On 30 August 2014, the Johannesburg Stock Exchange (JSE) announced amendments to the Listings Requirements (Requirements) that will come into effect on 30 September 2014.
Reasons for the general review
The JSE recognised that, since the last significant review of the Requirements, there have been significant developments in corporate governing structures and the quality of financial reporting as it relates to listed companies.Contributing factors are the Companies Act No.71 of 2008 (Act) and the application of the King Report on Corporate Governance (2009) (King III) and International Financial Reporting Standards (IFRS) by listed companies.
One of the aims of the general review was also to ensure that disclosure requirements be removed that (i) no longer add regulatory value or (ii) are now addressed through compliance with the Act or IFRS.
The amended Requirements also seek to impose stronger regulations on professional advisers who play a key role in ensuring the integrity of disclosures by listed companies (eg sponsors, designated advisers, auditors, independent experts, competent person etc). Instead of the JSE going through the disclosures itself, the JSE will be placing more reliance on these parties to check the dissemination of information to the market now that these roles are well established and regulated.
Process for implementation of the amendments to the Requirements
The JSE has also clarified the process for implementation of the amendments to the Requirements. Key points include:
- All transactions concluded before 30 September 2014 must be categorised and announced pursuant to the old provisions of the Requirements. Transactions concluded on or after 30 September 2014 will be categorised and announced in terms of the provisions of the amended Requirements.
- The disclosure requirements applicable in respect of the preparation of a circular for a transaction will be determined by the date of formal approval of the circular. In other words, if formal approval is provided before 30 September 2014, the disclosure requirements of the old Requirements will apply. However, if formal approval is provided on or after 30 September 2014, the amended disclosure requirements will apply.
- The amended conditions of listing in respect of Main Board issuers and ALTx issuers will apply in respect of a new listing if formal approval is provided on or after 30 September 2014.
Click here to read the JSE Guidance Letter.