PRM 2 Drawing up the prospectus

A prospectus must contain the information required by: 

(1) regulation 23 of the Public Offers and Admissions to Trading Regulations (General requirements to be met by a prospectus or MTF admission prospectus); and

(2) rules imposed by this sourcebook.

The FCA will not approve a prospectus unless it is satisfied that PRM 2.1.1R has been complied with.

Provisions regarding the omission of information that would otherwise be required by PRM 2.1.1R can be found in PRM 6.1.1UK.

Provisions detailing omission of other information required by the other rules in PRM by way of waiver or modification may be found in PRM 6.1.2R.

The content of a prospectus must be written in English and presented in an easily analysable, concise and comprehensible form, taking into account: 

(1) the nature of the issuer;

(2) the type of transferable securities;

(3) the circumstances of the issuer; and

(4) whether transferable securities issued by the issuer have already been admitted to trading.

[Note: regulation 23(2) of the Public Offers and Admissions to Trading Regulations]

The content of the component or separate parts of a prospectus referred to PRM 2.2.2R must be consistent with each other. 

A prospectus may be drawn up as a single document or as separate documents. 

Subject to PRM 2.3, a prospectus composed of separate documents must be divided into: 

(1) a registration document

(2) a securities note; and

(3) where applicable, a summary.

Rules regarding the content of a registration document are set out in PRM 4.2 .

Rules regarding the content of a securities note are set out in PRM 4.3. 

Rules regarding the content of a summary are set out in PRM 2.5 . 

Rules regarding a universal registration document are set out in PRM 2.6 .

A prospectus composed of separate documents will constitute a valid prospectus only once all of its component parts have been approved by the FCA. 

Where a registration document has already been approved by the FCA, an issuer must draw up the securities note and, where applicable, the summary, prior to the transferable securities being admitted to trading. The securities note and, where applicable, the summary will require separate approval by the FCA.

Once a registration document has been approved by the FCA, the registration document must be made available to the public without undue delay and in accordance with the arrangements set out in PRM 9.5 (Publication of the prospectus).

If, after the registration document has been approved by the FCA, a significant new factor, material mistake or material inaccuracy arises that: 

(1) relates to the information included in the registration document; and

(2) is capable of affecting the assessment of the transferable securities,

a supplement to the registration document must be submitted for approval in accordance with the rules at PRM 10 (Supplementary prospectus).

Where a summary is required, the supplement to the registration document referred to in PRM 2.2.10R must be submitted for approval no later than concurrently with the approval of the securities note and the summary.

Where the circumstances in PRM 2.2.10R apply, the right to withdraw acceptances in accordance with PRM 10.1.14R will not be available.

An issuer that has already had a universal registration document approved by the FCA, or that has filed a universal registration document without prior approval pursuant to PRM 2.6.3R, must draw up the securities note and, where applicable, the summary prior to the transferable securities being admitted to trading.

Where the universal registration document has already been approved by the FCA, the securities note, the summary and all amendments to the universal registration document filed since the approval of the universal registration document must be submitted for separate approval.

Where an issuer has filed a universal registration document without prior approval where applicable, the entire documentation, including amendments to the universal registration document, must be approved by the FCA, notwithstanding the fact that those documents remain separate.

The universal registration document, amended in accordance with PRM 2.6.8R(1) or PRM 2.6.12R, accompanied by the securities note and, where applicable, the summary will be a prospectus, once approved by the FCA.

A base prospectus may be used by the issuer or person requesting the admission to trading, where the transferable securities in issue are non-equity securities, including warrants in any form.

A base prospectus must include the following information:

(1) a template, entitled ‘form of the final terms’, to be filled out for each individual issue and indicating the available options with regard to the information to be determined in the final terms of the issue; and

(2) the address of the website where the final terms will be published.

A base prospectus may be drawn up as a single document or as separate documents.

Where a base prospectus contains options with regard to the information required by the relevant securities note, the final terms will determine which of the options is applicable to the individual issue by referring to the relevant sections of the base prospectus, or by replicating such information.

Where the issuer or the person requesting admission to trading has filed a registration document for non-equity securities, or a universal registration document and chooses to draw up a base prospectus, the base prospectus must consist of the following:

(1) the information contained in the registration document, or in the universal registration document; and

(2) the information which would otherwise be contained in the relevant securities note, with the exception of the final terms where the final terms are not included in the base prospectus.

The specific information on each of the different transferable securities included in a base prospectus must be clearly segregated.

The final terms must be presented in the form of a separate document or otherwise included in the base prospectus or any supplementary prospectus. The final terms must be prepared in an easily analysable and comprehensible form.

The final terms must only contain information that relates to the securities note and must not be used to supplement the base prospectus. PRM 2.4.1R(1)(b) will apply in such cases.

Following the approval of a base prospectus, any final terms made available to the public in accordance with PRM 9.5.3R to PRM 9.5.8R, PRM 9.5.10R, PRM 9.5.11R and PRM 9.5.15R will form part of the content of the base prospectus.

The information contained in the base prospectus must, where necessary, be supplemented in accordance with PRM 10 (Supplementary prospectus).

A PRM offer may continue after the expiration of the base prospectus under which it was commenced provided the conditions at (1) to (3) are met:

(1) a succeeding base prospectus is approved and published no later than the last day of validity of the previous base prospectus;

(2) the final terms of such an offer must contain a prominent warning on the first page, indicating the last day of validity of the previous base prospectus and where the succeeding base prospectus will be published; and

(3) the succeeding base prospectus must include or incorporate by reference the form of the final terms from the initial base prospectus and refer to the final terms that are relevant for the continuing offer.

With respect to an offer, a right of withdrawal pursuant to PRM 10 will also apply to investors who have agreed to purchase or subscribe for the transferable securities during the validity period of the previous base prospectus, unless the transferable securities have already been delivered to them.

Detailed content and format requirements for a base prospectus are set out in PRM App 1 Annex 3 (Base prospectus). 

(1) Where the final offer price and/or amount of transferable securities (whether expressed in number of securities or as an aggregate nominal amount) to be admitted to trading cannot be included in a prospectus relating to an offer that is not made reliant on one or more of the exemptions set out in paragraphs (1) to (5) and (12) of Schedule 1 to the Public Offers and Admissions to Trading Regulations:

     (a) the acceptances of the purchase or subscription of transferable securities may be withdrawn for not less than 2 working days after the final offer price and/or amount of transferable securities has been filed; or

     (b) the following must be disclosed in the prospectus:

          (i) the maximum price and/or the maximum amount of transferable securities, as far as they are available; or

          (ii) the valuation methods and criteria, and/or conditions, in accordance with which the final offer price is to be determined and an explanation of any valuation methods used.

(2) The final offer price and amount of transferable securities must be filed with the FCA and made available to the public in accordance with the arrangements set out in PRM 9.

In PRM 2.3.1R and PRM 2.4.1R transferable securities means non-excluded transferable securities.

(1) Subject to (2), a summary is required for every prospectus, whether drawn up as a single document or separate documents.

(2) A summary is not required where the prospectus relates to the admission to trading of non-equity securities.

A summary should read as an introduction to the prospectus. When read together with the other parts of a prospectus, whether drawn up as a single document or as component parts, it should aid investors in considering whether to invest in the transferable securities by providing key information on the nature and risks of:

(1) the issuer;

(2) the guarantor; and

(3) the transferable securities that are being admitted to trading.

A summary must be:

(1) accurate, fair, clear and not misleading; and

(2) consistent with the other parts of the prospectus.

The summary may contain cross-references to other parts of the prospectus but cannot incorporate information by reference.

The detailed format and content requirements for a summary are available at PRM App 1 Annex 2 (Prospectus summary).

Any issuer whose transferable securities are admitted to trading may draw up a registration document in the form of a universal registration document describing the company’s organisation, business, financial position, earnings and prospects, governance and shareholding structure.

Subject to PRM 2.6.3R , an issuer who chooses to draw up a universal registration document must submit it for approval in accordance with PRM 9 to the FCA for each individual financial year they wish to use it.

If an issuer has had a universal registration document approved by the FCA for 2 consecutive financial years, subsequent universal registration documents prepared in the following consecutive years may be filed with the FCA without prior approval.

If an issuer filing without prior approval in accordance with PRM 2.6.3R misses a financial year of filing a universal registration document, the benefit of filing without approval falls away. All subsequent universal registration documents must be submitted to the FCA for approval once more according to PRM 2.6.2R, until the issuer is once more eligible under PRM 2.6.3R.

The issuer must indicate in its application to the FCA whether the universal registration document is submitted for approval or is eligible to be filed without prior approval in accordance with PRM 2.6.3R .

Once approved or filed without prior approval, the universal registration document, as well as any of the amendments, must be made available to the public without undue delay, in accordance with the arrangements in PRM 9 .

Information may be incorporated by reference into a universal registration document under the conditions set out in PRM 5 (Incorporation by reference and use of hyperlinks).

(1) Following approval or filing of the universal registration document, the issuer may at any time update the information by filing an amendment with the FCA. The filing of the amendment with the FCA does not require prior FCA approval. 

(2) This rule does not apply if a universal registration document is in use as a component part of a prospectus and the rules in PRM 10 (Supplementary prospectus) will apply.

The FCA may choose to review the content of any universal registration document which has been filed without prior approval, at any time, including the content of any amendments.

In its review, the FCA will scrutinise the completeness, consistency and comprehensibility of the information given in the universal registration document, including the information in any amendments.

Where the FCA, in the course of its review, finds that the universal registration document does not meet the standards of completeness, comprehensibility and consistency, or that amendments or supplementary information are needed, it will notify it to the issuer. 

(1) As a result of its review, the FCA may request an amendment, or supplementary information to be added, to the universal registration document. The issuer must comply with the request and ensure that the relevant amendment or supplementary information requested is reflected in the next universal registration document filed for the following financial year unless either (2) or (3) applies.

(2) Where the issuer is a frequent issuer by reference to the rules in PRM 2.6.2R and PRM 2.6.3R and wishes to use the universal registration document as a component part of a prospectus to be submitted for approval, the issuer must make the amendment to the universal registration document to be filed no later than with the submission of the relevant component parts of the prospectus for approval, in accordance with PRM 9.2.7R and PRM 9.3.8R.

(3) Where the FCA notifies the issuer that its request for amendment or supplementary information concerns a material omission, material mistake or material inaccuracy which is likely to mislead the public with regard to facts and circumstances essential for an informed assessment of the issuer, (2) is not an available option. In those circumstances, the issuer must file an amendment to the universal registration document without undue delay.

A consolidated version of the amended universal registration document:

(1) must be prepared by the issuer upon request by the FCA, where a consolidated version is necessary to ensure comprehensibility of the information provided in that document; or

(2) may be prepared voluntarily by the issuer in an annex to the amendment.

The rule at PRM 2.6.12R does not apply to a universal registration document that is in use as a component part of a prospectus.

The rules applicable to supplements or amendments to a universal registration document that is to be used as a component part of a prospectus are set out in PRM 10 (Supplementary prospectus).

An issuer fulfilling the conditions set out in PRM 2.6.2R or PRM 2.6.3R will be given the status of a frequent issuer and will benefit from a faster approval process in accordance with PRM 9.3.7G and PRM 9.3.8R, provided that:

(1) upon the filing or submission for approval of each universal registration document, the issuer provides written confirmation to the FCA that, to the best of its knowledge, all regulated information that it was required to disclose under the transparency rules, if applicable, and under the Market Abuse Regulation has been filed and published in accordance with those requirements over the last 18 months or over the period since the obligation to disclose regulated information commenced, whichever is the shorter; and

(2) where the FCA undertakes a review of the kind referred to in PRM 2.6.9G and finds that the document does not meet the standards required, the issuer must amend its universal registration document in accordance with PRM 2.6.12R.

Where any of the conditions in PRM 2.6.16R are not fulfilled by the issuer, the status of frequent issuer shall be lost.

Where the universal registration document filed with or approved by the FCA:

(1) is made public within 4 months after the end of the financial year; and

(2) contains the information required to be disclosed in the annual financial report referred to in DTR 4.1,

the issuer will be deemed to have fulfilled its obligation to publish the annual financial report required under DTR 4.1.

Where the universal registration document, or an amendment thereto, is filed or approved by the FCA and:

(1) is made public within 3 months after the end of the first 6 months of the financial year; and

(2) contains the information required to be disclosed in the half-yearly financial report referred to in DTR 4.2,

the issuer will be deemed to have fulfilled its obligation to publish the half-yearly financial report required under DTR 4.2.

In the cases referred to in PRM 2.6.18R and PRM 2.6.19R, the issuer must:

(1) include in the universal registration document a cross-reference list identifying where each item required in the annual and half-yearly financial reports can be found in the universal registration document;

(2) file the universal registration document in accordance with DTR 6.2.2R and DTR 6.2.10R; and

(3) include in the universal registration document a responsibility statement using the terms required under DTR 4.1.12R and DTR 4.2.10R.