PSX proposes key regulatory amendments

July 01, 2025 (MLN): The Pakistan Stock Exchange (PSX) has proposed amendments to its regulations in three key areas.

These include the simplification of listing regulations for public offerings, enhanced visibility for the listing of REIT Scheme units, and structural reforms to the Growth Enterprise Market (GEM) Board.

To simplify listing regulations, PSX aims to align its framework with the Public Offering Regulations, 2017, and the Companies Act, 2017, as per the notice issued by PSX.

Proposed changes include removing the eight-month limit for audited accounts in the Prospectus/Offer for Sale Documents (OFSD), instead requiring the latest two years’ audited accounts and management accounts where applicable.

Credit rating requirements for debt securities would be linked with the Public Offering Regulations, while procedures and timelines for debt listing approval would be removed from the PSX Rulebook and aligned with SECP rules.

Several documents, including board resolutions and consent letters, would no longer be required under PSX regulations but will continue to be submitted via PRIDE in accordance with SECP requirements.

For REIT Scheme listings, PSX has suggested updates to Chapter 5 of its regulations to improve visibility.

These include inserting definitions for Company, RMC, REIT Scheme, and REIT Regulations; consistent use of the term “Unit of REIT Scheme”; and the addition of Clause 5.20A to ensure RMCs comply with post-listing disclosure requirements.

Regarding the GEM Board, following feedback on earlier proposed reforms (PSX/N-327 dated March 26, 2025), PSX now proposes permitting listings via a simplified Prospectus, removing the Information Memorandum (IM) route.

Other changes include capping post-issue paid-up capital (PIPC) for GEM listings at Rs500 million and raising the minimum for the Main Board to above Rs500m.

Additionally, the minimum free float is proposed to increase from 10% to 15%, and the minimum number of subscribers from 10 to 50.

Compliance with the Code of Corporate Governance Regulations, 2019, would be tiered by company size, and migration to the Main Board would remain optional with specific criteria.

A SECP-licensed Consultant to the Issue would be mandatory in place of an Advisor.

Under Section 7(3) of the Securities Act, 2015, PSX has invited stakeholders to submit comments on the proposed amendments by July 08, 2025.

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