Related provisions for PERG 8.14.38
21 - 40 of 199 items.
There is a general concern that the practice of companies issuing statements and giving briefings may involve a financial promotion. These arise sometimes as a result of requirements imposed by a listing authority or an exchange or market, PERG 8.4.14 G offers guidance on when such statements or briefings may amount to or involve an inducement to engage in investment activity. It indicates that whilst statements of fact alone will not be inducements, there may be circumstances
A 'relevant investment' in article 43 means:(1) shares or debentures or alternative debentures;3 and(2) warrants and certificates representing certain securities relating to (1) and issued by G or a person acting on behalf of or under arrangements made with C.Article 43 allows a company to communicate a financial promotion to its shareholders about rights issues or a cash offer by a third party for their shares. It also allows a company to communicate with its creditors about
Article 59 imposes certain conditions.(1) The financial promotion must be an inducement and not be an invitation or amount to advice to acquire or dispose of an investment.(2) The inducement must not relate to any investment other than shares or debentures or alternative debentures3 issued, or to be issued, by1 the company making the financial promotion (or a member of its group) or warrants relating to or certificates representing such shares or debentures or alternative debentures.3(3)
Article 67 exempts any financial promotion other than an unsolicited real time financial promotion which relates to shares, debentures, alternative debentures3, government and public securities, warrants or certificates representing certain securities which are permitted to be traded or dealt in on a relevant market. A relevant market for the purposes of article 67 is one which meets the criteria in Part I of, or is specified in or established under the rules of an exchange specified
Article 69 is somewhat1 similar to article 59 in the conditions it imposes (see PERG 8.21.12 G). There1 are two main differences between article 69 and article 59.1(1) Article 69 does not apply to unsolicited real time financial promotions.(2) The requirement in article 59 that the financial promotion be accompanied by accounts or a report is replaced in article 69. It is replaced by a requirement that shares or debentures or alternative debentures3 of the company or another body
A requirement common to the exemptions in articles 59, 67 and 69 is that the financial promotions must not relate to investments other than those issued, or to be issued,1 by the company or a member of its group. The FCA is aware that there is concern about comments made in company statements or briefings. This is that they may be held to be inducements to acquire or dispose of, or exercise rights conferred by, an investment issued by a third party. For example, traded options
This exemption disapplies the restriction in section 21 of the Act from non-real time financial promotions or solicited real time financial promotions which are made to a person who the communicator believes on reasonable grounds to be a certified high net worth individual and which relate to certain investments. These investments must be either:7(1) shares in or debentures or alternative debentures7 of an unlisted company; or(2) warrants,certificates representing certain securities,
To be a sophisticated investor for the purposes of article 50, the recipient of a financial promotion must have a current certificate from an authorised person stating that he has enough knowledge to be able to understand the risks associated with the description of investment to which the financial promotion relates. 13The FCA considers that a 'description of investment' relates to a category of investments with similar characteristics. Examples are given below.33(1) The shares
Article 52 concerns non-real time and solicited real time financial promotions about offers of shares or debentures or alternative debentures7 of a company. The offers must be made only to or be reasonably regarded as only directed at certain persons. These persons must belong to an identified group of persons who, when the financial promotion is made, might reasonably be regarded as having an existing and common interest with each other and the company.
The exemption in article 62 of the Financial Promotion Order applies to any financial promotioncommunicated by or on behalf of a body corporate, a partnership, an individual or a group of connected individuals. The financial promotion must relate to a transaction which is one to acquire or dispose of shares in a body corporate and either:(1) it is the case that:(a) the shares, in addition, where appropriate, to any shares already held by the buyer, amount to 50% or more of the
Where the nature of the parties test (see PERG 8.14.35G (1)(b)) is not met and the purpose for which the person who is the buyer holds or proposes to hold the voting shares is considered, it may still be the case that the objective of the transaction is the acquisition of day-to-day control. This may typically be because there are two or more parties involved as buyer and they do not collectively represent a group of connected individuals as defined. For example, this may happen
Several exemptions, including article 43 of the Financial Promotion Order (Members and creditors of certain bodies corporate), apply only in relation to relevant investments being shares or debentures or alternative debentures7 in the body corporate or a member of its group, or warrants or certificates representing certain securities relating to such shares or debentures or alternative debentures.7 In the FCA's view, an exchangeable debt security which is partly a debenture or
A credit union must not accept deposits except:(1) by way of subscription for its shares from persons who may lawfully be admitted to membership of the credit union under the Credit Unions Act 1979 or the Credit Union (Northern Ireland) Order 1985 (as appropriate) and the rules of the credit union; or(2) from persons too young to be members under any provision of the credit union’s rules or (for Northern Ireland credit unions) under article 15 of the Credit Unions (Northern Ireland)
Credit unions that provide CTFs should ensure that under their rules depositors under the age of 18 whose deposits are held within a CTF continue to be treated as juvenile depositors until the age of 18. This will provide for the fact that CTF account holders may not withdraw any money from the CTF until they reach the age of 18, in contrast with the position in relation to other deposits which become shares and may be withdrawn earlier.
1Where a mineral company applies for the admission of its equity shares to a premium listing and cannot comply with the minimum three-year period required in LR 6.2.1R(1) because it has been operating for a shorter period:(1) the mineral company must have published or filed historical financial information since the inception of its business; and (2) the following apply to the mineral company only with regard to the period for which it has published or filed historical financial
(1) 1This rule applies if the mineral company applies for the admission of its equity shares to premium listing and cannot comply with LR 6.6.1R (control of business) because the mineral company does not hold controlling interests in a majority (by value) of the properties, fields, mines or other assets in which it has invested.(2) The mineral company must demonstrate that it has a reasonable spread of direct interests in mineral resources and has rights to participate actively
A1sponsor must in relation to a sponsor service:11(1) referred to in 3LR 8.2.1R (1) to (4), LR 8.2.1R (11), LR 8.2.1A R and, where relevant LR 8.2.1R (5)3, 1provide assurance to the FCA when required that the responsibilities of the company with or applying for a premium listing of its securities8 under the listing rules have been met;33(1A) 3provide to the FCA any explanation or confirmation in such form and within such time limit as the FCA reasonably requires for the purposes
The1sponsor will be the main point of contact with the FCA for any matter referred to in LR 8.2.1 The FCA expects to discuss all issues relating to a transaction and any draft or final document directly with the sponsor. However, in appropriate circumstances, the FCA will communicate directly with the company with or applying for a premium listing of its securities8, or its advisers3.113
1If, in connection with the provision of a3sponsor service, a sponsor becomes aware that it, or a company with or applying for a premium listing of its securities8 is failing or has failed to comply with its obligations under3 the listing rules3, the3disclosure requirements7 or the transparency rules, the sponsor must promptly notify the FCA2.323
(1) This rule applies to the following schemes of a listed company incorporated in the United Kingdom and of any of its major subsidiary undertaking (even if that major subsidiary undertaking is incorporated or operates overseas):(a) an employees' share scheme if the scheme involves or may involve the issue of new shares or the transfer of treasury shares; and(b) a long-term incentive scheme in which one or more directors of the listed company is eligible to participate.(2) The
(1) This rule applies to the grant to a director or employee of a listed company or of any subsidiary undertaking of a listed company of an option to subscribe, warrant to subscribe or other similar right to subscribe for shares in the capital of the listed company or any of its subsidiary undertakings.(2) A listed company must not, without the prior approval by an ordinary resolution of the shareholders of the listed company in a general meeting, grant the option, warrant or
LR 9.4.4 R does not apply to the grant of an option to subscribe, warrant to subscribe or other similar right to subscribe for shares in the capital of a listed company or any of its subsidiary undertakings:(1) under an employees' share scheme if participation is offered on similar terms to all or substantially all employees of the listed company or any of its subsidiary undertakings whose employees are entitled to participate in the scheme; or(2) following a take-over or reconstruction,
1In this chapter:(1) references to an2 "issuer", in relation to shares admitted to trading on a regulated market, are to an issuer whose shares are admitted to trading on a regulated market11;2(2) references to a "non-UKissuer" are to an issuer whose shares are admitted to trading on a regulated market11other than:(a) a public company within the meaning of section 4(2)7of the Companies Act 200674; and434433477(b) a company which is otherwise incorporated in, and whose principal
A10person must notify the issuer of the percentage of its voting rights he holds as shareholder or holds or is deemed to hold 5through his direct or indirect holding of financial instruments10 falling within 2DTR 5.3.1R (1)10 (or a combination of such holdings) if the percentage of those voting rights2:2258(1) reaches, exceeds or falls below 3%, 4%, 5%, 6%, 7%, 8%, 9%, 10% and each 1% threshold thereafter up to 100% (or in the case of a non-UK issuer on the basis of thresholds
Voting rights attaching to the following shares are to be disregarded for the purposes of determining whether a person has a notification obligation in accordance with the thresholds in DTR 5.1.2 R:(1) (a) shares acquired; or10(b) shares underlying financial instruments within DTR 5.3.1R(1) to the extent that such financial instruments are acquired;10for the sole purpose of clearing and settlement within a settlement cycle not exceeding the period beginning with the transaction
(1) References to a market maker are to a market maker which:(a) (subject to (3) below) is authorised by the FCA or the PRA under the United Kingdom provisions which implemented MiFID11;(b) does not intervene in the management of the issuer concerned; and (c) does not exert any influence on the issuer to buy such shares or back the share price.[Note: articles 9(5) and 9(6) of the TD](2) A market maker relying upon the exemption for shares or financial instruments within DTR 5.3.1R(1)10
(1) The following are to be disregarded for the purposes of determining whether a person has a notification obligation in accordance with the thresholds in DTR 5.1.2 R except at the thresholds of 5% and 10% and above:(a) voting rights attaching to shares forming part of property belonging to another which that person lawfully manages under an agreement in, or evidenced in, writing;(b) voting rights attaching to shares which may be exercisable by a person in his capacity as the
Except where the purchases will
consist of individual transactions made in accordance with the terms of issue
of the relevant securities,
where1 a listed
company intends to purchase any of its securities convertible
into its equity shares2 with
a premium listing2 it must:1(1) ensure that no dealings in the
relevant securities are carried
out by or on behalf of the company or
any member of its group until
the proposal has either been notified to a RIS or
abandoned; and(2) notify
Any purchases, early redemptions or cancellations
of a company's own securities convertible
into equity shares with a premium listing,2 by or on behalf of the company or any other member of its group must be notified to a RIS when an aggregate of 10% of the initial
amount of the relevant class of securities has been purchased, redeemed
or cancelled, and for each 5% in aggregate of the initial amount of that class acquired thereafter.2
Where, within a period of 12 months,
a listed company purchases
warrants or options over its own equity shares which,
on exercise, convey the entitlement to equity
shares representing 15% or more of the company's existing
issued shares (excluding treasury shares), the company must
send to its shareholders a circular containing
the following information:(1) a statement of the directors' intentions regarding future purchases
of the company's warrants and
options;(2) the number and
A person is an indirect holder of shares for the purpose of the applicable definition of shareholder to the extent that he is entitled to acquire, to dispose of, or to exercise voting rights in any of the following cases or a combination of them:
Case |
|
(a) |
voting rights held by a third party with whom that person has concluded an agreement, which obliges them to adopt, by concerted exercise of the voting rights they hold, a lasting common policy towards the management of the issuer in question; |
(b) |
voting rights held by a third party under an agreement concluded with that person providing for the temporary transfer for consideration of the voting rights in question; |
(c) |
voting rights attaching to shares which are lodged as collateral with that person provided that person controls the voting rights and declares its intention of exercising them; |
(d) |
voting rights attaching to shares in which that person has the life interest; |
(e) |
voting rights which are held, or may be exercised within the meaning of points (a) to (d) or, in cases (f) and (h) by a person1 undertaking investment management, or by a management company, by an undertaking controlled by that person; 1 |
(f) |
voting rights attaching to shares deposited with that person which the person can exercise at its discretion in the absence of specific instructions from the shareholders; |
(g) |
voting rights held by a third party in his own name on behalf of that person; |
(h) |
voting rights which that person may exercise as a proxy where that person can exercise the voting rights at his discretion in the absence of specific instructions from the shareholders. |
[Note: article 10 of the TD]
Cases (a) to (h) in DTR 5.2.1 R identify situations where a person may be able to control the manner in which voting rights are exercised and where, (taking account of any aggregation with other holdings) a notification to the issuer may need to be made. In the FCA's view:(1) Case (e) produces the result that it is always necessary for the parent undertaking of a controlled undertaking to aggregate its holding with any holding of the controlled undertaking (subject to the exemptions
A person falling within Cases (a) to (h) is an indirect holder of shares for the purpose of the definition of shareholder. These indirect holdings have to be aggregated, but also separately identified in a notification to the issuer. Apart from those identified in the Cases (a) to (h), the FCA does not expect any other significant category "indirect shareholder" to be identified. Cases (a) to (h) are also relevant in determining whether a person is an indirect holder of financial
DTR 5.1.2 R and case (c) of DTR 5.2.1 R do not apply in respect of voting rights attaching to shares provided to or by the Bank of England3 in carrying out its functions as a monetary authority3, including shares provided to or by the Bank of England3 under a pledge or repurchase of similar agreement for liquidity granted for monetary policy purposes or within a payments system provided:(1) this shall apply only for a short period following the provision of the shares; and(2)
(1) A circular relating to a resolution proposing to give the company authority to purchase its own equity securities must also include:(a) if the authority sought is a general one, a statement of the directors' intentions about using the authority;(b) if known, the method by which the company intends to acquire its equity shares and the number to be acquired in that way;(c) a statement of whether the company intends to cancel the equity shares or hold them in treasury;(d) if
4In considering whether an explanation given in a circular satisfies the requirement in LR 13.7.1R (1)(g), the FCA would expect the following information to be included in the explanation:(1) the shareholdings of substantial shareholders in the listed company before and after the proposed transaction; and(2) the shareholdings of a holder of equity shares who may become a substantial shareholder in the listed company as a result of the proposed transaction.
(1) To be listed, securities must be freely transferable.
[Note: articles 46, 54 and 60 CARD](2) To be listed, shares must be fully paid and free from
all liens and from any restriction on the right of transfer (except any restriction
imposed for failure to comply with a notice under section 793 of the Companies Act 2006 (Notice
by company requiring information about interests in its shares)).11
(1) The expected aggregate market value
of all securities (excluding treasury shares and shares of a closed-ended investment fund or open-ended investment company7) to be listed must
be at least:(a) £30 million 7for shares; and(b) £200,000 for debt securities.(1A) 7The expected aggregate market value of shares of a closed-ended investment fund or open-ended investment company to be listed must be at least £700,000.(2) Paragraph (1) does not apply to
tap issues where the amount
12SUP 11 Annex 6G provides guidance on when one person's holding of shares or voting power must be aggregated with that of another person for the purpose of determining whether an acquisition or increase of control will take place as contemplated by section 181 or 182 of the Act such that notice must be given to the appropriate regulator17 in accordance with section 178 of the Act before making the acquisition or increase. This will be:17(1) where those persons are acting in concert,
The Treasury have made the following exemptions from the obligations under section 178 of the Act10:(1) controllers and potential controllers of non-directive friendly societiesare exempt from the obligation to notify a change in control (The Financial Services and Markets Act 2000 (Controllers) (Exemption) Order 2009 (SI 2009/77410));10(2) controllers and potential controllers of building societies are exempt from the obligation to notify a change in control unless the change
6The appropriate regulator17 recognises that firms acting as investment managers may have difficulties in complying with the prior notification requirements in sections 178 and 191D 10of the Act as a result of acquiring or disposing of listed shares in the course of that fund management activity. To ameliorate these difficulties, the appropriate regulator17 may accept pre-notification of proposed changes in control, made in accordance with SUP D, and may grant approval of such
6The appropriate regulator17 may treat as notice given in accordance with sections 178 and 191D17 of the Act a written notification from a firm which contains the following statements:171017(1) that the firm proposes to acquire and/or dispose of control, on one or more occasions, of any UK domestic firm whose shares or those of its ultimate parent undertaking are, at the time of the acquisition or disposal of control, listed, or which are traded or admitted to trading on a MTF
If BC comes within the definition of a collective investment scheme, the third element in determining whether it is an open-ended investment company is whether the 'investment condition' is satisfied. This condition is that, in relation to BC, a reasonable investor would, if he were to participate in the scheme:(1) expect that he would be able to realise his investment in the scheme, within a period appearing to him to be reasonable; his investment would be represented, at any
Section 236(3) of the Act states clearly that the investment condition must be met 'in relation to BC'. In the FCA's view, this means that the investment condition should not be applied rigidly in relation to specific events such as particular issues of shares or securities or in relation to particular points in time. The requirements of the investment condition must be satisfied in relation to the overall impression of the body corporate itself, having regard to all the circ
In the FCA's view, and within limits, the investment condition allows for the possibility that a body corporate that is an open-ended investment company may issue shares or securities with different characteristics. Some shares or securities may clearly satisfy the condition whereas others may not. The FCA considers that a reasonable investor contemplating investment in such a body corporate may still take the view, looking at the body corporate overall, that the investment condition
Certain matters are to be disregarded in determining whether the investment condition is satisfied. Section 236(4) of the Act states that, for these purposes, no account is to be taken of any actual or potential redemption or repurchase of shares or securities under:(1) Chapters 3 to 71 of Part 181 of the Companies Act 2006;1or1(2) [deleted]11(3) [deleted]2(4) provisions in force in a country or territory 2 which the Treasury has, by order, designated as corresponding provisions
Shares are defined in the Regulated Activities Order as shares or stock in a wide range of entities; that is, any body corporate wherever incorporated and unincorporated bodies formed under the law of a country other than the United Kingdom. They include deferred shares issued by building societies as well as transferable shares in industrial and provident societies, credit unions and equivalent EEA bodies. These shares are transferable and negotiable in a way similar to other
The following are excluded from the specified investment category of shares. Shares or stock in all open-ended investment companies are excluded from being treated in this particular category (but see PERG 2.6.17 G). Exclusions from this category also apply to shares or stock in the share capital of certain mutuals or in equivalent EEA bodies. This takes out building society or credit union accounts and non-transferable shares in industrial and provident societies. These may nevertheless
The category of specified investment of instruments giving entitlements to investments (referred to in the Handbook as warrants) covers warrants and other instruments which confer an entitlement to subscribe for shares, alternative debentures, 6debentures and government and public securities. This is one of several categories of specified investments that are expressed in terms of the rights they confer in relation to other categories of specified investment. The rights conferred
The specified investment category of units in a collective investment scheme includes units in a unit trust scheme or authorised contractual scheme10, shares in open-ended investment companies and rights in respect of most limited partnerships and all limited partnership schemes10. Shares in or securities of an open-ended investment company are treated differently from shares in other companies. They are excluded from the specified investment category of shares. This does not
(1) 16A binary or other fixed outcomes bet is also treated as contract for differences. This is defined as something that meets the following conditions:(a) it is a derivative contract of a binary or other fixed outcomes nature; (b) it is not covered by PERG 2.6.23G(1) or (2); (c) it is settled in cash; (d) it is a financial instrument that falls within paragraphs 4, 5, 6, 7 or 10 of Part 1 of Schedule 2 to the Regulated Activities Order18 (see PERG 13, Q31A to Q34 for guidance
(1) Taking account of the remuneration principles proportionality rule, the appropriate regulator8 does not generally consider it necessary for a firm to apply the rules referred to in (2) where, in relation to an individual ("X"), both the following conditions are satisfied:8(a) Condition 1 is that Xs variable remuneration is no more than 33% of total remuneration; and(b) Condition 2 is that Xs total remuneration is no more than 500,000.(2) The rules referred to in (1) are those
A firm must ensure that any approval by the its shareholders or owners or members for the purposes of SYSC 19A.3.44AR is carried out in accordance with the following procedure:535(1) the firm must give reasonable notice to all its shareholders or owners or members of its intention to seek approval of the proposed higher ratio;55(2) the firm must make a detailed recommendation to all its shareholders or owners or members that includes:(a) the reasons for, and the scope of, the
(1) A firm must ensure that a substantial portion, which is at least 50%, of any variable remuneration consists of an appropriate balance of:(a) shares or equivalent ownership interests, subject to the legal structure of the firm concerned, or share-linked instruments or equivalent non-cash instruments in the case of a non-listed firm; and(b) 3where possible other instruments which are eligible as Additional Tier 1 instruments or are eligible as Tier 2 instruments or other instruments
(1) Deferred remuneration paid in:6(a) shares or share-linked instruments should be made under a scheme which meets appropriate criteria, including risk adjustment of the performance measure used to determine the initial allocation of shares; and6(b) cash should also be subject to performance criteria.6(2) The FCA6 would generally expect a firm to have a firm-wide policy (and group-wide policy, where appropriate) on deferral. The proportion deferred should generally rise with
(1) A firm should reduce unvested deferred variable remuneration when, as a minimum:(a) there is reasonable evidence of employee misbehaviour or material error; or(b) the firm or the relevant business unit suffers a material downturn in its financial performance; or(c) the firm or the relevant business unit suffers a material failure of risk management.(2) For performance adjustment purposes, awards of deferred variable remuneration made in shares or other non-cash instruments
A firm must ensure that any approval by its shareholders or owners or members, for the purposes of SYSC 19D.3.49R, is carried out in accordance with the following procedure: (1) the firm must give reasonable notice to all its shareholders or owners or members of its intention to seek approval of the proposed higher ratio;(2) the firm must make a detailed recommendation to all its shareholders or owners or members that includes:(a) the reasons for, and the scope of, the approval
(1) A firm must ensure that a substantial portion, which is at least 50%, of any variable remuneration consists of an appropriate balance of:(a) subject to the legal structure of the firm concerned: shares or equivalent ownership interests; or share-linked instruments or equivalent non-cash instruments2; and (b) where possible, other instruments that in each case adequately reflect the credit quality of the firm as a going concern and are appropriate for use as variable remuneration,
(1) Deferred remuneration paid in:(a) shares or share-linked instruments should be made under a scheme which meets appropriate criteria, including risk adjustment of the performance measure used to determine the initial allocation of shares;(b) cash should also be subject to performance criteria.(2) The FCA would generally expect a firm to have a firm-wide policy (and group-wide policy, where appropriate) on deferral. The proportion deferred should generally rise with the ratio
(1) A firm should reduce unvested deferred variable remuneration when, as a minimum:(a) there is reasonable evidence of employee misbehaviour or material error; or(b) the firm or the relevant business unit suffers a material downturn in its financial performance; or(c) the firm or the relevant business unit suffers a material failure of risk management.(2) For performance adjustment purposes, awards of deferred variable remuneration made in shares or other non-cash instruments
If by virtue of its holding treasury shares, a listed
company is allotted shares as
part of a capitalisation issue, the company must
notify a RIS as soon as possible
and in any event by no later than 7:30 a.m. on the business
day following the calendar day on
which allotment occurred of the following information:(1) the date of the allotment;(2) the number of shares allotted;(3) a statement as to what number of shares allotted have been cancelled and
what number is being held
Any sale for cash, transfer for the purposes
of or pursuant to an employees' share scheme or
cancellation of treasury shares that represents over 0.5% of the listed company'sshare capital 2 must be notified to a RIS as
soon as possible and in any event by no later than 7:30 a.m. on the business day following the calendar day on
which the sale, transfer or cancellation occurred. The notification must include:2(1) the date of the sale, transfer
or cancellation;(2) the number of
1Factors that may indicate that an applicant does not satisfy the requirement in LR 6.6.1R include where the applicant’s business consists principally of holding shares in entities that it does not control, including entities where the applicant:(1) owns a minority holding of shares; or(2) is only able to exercise negative control; or(3) exercises control subject to contractual arrangements which could be altered without the applicant’s agreement or could result in a temporary