The JSE is prioritising several amendments to its listing requirements and debt listing requirements. 

This follows the release, in May, of a consultation paper, requesting stakeholders to comment on a raft of proposals.

This was followed in August, by the publication of a response paper outlining the feedback received from market participants, which showed favourable support for the proposed changes from an overwhelming majority of commentators.

The JSE intends to follow a phased approach to implementing the amendments.

LISTINGS REQUIREMENTS

Considering developments in other leading international markets, the JSE is proposing amendments to introduce dual-class shares for applicants seeking a listing on the Main Board.

The proposed amendments are accompanied by appropriate safeguards to afford the necessary investor protection and will allow the JSE to remain competitive and to attract new listings, it says.

The UK and the European Union (EU) have reconsidered the level of free float required on the listing, which has been identified as a deterrent to listing. In line with these developments, the JSE is proposing amendments to reduce the 20% free float threshold to 10%.

Currently, one type of holdings of securities that does not qualify as free float on listing, is any holdings of 10% or more in the securities of an issuer, irrespective of such shareholder’s relationship with the company.

The proposed amendments will remove the 10% holdings free float exclusion and instead introduce a minimum number of shareholders and introduce a more appropriate exclusion for controlling shareholders, to align with certain peer exchanges.

During 2020 and 2021, the pandemic raised volatility levels, making traditional listings riskier, the JSE points out.

This resulted in a special purpose acquisition companies (Spac) boom, especially in the US, although interest may have tapered recently, it says.

The JSE says its current Spac offering is accessible and flexible, but it is proposing amendments to align with international leading markets to ensure the attractiveness and competitiveness of Spacs to issuers and investors.

Following its “cutting red tape” initiatives, the JSE is proposing to remove the obligation to produce an abridged report when the issuer has published its audited yearly financial statements on the issuer’s website.

The JSE is also proposing simplification of the financial reporting requirements and removing provisions that do not provide regulatory value. These changes will save time and costs for companies, the JSE posits.

DEBT LISTINGS REQUIREMENTS

The JSE’s Annual Improvement Project mainly aims to propose amendments to the debt requirements, where the JSE has determined that certain provisions in the debt requirements require more clarity or context if there is ambiguity in the interpretation that needs to be remedied.

Interested parties are invited to comment on the consultation paper on or before Wednesday, November 30, via email to consultation@jse.co.za.