• Doing business with the FSA
  • UK Listing Authority
    • Sponsors
      • Frequently asked questions

This page contains frequently asked questions relating to Sponsors.

How do I become a sponsor?

If a firm wants to act as a sponsor it must be approved as such by the UKLA. The criteria for approval are set out in LR8.6.5R. In effect an applicant must demonstrate, to the satisfaction of the UKLA, that it:

• is either an authorised person or a member of a designated professional body;
• is competent to perform the services of a sponsor;
• has adequate systems and controls in place to ensure it can carry out its role as a sponsor.

The applicant firm should complete Sponsor Firm and Sponsor Employee application forms and submit them to the Sponsor Supervision Team, with a cheque for the application fee of £4,000. Guidance published in LR 8.6 sets out the areas in which systems and controls are expected.

How do you judge a sponsor firm’s competence?

Under LR8.6.7R a firm will be competent if it has a broad range of relevant experience and expertise in providing advice to listed companies and on the listing rules. This experience is demonstrated through suitably experienced employees of the firm who provide advice on listing role transactions.

Will my firm need ‘suitably experienced employees’?

To be eligible to act as a sponsor, the sponsor firm will need to have a sufficient number of employees with suitable experience.

For each employee that is being put forward by the firm as having the appropriate recent experience an Sponsor Employee form will need to be submitted. Guidance outlining the type of experience that is expected is set out under 8.6.8 and 8.6.9 of the Listing Rules.

We recommend that you contact the sponsor supervision team (on 020 7066 8333) in the first instance before you apply for approval as a sponsor.

What is the difference between a Nominated Advisor (NOMAD) and a sponsor?

NOMADs advise AIM companies on the application of the AIM rules and are authorised and regulated by the London Stock Exchange. A sponsor firm is approved as a sponsor by the UKLA to advise listed companies on the application of the Listing Rules. A NOMAD that is not also approved as a sponsor cannot act as a sponsor.

Are all listed companies required to retain a sponsor?

No. While it is good practice to do so, the appointment of a sponsor is only required in certain defined circumstances e.g. an Initial Public Offer on the Official List. LR 8.2 sets out when a sponsor must be appointed or its assistance obtained.

Must a sponsor firm already have authorisation from the FSA?

No, it is not a requirement for a sponsor to be authorised by the FSA, though the vast majority are.

Why are sponsors called 'sponsors'?

The terminology dates from when the London Stock Exchange was run as a members' club. For a new company to be admitted to the London market it would need to be 'sponsored' by an Exchange member that deemed it suitable for listing.