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Exempt Issuer

Updated on July 18, 2023

A “listed issuer” is a company whose shares are traded on a stock exchange and included in the exchange’s official list. It allows the company to raise capital by selling shares to the public. The listing requirements of the stock exchange and the market regulator outlines the specific criteria that a company must meet to be eligible for listing. Once listed, the company has privileges and responsibilities, which vary based on the exchange and regulations.

An “exempt issuer” refers to a listed issuer that is exempted from certain special reporting rules or obligations. These exemptions are typically granted to senior listed issuers, which are well-established companies with a strong financial position and significant market capitalization.

What is the implication of the ‘Exempt Issuer’ status?

The exempt status relieves the issuer from complying with certain additional reporting requirements that are imposed on other listed issuers. These special reporting rules may include more detailed financial reporting, disclosure of specific information, or additional compliance obligations. By granting exemptions, the regulatory authorities acknowledge the senior listed issuers’ strong market position, stable financials, and comprehensive reporting practices.

The exempt status, however, does not absolve the listed issuer from fulfilling basic reporting and disclosure obligations. All listed issuers are still required to comply with standard reporting and disclosure requirements, which include timely submission of financial statements, annual reports, material information, and other disclosures mandated by the stock exchange or the securities regulator.

It is important to note that the exact criteria for qualifying as an exempt issuer and the specific reporting obligations may differ among stock exchanges and regulatory jurisdictions. Companies seeking exempt status should refer to the listing requirements, rules, and guidelines provided by the relevant stock exchange and regulatory authorities to understand the precise details and conditions applicable to their specific situation.