Your ref: Our ref: Date: 27 October 2014

Transcription

1 Consultation parties as shown on the attached list OFFICE TRANSLATION Your ref: Our ref: Date: 27 October 2014 Consultation Changes to the listing rules for Oslo Børs and Oslo Axess 1 Consultation process Oslo Børs wishes to consult on proposed changes to the Listing Rules for Equities on Oslo Børs and the Listing Rules for Equities on Oslo Axess. No changes are being proposed to the Continuing Obligations of Stock Exchange Listed Companies as part of this revision of the rules. The proposals are circulated for consultation to issuers of shares and equity certificates listed on Oslo Børs, issuers of shares listed on Oslo Axess, member firms, and other interested parties. We ask that responses to this consultation should be sent by to Rita.Distad@oslobors.no by 14 November Depending on the responses received to the consultation, new versions of the listing rules for Oslo Børs and Oslo Axess will be prepared and distributed. Oslo Børs expects to bring the new rules into force from mid-january The proposed changes are described below. Please address any questions or comments to Lars Jacob Braarud or Linn Cathrin Slettedal in the Listing Department. 2 Details of the proposed changes to the listing rules 2.1 Listing of pre-commercial companies on Oslo Børs The first paragraph of Section of the Listing Rules for Equities on Oslo Børs states that: "At the time of application for admission to stock exchange listing, the main part of the company s activities must not be in a pre-commercial phase. When considering whether the main part of the company s activities are in a pre-commercial phase, consideration will be given to factors such as the character of the activities and the extent to which the company has earned operating revenue from the main part of its activities". According to the second paragraph of the same section, Oslo Børs may "grant an exemption from the first paragraph in special circumstances". The second paragraph of Section of the Listing Rules for Equities on Oslo Børs states that: "If the company applies to be exempted from the requirements set out in section 2.3.4, it must demonstrate

2 that it has certain access to sufficient liquidity to continue its business activities in accordance with their planned scale of operation for at least 18 months from the planned listing date." Oslo Børs proposes to remove the provisions regarding pre-commerciality. The proposal means that pre-commercial companies, regardless of their industry or sector, will be able to be admitted to listing on Oslo Børs, provided that all other admission requirements are satisfied. As a result of the proposed removal of section 2.3.4, sections in the current listing rules will be renumbered sections Neither the Directive 2001/34/EC on the admission of securities to official stock exchange listing nor relevant legislation and regulations issued pursuant to legislation on stock exchange listing contain rules requiring that a company that is to be admitted to listing on a regulated market or stock exchange must have reached a commercial phase. However, section 4 of the Stock Exchange Regulations states that "When making its decision the regulated market shall also attach importance to the company s financial position and other factors of significance for whether the shares are suitable for listing". Neither the Directive on the admission of securities to official stock exchange listing nor the Stock Exchange Regulations provides a definition of "other factors of significance", but the requirement for a company to have reached a commercial phase has previously been considered to be appropriate in relation to admission to listing on Oslo Børs. For the sake of good order, it is to be noted that there will be no change to the admission requirement that a company must have operated the major part of its activities for at least three years prior to any application for listing in order to be able to qualify for listing on Oslo Børs. Similarly, the admission requirement that a company must demonstrate that it will at the time of the planned listing date have sufficient liquidity to continue its business activities on their planned scale for at least twelve months will still apply. Pre-commercial companies which do not satisfy the requirement of having operated the major part of their activities for three years will therefore not be allowed to list on Oslo Børs, but can, as at present, apply for listing on Oslo Axess. As far as Oslo Børs is aware, no other comparable stock exchange has an equivalent admission rule requiring that a company must have reached a commercial phase when submitting an application for stock exchange listing. However, some exchanges require profit or turnover to be of a certain size, which can have a comparable effect. Removing the requirement that a company must be in a commercial phase further aligns Oslo with competing marketplaces that do not have a specific requirement regarding commerciality in their listing rules. Pre-commercial companies are listed on and traded on Oslo Axess and other regulated markets and stock exchanges internationally. These companies can in some cases be considered to have a somewhat higher risk than companies that have reached a commercial phase, but given the existing rules regarding the duty of disclosure and prospectuses, the market has sufficient information to be able to evaluate such companies. A number of companies, e.g. pharmaceutical and biotech companies, can have a significant market value and a large number of shareholders long before reaching a commercial phase. Oslo Børs is of the view that, provided fulfilment of the other listing requirements, pre-commerciality should not in itself disqualify a company from being listed on Oslo Børs. Given this, Oslo Børs proposes to remove the provisions regarding pre-commercial

3 companies from the listing rules. If implemented, there will still be a clear distinction between the companies that are suitable for listing on Oslo Børs and Oslo Axess, respectively, as no changes are being proposed to the requirements regarding the duration of a company s business activities, its market value, and the total number of shareholders. 2.2 Suitability requirements for shareholders with significant ownership stakes or control over companies Oslo Børs proposes to introduce a new requirement in the listing rules for both Oslo Børs and Oslo Axess regarding the suitability of shareholders who either own or control more than one third of the share capital or voting capital in a company. This listing requirement will supplement the suitability requirement that already applies to members of a company s management and members of its board of directors, cf. the listing rules, Sections (1) and (3) (sections (1) and (3) in the listing rules for Oslo Axess). The rationale for introducing this listing requirement is that a shareholder who either own or control more than one third of the share capital or voting capital will normally have significant influence over a company. The requirement regarding the suitability of such significant shareholders will contribute to ensuring that listed companies are managed with proper consideration of the need for integrity and confidence in the market. Given this, Oslo Børs proposes to introduce a new section at in the listing rules for Oslo Børs and Oslo Axess. Sections as they are currently in the listing rules will accordingly become sections The new section 2.4.3, "Shareholders with a significant ownership stake or control over a company", would be as follows: Shareholders who either individually or together with their close associates, either directly or indirectly, own or control more than one third of the share capital or voting capital of the company must not have acted in such a manner as to be judged unfit to be significant shareholders in a listed company. Close associates means such persons and companies as mentioned in Section 2-5 of the Securities Trading Act. This new listing requirement will mean that Oslo Børs can refuse to list a company if a significant shareholder is not regarded as satisfying this listing requirement. It is formulated in the same way as the equivalent requirement that already applies to a company s board of directors and management, and is largely expected to be applied in a similar way. This means that Oslo Børs, when evaluating a company s suitability for listing, will be able to regard as important any breaches of legislation or regulations that must be considered relevant to the orderly and proper functioning of the markets. These breaches will typically include previous breaches of Norwegian or foreign securities trading laws, stock exchange laws and regulations, accounting laws and other laws related to financial matters. As part of the evaluation, Oslo Børs will take into consideration the nature, relevance and severity of any breach, as well as the number of breaches and their proximity in time to the listing application

4 In conjunction with the possible introduction of a suitability requirement for significant shareholders as discussed above, Oslo Børs will introduce a requirement that a statement must be produced, possibly as a form to be completed in connection with the listing process, giving information deemed to be necessary in order for Oslo Børs to be able to assess whether the suitability requirement has been satisfied. Yours sincerely, OSLO BØRS ASA Øivind Amundsen Senior Vice President Head of Primary Market and Legal Affairs Lars Jacob Braarud Vice President Listing

5 Consultation parties: Issuers of shares and equity certificates listed on Oslo Børs and issuers of shares listed on Oslo Axess Member firms of Oslo Børs Arntzen de Besche Advokatfirma AS Den norske advokatforening Advokatfirmaet Haavind AS Advokatfirmaet Schjødt AS Advokatfirmaet Selmer DA Advokatfirmaet Thommessen AS Advokatfirma Wikborg, Rein & CO BUGGE, ARENTZ-HANSEN & RASMUSSEN CLP DA Grette Den norske Revisorforening Finansdepartementet Finansnæringens Fellesorganisasjon Folketrygdfondet Justis- og beredskapsdepartementet Kluge Advokatfirma DA Kvale Advokatfirma DA Finanstilsynet Norges Bank Norges Fondsmeglerforbund Norske Finansanalytikers Forening Norske Pensjonskassers Forening Næringslivets Hovedorganisasjon Verdipapirfondenes Forening Verdipapirsentralen Wiersholm, Mellbye & Bech, advokatfirma AS Økokrim