2. Any company that wants to join AIM must first appoint a sponsor (commonly known as "Nomad") who is responsible for assuring the stock exchange that a specific company is suitable to join AIM. This is an important quality control measure of AIM and a serious responsibility of the designated sponsors. After the company goes public, there should be a sponsor service to make suggestions on the company's current company information disclosure.
The sponsor is a company composed of experienced corporate finance professionals recognized by the London Stock Exchange, with 69 sponsors. With the increasing international image of AIM, the sponsor network is being displayed around the world.
Any company wishing to become a sponsor must be approved by the Exchange and registered on the designated list of sponsors.
The company must also appoint a broker, that is, a securities company that is a member of the London Stock Exchange. They bring together the sellers and buyers of stocks to help the company go public smoothly and trade in the market after the securities are issued.
Brokers are also responsible for providing important information about the company through the SEATS PLUS system.
Other necessary professional consultants include legal consultants, reporting accountants and investor relations consultants.
The main requirement is that the company must be "suitable" for the market, and this judgment is made by the consultant appointed by the company. If a company wants to apply to join AIM, it must take the following steps:
(1) Designate sponsors and brokers.
(2) The free transfer of its shares is not restricted.
(3) Pay a fixed annual fee.
(4) Traditionally, all companies must also prepare market entry documents (or profiles), including all relevant information about the company and its activities. However, the London Stock Exchange recently launched a new fast track to join AIM. Companies that have been listed on nine overseas exchanges can now use their existing annual reports and account books as the basis for supplementary quotations on AIM.
(5) During the preparation for listing, the company must announce its intention to list in this market and submit an application with appropriate documents to the London Stock Exchange.
All AIM companies enjoy the benefits of listing on the London Stock Exchange-a recent survey (April 2003) found that 83% of the respondents believed that AIM met or exceeded their expectations despite the low share price.
4. The UK AIM market implements a "lifetime" sponsor system. In AIM, UK, sponsors and brokers are in perfect harmony, just like the two "Optimus Prime" of GEM, which has propped up a clear sky for investors and promoted the standardized and steady development of GEM. In this sense, the emergence of the sponsor system is the inherent requirement for the standardized and steady development of the GEM market.
After considering the current situation of the domestic market, the British government clearly put forward the main theme of supervision to maintain market confidence, and listed the protection of investors' legitimate rights and interests as the first step in the adoption of the supervision principle. It is considered that the establishment of "lifelong" sponsor system based on AIM is an effective solution to prevent and resolve market operation risks.
(1) After the London Stock Exchange accepts the application of enterprises to sign up for listing, the main consideration is whether the issuer can abide by the transfer rules and whether investors can buy and sell transactions freely. To this end, AIM has established two important market roles: sponsor and broker. All enterprises seeking listing on AIM must first hire a sponsor and a broker. Sponsors mainly provide information guidance and suggestions on listing rules to issuers, and the duty of brokers is to focus on providing and supporting the trading convenience of enterprise stocks. The responsibilities of the sponsor and the broker can be concurrently held by the same company. Hiring sponsors is one of the prerequisites of AIM's listing review standards, and no enterprise can be excluded.
Britain has always been famous for its strict supervision of financial markets. The primary goal of supervision by regulators is to maintain market confidence and protect the interests of investors. In view of the common characteristics of high returns and high risks in GEM, the regulatory authorities require AIM listed companies to implement a lifetime sponsorship system. Life-long sponsor system means that listed companies must hire a company with legal qualifications as their sponsor at any time to ensure that enterprises continue to abide by market rules and enhance investors' confidence. The term of office of the sponsor shall be subject to the contract term of the listed enterprise. One day the company goes public, the sponsor will accompany the salary for about one day. If the sponsor is absent due to resignation or dismissal, the dividend of the stock trading volume of the sponsored enterprise will stop immediately, and the trading volume may not continue until the new sponsor officially performs his duties. If there is still no new sponsor to fill the vacancy within one month, the shares of the sponsored enterprise will be delisted.
(2) The responsibilities of sponsors are defined in principle in the articles of association, and the right of interpretation belongs to the London Stock Exchange. The responsibilities of AIM sponsors mainly include:
The responsibilities and obligations of directors of listed companies stipulated in 1.AIM market rules provide guidance for directors to ensure that directors receive adequate training and clarify their responsibilities.
2. Do your best to conduct proper and careful due diligence on all aspects of the issuer.
3. Confirm that the issuer and the stocks to be issued comply with the AIM market rules, and make a written statement to the Exchange.
4. Provide continuous consultation and guidance on the duties and obligations of directors of listed companies, and ensure that the issuer meets the AIM market rules when taking office after listing.
5. When deciding to terminate the sponsorship qualification, it shall notify the Exchange in the format and time limit required by the Exchange.
6. Regularly check the actual trading activities and financial status of the enterprise against the profit forecast, estimate and prospect plan published or made public in the application documents of the listed company.
7. Assist the directors to decide whether to disclose the profit forecast made by the listed company when there is a significant difference between it and the actual performance of the enterprise.
It can be seen that the sponsors' focus on sponsorship work before and after the listing of enterprises is different. Before an enterprise applies for listing, the sponsor institution shall substantially examine the quality and conditions of the issuer. It must first evaluate and judge that the issuer meets the relevant requirements of the listing standards, and confirm its transaction amount in writing before continuing the application procedure. At the same time, it should ensure that the directors of the company have obtained advice and guidance on their responsibilities and obligations, and abide by the relevant AIM market rules. The sponsor shall promise to listen to the directors' guidance on the relevant AIM market rules as an adviser at any time. At this stage, the sponsor plays the role of "mentor" and "independent auditor".
In order to be responsible for the London Stock Exchange, sponsors generally conduct detailed due diligence on issuers. According to the Regulations on Public Offering of Securities 1995, some information that needs to be disclosed to investors in the prospectus includes: the issuer's assets and liabilities, financial status, profitability, business development prospects, rights attached to securities, etc.
After an enterprise goes public, the sponsorship work of the sponsor institution turns to guide and urge the enterprise to continuously abide by the market rules and fulfill its information disclosure obligations as required. In addition, sponsors can also actively communicate with exchanges and investors on behalf of enterprises.
Although the work scope of sponsors has been expanded after the listing of enterprises, it must be clear that the core responsibility of sponsors is to guide the directors of enterprises to abide by market rules and fulfill their due responsibilities and obligations. Especially in information disclosure, the guidance and supervision of sponsors on enterprises will directly affect the quality of AIM market operation and the vital interests of investors. Therefore, it can be said that the functions of "counseling" and "independent auditor" are the essence and key of the sponsor system.