LSE amends AIM Rules for Nominated Advisers
The London Stock Exchange (the “Exchange”) has published AIM Notice 52, announcing changes to the AIM Rules for Nominated Advisers (or “nomads”). The changes broadly track the proposals previously announced by the Exchange in AIM Notice 51, but with two changes. The main points to note are:
- Firms wishing to become or continue as a nomad will need to satisfy new, additional eligibility criteria. These include demonstrating “appropriate financial and non-financial resources”. However, the Exchange has not adopted its original proposal to require new applicants to show they have “adequate risk management systems”, as it believes this is already covered by the requirement to have “proper procedures” in place. The Exchange does not intend to review existing nomads against the new criteria, unless an issue is identified as part of the Exchange’s supervisory work or relevant information comes to its attention bringing a nomad’s ability to comply with the continuing eligibility criteria into question.
- The Exchange would be able to refuse approval to a prospective nomad if it feels the applicant (or any of its shareholders or officers) might be detrimental to the reputation or integrity of AIM. This could be the case even if the applicant satisfies all of the other eligibility criteria.
- The rules would clarify which events a nomad is required to report to the Exchange. These would now include the commencement of any investigation or disciplinary proceedings relating to the nomad’s conduct. However, the Exchange has not adopted its original proposal to extend this to investigations into the conduct of the nomad’s employees.
- A new Rule 27 will allow the Exchange to take steps to address poor nomad performance, including requiring remedial action, imposing restrictions or limitations on nomad services, and suspending individual employees’ approvals.
The amended Rules come into effect on 30 July 2018.