The Irish stock exchange is a leading market for the listing of both investment funds and debt securities
Two of the markets operated by the Irish stock exchange are the MSM1 and the GEM2 . The MSM, which is an EU regulated market, is the leading venue worldwide for the listing of investment funds with over 7,000 fund listings. The GEM, which is an exchange regulated market and MiFID Multi-Lateral Trading Facility3 , is a major market for the listing of debt securities with 9,000 securities from 50 countries listed.
There are a number of benefits for an investment fund listing on a stock exchange. The advantages generally relate to increased distribution possibilities resulting from improved regulatory status and increased fund profile.
On April 4th 2016, the Irish stock exchange announced that the GEM would be open to investment funds which wish to apply for a listing or to any funds looking to transfer from an existing MSM listing. There are a number of differences between MSM and GEM listings which include:
- Listings on the GEM do not need to comply with the EU statutory audit directive which applies to the MSM. The EU audit directive places a requirement on public interest entities4 to rotate auditors every ten years. It also places restrictions on the provision of certain non-audit services, such as tax and payroll services to investment funds by auditors
- Listings on the GEM do not need to comply with the EU prospectus directive which applies to the MSM. The prospectus directive puts in place rules regarding the format and content of a prospectus which investment managers/issuers of listed closed ended investment funds must make available to potential investors before an investor may purchase shares in one of their listed funds
- Listings on the GEM do not need to comply with the EU transparency directive which applies to the MSM. Under the transparency directive, listed entities are required to publish annual reports not later than four months after the end of the fiscal year and are required to ensure such reports are accessible for at least ten years. In addition, listed entities must publish half-yearly financial reports not later than three months after the end of the relevant reporting period
The EU MAR5 , which replaced the MAD6 and will become effective from July 2016, will apply to funds listed on the GEM and to those listed on the MSM. The MAR regime which focuses mainly on insider dealing introduces a single market abuse rulebook across all EU member states.
How can KB Associates Assist?
KB Associates offers a range of services to investment funds including:
- The provision of designated persons to perform UCITS business plan and AIFMD programme of activity managerial functions
- The provision of UCITS/AIF7 operational support
- The provision of UCITS/AIF management company services
- Service provider selection
- The provision of directors
- MLRO8 services
- Company secretarial services.
If you would like to discuss any issues raised in this article or related to KB Associates’ services in general, please feel free to contact Mike Kirby (+353 1 667 1980), Peter Northcott (+44 203 170 8813) or Mike Parton (+1 345 946 4224).
1 Main Securities Market of the Irish stock exchange
2 Global Exchange Market of the Irish stock exchange
3 Non-exchange financial trading venue bringing together multiple third-party buying and selling interests in financial instruments
4 All entities governed by law in an EU member state and listed on a regulated market
5 Market Abuse Regulation
6 Market Abuse Directive