RECAP
- Private Intermittent Securities and Capital Exchange System (PISCES) Regulations (SI 2025/583) are now in force.
- PISCES is not a stock market; it is a regulatory sandbox for those market participants who want to set up an exchange to do so.
- FCA-regulated PISCES platforms will be designed to trading existing shares as secondary markets only.
Read our previous update on PISCES
WHAT’S CHANGED?
Eligibility:
- Trading shall be limited to institutional, high-net-worth, self-certified sophisticated investors, and company employees and directors.
- Mainstream retail investors are explicitly excluded.
Disclosure:
- The Financial Conduct Authority (FCA) has opted for a pared-back disclosure regime.
- Companies will only need to disclose significant changes in their financial position and can omit acquisitions, details about litigation, financial forecasts, ESG metrics, and major contracts.
- The threshold for identifying major shareholders has increased to 25%.
- UK Market Abuse Regulation will not apply—the FCA has proposed to instead rely on eligibility filtering, information gating, and operator-level controls to manage misconduct risk.
Share transfer taxes:
- Stamp Duty and Stamp Duty Reserve Tax exemptions shall apply.
Operator discretion:
- PISCES platforms shall be able to exercise their discretion by structuring trading events around intermittent windows, and tailoring rules on pricing, participant approvals, and disclosure mechanics.
- Companies on those platforms will have discretion on which investors are allowed to buy shares, when shares are traded, and the price at which the shares are traded.
WHAT’S NEXT?
- Platforms can apply to operate PISCES exchanges, and first trading events are expected in late 2025.
- The regulatory sandbox runs for five years, until June 2030, after which permanent rules may follow.
WHAT SHOULD COMPANIES INTERESTED IN SECONDARY LIQUIDITY DO NOW?
- Assess shareholder appetite for liquidity.
- Review existing incentive plans (e.g., EMI/CSOP) for trading compatibility.
- Start assembling a disclosure package that fits both the FCA core expectations and investor needs.
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