FCA’s Final Proposals for PISCES: A New Era for Private Market Trading

On 10 June 2025, the FCA unveiled its final proposals for the Private Intermittent Securities and Capital Exchange System (PISCES), following a comprehensive consultation process. The proposals mark a significant step in the development of a regulated platform for trading private company shares, designed to operate within a sandbox environment for five years. The proposals aim to foster innovation and competition amongst a variety of PISCES models, while ensuring appropriate investor protections based on a “private-plus” approach.

The FCA published the proposals in Policy Statement P25/6. This policy statement follows the UK government’s statutory instrument, which was published on 15 May 2025 and sets out the legislative framework establishing the regulatory sandbox environment for the operation of PISCES for a five-year period.

Key Features of PISCES

• Purpose: PISCES is designed to operate as a secondary market, facilitating the trading of existing shares during intermittent trading windows, the frequency of which can be set by the issuer. PISCES will not support capital raising through primary share issuance, and companies cannot use the platform for share buybacks.

• Eligibility: Only shares of companies not currently admitted to trading on a public market, either in the UK or internationally, are eligible for trading on PISCES. This includes UK private and public limited companies as well as overseas companies. PISCES operators have the authority to establish admission requirements for their markets, which may include minimum corporate governance standards.

  Trading on PISCES is restricted to specific categories of investors, such as professional investors and employees of participating companies. Most retail investors will be prohibited from trading.

• Intermittent trading: Companies will have discretion on who is allowed to buy the shares, when the shares may be traded, and the price at which the shares are traded, subject to their PISCES operator’s business model and certain disclosure requirements and guardrails prescribed by the FCA rules (see “Operator Requirements” below).

  Companies will also have discretion over who can participate in the auction and will be able to vet potential participants.  Importantly, it will also be possible to re-impose governance arrangements, amended as appropriate if desired, after the use of the platform — which will be a key point for issuers and their shareholders.

• Tax advantages: PISCES transactions will be exempt from stamp taxes on shares. In addition, the government recently announced plans to legislate in the next finance bill to allow employers, with their employees’ permission, to amend existing Enterprise Management Incentives (EMIs) and Company Share Option Plan (CSOP) contracts to include a PISCES trading event as an exercisable event, maintaining tax advantages.

• Financial promotion: The Treasury has taken steps to modify the Financial Promotion Order (FPO) to introduce a new exemption for communications related to PISCES shares.

FCA Regime for PISCES

The FCA’s policy statement outlines the regulatory requirements for the PISCES sandbox, including its tailored disclosure regime and other obligations for PISCES operators.

Disclosure Arrangements

In the initial proposals, PISCES operators were required to ensure that companies trading on their platforms disclose a standardised set of core information, including business and management overviews, financial statements for the past three years (or since the incorporation of the company if shorter) together with the auditors’ reports (if any), capital structure, and details of any price parameters for the PISCES trading event. However, in response to feedback, the FCA has refined and reduced certain disclosure requirements to better suit the PISCES context, including:

• Only an overview of material contracts is required, excluding those in the ordinary course of business
• Sustainability information has been removed from the core disclosure requirements
• Forward-looking information on financial forecasts and business strategy is no longer required in core disclosures
• The threshold for identifying major shareholders has been increased to 25%, aligning with the PSC disclosure regime, though PISCES operators may opt for a lower threshold
• If a PISCES company prepares a share valuation or price parameters, its core disclosures must indicate whether this was done with the agreement of another party, such as a key investor, and identify any such party
• The requirement for post-trade disclosures for directors and major shareholders has been removed

Regarding additional disclosures, the FCA has clarified that the “sweeper model” is not mandatory, though PISCES operators may choose to adopt it. Operators must have arrangements to require or facilitate additional information if core disclosures are insufficient for investor decision-making. Operators will need to determine how to implement “ask-model” arrangements.

PISCES operators have the flexibility (under a “legitimate omissions” regime) to allow companies to forgo disclosure if the companies have identified such information that has been omitted and provided a legitimate explanation for the omission.

Operator Requirements

The policy statement details the FCA’s approach for PISCES operators in organizing and running trading events, with a focus on maintaining fair and orderly markets, including:

• Operator oversight: Operators are to have proportionate controls, such as checking the general completeness of disclosures, the ability to follow up investor complaints, and the ability to take remedial or disciplinary action.
• Organizing and running trading events: PISCES companies have significant discretion over investor participation during trading events. The FCA mandates that operators must impose specific guardrails, including that a company can only restrict investors from participating in a trading event if it is to protect a legitimate commercial interest.
• Market manipulation and oversight: The FCA has clarified the role of PISCES operators in monitoring and reporting potential market manipulation. Operators are expected to implement proportionate, risk-based oversight arrangements to balance market integrity with operational feasibility. Additionally, the FCA has reminded PISCES intermediaries of their existing obligations to uphold market integrity and counter financial crime risks.

Trading Intermediary Requirements

The policy statement outlines the FCA’s requirements for intermediaries promoting or distributing PISCES shares, aligning with existing rules for other high-risk investments. In particular:

• Qualifying individuals must sign an adapted “restricted investor statement”, confirming they have not invested, and will not invest, more than 10% of their net assets in high-risk investments, including PISCES shares, within a 12-month period
• A 24-hour cooling-off period is introduced for new investors, allowing them time to reflect on their investment decisions

Next Steps

Prospective PISCES operators can now apply for a PISCES Approval Notice (PAN) to participate in the sandbox. The FCA will consult on proposals for PISCES operator annual periodic fees in November 2025. The Treasury is required to report to Parliament on the effectiveness of the PISCES sandbox before the end of the five-year period, which will inform any permanent legislative amendments needed to support a long-term PISCES proposition.