UK exchange group PLUS Markets has resolved its long-standing legal battle with the London Stock Exchange (LSE), allowing PLUS to trade all the stocks listed on the LSE’s AIM small- and mid-cap segment.
The dispute centred on an LSE rule on AIM trading, which required trades in AIM stocks conducted away from the LSE to be reported to the LSE. PLUS argued that this rule effectively prevented the trading of the roughly 1,600 AIM securities on PLUS, save the 90 AIM companies that had elected to be dual-traded on AIM and PLUS. On 19 September last year, PLUS filed an action in the UK High Court challenging the rule.
Under the resolution, PLUS will provide real-time trading data to the LSE to support the exchange’s role in regulating AIM companies and ensuring their compliance with its rules. In turn, market-makers will be able to quote and trade-report in all AIM securities on PLUS’s markets without any additional trade reporting requirements to the LSE.
The LSE will make changes to its rule-book to give firms the right to choose whether to trade AIM securities under PLUS or LSE rules. PLUS said this will allow its main market and PLUS Europe, its pan-European trading platform, to operate as independent execution venues.
The agreed structure, including rule-book changes, will be implemented as soon as possible and by 1 September at the latest.
PLUS believes its ability to trade the full range of AIM stocks will attract institutional traders to connect to its PLUS Pool non-displayed trading architecture for small- and mid-cap stocks.