PRM 4.4 Additional information to be included in the prospectus

Where the issuer of an equity security has a complex financial history by reference to PRM 4.4.3R, or has made a significant financial commitment by reference to PRM 4.4.4R, additional information with respect to an entity other than the issuer must be included in the prospectus.

The additional information referred to in PRM 4.4.1R must be sufficient to allow an investor to make an informed assessment of the transferable securities, in accordance with the requirements of regulation 23 of the Public Offers and Admissions to Trading Regulations and PRM 7(Simplified disclosure regime for secondary issuances), as if that entity were the issuer of the equity security. In particular, the additional information must include:

(1) with respect to an entity other than the issuer, all the information referred to in PRM App 2 Annex 1 and PRM App 2 Annex 15 ; and

(2) a clear explanation preceding the additional information: 

     (a) explaining why the additional information is needed for investors to make an informed assessment; and

     (b) specifying the effects of the complex financial history or of the significant financial commitment on the issuer or on the issuer's business.

For the purposes of PRM 4.4.1R, an issuer will be considered as having a complex financial history where all of the following conditions are fulfilled:

(1) at the time of drawing up the prospectus, the information referred to in the relevant PRM App 2 Annexes does not represent the issuer's undertaking accurately;

(2) the inaccuracy referred to at (1) affects the ability of investors to make an informed assessment in accordance with the requirements of regulation 23 of the Public Offers and Admissions to Trading Regulations and PRM 7 (Simplified disclosure regime for secondary issuances); and

(3) additional information relating to an entity other than the issuer is needed for investors to make an informed assessment as referred to regulation 23 of the Public Offers and Admissions to Trading Regulations and PRM 7 (Simplified disclosure regime for secondary issuances).

For the purposes of PRM 4.4.1R, a significant financial commitment is a binding agreement to undertake a transaction that is likely to give rise to a variation of more than 25% relative to one or more indicators of the size of the issuer's business.

Where transferable securities are exchangeable for, or convertible into, shares:

(1) where the shares are admitted to trading, the securities note must contain additional information referred to in Item 2.2.2 of PRM App 2 Annex 12.2R; 

(2) where the shares are not admitted to trading, but which are, or will be, issued by the issuer or an entity belonging to that issuer's group, the securities note must contain additional information referred to in:

     (a) Items 3.1 and 3.2 of PRM App 2 Annex 8.3R in respect of that issuer or of that entity belonging to the issuer's group; and

     (b) the information referred to in PRM App 2 Annex 13 in respect of the underlying share; and

(3) where the shares are not admitted to trading, but which are or will be issued by a third-party issuer, the securities note must contain the additional information referred to in PRM App 2 Annex 13.

The rules at PRM 4.4.7R and PRM 4.4.8R do not apply to the transferable securities referred to in PRM 4.4.5R.

For transferable securities that give the right to buy or subscribe for shares that are, or will be, issued by the issuer or by an entity belonging to that issuer's group, the securities note must contain the following information:

(1) where the shares are admitted to trading, the securities note must contain as additional information the information referred to in PRM App 2 Annex 12; and

(2) where the shares are not admitted to trading, the securities note must contain as additional information: 

     (a) the information referred to in PRM App 2 Annex 12 , except for the information referred to in Item 2.2.2 of PRM App 2 Annex 12.2R; and 

     (b) the information referred to in PRM App 2 Annex 13 in respect of the underlying share.

For all other transferable securities that are linked to an underlying asset other than those referred to in PRM 4.4.7R(1) and PRM 4.4.7R(2), the securities note must contain the additional information referred to in PRM App 2 Annex 12 .

For asset backed securities, the securities note must also contain the additional information referred to in PRM App 2 Annex 14 .

For non-equity securities that are supported by guarantees, the securities note must also contain the additional information referred to in PRM App 2 Annex 16 .

In relation to any financial year beginning after 31 December 2020, issuers established in the UK must present their historical financial information in accordance with:

(1) UK-adopted international accounting standards; or

(2) if the standards in (1) are not applicable, UK accounting standards.

Subject to PRM 4.4.13R, for overseas issuers, the historical financial information must be presented in accordance with one of the following accounting standards:

(1) UK-adopted international accounting standards;

(2) International Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards, as it applies in the European Union;

(3) International Financial Reporting Standards, but only if the notes to the audited financial statements that form part of the historical financial information contain an explicit and unreserved statement that the financial statements comply with International Financial Reporting Standards in accordance with IAS 1 Presentation of Financial Statements;

(4) Generally Accepted Accounting Principles of Japan; 

(5) Generally Accepted Accounting Principles of the United States of America;

(6) Generally Accepted Accounting Principles of the People’s Republic of China;

(7) Generally Accepted Accounting Principles of Canada;

(8) Generally Accepted Accounting Principles of the Republic of Korea; or

(9) national accounting standards of a country that are equivalent to UK-adopted international accounting standards in accordance with a determination made by HM Treasury in regulations under Commission Regulation (EC) No 1569/2007 establishing a mechanism for the determination of equivalence of accounting standards applied by third country issuers of securities pursuant to Directives 2003/71/EC and 2004/109/EC of the European Parliament and of the Council.

[Note: regulation 24(2) of the Public Offers and Admissions to Trading Regulations]

Subject to PRM 4.4.14R, if the historical financial information is not prepared in accordance with the required standards set out in PRM 4.4.12R, the financial statements must be restated in compliance with UK-adopted international accounting standards.

[Note: regulation 24(3) of the Public Offers and Admissions to Trading Regulations]

(1) An issuer of non-equity securities is exempt from the requirement in PRM 4.4.13R provided that the historical financial information has been prepared in accordance with the issuer's national law and, in all material respects, the national accounting standards of the issuer.

(2) Any person other than the issuer whose financial information is required to be included in theprospectus as if they were the issuer of the non-equity securities that are the subject of the prospectus is exempt from the requirement inPRM 4.4.13R, provided that the historical financial information has been prepared in accordance with thatperson's: 

     (a) national law; and 

     (b) in all material respects, national accounting standards.

[Note: regulation 24(4) and regulation 24(5) of the Public Offers and Admissions to Trading Regulations]

Where an exemption under PRM 4.4.14R is relied on, the prospectus must include: 

(1) a statement:

     (a) that the historical financial information included in the document has not been prepared in accordance with UK-adopted international accounting standards; and

     (b) that, if the historical financial information had been prepared in accordance with UK-adopted international accounting standards, there might have been material differences in the financial information; and

(2) a narrative description of the differences between UK-adopted international accounting standards and the accounting principles adopted by the issuer in preparing its annual financial statements.

[Note: regulation 24(6) of the Public Offers and Admissions to Trading Regulations]