OREANDA-NEWS. Moscow Exchange's new listing rules came into effect on 9 June, with the list of securities admitted to trading having been revised. The list will comprise three sections: Level 1 and Level 2, which are quotation lists, and Level 3, which is a non quotation list.

Level 1 includes securities that were on the A1 and A2 quotation lists before 9 June. Level 2 comprises securities from the previous B, V, and I quotation lists. Level 3 contains securities that were in the “Unlisted' and “Admitted to Placement' sections.

The highest level has thus been expanded from 478 to 535 securities, with the number of stocks increasing from 38 to 65.

“The listing reform broadens opportunities for conservative institutional investors, while also increasing requirements for issuers, including in corporate governance', said Equity and Bond Market Managing Director Anna Kuznetsova.

The new rules allow issuers to list their securities at any level at the IPO stage.

The main features of the reform are that free float is now among the criteria to determine on which list a security is included, and for inclusion in Level 1, issuers are now required to submit three years of IFRS results (versus one year previously). Corporate governance requirements have been increased for issuers to meet the Central Bank's new Corporate Governance Code. To be included in Level 1, at least 20% and no fewer than three directors on an issuer's board must be independent. Issuers' boards are required to create audit, personnel, and remuneration committees comprising a majority of independent directors.

For a bond issue to be included in Level 1 (in addition to three years of IFRS statements), the issuer, guarantor, or issue must have a credit rating; the minimum rating has been increased by two notches. The minimum corporate bond issue size must be RUB 2 bln, while regional and municipal issues must be at least RUB 1 bln.

Mutual fund units must meet minimum NAV and liquidity requirements to be listed. A mutual fund must have a NAV of at least RUB 1 bln to be included in Level 1, RUB 300 mln for Level 2, and RUB 150 bln for Level 3 (RUB 250 bln for real estate mutual funds.