London Stock Exchange amends AIM Rules for Nominated Advisers under AIM Notice 52

LNB News 05/07/2018 51

Further to its consultation launched earlier this year in April (in AIM Notice 51), the London Stock Exchange (LSE) has published amended AIM Rules for Nominated Advisers (Nomad Rules). The Nomad Rules set out the eligibility requirements, ongoing obligations and certain disciplinary matters in relation to nominated advisers (Nomads). The revised rules will come into force on 30 July 2018.

The main changes proposed to the Nomad Rules by the LSE in AIM Notice 51 related to eligibility and continued eligibility of Nomad firms and clarifying the LSE’s supervisory powers (see London Stock Exchange consultation on changes to the AIM Rules for Nominated Advisers, LNB News 26/04/2018 76). The LSE is implementing the majority of the amendments as proposed.

The main rule changes being introduced are:

• an additional eligibility criteria for Nomads to provide evidence to the LSE about their resources and that they are able to comply with the standards of conduct the LSE expects from Nomad firms when performing their responsibilities (Rule 2). The LSE is not taking forward a proposed requirement in Rule 2 for Nomads to provide evidence that they have in place adequate risk management systems as this is already covered by Rule 23 (obligation to have proper procedures). Guidance on the new eligibility criteria will be set out in a revised NA1 (Nomad application form)

• a non-exhaustive list of matters that a Nomad firm must inform the LSE of, which may affect its operation, role or the performance of its Nomad services (new Rule 12). Minor changes are being made to the drafting originally proposed in AIM Notice 51

• specifying a range of supervisory actions the LSE can take in respect of a Nomad’s performance, including requiring a Nomad to undertake remedial action (eg the employment of additional staff) or impose restrictions or limitations on the services a Nomad can provide (eg where its experience and expertise is limited) (new Rule 27)

• including the power for the LSE to require remedial action and/or restrictions in relation to a Qualified Executive (QE) at a Nomad firm, where issues of competency or training in relation to the QE arise (new Rule 27(c))

• additional examples of when the LSE may place a Nomad firm under a moratorium, preventing it from acting as a Nomad to additional AIM companies (Rule 31)

• clarifying that the LSE has jurisdiction over Nomads that were once, but are no longer, approved in relation to breaches or suspected breaches of the Nomad Rules or the AIM Rules for Companies they committed whilst they were approved

Source: Press release: AIM Notice 52

Filed Under: News Analysis

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