All securities, with the exception of bonds issued by the Government of the Republic, get a listing following the approval of the Council of the Cyprus Stock Exchange, with the consent of the Securities Commission. Bonds issued by the Government of the Republic are quoted following a decision taken by the Minister of Finance, announced to the Council of the Cyprus Stock Exchange.

1. Ways of getting a listing (Regulation 60) 

Issuers can list securities on the Stock Exchange  in one of the following ways:

  • By offer for sale - through the placement of securities that have already been issued
  • By public offer for sale to the public of titles which have already been issued
  • By public offer for subscription for the purchase of titles which have already been issued, or allocated
  • By private placement - an offer is made to specific investors for the sale of shares that have already been issued, or are about to be issued

In the case where the offer for sale to the pubic method is chosen, the issue has to be underwritten by at least one underwriter. This role can be carried out either by Members of the Stock Exchange (stockbrokers), Commercial Banks or any other organisation or person that has the knowledge, experience and financial standing to carry out this task. The underwriter(s) of the issue have to be approved by the Council of the Cyprus Stock Exchange.


2. Basic requirements for obtaining a listing (Regulation 61). 

Each company that seeks a listing must satisfy some basic requirements, the most important of which are:

  • The issuer must have the right to issue the proposed category of titles in accordance with the company's Memorandum and Articles of Association.
  • The expected market value of the proposed issue must be in excess of CYP2.000.000.
  • There must be no restrictions in the transferability of the titles.
  • The issuer must have published audited accounts for at least the three years preceding the application. 
  • Companies that have been established with the sole purpose of financing a large project, investment companies and newly established companies are exempted from this provision, provided that they satisfy the Council of the Cyprus Stock Exchange that potential shareholders will be given sufficient information to enable them to access properly the value of the titles.
  • It is not allowed for any shareholder to control either directly or indirectly, more than seventy per cent of the share capital, and a percentage of at least twenty five per cent of the share capital must be satisfactorily dispersed to the public at large.
  • The issuer must safeguard that existing shareholders will enjoy preemption rights in every subsequent issue.
  • The issuer must make a commitment to list all the titles of the same category that have already been issued, or will be subsequently    issued.

3. Applying for listing (Regulation 64)

In order for a company to obtain a listing, it is necessary to submit to the Council of the Cyprus Stock Exchange for approval a signed application and a number of other documents, in accordance with the provisions of Regulation 64. The most important of these documents are the Listing Particulars.
The aims of the Listing Particulars are to assist potential investors to make an assessment, in the best possible manner of the asset value, the financial state, the track record and the prospects of the company that seeks a listing, as well the rights associated with the ownership of the securities concerned.
In the case of equity titles and bonds, the Listing Particulars must contain at least the information prescribed in Schedule I and II of Annex E respectively. In the case of debentures the prospectus must contain at least the information prescribed in Part VII of the Regulations.
The Council of the Cyprus Stock Exchange has the right to approve the listing of partly paid shares, provided that in addition to to the basic requirements, the applicant satisfies some additional requirements, as contained in Schedule I of Annex E, namely:

  • The shares have to be paid in full within the maximum of 36 months following their listing on the CSE
  • At the time of the issue, the investor has to pay the whole of the share premium and 25% of the nominal value of the share.
  • The issuer must inform investors through the Listing Particulars, for the obligations as well as the risks associated with the ownership of partly paid shares.

According to Regulation 75 an issuer is not allowed, apart from exceptional cases and after having obtained the written consent of the Council of the CSE, to issue share warrants and options, the exercise of which would amount to participation in the company's issued share capital in excess of 20%. 
In the case of Initial Public Offerings (IPOs) the depth and detail of information required for the preparation of the Listing Particulars can be quite substantial whereas these information requirements are less onerous for subsequent issues (Regulation 69). Furthermore, the Council has the discretion to exempt, either partially or totally, an issuer from the obligation to prepare Listing Particulars, under the conditions outlined in Regulation 70.


4. Granting a permission for the publication of the introduction of the Issuer's titles in the Cyprus Stock Exchange

The Council examines the draft version of the prospectus and has the power to propose certain amendments. When the amendments are completed according to the instructions of the Council, the issuer proceeds with the submission of certain documents as required by Regulation 72. Provided that all the procedures have been followed, the Council proceeds with the granting of the permission for the publication of the Listing Particulars.

Having obtained the permission, the Issuer has the obligation to announce within a fortnight, in at least two daily newspapers of National circulation, the publication of the Listing Particulars. The announcement must state the address where interested parties can obtain a copy of the prospectus. Within 48 hours, the issuer has to submit to the Council three copies of the newspapers in the which the announcement was inserted. The final step is for the Council to issue an official announcement stating its decision to accepts the listing of the specific titles and to set a date for the commencement of trading.

 

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