• MIR 3.9 MIR 3.9 Admission of Financial Instruments to trading

    • MIR 3.9.1 Admission to trading

      (a) The Recognised Investment Exchange must make clear and transparent rules concerning the admission of Financial Instruments to trading on any market operated by it.
      (b) The rules must ensure that all Financial Instruments admitted to trading on any market operated by the Recognised Investment Exchange are capable of being traded in a fair, orderly and efficient manner.
      (c) The rules must ensure that:
      (i) all Financial Instruments admitted to trading on a market operated by the Recognised Investment Exchange are freely negotiable; and
      (ii) all contracts for Derivatives admitted to trading on a regulated market operated by the Recognised Investment Exchange are designed so as to allow for their orderly pricing as well as for the existence of effective settlement conditions.
      (d) The Recognised Investment Exchange must maintain effective arrangements to verify that Issuers of Financial Instruments admitted to trading on a market operated by it comply with its disclosure obligations.
      (e) The Recognised Investment Exchange must maintain arrangements to assist users of a market operated by it to obtain access to information made public under its disclosure obligations.
      (f) The Recognised Investment Exchange must maintain arrangements regularly to review whether the Financial Instruments admitted to trading on a market operated by it comply with the admission requirements for those Financial Instruments.
      (g) The rules must provide that where a Recognised Investment Exchange, without obtaining the consent of the Issuer, admits to trading on a market operated by it a Financial Instrument which has been admitted to trading on another market, the Recognised Investment Exchange:
      (i) must inform the Issuer of that Financial Instrument as soon as is reasonably practicable; and
      (ii) may not require the Issuer of that Financial Instrument to demonstrate compliance with its disclosure obligations.
      (h) The rules must provide that where a Recognised Investment Exchange, without obtaining the consent of the Issuer, admits to trading on an MTF operated by it a Financial Instrument which has been admitted to trading on a market, it may not require the Issuer of that Financial Instrument to demonstrate compliance with its disclosure obligations.

    • MIR 3.9.2 Financial Instruments – Freely negotiable and fair, orderly and efficient

      For the purposes of Rules 3.9.1(b) and 3.9.1(c)(i):
      (a) Financial Instruments shall be considered freely negotiable if they can be traded between the parties to a transaction, and subsequently transferred without restriction, and if all Financial Instruments within the same class as the Financial Instrument in question are fungible.
      (b) Financial Instruments which are subject to a restriction on transfer shall not be considered as freely negotiable unless the restriction is not likely to disturb the market.
      (c) Transferable securities that are not fully paid may be considered as freely negotiable, if arrangements have been made to ensure that the negotiability of such securities is not restricted and that adequate information concerning the fact that the securities are not fully paid, and the implications of that fact for shareholders, is publicly available.
      (c) Financial Instruments that are not fully paid may be considered as freely negotiable, if arrangements have been made to ensure that the negotiability of such Financial Instruments is not restricted and that adequate information concerning the fact that the Financial Instruments are not fully paid, and the implications of that fact for shareholders, is publicly available.
      (d) When exercising its discretion whether to admit a Financial Instrument to trading, a Recognised Investment Exchange shall, in assessing whether the Financial Instrument is capable of being traded in a fair, orderly and efficient manner, take into account the following:
      (i) the distribution of those Financial Instruments to the public; and
      (ii) such historical financial information, information about the Issuer, and information providing a business overview as is required to be prepared under the Market Rules or is or will be otherwise publicly available.
      (e) A Financial Instrument that is admitted to the Official List, and the listing of which is not suspended, shall be deemed to be freely negotiable and capable of being traded in a fair, orderly and efficient manner.
      (f) When assessing whether a Financial Instrument is capable of being traded in a fair, orderly and efficient manner, the Recognised Investment Exchange shall take into account, whether the following criteria (if relevant to the particular kind of Financial Instrument) are satisfied:
      (i) the terms of the Financial Instrument are clear and unambiguous and allow for a correlation between its price and the price or other value measure of the underlying Financial Instrument;
      (ii) the price or other value measure of the underlying Financial Instrument is reliable and publicly available;
      (iii) there is sufficient information publicly available of a kind needed to value the Financial Instrument;
      (iv) the arrangements for determining the settlement price of the Financial Instrument ensure that this price properly reflects the price or other value measure of the underlying; and
      (v) where the settlement of the Financial Instrument requires or provides for the possibility of the delivery of an underlying security or asset rather than cash settlement, there are adequate settlement and delivery procedures for that underlying as well as adequate arrangements to obtain relevant information about that underlying.

    • MIR 3.9.3 Units in collective investment funds

      When assessing whether Units are capable of being traded in a fair, orderly and efficient manner for the purposes of Rule 3.9.1, a Recognised Investment Exchange shall take the following aspects into account:
      (a) For an open‐ended Collective Investment Fund:
      (i) the distribution of those Units to the public;
      (ii) whether there are appropriate market‐making arrangements, or whether the Fund Manager provides appropriate alternative arrangements for investors to redeem the Units; and
      (iii) whether the value of the units is made sufficiently transparent to investors by means of the periodic publication of the net asset value.
      (b) For a closed‐ended Investment Fund:
      (i) the distribution of those Units to the public; and
      (ii) whether the value of the Units is made sufficiently transparent to investors, either by publication of information on the Fund's investment strategy or by the periodic publication of a net asset value.

    • MIR 3.9.4 Derivatives

      When admitting to trading a Financial Instrument that is a Derivative, Recognised Investment Exchanges shall verify that the following conditions are satisfied:
      (a) the terms of the contract establishing the Derivative must be clear and unambiguous, and enable a correlation between the price of the Derivative and the price or other value measure of the underlying;
      (b) the price or other value measure of the underlying must be reliable and publicly available or ascertainable; or the contract establishing that instrument must be likely to provide a means of disclosing to the market, or enabling the market to assess, the price or other value measure of the underlying, where the price or value measure is not otherwise publicly available;
      (c) sufficient information of a kind needed to value the Derivative must be publicly available or ascertainable;
      (d) the arrangements for determining the settlement price of the contract must be such that the price properly reflects the price or other value measure of the underlying or reference;
      (e) the Recognised Investment Exchange must ensure that appropriate supervisory arrangements are in place to monitor trading and settlement in such Derivative;
      (f) the Recognised Investment Exchange must ensure that settlement and delivery, whether physical delivery or by cash settlement, can be effected in accordance with the contract terms and conditions of those Derivative; and
      (g) where the settlement of the Derivative requires or provides for the possibility of the delivery of an underlying security or asset rather than cash settlement, there must be adequate arrangements to enable market participants to obtain relevant information about that underlying, as well as adequate settlement and delivery procedures for the underlying.

    • MIR 3.9.5 Rules concerning the admission of Financial Instruments to trading on an MTF

      When determining, for the purposes of Rule 3.3.1, whether a Recognised Investment Exchange has clear and transparent rules concerning the admission of Financial Instruments to trading on any Multilateral Trading Facility operated by it, the Regulator may have regard to:

      (a) whether there is a sufficient range of Persons already holding the Financial Instrument (or, where relevant, the underlying asset) or interested in dealing in it to bring about adequate forces of supply and demand;
      (b) the extent to which there are any limitations on the Persons who may hold or deal in the Financial Instrument, or the amounts of the Financial Instrument which may be held; and
      (c) whether the Recognised Investment Exchange has adequate procedures for obtaining information relevant for determining whether or not to suspend or discontinue trading in that Financial Instrument.