Proposed changes to the AIM Rules: an overview

London Stock Exchange plc (LSE or the Exchange) has published AIM Notices 62 and 63, setting out proposed changes to the AIM Rules for Companies, the AIM Disciplinary Procedures and Appeals Handbook and the AIM Rules for nominated advisers (Nomad). The proposed changes are designed to give effect to proposals outlined in the Feedback Statement that was published in November 2025 and represent one of the most significant updates to the AIM framework in recent years.

The Exchange is seeking to reposition AIM as a more agile and competitive growth market by reducing unnecessary regulatory burdens on admission and to give companies on AIM greater flexibility

While many of the changes formalise practice which has been in place since the Feedback Statement, others go further and, if implemented, are likely to have a meaningful impact on how companies approach IPOs, fundraisings and strategic transactions on AIM. This update sets out the proposals most likely to be of interest to new entrants to the market, issuers and their advisers.

Simplifying admissions to AIM

Removal of working capital statement

The Exchange proposes to remove the requirement for a working capital statement in the AIM admission document. This would be replaced with a tailored disclosure on capital resources, financial obligations and expected funding needs over the following 12 months, bringing AIM more closely into line with both international practice and the more flexible approach on the Main Market where qualified working capital statements are permitted.

Accounting standards

The proposed changes would permit UK-incorporated AIM companies to use UK GAAP (FRS 102) rather than IFRS, reflecting existing policy and responding to concerns about the cost and complexity of IFRS conversion. The Exchange also proposes to codify the ability to incorporate information by reference, which should help to shorten admission documents and avoid duplication, and to confirm that a full admission document is not required where an AIM company is simply admitting a second line of securities.

Collectively, these measures are aimed at making the IPO process more proportionate and cost-effective, particularly for smaller and growth-stage companies where regulatory burden can be a significant deterrent.

New admission routes for international and Main Market companies

For a long time the AIM Rules have included a ’fast track’ AIM designated market route for certain overseas and UK issuers seeking an admission of their shares on AIM. However, the work required for these transactions has not been significantly less than the work required for an IPO on AIM and so it has not been used that extensively. To enhance AIM’s international appeal and facilitate access for companies from other public markets, the Exchange is proposing to replace the existing AIM Designated Market route with a new ’Express Market’ route for applicants that have been listed for four years and will, on Admission, have a market cap of at least £20 million.

The proposed framework (i) includes a wider range of markets which are eligible for this new route and puts this route on a par with the Equity Shares (International Commercial Companies Secondary Listing) category in the UK Listing Rules (UKLR), (ii) provides for the market notification period to be reduced from 10 to 3 clear business days, (iii) removes mandatory lock-in requirements for applicants and (iv) most importantly it reduces the disclosure requirement on admission. Also, the Exchange is proposing to create a new dual market admission route which allows a company seeking to raise at least £6 million that is applying for listing on an “Express Market” to simultaneous apply for a listing on AIM and rely primarily on documents prepared for their Express Market admission, subject to certain additional disclosures.

An accelerated admission process is also proposed for certain Main Market companies, recognising that these companies already have an established public-market track record on a UK regulated market.

More flexible approach to acquisitions and transactions

Reverse takeovers

The Exchange has followed through with a policy introduced at the time of the Feedback Statement that exceeding 100% in the class tests will no longer, of itself, result in a transaction being treated as a reverse takeover (RTO). Instead, the classification will turn on whether the transaction gives rise to a fundamental change in the company’s business, board or voting control. Transactions which exceed 100% but do not involve a fundamental change will instead fall within the substantial transaction rule, with disclosure tailored to their impact and, in some cases, subject to shareholder approval. This is a significant change as previously such transactions would have required a very expensive re-admission process.

The Exchange has also opted to incorporate its policy of permitting trading to continue in AIM shares where an RTO is in contemplation provided that sufficient information is disclosed to the market rather than imposing an automatic suspension. This allows issuers to avoid a suspension early on in a transaction when there is more uncertainty that it will complete. The Exchange is also proposing helpful guidance on the circumstances where an option to carry out an RTO does not constitute an RTO. This avoids situations where an option prematurely triggers RTO obligations such as suspension even though it is not likely to result in an RTO.

Class tests

In addition, it is proposed that the threshold for substantial transactions will be increased from 10% to 25%, aligning AIM with the Main Market threshold for significant transactions and the profit test will be removed (other than in respect of related party transactions) which is similar to the approach taken with the UK Listing Rules.

The gross capital test may be pro-rated for investing companies making acquisitions in line with their investing policy, in certain circumstances.

Taken together, these changes reflect a clear shift towards a more pragmatic, substance-based regime, intended to reduce unnecessary disruption and allow companies to execute transactions more efficiently where there is no transformative change.

Easier fundraisings (including retail participation)

A key innovation is the proposed introduction of a “Capital Access Window”, under which an AIM company would be able to request a temporary suspension of trading while undertaking an equity fundraising. This would be a voluntary tool, similar to the trading halts on the ASX.

The Exchange’s intention is that this mechanism will enable companies to engage with a broader range of investors, including retail participants, within a more controlled environment. It may also assist in managing information flows and reducing execution risk and volatility during the fundraising process. In practice, this could become a useful addition to the toolkit for AIM companies, particularly in the context of larger or more complex capital raises, as it removes the risk of shifts in price derailing or prolonging fundraising transactions.

Flexible governance

The Exchange is also seeking to replace the current comply-or-explain requirement against a recognised corporate governance code with a more flexible disclosure-based model in key areas such as board composition, remuneration, risk management and investor relations.

The proposals also permit the use of special voting shares at admission, enabling founders to retain enhanced control following IPO. This brings AIM into line with broader market trends, including developments in the UKLR for the issue of a dual share class structure. This enables founders to obtain a public listing without ceding control which is more common in the United States.

The Exchange has proposed removing the requirement for Nomads to provide a ’fair and reasonable’ opinion on non-standard director remuneration arrangements where they are satisfied that there are adequate contractual protections for the AIM company in place.

These changes reinforce AIM’s positioning as a market that can accommodate a wide range of corporate structures and governance models, rather than imposing a uniform framework.

Greater agency over disclosure and market engagement

New voluntary disclosure provisions would allow AIM companies to disclose details of their engagement with proxy advisers, either on their AIM Rule 26 website or by notification. It was clear from the Feedback Statement that there was a significant amount of unhappiness regarding the current proxy advisory system which sometimes imposes excessive and inconsistent corporate governance requirements. The changes would allow companies to explain to the market the difficulties they have to correct proxy voting recommendations which they believe are not well-founded. The proposals set out the framework for the disclosure and asks for feedback on whether they should be mandatory.

Shift in the Nomad role

AIM Notice 63 highlights an important evolution in the role of Nomads. The Exchange acknowledges that the role has become increasingly compliance-driven over time and is seeking to rebalance it towards corporate finance expertise and judgement. However, the proposals do not reduce the obligations on Nomads in the AIM Rules for nominated advisers and impose a new overriding obligation to preserve the reputation and/or integrity of AIM and impose more restrictions on what Nomads can do with communications from the Exchange.

The removal of the current AIM Rule 11 disclosure obligations, which are viewed as duplicative of the requirements under UK MAR, does decrease the burden on Nomads. In its place, the revised framework would place greater emphasis on the Nomad’s role in helping companies assess the market impact of developments, while leaving primary responsibility for disclosure decisions with the company itself.

Nominated Adviser Technical Note

The Exchange has supplemented these proposals with a new Nomad technical note (Technical Note), which consolidates and updates existing guidance on key aspects of the Nomad role including relevant guidance previously set out in Inside AIM, which will be retired when the new AIM Rules and Nomad Rules come into force.

In particular, the Technical Note includes helpful clarification on a number of core operational areas, including:

• confirmation that a Nomad is not expected to instruct its own lawyers to oversee, review, duplicate or report on the verification exercise undertaken by the issuer’s lawyers

• a more proportionate approach to due diligence at take-on, confirming that Nomads are not expected to undertake IPO-style due diligence for existing AIM companies or applicants already admitted to another public market

• a more pragmatic stance on site visits. While still regarded as valuable in many cases, the Exchange confirms that site visits at admission are not required where they are unlikely to yield benefit for the Nomad’s assessment of appropriateness and the Technical Note sets out specific circumstances where this will be the case and

• additional structure around the assessment of free float, emphasising factors such as the range and spread of shareholders, the influence and visibility of any major shareholders, any measures in place at admission to enhance liquidity and the existence of concentrated shareholders and what measures are in place at admission to address these.

Conclusion

The proposals set out in AIM Notices 62 and 63 collectively amount to a deliberate rebalancing of the AIM regime. The emphasis is on reducing cost and complexity, increasing flexibility and restoring a more commercial, judgement-based approach to regulation, while maintaining the core protections necessary for market integrity.

For issuers, the changes have the potential to make AIM a more attractive venue for both IPOs and follow-on activity, with simpler admission requirements, more flexible transaction rules and greater freedom in governance structures. For advisers, and in particular nominated advisers, the proposals signal a shift in expectations, with a renewed focus on the application of expertise rather than adherence to detailed procedural requirements.

If implemented in their current form, these reforms are expected to enhance AIM’s competitiveness both domestically and internationally, particularly in the context of attracting founder-led and high-growth companies.

The consultation remains open until 2 July 2026, and market participants have an opportunity to shape the final form of the rules. Final rules are expected later in 2026 although a number of the proposals already reflect the Exchange’s current policy approach.

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