LR 21.8 Continuing obligations: Certificates representing shares

Compliance with LR 9 (Continuing obligations)

LR 21.8.1R

1A listed company must comply with LR 9 (Continuing obligations) except:

  1. (1)

    LR 9.2.1R to LR 9.2.2R;

  2. (2)

    LR 9.2.5G to LR 9.2.6BR;

  3. (3)

    LR 9.2.15R to LR 9.2.15AG;

  4. (4)

    LR 9.2.21R to LR 9.2.22G; and

  5. (5)

    LR 9.2.26G; and

subject to the modifications and additional requirements set out in LR 21.8.2R to LR 21.8.12R.

LR 21.8.2R

1For the purposes of LR 21.8.1R, references to the listed company or the issuer must be read as references to the issuer of the equity shares which the certificates represent in LR 9.

LR 21.8.2AR

1For the purposes of LR 21.8.1R, in LR 9.2.23R the reference to LR 9.2.21R should be read as a reference to LR 21.8.22R.

LR 21.8.3G

1For the purposes of LR 21.8.1R, in LR 9.2.2AAG factors that may indicate that a listed company does not satisfy LR 9.2.2AR also include situations where a listed company has granted or may be required to grant security over its business in connection with the funding of a sovereign controlling shareholder.

LR 21.8.4R

1For the purposes of LR 21.8.1R, references to controlling shareholder must be read as excluding a sovereign controlling shareholder in, or for the purposes of, the following:

  1. (1)

    LR 9.2.2ABR and LR 9.2.2ACG;

  2. (2)

    LR 9.2.2ADR(1);

  3. (3)

    LR 9.2.2BR;

  4. (4)

    LR 9.2.2CR;

  5. (5)

    LR 9.2.2GR and LR 9.2.2HG;

  6. (6)

    LR 9.8.4 R(11); and

  7. (7)

    LR 9.8.4R(14).

LR 21.8.5G

1For the purposes of obtaining the shareholder approvals required by:

  1. (1)

    LR 9.2.2ER;

  2. (2)

    LR 9.2.2FR;

  3. (3)

    LR 9.4.1R(2);

  4. (4)

    LR 9.4.4R(2); and

  5. (5)

    LR 9.5.10R(3)(a),

a listed company is required under LR 21.8.13R to ensure that the holders of its certificates representing shares are able to exercise the votes attaching to the equity shares which the certificates represent on any shareholder vote.

LR 21.8.6G

1For the purposes of LR 9.3.11R the listed company is required under LR 21.8.13R to ensure that, where the offer is made to holders of the class of equity shares which the certificates represent, the holders of its certificates representing shares have an equal opportunity to participate in the offer.

LR 21.8.7R

1For the purposes of LR 21.8.1R, LR 9.5 is modified as follows:

  1. (1)

    in LR 9.5.1R(4) the equity securities which are the subject of the rights issue must be of the same class as the equity shares which are represented by the listed certificates representing shares;

  2. (2)

    LR 9.5.3G does not apply;

  3. (3)

    in LR 9.5.10R(1):

    1. (a)

      the reference to a class already listed must be read as a reference to a class of equity shares which the listed certificates represent; and

    2. (b)

      for the purposes of LR 9.5.10R, if the equity shares are not listed, then the middle market price of those equity shares shall be determined by reference to the middle market price of the listed certificates representing shares; and

  4. (4)

    a listed company must comply with the requirements in LR 9.5.15R and LR 9.5.16R so far as relevant to certificates representing shares.

LR 21.8.8G

1For the purposes of LR 21.8.1R, in LR 9.5 the listed company is required under LR 21.8.13R to ensure that in relation to:

  1. (1)

    any rights issue; or

  2. (2)

    any open offer where the offer relates to the class of equity shares which the certificates represent,

the holders of its certificates representing shares have an equal opportunity to participate in the rights issue or open offer.

LR 21.8.9R

1In addition to complying with LR 9.6.2R, a listed company must also forward to the FCA, for publication through the document viewing facility, two copies of all resolutions passed by the holders of the listed certificates representing shares. It must also comply with the notification requirements set out in LR 9.6.3R in relation to such resolutions.

LR 21.8.10R

1For the purposes of LR 21.8.1R:

  1. (1)

    in LR 9.6.4R(3) the reference to listed shares must be read as a reference to equity shares of the class which the certificates represent; and

  2. (2)

    in LR 9.8.4CR the reference to LR 9.8.4R must be read as a reference to LR 9.8.4R as modified by LR 21.8.4R.

LR 21.8.11R

1In addition to complying with LR 9.6.18R, a listed company must also notify a RIS as soon as possible after a meeting of the holders of the listed certificates representing shares of all resolutions passed by the holders.

LR 21.8.12R

1In addition to complying with LR 9.7A.2R, a listed company must comply with the notification requirements in LR 9.7A.2R in respect of the equity shares which the certificates represent.

Additional requirements: exercise of rights attaching to the equity shares which the certificates represent

LR 21.8.13R
  1. (1)

    1The rights attaching to the equity shares which the certificates represent must at all times be capable of being exercised by the holders of the certificates as if they were the holders of the relevant equity shares.

  2. (2)

    A listed company must at all times have in place arrangements which enable the holders of the certificates to exercise the rights attaching to the equity shares which the certificates represent as if they were the holders of the relevant equity shares.

  3. (3)

    Every circular which is sent by a listed company to the holders of the equity shares which the certificates represent must be sent to the holders of its certificates representing shares at the same time as the circular is despatched to the holders of those equity shares.

Additional requirements: compliance with the disclosure requirements and transparency rules

LR 21.8.14G

1A listed company, whose certificates representing shares are admitted to trading on a regulated market in the United Kingdom, should consider its obligations under the disclosure requirements.

LR 21.8.15R

1A listed company that is not already required to comply with the obligations referred to under article 17 of the Market Abuse Regulation must comply with those obligations as if it were an issuer for the purposes of the disclosure requirements and transparency rules subject to article 22 of the Market Abuse Regulation.

LR 21.8.16G

1A listed company, whose certificates representing shares are admitted to trading on a regulated market, should consider its obligations under DTR 4 (Periodic Financial Reporting), DTR 5 (Vote Holder and Issuer Notification Rules), DTR 6 (Continuing obligations and access to information) and DTR 7 (Corporate governance).

LR 21.8.17R

1A listed company that is not already required to comply with DTR 4, DTR 5 and DTR 6 (or with corresponding requirements imposed by another EEA Member State) must comply with DTR 4, DTR 5 and DTR 6 as if it were an issuer of shares for the purposes of the transparency rules.

Additional requirements: certificates in public hands and admission to trading

LR 21.8.18R

1A listed company must comply with LR 21.6.18R at all times.

LR 21.8.19G

1Where the FCA has modified LR 21.6.18R to accept a percentage lower than 25% on the basis that the market will operate properly with a lower percentage, but the FCA considers that in practice the market for the certificates representing shares is not operating properly, the FCA may revoke the modification in accordance with LR 1.2.1R(4).

LR 21.8.20R

1A listed company must comply with LR 21.6.23R at all times.

LR 21.8.21R

1A listed company must inform the FCA in writing as soon as possible if it has:

  1. (1)

    requested a RIE to admit or re-admit any of its listed certificates representing shares to trading; or

  2. (2)

    requested a RIE to cancel or suspend trading of any of its listed certificates representing shares; or

  3. (3)

    been informed by a RIE that trading of any of its listed certificates representing shares will be cancelled or suspended.

Additional requirements: voting on matters relevant to premium listing

LR 21.8.22R
  1. (1)

    1Where pursuant to LR 21.8, LR 21.9 or LR 21.10 the provisions of LR 9.4, LR 9.5, LR 10, LR 11 or LR 12 require a shareholder vote to be taken, that vote must be decided by a resolution of the holders of the class of equity shares which the certificates that have been admitted to premium listing represent.

  2. (2)

    Where pursuant to LR 21.8 the provisions of LR 9.2.2ER require that the resolution must in addition be approved by the independent shareholders, only:

    1. (a)

      independent shareholders who hold equity shares of the class which the certificates that have been admitted to premium listing represent; and

    2. (b)

      holders of certificates admitted to premium listing who would be independent shareholders within (a) if they held the equity shares which the certificates represent;

    can vote.

  3. (3)

    Where the provisions of LR 5.2 or LR 5.4A require a vote of the holders of the certificates to be taken, that vote must be decided by a resolution of the holders of the listed company’s certificates representing shares that have been admitted to premium listing.

  4. (4)

    Where the provisions of LR 5.2.5R(2A) or LR 5.4A.4R(3)(e)(ii) require that the resolution must in addition be approved by holders of certificates other than the controlling shareholder, only holders of the listed company’s certificates representing shares that have been admitted to premium listing can vote.

LR 21.8.23G
  1. (1)

    1In the case of a shareholder vote referred to in LR 21.8.22R(1) the listed company is required under LR 21.8.13R to ensure that the holders of the listed certificates representing shares are able to exercise the votes attaching to the equity shares which the certificates represent on any shareholder vote.

  2. (2)

    The purpose of LR 21.8.22R(2) is to ensure that the election or re-election of independent directors must be approved by the independent shareholders as a class. That class includes those persons whose entitlement to vote on the election of the independent directors arises as a result of their holding of certificates representing shares that have been admitted to premium listing. Accordingly, in the case of approval by the independent shareholders referred to in LR 21.8.22R(2) the listed company is required under LR 21.8.13R to ensure that the holders of the listed certificates representing shares are able to exercise the votes attaching to the equity shares which the certificates represent in relation to any such approval.

LR 21.8.24G

1Where the provisions of LR 5.2.5R(2A) or LR 5.4A.4R(3)(e)(ii) require that the resolution must in addition be approved by holders of certificates other than the controlling shareholder, the controlling shareholder will include a sovereign controlling shareholder.

LR 21.8.25G

1The FCA may modify the operation of LR 21.8.22R in exceptional circumstances, for example to accommodate the operation of:

  1. (1)

    special share arrangements designed to protect the national interest;

  2. (2)

    dual-listed company voting arrangements; and

  3. (3)

    voting rights attaching to preference shares or similar securities that are in arrears.

LR 21.8.26G

1Where a listed company is unable to comply with a continuing obligation set out in:

  1. (1)

    LR 9.2 as modified by LR 21.8; or

  2. (2)

    LR 21.8.13R to LR 21.8.25G,

it should consider seeking a cancellation of listing or applying for a transfer of its listing category. In particular, the listed company should note LR 5.2.2G(2) and LR 5.4A.16G.

Additional requirements: working capital statement

LR 21.8.27R

1In relation to an application for admission of certificates representing shares of an applicant that has certificates representing shares already listed:

  1. (1)

    an applicant must satisfy the FCA that it and its subsidiary undertakings (if any) have sufficient working capital available for the group’s requirements for at least the next 12 months from the date of publication of the prospectus or listing particulars for the certificates representing shares that are being admitted; and

  2. (2)

    if the prospectus or listing particulars for the certificates representing shares that are being admitted does not include a working capital statement which demonstrates that the requirement under paragraph (1) is satisfied, then:

    1. (a)

      an applicant must prepare and publish a working capital statement which demonstrates that the requirement under paragraph (1) is satisfied;

    2. (b)

      the working capital statement required by paragraph (a) must be prepared in accordance with item 3.1 of Annex 3 of the PD Regulation; and

    3. (c)

      the working capital statement required by paragraph (a) must be published at the same time as the prospectus or listing particulars, as applicable.

LR 21.8.28R

1A working capital statement published for the purposes of LR 21.8.27R must be published by means of a RIS.

Additional requirements: sovereign controlling shareholder

LR 21.8.29R
LR 21.8.30R

1To comply with LR 21.8.29R, a State which is a sovereign controlling shareholder must be either:

  1. (1)

    recognised by the government of the UK as a State; or

  2. (2)

    the UK.

LR 21.8.31R

1A listed company must notify the FCA without delay if it no longer complies with the continuing obligation set out in LR 21.8.29R.

LR 21.8.32G

1Where a listed company is unable to comply with the continuing obligation set out in LR 21.8.29R, it should consider seeking a cancellation of listing or applying for a transfer of its listing category. In particular, the listed company should note LR 5.2.2G(2) and LR 5.4A.17G.

Change of depositary

LR 21.8.33R

1Prior to any change of the depositary of certificates representing shares, the new depositary must satisfy the FCA that it meets the requirements of LR 21.6.22R to LR 21.6.26G.

Notification of change of depositary

LR 21.8.34R
  1. (1)

    1An issuer of equity shares represented by listed certificates representing shares must notify a RIS of any change of depositary.

  2. (2)

    The notification required by paragraph (1) must be made as soon as possible and in any event by 7:30 a.m. on the business day following the change of depositary, and must contain the following information:

    1. (a)

      the name, registered office and principal administrative establishment if different from the registered office of the depositary;

    2. (b)

      the date of incorporation and length of life of the depositary, except where indefinite;

    3. (c)

      the legislation under which the depositary operates and the legal form which it has adopted under the legislation; and

    4. (d)

      any changes to the information regarding the certificates representing shares.

Sponsors

LR 21.8.35G

1A listed company should consider the requirements in LR 8.2 (When a sponsor must be appointed or its guidance obtained) and LR 8.5 (Responsibilities of listed companies), subject to the modification to LR 8.2.3R in LR 21.10.5R.