On May 27, 2025, UK FCA published a new webpagePISCES: platforms for trading private company shares, giving overview of planned PISCES private stock market.
Sets out who can use and run a PISCES platform and background to market creation.
FCA notes that it will publish its final rules for PISCES in Jun. 2025 and that until Jun. 2030 it will test the regulatory framework for PISCES using a sandbox.
Another new webpage, PISCES Sandbox: apply to run a platform, says applications will open in Jun. 2025, notes how to apply, material to submit, pre-application support.
FCA issued consultationPrivate Intermittent Securities and Capital Exchange System: Sandbox Arrangements, containing proposals for a new private stock market.
FCA is consulting on the regulatory framework for the Private Intermittent Securities and Capital Exchange System (PISCES), a new type of trading platform that will enable intermittent trading of private company shares using market infrastructure.
Will use public market features such as multilateral trading and private market features to give companies greater discretion over how and to whom their disclosures are distributed when trading occurs, and which investors can participate in trading events.
Proposed regulatory framework for PISCES will be established under a financial market infrastructure (FMI) sandbox created by UK Treasury, latter has confirmed it will give FCA powers to implement and oversee operation of PISCES sandbox for 5-year period.
Consultation contains proposed rules and guidance for PISCES sandbox, and also includes alternative options FCA considered during the policy development process.
Framework is temporary, so FCA may need to update it as it learns from the operation of PISCES, this will help shape the possible future permanent regime.
Participation in PISCES sandbox is voluntary, so proposals not being imposed on firms.
Proposals
FCA wants to create regulatory framework for PISCES which encourages and supports operator, company and investor participation; enables innovation and helps firms access capital; accommodates different operator business models and service features.
Addresses relevant risks proportionately while avoiding disproportionate regulatory burden; enables further change during sandbox period to ensure objectives are met.
Regulatory framework for PISCES will differ from other markets, UK Market Abuse Regulation (UK MAR) will not directly apply to shares admitted to a PISCES platform in and of themselves, only if PISCES share has impact on price/value of another financial instrument admitted to trading on a UK (or other inc-scope) trading venue.
PISCES will be a secondary market only and not a trading venue, trading activity for a given share must be intermittent and of limited duration, no transaction reporting.
Non-public and intermittent disclosures via bespoke regime including core information.
Statutory requirement to ensure only certain categories of retail investor can participate, and issuer flexibility over trading events, e.g. can determine when traded.
FCA proposes a standalone sourcebook for PISCES sandbox that contains some new rules and guidance - the draft PISCES Sourcebook (PSI); and is also consulting on limited proposals to amend existing FCA Handbook rules for the PISCES sandbox.
Firms who want to operate a PISCES platform will need to apply to FCA to enter the sandbox, regulator will review applications against requirements in its final rules.
Consultation End
The closing date for the submission of feedback to consultation is Feb. 17, 2025.
FCA will consider responses, publish made rules, expected to be by May 2025.
In Feb. 2025, UK Innovate responded to FCA PISCES sandbox proposals, see #245010.
Apr. 10, 2025 Feedback and Pre-Application Support
On Apr. 10, 2025, UK FCA issued an update on PISCES and pre-application support.
Following closure of the consultation, the regulator is providing an early update on the potential impact of the feedback on its final rules, is doing this in order to give firms sight of its thinking as they are working on their plans to operate a PISCES.
However, final rules for PISCES remain subject to the agreement of the FCA Board.
Most respondents supported approach, so FCA does not intend to make material changes to proposals, or mandate sweeper model for additional company disclosures.
However, intends to propose various technical changes, responding to feedback that FCA should more fully align PISCES with private market practice, where it feels would allow regulator to maintain proportionate standards appropriate for PISCES.
To assist potential operators of a PISCES, FCA sets out the changes it is minded to propose in a table, but may be adjusted as it develops its rules instrument for PISCES.
Final rules will be set out in a policy statement which is expected to be published in Jun. 2025, any differences with proposed changes described in table will be identified.
FCA's expectation remains that the PISCES sandbox will then open for applications.
FCA now welcomes requests from prospective PISCES operators for regulator to provide preliminary feedback on their proposed operating models and draft rulebooks.
This engagement can happen from now, with no need to wait for final PISCES rules.
Formal feedback will be provided following the review of final documentation submitted as part of a valid application post publication of the regulator's final rules.
Firms who would like to use this pre-application support should contact the FCA.
Prospective PISCES operators who are not yet authorized and need to apply for a new permission or those who need to vary an existing permission are also welcome to engage FCA's Pre-Application Support Service (PASS) to discuss their applications.
May 15, 2025 Regulations
On May 15, 2025, UK Treasury announced delivery of legislation to establish PISCES.
The Financial Services and Markets Act 2023 (Private Intermittent Securities and Capital Exchange System Sandbox) Regulations 2025 (StIn 2025/583) provide for creation, operation of PISCES sandbox and will come into force on Jun. 5, 2025.
This delivers on the Chancellor’s Mansion House commitment to launch PISCES by May 2025 (see #233503), with share trading taking place later in Autumn 2025.
UKP issued UK Treasury's written statements to Commons and Lords on legislation.
UK GVT will legislate to ensure employees who have share options will be able to exercise them on PISCES, retain tax advantages, making the platform more attractive.
Thanks to PISCES, private company shareholders, which includes founders and early-stage investors, can more easily realize gains and reinvest this in productive assets.
To ensure employees can continue to benefit from the tax advantages on their shares, the law will be changed to extend to the existing Enterprise Management Incentives (EMI) and Company Share Option Plan (CSOP) contracts to also include PISCES.
This is in addition to making PISCES transactions exempt from stamp taxes on shares.
UK FCA will publish rules underpinning PISCES shortly after legislation in force.
On same date, UK HMRC consequently updated technical note providing details of the tax implications in relation to employees trading their shares on PISCES.
Provides further details regarding introduction of PISCES, the interaction with the tax advantaged share schemes and the application of the readily convertible assets rules.
May 27, 2025 PISCES Guidance and Sandbox
On May 27, 2025, UK FCA published a new webpagePISCES: platforms for trading private company shares, giving overview of planned PISCES private stock market.
Sets out who can use and run a PISCES platform and background to market creation.
FCA notes that it will publish its final rules for PISCES in Jun. 2025 and that until Jun. 2030 it will test the regulatory framework for PISCES using a sandbox.
Another new webpage, PISCES Sandbox: apply to run a platform, says applications will open in Jun. 2025, notes how to apply, material to submit, pre-application support.
Regulators
UK FCA; UK HMRC; UK Treasury; UKP
Entity Types
B/D; Corp; Exch; HF; IA; Inv Co
Reference
Gd 5/27/2025; St UIN HLWS643, St UIN HCWS639, PR, StIn 2025/583, 5/15/2025; PR 4/10/2025; CP24/29, PR, 12/17/2024; Citation: StIn 2025/583;
