International ECM Listings Rules, Requirements & Obligations in Stockholm

Nasdaq Stockholm is a regulated market in Sweden, under the supervision of the Financial Supervisory Authority of Sweden (the “FSA”) (Sw. Finansinspektionen).

Shares issued by a Swedish public limited liability company (sw. aktiebolag), whose articles of association contain a record date provision (Sw. avstämningsförbehåll) or an equivalent foreign company may be admitted to trading provided that the issuer complies with the admission requirements stated in the Rulebook (as defined below).

The admission requirements outlined in the Main Market Rulebook for Issuers of Shares (the “Rulebook”) issued by Nasdaq Stockholm, together with its supplements, must be fully satisfied.

A prospectus in accordance with the Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (the “Prospectus Regulation”) must be prepared and made public prior to admission to trading.

An approved prospectus must be submitted to Nasdaq Stockholm (in Sweden, prospectuses are approved and registered by the FSA), together with a listing application in accordance with the requirements of the Rulebook.

A prospectus must also be prepared and approved in accordance with the Prospectus Regulation when issuing shares of the same class as those listed which constitute, in any twelve (12) month period, more than 20 percent of the issued shares of the same class.

The public limited liability company must have a minimum share capital of SEK 500,000 or equivalent in foreign currency.

The market value of the shares for which admission to trading on Nasdaq Stockholm is sought must be expected to be at least EUR 1 million.

Furthermore, the issuer shall be able to demonstrate sufficient working capital, on a business group level, for its planned business for at least twelve (12) months from the first day of trading.

A sufficient number of shares shall be deemed to have been distributed to the public if (i) at least 25 percent of the issuer’s shares within the same class of shares are in public hands; and (ii) the shares are held by at least 500 shareholders each holding shares with a value of at least EUR 500 (“Qualified shareholders”). However, if the number of shareholders is less than 500, but more than 300, the requirement can be met if the company retains the services of a liquidity provider.

If the above requirements are not met, Nasdaq Stockholm may, upon request, determine that the liquidity requirement is nevertheless met, provided it is satisfied that the market will operate properly in view of the large number of financial instruments that are distributed to the public.

The issuer shall have a clear business strategy and be able to demonstrate ongoing business operations. Furthermore, the issuer’s business operations shall have a sufficient operational history, meaning it has been conducted in its current form for at least one (1) year.

For admission to trading on Nasdaq Stockholm, the issuer shall have published or filed annual financial reports for at least three (3) financial years in accordance with the accounting legislation applicable to the issuer in the jurisdiction of incorporation or establishment. Furthermore, at least one consolidated financial statement shall have been prepared in compliance with IFRS standards.

The financial reports shall contain sufficient information to enable the stock exchange and investors to evaluate the development of the issuer's business and to form a well-informed judgement about the issuer and its shares as an investment. Furthermore, special purpose acquisition companies (“SPAC”), are exempted from the rules regarding historical financial information and operations, as described above.

The shares shall be freely negotiable.

The board of directors and of the issuer’s management shall not be persons who have acted in such a manner as to make them unfit to participate in the board of directors and management of an issuer admitted to trading on Nasdaq Stockholm.

The board of directors shall have sufficient knowledge about the issuer and its business, and be familiar with the way the issuer has structured its internal reporting lines, the management pertaining to financial reporting, its investor relation management and its procedures for disclosing ad hoc and regular information to the stock market.

The Exchange will consider the board of directors and the management as being sufficiently familiar with the above-mentioned circumstances if (i) they have been active in their respective current positions in the issuer for a period of at least three (3) months and (ii) have participated in the production of at least one (1) annual or other financial report issued by the issuer, prior to the admission to trading.

In accordance with the Swedish Corporate Governance Code (Sw. Svensk kod för bolagsstyrning), which applies for all issuers listed on Nasdaq Stockholm, a majority of the board of directors are to be independent of the company and its management. At least two (2) of the board of directors who are independent of the company and its executive management are also to be independent in relation to the company’s major shareholders.

There are no lock-in requirements by the listing rules. However, the shareholders may sign lock-up agreements ahead of the listing and thereby restricting their right to transfer the shares in the issuer.

The issuer shall appoint a listing auditor (Sw. noteringsrevisor) who will assess whether the issuer meets the listing requirements. The issuer’s listing application shall include a report issued by the listing auditor approved by the stock exchange, addressing the preconditions for the issuer’s listing and its operation as a listed company, as well as information about the issuer. The issuer shall also appoint a legal advisor that shall perform a legal examination. The legal examination shall be performed by an attorney. The issuer shall also appoint a financial advisor.

No additional sponsor is required.

No market-maker or broker is required. However, market-makers are allowed in order to guarantee the liquidity of shares and ensure that the difference between purchase price and selling price remains at a reasonable level.

Advertisements, presentations to potential investors, and other means of publicising an IPO or secondary issue are generally permitted, subject to certain restrictions.

For instance, advertisements shall state that a prospectus has been or will be published and indicate where investors are or will be able to obtain it. Further, advertisements shall be clearly recognisable as such. The information contained in an advertisement must be accurate and not misleading and shall be consistent with the information contained in the prospectus, where already published, or with the information required to be in the prospectus, where the prospectus is yet to be published. In general, all information disclosed in an oral or written form concerning the offer to the public or the admission to trading on Nasdaq Stockholm, even where not for advertising purposes, must be consistent with the information contained in the prospectus.

Timing depends on the size and complexity of the company, and its state of readiness for an IPO. In general, an IPO takes six (6) to twelve (12) months.

The formal process for admission to listing is as follows:

1. appointment of advisors;
2. kick-off meeting with the advisors and prospectus drafting;
3. due diligence to ensure that all information about the company is appropriately disclosed in the prospectus for future investors;
4. submission of the prospectus together with the listing application;
5. FSA approves the prospectus;
6. orderbook and public offering open; and
7. trading starts after the settlement and delivery have been finalised.

An issuer with a primary listing on a foreign exchange or regulated market recognised by on Nasdaq Stockholm may apply for a secondary listing. In such cases the admission rules shall apply similarly.

A foreign issuer may apply for a primary listing on Nasdaq Stockholm. The admission rules shall apply similarly to domestic issues.

1. For companies registered in Sweden listed on Nasdaq Stockholm, Swedish is the primary language. Furthermore, if certain specific conditions are met, Swedish or English can be accepted.
2. A translation of the summary in Swedish is required, with the exception of prospectuses relating to non-equity securities with a denomination of at least EUR 100,000.

Nordic Main Market Rulebook for Issuers of Shares, available here.

Securities Market Act (2007:528), available here.

Swedish Corporate Governance Code, available here.

Regulations of the Financial Supervisory Authority (FFFS) 2007:17, available here.

Nasdaq Stockholm is a regulated market in Sweden, regulated by the Financial Supervisory Authority of Sweden.

Under Swedish company law, the following key matters require shareholder approval;

• amendment of the articles of association;
• approval of annual financial statements;
• determination of dividend distribution;
• appointment or dismissal of the board of directors;
• remuneration of the board of directors;
• appointment or dismissal of the auditor;
• capital increase or cancellation;
• merger/demerger; and
• certain closely related party transactions.

The issuer shall also adhere to - in addition to laws, other regulations, and the Rulebook – Generally Accepted Practices in the Securities Market (sw. God sed på värdepappersmarknaden). Generally Accepted Practices in the Securities Market refer to actual prevailing practices for issuers' conduct in the securities market. Such practices may be expressed, for example, through statements by the Swedish Securities Council (Sw. Aktiemarknadsnämnden), recommendations from the Council for Swedish Financial Reporting Supervision, (Sw. Nämnden för svensk redovisningstillsyn), the Swedish Stock Market Self-Regulation Committee (Sw. Aktiemarknadens självregleringskommitté) or the Swedish Corporate Governance Board (Sw. Kollegiet för svensk bolagsstyrning), and through the rules in the Swedish Corporate Governance Code (Sw. Svensk kod för bolagsstyrning).

If the issuer does not fully comply with the Swedish Corporate Governance Code the issuer shall provide an explanation of the reason for the deviation and what alternative solution it has selected.

Equal treatment of shareholders must be ensured.

Additionally, shareholders in an issuer registered in Sweden must notify the FSA and the issuer when the percentage of the issuer's share capital or voting rights such shareholder holds reaches, exceeds, or falls below any of the following thresholds: 5%, 10%, 15%, 20%, 25%, 33%, 50%, 66.66%, and 90%.

Companies listed on a regulated market are subject to the EU Market Abuse Regulation (“MAR”) and the Swedish Securities Market Abuse Penalties Act (2016:1307), which govern inside information, insider dealing, and market manipulation. The issuers must disclose inside information in accordance with the requirements of MAR and the Swedish Securities Market Abuse Penalties Act.

The issuer shall ensure that a list is drawn up of persons who are given access to inside information in accordance with MAR article 18 and Commission Regulation 2016/347.

The issuer shall, when publishing inside information that has been the subject to delayed disclosure, submit a notification to the FSA.

Aside from MAR, the issuer is obliged to disclose regulatory information as stated in the Rulebook.

The issuer shall prepare and disclose all financial reports/statements pursuant to accounting legislation and regulations applicable to the issuer.

Issuers incorporated in Sweden, and issuers incorporated outside Sweden that are admitted to trading only on Nasdaq Stockholm, shall disclose one annual financial statement and interim reports/statements quarterly.

The annual report shall be published not later than four months after the close of each financial year. The year-end report (Sw. bokslutskommuniké) and the interim reports/statements (Sw. delårsrapporter), shall be disclosed within two months from the expiry of the report/statement period. Interim reports/statements shall state whether or not the issuer’s auditors have conducted a review.

In addition, the issuer shall, no later than by the close of the year, publish a financial calendar disclosing the dates planned for the publication of its annual report, interim report, the annual general meeting, and, if applicable, payment of dividends in the following year.

All transactions in securities issued by or related to the issuer by persons discharging managerial responsibilities (“PDMR”) and persons related to them (including dependent children and controlled companies) shall notify the issuer and the FSA without undue delay (in accordance with MAR). The PDMR shall promptly publish such notification and not later than three (3) business days after the transaction.

A PDMR shall not conduct any transactions on its own account or for the account of a third party, directly or indirectly, relating to the shares or debt instruments of the issuer or other financial instruments linked to them during a closed period of 30 calendar days before the announcement of a year-end report or an interim report.

Furthermore, the prohibition on insider trading according to MAR applies.

The FSA shall approve and register prospectuses.

The obligation to make a mandatory bid is triggered if a party, alone or together with any another closely related party, through acquisition of shares carrying voting rights, directly or indirectly, holds more than 30 percent of the voting rights of the target company. Such party must, within four (4) weeks, make a mandatory offer for the remaining shares in the company.

A shareholder who crosses the mandatory bid threshold may avoid the obligation to make a mandatory bid by selling the proportion of shares which exceed the threshold within four (4) weeks of the date on which the mandatory bid obligation was triggered.

The issuer may, in accordance with the Rulebook, request that its shares be removed from trading. Nasdaq Stockholm will approve such request by a formal decision, which becomes effective at such time as is agreed between Nasdaq Stockholm and the issuer.

Furthermore, Nasdaq Stockholm may decide to compulsorily remove an issuer’s shares from trading if

1. an application for bankruptcy, winding-up or equivalent motion has been filed by the issuer or a third party to a court or other public authority; or
2. The issuer does not fulfil all the admission requirements, provided that:
   1. the issuer has not remedied the situation within a time decided by the exchange, although under normal circumstances, not longer than six (6) months
   2. there are no other available means to remedy and restore the situation; and
   3. the non-fulfilment is deemed to be significant; or

the issuer has not paid in due time such fees to the stock exchange as are set out in the stock exchange's price list in force from time to time.

No. However, non-domestic issuers may apply the corporate governance code applicable in their domicile instead of the Swedish Corporate Governance Code.