Picture: Fenwick & West LLP
In an effort to combat a growing trend of companies delisting from Africa’s largest bourse, the Johannesburg Stock Exchange (JSE) is actively pursuing a simplification of its listing procedures. The exchange has invited public input regarding this initiative, emphasizing the need for a streamlined process to attract more companies to list.
On a mission to reduce both the quantity and complexity of listing requirements, the JSE has initiated a simplification project that prioritizes plain language to foster a more welcoming listing environment. André Visser, the Director of Issuer Regulation at the JSE, highlighted the importance of maintaining regulatory standards and disclosure transparency in line with South African financial markets.
The JSE intends to execute this simplification endeavor within the next 12 to 18 months, adopting a phased and consultative approach. The exchange has already initiated a dedicated project portal and has unveiled the initial four simplified sections, covering General Powers of the JSE, Sponsors, Transactions, and Related Party Transactions. The public consultation period is set to conclude on October 23, giving stakeholders an opportunity to provide feedback.
This move towards simplification was initially proposed in May 2022, and since then, the JSE has garnered substantial support for its efforts. The overarching goal is to ensure fairness, efficiency, transparency, and competitiveness within the bourse.
Furthermore, the JSE has already made amendments to its listing and debt listing requirements, broadening its offerings in specialized securities, such as actively managed exchange-traded funds. The introduction of weighted voting shares for listing applicants, along with a reduction in the free float threshold from 20% to 10%, aligns with international standards, bolstering competitiveness and enticing new listings.
Adhering to global market trends, the JSE is also adapting to accommodate special purpose acquisition companies (SPACs) and simplifying reporting requirements. Notably, the JSE eliminated the obligation for an abridged report when audited annual financial statements are published on the issuer’s website, further removing non-essential provisions to enhance regulatory efficiency and attractiveness for market participants.
Streamlining Listing Processes to Foster
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