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Investment Environment > other regulatory requirements > Flashcards

other regulatory requirements Flashcards

1
Q

FCA as UKLA

A
  • prospectus rule
  • listing rule
  • disclosure and transparency rules
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2
Q

exemptions to prospectus rules

A
  • qualified investors
  • fewer than 150 natural persons
  • for offers less than a total consideration of 5mill euro pver 12 mtnhs
  • where investors acquire at least 100000euro each
  • bonus or scrip issue
  • non-transferrable securities
  • shares admitted are less than 10% of shares already admitted in mrkt
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3
Q

conditions from premium listing

A
  • public company
  • market value of: equity at least 30mill, debt at least 200k
  • 10% free float
  • mngmnt with sufficient experience and expertise that comply with Model code of director’s dealings
  • listing particulars or prospectus
  • trading history: 3 yrs *
  • 12mtnhs working capital *
  • sponsors *
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4
Q

higher growth segment (HGS)

A

firms that cannot yet meet the premium status
- incorporation in the EEA
- commercial company issuing equity only
- free flot of 10%
- CAGr of 20% over 3 years

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5
Q

AIM key roles and conditions for entry

A

key roles :
- NOMAD
- Broker
conditions for entry :
- public company
- accounts must be IAS compliant
- comply with admissions document

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6
Q

AQSE exchange main board

A
  • similar to the official list
  • conditions for entry are the same as the official list
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7
Q

AQSE Exchange growth market

A
  • similar to AIM
  • conditions for entry :
    appoint and retain an AQSE corporate adviser
    24 months of audited accounts
    10% free float
    at least 12 months working capital
    appropriate levels of corporate governance
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8
Q

disclosure and transparency rules

A
  • listed firm has to comply with DTR
    by disclosing and controlling inside information (dividends, persons dealing on firms shares, takoevers, price sensitive info)
    financial reporting ( annual and 6monthly)
  • anouncements through regulatory info service (PIP)
  • obligations on corporate governance
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9
Q

FCA requires firms that are officially listed to produce ..

A

half yearly reports

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10
Q

companies act 2006 requires

A

annual reports

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11
Q

if annual reports or semi-annual are written up then firm can’t deal for

A

30 days b4 publication

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12
Q

principal-agent problem solutions

A
  1. UK code of corporate governance
  2. stewardship code
  3. retail distribution review
  4. cfa code of professional practice
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13
Q

UK code of corporate governance

A

-board leadership and company purpose
- division of responsibilites
- composition, succession and evaluation
- audit, risk and itnernal control
- remuneration

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14
Q

UK code of corporate governance : board leadership and company purpose

A
  • responsible for long-term success and should establish the firm’s purpose, values and strategy
  • necessary resources to meet objectives and measure performance
  • effective engagement and participation from stakeholders
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15
Q

uk code of corporate governance: division of responsibilities

A
  • chair leads a board with executives + non-executives
  • policies, processes, information, time and resources to function effectively and efficiently
  • board and committees have appropriate balance of skills, experience, independence and knowledge to discharge duties effectively
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16
Q

uk code of corporate governance: composition, succession and evlauation

A
  • both appointments and succession plans should be based on merit and objective criteria and promote diversity
  • board and committees have skill, knowledge and experience
  • annual evalution of composition
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17
Q

uk code of corporate governance: audit risk and internal control

A
  • formal and transparent policies and procedures
  • fair, balanced and understandable assessment of the firm’s position and prosepcts
18
Q

uk code of corporate governance: remuneration

A
  • support strategy and promote long-term sustainable success
  • formal and transparent procedure
  • directors exercise independent judgement and discretion when authorizing remuneration outcomes
19
Q

company meetings: right to call

A

AGM the board
GM the board or 5% or more of the voting shares

20
Q

notice of meeting and resolutions

A

AGM -21 days
GM -14 days
ordinary resolution : more than 50%
special : at least 75%

21
Q

proxy forms

A
  • used to appoint proxy
  • deposited at least 48 hrs before meeting
22
Q

uk disclosure requirements for a notifiable interest

A
  • within 2 business days
23
Q

person’s discharging material responsibilities (PDMR) must notify listed company of any trades

A

within the next 3 business days of the date of transaction

24
Q

EU transparency directive sets initial disclosure level at

A

5%, 10%, 15%, 20, 25, 30, 50, 75
need to inform within 4 days

25
Q

enterprise and regulatory reform act 2013

A

empowers the competition and markets authority (CMA)

26
Q

CMA has …. to complete initialy sutdy of share of supply test and turnover test for a qualifying merger

A

40 days

27
Q

takeover panel

A
  • chairman appointed by the BOE
  • funded by takeover panel levy
  • independent statutory body
  • responsible for writing and monitoring takeover code
28
Q

takover code application and general ppls

A
  • listed and unlisted plc firms resident in UK, Channel islands or Isle of man
  • complies with EU takeover
    general ppls :
  • shareholders to be treated equally
  • shareholders given sufficient time to reach decision for the bid
29
Q

advantages and disadvantages of flotation

A

adv:
- acquisitions and mergers
- public profile prestige
dis:
- regulations and cost
- market conditions
- investor power

30
Q

dual listing (to ensure equal treatment of shareholders in voting and cash flow rights)

A
  • separate legal entities
  • seperate stock exchange listings
  • cross border
  • tax advntages
  • single board
  • integrated mgmt structure
    equalisation contracts cover:
  • dividends
  • liquidation
  • corporate governance
31
Q

FCA empowered in its role as listing authority

A

section 72

32
Q

FCA empowered in its role as listing authority

A

section 72

33
Q

AIM market

A
  • not EU regulated
  • MTF
  • apply to LSE for admittance
34
Q

AIM’s companies assigned broker

A

provide info about the company on SETS

35
Q

UKLA imposes requirements for firms on LSE to publish reports

A
  • annual reports (max 4 months after end of financial year)
  • half yearly reports ( 2 months after midpoint of financial year)
  • mngmnt reports
36
Q

poll vote can be demanded

A
  • shareholders with 10% or more of the voting right
  • 5 members having voting rights
  • chaiperson
37
Q

poll vote can be demanded

A
  • shareholders with 10% or more of the voting right
  • 5 members having voting rights
  • chaiperson
38
Q

fund managers for authorised, recognised and UCITS scheme notifiable interest

A
  • 5%, 10%
39
Q

persons with significant control must be held on

A

statutory register

40
Q

BEIS objectives

A
  • RAISE PRODUCTIVITY OF THE uk ECONOMY
  • improve population skills
  • promote world class science and innovation in UK
    -deliver conditions for business success
  • improve economic perfomrance and reduce gap in ecnomic growth rates between regions

Investment Environment (10 decks)

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