Points of practice – tips on FCA and LSE completion processes
For those advisers responsible for handling the FCA’s and LSE’s completion processes relating to securities issuance, there are detailed and precise administrative processes to be navigated (and tripwires for the unwary!). In this article, we set out some of the key points of practice arising from our experiences.
The first point to note is that there is a separate protocol which must be followed with each body, which we summarise below.
The FCA’s process is conducted primarily via its Electronic Submission System (ESS) portal, with some separate communication by email also required. Depending on the circumstances, either one or two separate cases must be opened for each matter on the ESS.
Where a prospectus is required for an issue of shares, both (1) a transaction review file and (2) an issuer management file must be opened. Where a prospectus is not required, only an issuer management file need be opened.
Transaction review file
Where a prospectus is required, a transaction review file must be opened, and used to submit each proof of the prospectus and any supporting documents, such as competent person’s reports.
In order to reach completion, the prospectus must be submitted (i) in final clean form with marginal references, (ii) in final clean form without marginal references and (iii) as a redline against the preceding version.
In addition, final versions of any accompanying checklists, signed by an officer of the company, must be submitted via the ESS, noting that there is no requirement, according to the FCA website, to resubmit Prospectus Regulation Rules cross-reference lists after the initial submission.
The following ancillary items are also required in order to reach completion (which are available here), in each case submitted via the ESS unless otherwise stated:
- form A (an application for a prospectus to be approved by the FCA);
- publication form (noting where the prospectus will be published);
- no change confirmation (noting that there have been no changes to a previously submitted form A, publication form and any information incorporated by reference);
- payment form (noting payment of the FCA’s fee);
- sanctions letter noting that the issuer does not fall under article 5.1 or 5.2 of Council Regulation (EU) No 960/2014 of 8 September 2014;
- eligibility letter, which in the FCA’s own words is “an opportunity to put the transaction in context and to draw to [its] attention… the key issues”; and
- contact details confirmation form, which should be sent to PMMteam@fca.org.uk.
Issuer management file
The following documents must be uploaded to the issuer management file on the ESS:
- if a prospectus is required, a clean version of it without marginal references (i.e. the version which will be published) must be submitted;
- notice of approval of documents (which will have been sent by email by the readers on the transaction review file once the prospectus has been approved);
- copies of announcements relating to the placing and admission. The FCA will require a copy of the published announcement, rather than a draft announcement; and
- a letter confirming compliance with EU sanctions (specifically that the issuer does not fall under article 5.1 or 5.2 of Council Regulation (EU) No 960/2014 of 8 September 2014).
Separately, the following must be submitted by email to the FCA at firstname.lastname@example.org ahead of the admission hearing:
- confirmation that the placing agreement (if one has been used) has become unconditional in all respects;
- that all other conditions, save admission, have been met; and
- the home member state of the issuer for the purposes of the Transparency Directive.
The LSE process is conducted exclusively via email. There are two parallel email addresses used by the LSE: Admissions@lseg.com and AdmissionsInbox@lseg.com. For the avoidance of doubt, we recommend that all email correspondence with the LSE in relation to admissions of shares to trading are addressed to both of these email addresses.
An admission hearing must be booked with the LSE in order for admission of securities to take place.
The LSE requires the following documents ahead of the admission hearing:
- completed form 1 (available from the LSE website here);
- completion board minutes of the issuer relating to the issue of shares;
- copy of the notice of AGM or GM (if such a meeting is being held in relation to the relevant issue);
- confirmation that any shareholder resolutions relating to the issue have been passed; and
- copies of announcements relating to the placing and admission. The LSE will require a copy of the published announcement, rather than a draft announcement.
The completed form 1 is required to be submitted to the LSE by no later than 48 hours prior to the date of the admission hearing.
The remaining documents may be sent at any time prior to the admission hearing, but in order to ensure that the LSE has time to process the documents and to raise any questions they have in relation to them, it is advisable to, if possible, submit the other documents at least as early as the form 1.