The London Stock Exchange has published two editions of Inside AIM on (i) the staffing of Nominated Advisers and (ii) the AIM Designated Market Route.
Staffing of Nominated Advisers (nomads)
This edition of Inside AIM sets out answers to some of the frequently asked questions in respect of staffing, a number of which related to current market conditions and the recent consolidation of nomads. In particular:
- Relevant Transactions - the London Stock Exchange (LSE) acknowledge that as market conditions can have an impact on the number of Relevant Transactions undertaken, they will use their discretion to consider alternative transactions. In doing so, they will look for evidence that firms have undertaken equivalent work to the Admission Responsibilities set out in Schedule Three and that the firm has retained overall management and responsibility for the transaction. Examples of transactions that the LSE may consider accepting include schemes of arrangement and aborted transactions which fail to complete due to market conditions.
- QE Applications – these are considered in the context of the firm’s overall staffing and supervision and is not an individual qualification. QE status is therefore not automatically transferrable if a QE changes firm; a number of factors will be taken into account when considering QE applications, for example, evidence that the applicant has a sound understanding of AIM and the UK corporate finance market.
- Ensuring coverage for nomad obligations – Nomad Rule 4 refers to a ‘full-time employee’. This requires QEs to give full attention to the role but does not exclude individual working arrangements such as part-time or other forms of flexible working. In such situations, firms need to ensure that alternative arrangements do not impact on the performance of their obligations. For example, by ensuring that clients have access to more than one QE with the requisite knowledge of its business.
- Compliance – firms needs to consider what a ‘good’ compliance function looks like. A firm should consider a compliance function that has sufficient resources, is knowledgeable of its obligations set out in the Nomad Rules, understands and appreciates relevant risks, has a mandate from management and the experience to provide independent challenge.
- Maintenance of knowledge and experience – a nomad is advised to engage the experience and expertise within their team when conducting reviews of their obligations to the LSE and their knowledge of the AIM Rules rather than commissioning an external review or training.
AIM Designated Market Route
This revised publication updates the list of AIM Designated Markets by introducing a new category extending the AIM Designated Market Route to EU Regulated Markets and SME Growth Markets.
To use this route a company listed on an EU Regulated Market or SME Growth Market must (i) have a market capitalisation of at least £20m upon admission and (ii) have its admission documentation on its home market and all disclosure required under the Market Abuse Regulation published in English.
The AIM Designated Market Route