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Quoted Eurobonds: The Professional Securities Market, Euro MTF and the Irish Alternative Securities Market

Securities that are officially listed on the Professional Securities Market in London, the Euro MTF in Luxembourg and the Alternative Securities Market in Ireland will be regarded as 'listed on a recognised stock exchange'.

Detail

In order to qualify as quoted Eurobonds, and therefore enabling interest to be paid gross without deduction of income tax, securities have to meet the conditions set out in section 349 (4) ICTA 1988; namely quoted Eurobond means any security that:

  • is issued by a company;
  • is listed on a recognised stock exchange, and
  • carries a right to interest.

A recognised stock exchange is a stock exchange designated as such by the Board of HMRC under section 841 ICTA 1988 and s1005 ITA 2007, and a list of exchanges presently designated is available.

As set out in a press release issued on 28 November 2001 (PR120/01) the phrase listed on a recognised stock exchange denotes listing by a competent authority and admission to trading on a recognised stock exchange.

We have received a number of questions recently in connection with these particular market platforms that have been launched in London, Luxembourg and Ireland.

London Stock Exchange: Professional Securities Market (PSM)

The London Stock Exchange launched the new PSM on 1 July 2005, which is a market operated by the London Stock Exchange. The London Stock Exchange is a recognised stock exchange. The UK Listing Authority is the competent authority for listing securities on the London market.

Eurobond securities that have been admitted to the Official List by the UK Listing Authority are officially listed. Eurobond securities that are admitted to trading on the Professional Securities Market will be admitted to trading on a recognised stock exchange. The PSM is part of the London Stock Exchange and the LSE is a recognised stock exchange.

Therefore, Eurobond securities that have been admitted to the Official List, and admitted to trading on the PSM will meet the quoted Eurobond requirement to be listed on a recognised stock exchange.

This will apply to new issues on the PSM, and also to existing Eurobond securities that are transferred to the PSM from an existing London Stock Exchange market.

Luxembourg: Euro MTF

Until 15 July 2005 the Luxembourg Stock Exchange operated only one market, the “Bourse de Luxembourg”. On 18 July 2005 the Luxembourg Stock Exchange started to operate another market called the “Euro MTF” in addition to the Bourse de Luxembourg. Some commentators have referred to this new market as “Luxalter”.

The Luxembourg Stock Exchange is designated as a recognised Stock Exchange. The Societe de la Bourse de Luxembourg is the competent authority for admitting securities to the official list of the Luxembourg Stock Exchange.

Therefore, Eurobond securities that have been admitted to the Official List by the Societe de la Bourse de Luxembourg, and are admitted to trading on Euro MTF, will meet the requirement to be listed on a recognised stock exchange. This will apply to new issues, and also to existing Eurobond securities that transfer from the main market.

Ireland: The Alternative Securities Market (ASM)

The Irish Stock Exchange is designated as a recognised stock exchange and the ASM is a market of the Irish Stock Exchange. The Irish Financial Services Regulatory Authority is the competent authority in Ireland and is responsible for the supervision of the Irish Stock Exchange.

Therefore securities that are admitted to the Official list of the Irish Stock Exchange and admitted to trading on the ASM will meet the requirement to be listed on a recognised stock exchange.

Contact for queries

CT & VAT Products & Processes
100 Parliament Street
LONDON
SW1A 2BQ

Tel 020 7147 3195

June 2007