As published on guernseypress.com, Monday 2 August, 2021.
The International Stock Exchange could be hit by a regulatory shake-up being plotted by HM Treasury.
Firms that currently list on exchanges such as Tise may no longer need to qualify for a critical UK tax exemption, said the Guernsey-headquartered exchange.
In a market update, Tise said the issue was around changes to the tax treatment in the UK of asset-holding companies in alternative fund structures.
AHCs are companies used as intermediate entities in investment fund structures.
Their role is to facilitate the flow of capital, income and gains between investors and underlying investments.
‘After a further period of technical consultation, UK legislation introducing changes to the taxation of qualifying asset-holding companies is likely to be included in the next Finance Bill in April 2022,’ said Tise.
‘Under the prospective legislation, UK-resident companies who meet certain eligibility tests and elect for the QAHC regime to apply may no longer need to list on exchanges like Tise in order to avail themselves of the Quoted Eurobond Exemption from UK withholding tax on interest in the UK from April 2022.’
A ‘substantial proportion’ of Tise issuers said ‘availing of the QEE’ was the principal reason for listing securities on the exchange.
‘However, it is not currently possible to identify how many issuers will be eligible to, and elect for, the QHAC regime under the prospective UK legislation.
‘The impact on the volume of new, and possibly existing, listings on Tise is unclear and is likely to remain so for some time.’
The exchange’s board was therefore continuing its focus on attracting listings in other areas. Tise's operations and technology were also being enhanced to ensure it could offer the highest standards of client services within a newly expanded suite of products and markets.
‘Further updates will be provided, as and when appropriate,’ it added.