ACE Market Listing Requirements Amended to Facilitate One-Stop Centre for IPOs

29 December 2021

1. A mandatory pre-consultation process will be introduced. Among others: 

• the applicant’s Sponsor is to submit the prescribed documents or information (‘pre-admission consultation pack’) to the Exchange prior to the consultation; and 


• the consultation is to be carried out with the applicant and its key advisors after the Sponsor has substantially completed its due diligence on the applicant; 


• in addition to the factors set out in Rule 4.07(2) and Guidance Note 18 of the ACE LR, the Sponsor must also consider whether the admission of the applicant is detrimental to the interest of investors; 

2. New requirements are introduced into the ACE LR to set out the requirements for an ACE Market prospectus³ which in essence, adopt the relevant requirements under the SC’s Prospectus Guidelines and the Capital Markets and Services Act 2007; 


3. All parties involved in the preparation of a pre-admission consultation pack, an initial public offering (‘IPO’) on the ACE Market and prospectus are to be responsible for ensuring that the said documents are clear, unambiguous and accurate, do not contain material omission and are not false or misleading; 


4. A moratorium will be imposed on the entire shareholding of a pre-IPO investor who is not a specified shareholder⁴, for six months from the date of admission of the applicant to the Official List if such investor has acquired the shares of the applicant: 

• Within 12 months from the date of submission of the listing application to the Exchange; and 


• at a price lower than the issue price offered to the general public in conjunction with the IPO; 

5. Directors of an applicant will be required to complete the Mandatory Accreditation Programme prior to the listing of the applicant on the ACE Market; 


6. The requirements of a Sponsor/Adviser will be aligned with the Recognised Principal Adviser framework for the Main Market; 


7. The responsibilities of a Sponsor/Adviser will be enhanced, inter alia, by requiring the Sponsor/Adviser to be primarily responsible for a Specific Proposal, namely an ACE Market IPO application, the registration of a prospectus with the Exchange, an ACE Market reverse take-over, and a Major Disposal under Rule 10.02(eA) of the ACE LR (‘Specific Proposal’), and any listing application for new issue of securities submitted to the Exchange;⁵ 


8. The accountability of a Sponsor/Adviser and its key officers, namely a Senior Officer (‘SO’) and a Qualified Person (‘QP’) involved in submitting a Specific Proposal will be enhanced by prescribing the responsibilities of the Sponsor/Adviser, SO and QP in respect of such proposal, and expanding the enforcement framework over the SO and QP;⁶ 


9. The prescriptive approach to due diligence will be replaced by a requirement that the Sponsor/Adviser and other relevant parties undertake due diligence in accordance with industry best practices; notwithstanding the foregoing, the aforesaid parties will still be required to make due and careful enquiries and comply with the equivalent obligations and standards under the SC’s Guidelines on Submission of Corporate and Capital Market Product Proposals; 


10. It is clarified that an independent adviser for a Major Disposal and voluntary withdrawal of listing must be a person who is appropriate to give competent independent advice under the Malaysian Code on Take-Overs and Mergers 2016 read together with the Rules on Take-Overs and Mergers and Compulsory Acquisitions; 


11. The Exchange will be empowered to return any listing or quotation application submitted to it if the quality of the application is deemed unsatisfactory or does not comply with the ACE LR; and 


12. It is now expressly provided that the rejection or return of any application by the Exchange is without prejudice to its right of the Exchange to take enforcement actions for breaches of the ACE LR.