On 11 April 2014, the London Stock Exchange (LSE) put out Market Notice N03/14 concerning stamp duty (SD) and stamp duty reserve tax (SDRT) in relation to securities admitted to AIM.
The Market Notice states that from 28 April 2014, SD and SDRT will no longer be chargeable on transactions in securities admitted to trading on a 'Recognised Growth Market'.
The Recognised Growth Market is a new concept which has been introduced solely for the purposes of the exemption. The full list of Recognised Growth Markets has not yet been published but the LSE has applied to HMRC for AIM to be classified as such.
To allow Euroclear to apply the stamp duty exemption to securities on AIM with effect from 28 April 2014, issuers on AIM must certify to Euroclear that:
their securities are admitted to trading on AIM, and
that those securities are not also listed on a Recognised Stock Exchange (as listed here and here).
Issuers are also required to give no less than two business days' notice in advance to Euroclear should their securities cease to be eligible for the exemption at any point.
The LSE requires issuers to submit the exemption form to Euroclear by no later than Wednesday 23 April 2014.
If the form is not received by that date, SD and SDRT will continue to be levied on transactions in securities, even if technically the issuer could take advantage of the exemption.
We understand that companies listed on the ISDX stock exchange will not have to undertake this self-certification process and will automatically be treated as exempt from 28 April 2014, although this is yet to be officially confirmed.
This article was written by Paul Arathoon.
For more information please contact Paul on +44 (0)20 7427 6515 or firstname.lastname@example.org.