TISE listing rules changes | Deloitte UK has been saved
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All entities require funds to operate their businesses and with the introduction of the new listing rules, the listing process is expected to be smoother and encourage more businesses to use TISE to raise funds either through debt or equity.
In July 2021, The International Stock Exchange Authority Limited (TISEA) issued the updated listing rules of debt and equity instruments on The International Stock Exchange (TISE) with an effective application date of 2 August 2021. The rules were issued to increase the competitive position of TISE, to assist market participants in easily identifying the relevant content and facilitate the listing requirements.
We are very positive about the introductions of these changes and look forward to more activity in what is a great platform for promoting business activity in the Islands.
The new rules have a subset for the debt instruments which includes the establishment of a dedicated Qualified Investor Bond Market (“QIBM”). Under QIBM, the issuer of bonds is only required to provide financial information for the last two years, instead of three years as per the previous rules.
Furthermore, the principal amount threshold of bonds listing has been reduced from £1 million on an overall listing to £200k in a single listing. In addition, a new set of rules was introduced in relation to the derivative bonds listing together with a bespoke regime, in respect of the listing of sovereign and other public bonds, which ultimately aims to facilitate the listing process of the instruments.
On the other hand, the admin work in listing bonds reduced under the QIBM due to the introduction of a consolidated TISE 1 Form, as well as the reduction of the final application documents needed for listing submission. Lastly, the TISE passport service concept was introduced within the QIBM which is a fast-track listing service available for the approved bond programmes by a national competent authority within the EEA or UK. This new concept complements the existing approved programme service for bonds that are not submitted under the new passport service.
The key changes for the equity instruments rules are in relation to the introduction of the Special Purpose Acquisition Companies (“SPACs”) listing to align with the trends of other developing markets including the US and UK. These changes are expected to attract SPACs that have a potential sophisticated and institutional investor base.
The changes include the ability to have dual share class structures in addition to founder shares, if applicable, to attract issuers of such structures to use TISE. The other key changes are related to acquisitions transactions as issuers are no longer required to obtain prior shareholder approval for the completion of a qualifying acquisition - but issuers must give shareholders the option to redeem or acquire their shares using a pre-determined price per share. Furthermore, qualifying acquisitions must be announced to the market within three business days, with no further requirements to suspend the dealing on the underlying securities upon the publication of the announcement.
In addition to the above, a TISE Guarantee of 3+1 review timeframe was introduced. This commits the TISE to conduct an initial review of listing application within three business days of the first submission and within one business day of subsequent submissions, which will shorten the listing process when compared to the previous rules.
Who are we?
Deloitte’s Debt Fund Services team spans audit but also includes advisory and tax experts with a debt focus in the Channel Islands, Isle of Man, Gibraltar and Deloitte’s NSE network.
The award-winning team has developed a level of competency, experience and expertise which is unique in the financial services market, and our client experience and technical knowledge of all debt asset types means we can deliver an expert and insightful audit.
Deloitte’s market-leading reputation has developed over the past 10 years and is grounded in marquee debt sector clients including LSE and TISE listed debt funds.
Deloitte is the winner of the 2019, 2020 and 2021 Alt Credit European Awards for best Audit Service.
Belal is a Senior Manager in our Audit and Assurance practice based in Guernsey. He has over 12 years’ audit experience in financial services and has worked on a range of listed and private fund clients, listed banks, listed insurance companies and brokerage firms. Belal is a member of the US board of accountancy and a member of the CFA institute and GARP for more than nine years. He is a US Certified Public Accountant, Chartered Financial Analyst and Certified Financial Risk Manager. Belal is one of the leaders of the Debt Fund Services team of Channel Islands, Isle of Man and Gibraltar. He is also one of the leaders of the central Financial Instruments Specialists team, part of the Centre of Credit Excellence team and the Professional Standards Review team.