regulated market (Bourse de Luxembourg) and on its Multilateral Trading Facility (Euro MTF) and communicate it to the relevant supervisory authorities. Listing Shares /GDRs on the Euro MTF Listing on the Euro MTF will require submission of a prospectus to LuxSE.

Once your prospectus has been reviewed and approved, your share or GDR will be listed and admitted to trading.

Choose a listing agent (optional): It is not mandatory to appoint a listing agent.

Either the issuer itself or a company acting on its behalf can submit requests for approval:-

Listing Requirements:-

In order to list on the Euro MTF, a security must fulfil the following criteria, among other things:-

Minimum capital of €1,000,000, or equivalent value in other currencies Minimum public free float of 25%

Securities should be eligible for clearing and settlement

Securities should be freely negotiable and fungible.

Listing Process: − File a prospectus:- To begin the listing process, the following documents to be sent to Lux SE:-

  1. A copy of your prospectus;
  2. Application form
  3. Undertaking letter
  4. Articles of association
  5. Existing agreements/conventions
  6. The last three annual financial reports (if published)

Prospectus review:- A first set of comments on a complete draft prospectus will be sent to you within a maximum period of three business days from the date of receipt of the filed application.

Additional comments following submission of an updated draft prospectus will be provided within a maximum of two business days after submission,

Final submission: Listing can take place after receipt of the following items: –

  1. Final version of the prospectus
  2. First listing price

Fees:- All fees are to be paid to LuxSE and are priced in Euros. The fee structure will vary depending on whether or not you are a “recently established company”, i.e. a company that has not published or registered annual accounts for the three previous financial years.

  • Continuing Obligations:-After listing and admission to trading, issuers must fulfil specific reporting obligations.
  • LEI Code:-In the context of MiFID II / MiFIR and MAR, the LuxSE is obliged to collect a ‘Legal Entity Identifier’ or ‘LEI’ code from any issuer operating on its regulated market (Bourse de Luxembourg) and on its Multilateral Trading Facility (Euro MTF) and communicate it to the relevant supervisory authorities.

CS Tanuj Saxena

is a Qualified Company Secretary from Lucknow having a rich and Core expertise in Secretarial compliances of Companies, Nclt matters and Corporate Litigation matters.

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