Comparison of the Eligibility Criteria and Continuing Obligations for Listing on the Main Market, and AIM of the London Stock Exchange and Euronext Amsterdam
Introduction
There are primarily two markets offered in London for listing securities, such as shares. One is the London Stock's Exchange's Main Market, which is divided into Premium Segment and Standard Segment, with the Premium Segment representing the highest standard of listing in London. The second is the AIM Market. A summary of the differences between the three categories of listing are set out in the table below alongside the requirements of Euronext Amsterdam.
Main market – premium Main market – standard AIM Euronext Amsterdam listing listing
Regulated market EU regulated market (Official EU regulated market (Official Multilateral trading facility and EU regulated market List) List) SME Growth Market
Prospectus/Admission Prospectus (Prospectus Prospectus (Prospectus Admission Document (AIM Prospectus (PR Annexes I, II & Document Regulation Annexes I, II & III) Regulation Annexes I, II & III) Rules) or Prospectus (if public III) offer)
Exchange Rules Admission & Disclosure Admission & Disclosure AIM Rules and Guidance Notes Euronext Harmonised Rules Standards, Listing Rules and Standards, Listing Rules and FCA (Rulebook I), General Rules for FCA Handbook Handbook the Euronext Amsterdam Securities Market
Domicile Any Any Any Any
Depositary receipts No Yes (subject to conditions) Yes (subject to conditions) Yes (subject to conditions)
Introduction & 01
Main market – premium Main market – standard AIM Euronext Amsterdam listing listing
Minimum free float 25% 25% No minimum required. Nomad Normally 25% of the relevant i.e. the amount of the assessment of suitability. class of shares must be company's shares to distributed to the public or 5% be in public hands only if it represents at least €5 million.
Minimum market £700,000 £700,000 No minimum required. Nomad No minimum required. capitalisation assessment of suitability.
Securities Securities to be freely Securities to be freely Securities to be freely Securities must be freely transferable, fully paid and transferable, fully paid and transferable, fully paid and transferable and negotiable eligible for electronic settlement. eligible for electronic settlement. eligible for electronic settlement except where:
any jurisdiction, statute or regulation places restrictions on transferability; or where the company wishes to restrict number of shareholders domiciled in a particular country to avoid being subject to statute or regulation. Sponsor or Nomad Sponsor required for certain n/a Nomad required Listing Agent required required actions1
Working capital for Yes Yes (where a prospectus is being Yes Yes next 12 months issued)
Operating history and Historical financial accounts for Where a prospectus is being In certain circumstances, where Historical financial accounts for management a 3 year period to be provided issued, the company must provide a prospectus is being issued, the a 3 year period to be provided with a historic revenue earning historical financial accounts for a company must provide historical
1 See LR 8.2.
02 & Introduction
Main market – premium Main market – standard AIM Euronext Amsterdam listing listing
record which supports at least 3 year period, or less if it has financial accounts for a 3 year 75% of the company's business existed for less than 3 years period for the 3 year period covered by the accounts
Corporate Governance Independent Directors: Independent Directors: Independent Directors: Dutch companies are subject to The UK Corporate Governance See comments for Premium See comments for the Main the Dutch Corporate Code (the Code) recommends Listing. Market. However, smaller Governance Code. that except for smaller companies should have at least companies (below FTSE 350) at Committees: two independent non-executive least half of the board of See comments for Premium directors. directors (excluding the Listing. chairman) should be Committees: independent non-executive See comments for the Main directors. Market. AIM Rules will also require an Committees: AIM company to adopt a The Code states that the board recognised code of corporate should establish both a governance. remuneration and audit committee consisting of at least 3 members (2 members for smaller companies) who should all be independent non-executive directors. The Code also states that all listed companies should have a nomination committee which consists of a majority of independent non-executive directors.
Business to be Required n/a n/a No specific requirements or independent of market practice controlling shareholder
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Main market – premium Main market – standard AIM Euronext Amsterdam listing listing
Relationship Required n/a n/a No specific requirements but agreement with increasingly common controlling shareholder Annual financial Yes Yes Yes Yes report Half yearly financial Yes Yes Yes Yes report International Yes Yes Yes Yes Financial Reporting Standards Publication of inside Yes Yes Yes Yes information as soon as possible (i.e. information which is likely to have a significant effect on the company's securities) Major shareholder Yes Yes Yes Yes notification regime applies Significant Shareholder approval required if No shareholder approval Shareholder approval required if Shareholder approval required transactions "class tests" met. required. reverse takeover or for disposals for certain major transactions if resulting in a fundamental issuer is a Dutch company
change in business.
Reverse takeovers Shares usually suspended from Shares usually suspended from Shares usually suspended from Shareholder approval likely trading pending publication of trading pending publication of trading pending publication of required if listed entity is Dutch prospectus relating to enlarged prospectus relating to enlarged admission document relating to NV. Prospectus may be required group and approval of group and approval of application enlarged group and approval of if new shares are offered and/or listed. A prospectus like
04 & Introduction
Main market – premium Main market – standard AIM Euronext Amsterdam listing listing
application for re-admission. for re-admission. application for re-admission. disclosure document is required if the listed entity does not have Shareholder approval required. No shareholder approval Shareholder approval required. sufficient substance (reverse required. listing)
Related party Listing Rules (LR) No shareholder approval Details of relevant related party Upon implementation of the transactions required. transactions require notification amended Shareholders Rights Shareholder approval required. to the market but do not require Directive, material related party "Class tests" applied. Disclosure Guidance and shareholder approval. transactions will have to be Transferring Rules (DTR) publicly announced but will not Independent adviser must Nomad must confirm terms of require shareholder approval. confirm terms of transaction are If any 'class test' exceeds 5% then transaction are fair and fair and reasonable in certain reasonable. circumstances.2 1. UK incorporation issuers must obtain board approval Disclosure Guidance and and announce Transferring Rules (DTR) 2. Rest of the world (but non- EEA issuers) must simply If any 'class test' exceeds 5% announce 4 then
1. UK incorporation issuers must obtain board approval and announce 2. Rest of the world (but non- EEA issuers) must simply announce 3
Pre-emption rights on Yes Not required by Not required by AIM Rules but No specific requirements issue of new shares Listing/Prospectus Rules but may may be required by issuer's for cash be required by issuer's domestic domestic company law company law
2 LR 11 3 DTR 7.3 applies to financial years beginning after 10th June 2019 4 DTR 7.3 applies to financial years beginning after 10th June 2019
Introduction & 05
Main market – premium Main market – standard AIM Euronext Amsterdam listing listing
Further issues of A prospectus is required if more A prospectus is required unless A prospectus is only required if A prospectus is required unless shares than 20% of shares of the same shares are not offered to the shares are offered to the public. shares are not offered to the class are admitted to trading public and they represent less public and they represent less over a 12 month period. than 20% of shares of the same than 20% of shares of the same class over a 12 month period. class over a 12 month period.
Issue of convertible Permitted provided the Permitted provided the company Permitted provided the Permitted provided the securities company (i) is not subject to any (i) is not subject to any company (i) is not subject to any company (i) is not subject to any restrictions in its constitution or restrictions in its constitution or restrictions in its constitution or restrictions in its constitution or under domestic law and (ii) has under domestic law and (ii) has under domestic law and (ii) has under domestic law and (ii) has waived any pre-emption rights waived any pre-emption rights to waived any pre-emption rights waived any pre-emption rights to issue sufficient shares on issue sufficient shares on to issue sufficient shares on to issue sufficient shares on conversion. conversion. conversion. conversion.
Transfer between May move to Standard segment May move to Premium segment No "fast-track" procedure for NA listing categories without cancelling listing. without cancelling listing. moving from AIM to the Main Market so company will need to 75% shareholder approval No shareholder approval cancel its listing (see below) and required to transfer out of required. comply with same requirements premium listing. for a new listing. AIM Designated Market (fast AIM Designated Market (fast track) procedure for transfer to track) procedure for transfer to AIM Market provided shares AIM Market provided shares listed for at least 18 months listed for at least 18 months.
06 & Introduction
Main market – premium Main market – standard AIM Euronext Amsterdam listing listing
Cancellation of listing 75% shareholder approval No shareholder approval 75% shareholder approval Delisting possible (1) following a required. required. required. public offer in which bidder has
acquired 95% of the shares (2) if a shareholder, or shareholders group 95% and the minority shareholders are offered an exit arrangement or (3) the shares have been listed for at least 12 months on another regulated and sufficiently liquid market.
Tax benefits Payable Payable Exempt None Stamp duty n/a n/a Yes (subject to qualifying n/a EIS relief criteria) n/a n/a n/a VCT relief n/a n/a Yes (subject to qualifying n/a IHT relief Yes Yes criteria) ISA Yes n/a Yes (subject to qualifying n/a UK-REIT criteria) n/a Yes n/a
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