The Financial Conduct Authority (FCA) has released the final rules for a new private stock market called the Private Intermittent Securities and Capital Exchange System (PISCES). PISCES is set to launch later this year and will allow private companies to attract a wider range of investors and asset managers. The new market is part of the FCA’s efforts to reform UK markets and boost growth and competitiveness.
It will provide investors with easier access to investment opportunities in private firms. Access to PISCES will be restricted to institutional investors, high-net-worth individuals, sophisticated investors, and employees of participating companies. The FCA has emphasized that investors will receive comprehensive information about the associated risks to make well-informed decisions.
PISCES will initially operate within a sandbox environment, allowing the FCA to test and refine its design ahead of a planned permanent framework in 2030. The sandbox is already open, with actual trading expected to commence later this year.
Pisces market opens new opportunities
Entities wishing to run a PISCES platform will need to apply to the FCA for approval. Upon receiving approval, these firms can conduct intermittent trading events. Simon Walls, Executive Director of Markets at the FCA, said, “This bold design rebalances risk, but it is bold risk-taking that has made the UK the leading financial center it is today.
The new platforms will provide investors with greater access and confidence to invest in exciting new companies, while early backers and employees can sell up and reinvest.”
Emma Reynolds, Economic Secretary to the Treasury, added, “PISCES is a great example of industry, regulators, and the government working together to advance innovative reforms, strengthen UK capital markets, support economic growth, and put more money in people’s pockets as part of our Plan for Change.”
While some believe PISCES could revitalize the UK’s capital markets, others are less optimistic. Critics have voiced concerns about privacy, future valuations, and the potential for competitors to infiltrate shareholder registers. However, supporters argue that many of these criticisms are based on misunderstandings.
They point out that PISCES allows operators and issuers to choose pricing mechanisms, offering control not commonly found in public markets. If implemented correctly, PISCES could catalyze the UK’s private markets ecosystem, positioning them as direct competitors to public markets. The introduction of PISCES represents a significant shift in how private company shares are traded in the UK, promising to reshape the landscape of capital markets.
