Equity Capital Markets
The Equity Capital Markets (ECM) Division works to promote efficient and coordinated equity-raising transactions in Europe and to develop good practice.
The ECM Division advocates proportionate regulation, which is necessary to preserve flexibility for issuers, their corporate advisers and underwriters whilst ensuring fairness for shareholders and investors. AFME staff work with teams of experts from member firms on projects ranging from informal discussion groups to formal responses to government consultations.
- Providing members with a forum to discuss industry issues and concerns.
- Eliminating the inefficiencies in market practice and regulation that increase cost and impede capital formation.
- Facilitating the development of good practice, industry standards and form documentation.
- Contributing industry expertise to informed debates about regulation.
- Serving as a resource to help policy makers, media and individuals understand equity capital markets.
Standard forms and documents
Click on the links below to access AFME’s Equity Capital Markets Standard Forms and Documents.
- Model ECM Block Trade Agreement (Backstop)
- Model ECM Block Trade Agreement (Without backstop)
- Model Agreement Among Underwriters (Equities - English Law)
- Model Confidentiality Agreement for Block Trades
- Model Confidentiality Agreement for Listed Issuers
- AFME - Model ECM Research Guidelines
Industry guidelines (relating to UK IPO reform)
- Q&A in relation to COBS 11 A (20 December 2018): This Q&A relates to the FCA COBS 11 rules governing UK IPOs, which came into force on 1 July 2018. It should be read in conjunction with the AFME-Euro IRP process document and guidelines for unconnected analysts seeking to access information on prospective issuers.”
- Note on the verification of unconnected analysts in UK IPOs: This note sets out a protocol that joint global co-ordinators (under the UK IPO Rules – COBS 11A.1.4 – introduced on 1 July 2018) may choose to adopt in order to document the process by which they verify that persons that register their interest in accessing issuers ahead of UK IPOs are bona fide unconnected analysts. It should be read in conjunction with AFME’s record keeping protocol for banks in relation to COBS 11A.1.4.
- Record keeping protocol for banks in relation to COBS 11A.1.4. (19 September 2018): The new UK IPO rules (FCA COBS 11A.1.4) came into force on 1 July 2018 and the protocol sets out a suggested approach to record-keeping by banks in relation to unconnected analysts having an opportunity to be in communication with the issuer team as required by COBS 11A.1.4. It should be read in conjunction with the AFME-Euro IRP process document and guidelines for unconnected analysts seeking to access information on prospective issuers.
- Process document and guidelines for unconnected analysts seeking to access information on prospective issuers (17 August 2018): This relates to the UK IPO rules (FCA COBS 11A.1.4A-F), which came into force on 1 July 2018. It sets out a process by which issuers/banks can facilitate access for unconnected analysts to prospective issuers. It also includes guidelines for unconnected analysts gaining access to companies undertaking an IPO to sign.
- Note on the Scope of Application of the UK Financial Conduct Authority’s Conduct of Business Sourcebook (COBS) 12.2.21A (31 July 2018): This note covers the scope of FCA COBS 12.2.21A (which came into force on 1 July 2018) relating to the identification and management of conflicts of interest affecting financial analysts in the context of investment banking activities.
- Q&A in relation to COBS 12.2.21AG (6 August 2018): This Q&A relates to the FCA COBS 12.2. guidance on the MiFID II provisions, which govern the identification and management of conflicts of interest. This guidance affectsfinancial analysts in the context of investment banking activities such as participating in pitches for new business. The Q&A was prepared following discussions with the FCA and addresses certain commonly asked questions in relation to the practical implementation of the FCA’s guidance.
Industry guidelines (general)
- Protocol (including documentary legends) on MiFID II Product Governance Regime for Equity Capital Markets (15 December 2017): This memorandum sets out steps which firms can use to meet their principal product governance obligations under MiFID II and is designed to be used periodically by committees comprising ECM and Sales & Trading business/legal/compliance teams and commitment committee personnel. The memorandum covers ECM transactions in ordinary shares which are, or will be, admitted to trading on a regulated capital market.
- Guidance Note on Allocation Record Keeping Requirements for Equity Capital Markets (18 December 2017): This guidance note has been developed to assist firms in relation to the allocation record keeping requirements for equity capital markets transactions under MiFID II Articles 16 and 23, Delegated Regulation (EU) 2017/565 Articles 38-41 and the associated ESMA Q&A.
- Note on Application of the MiFID II Allocation and Product Governance requirements to global Equity Capital Markets deals (19 December 2017): This note has been developed to assist firms involved in cross border equity capital markets deals in relation to the allocation and/or product governance requirements under MiFID II.
- Block Trade Lock-Ups Guidelines for Increased Transparency
- Model ECM Block Trade Agreements - explanatory memo
- Selling Restrictions for Equity Transactions (Updated 26 March 2019)
- Block Trade Procedures – Volcker Rule/Investment Company Act
Recent Consultation Responses
- AFME response to the Financial Conduct Authority Call for Input: PRIIPs Regulation – initial experiences with the new requirements (published in July 2018): AFME’s response (dated 27 September 2018) refers to, and should be read in conjunction with, its commentary on the considerations set out in the Annex to the European Supervisory Authorities’ 19 July letter to the European Commission. Also attached to the response is a document entitled Impact of PRIIPS on Retail Activity in Corporate Bonds, dated March 2018.
- AFME response to the Department for Business, Energy and Industrial Strategy (BEIS) consultation on national security and investment: The response is dated 15 October 2018. It refers to, and should be read in parallel with, BEIS’s white paper on proposed legislative reforms in relation to National Security and Investment.
ECM Division board
Laura Holleman, Chair
Goldman Sachs International
Ben Plant, Vice-Chair
Mario Martinez Munoz
Crédit Agricole CIB
Deutsche Bank AG
Jefferies International Limited
Morgan Stanley & Co. International plc