The key advantages of being a public limited company are set out below:

How to become listed on the exchange?

Only a joint stock company may be an issuer of shares listed on GPW. This does not bar entities operating under any other legal form from listing, but their owners need to transform them into joint stock companies or establish joint stock companies and transfer the entities’ assets thereto.

Listed companies come from many sectors of the domestic and international markets and the exchange is open to companies of different business profiles.

Source: GPW, 31/12/2019

Discover the procedure of going public

1. 1

   Preparing for the process

   To be able to float its shares in an IPO, a prospective issuer must be a joint-stock company. A business having a different form of incorporation, for instance, a limited liability company, will need to change its legal form.

   As a next step, the General Shareholders Meeting should adopt a resolution approving a public offer of shares, dematerialisation of the shares, and an application for admission of the shares to trading on the regulated market.

   The decision to apply for admission to trading on the regulated market may require the preparation of a prospectus so the company will need to work with:

   • an investment firm which will offer the company’s shares in a public offer,
   • an auditor who will audit the company’s financial statements published in the prospectus;
   • legal advisor.

   Depending on the issuer's individual needs, the company may need to hire IR/PR advisors to strengthen communication activity.

   The public offering, including the approval of the prospectus and its contents (or an information memorandum where relevant) follow the legal regime established under the following key legislation:

   • Act on Public Offering, Conditions Governing Admission of Financial Instruments to Organised Trading, and Public Companies, of July 29th, 2005 (”Public Offering Act”);
   • Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/ECText with EEA relevance (“Regulation (EU) 2017/1129”);
   • Commission Delegated Regulation (EU) 2019/980 of 14 March 2019 supplementing Regulation (EU) 2017/1129 of the European Parliament and of the Council as regards the format, content, scrutiny and approval of the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Commission Regulation (EC) No 809/2004 (“Regulation (EU) 2019/980”);
   • Commission Delegated Regulation (EU) 2019/979 of 14 March 2019 supplementing Regulation (EU) 2017/1129 of the European Parliament and of the Council with regard to regulatory technical standards on key financial information in the summary of a prospectus, the publication and classification of prospectuses, advertisements for securities, supplements to a prospectus, and the notification portal, and repealing Commission Delegated Regulation (EU) No 382/2014 and Commission Delegated Regulation (EU) 2016/301 (“Regulation (EU) 2019/979”).

   A prospectus is subject to approval by the Polish Financial Supervision Authority (“UKNF”, “KNF”). Once it is approved, the issuer can use it to offer securities to the public and subsequently seek listing and admission of the securities to trading on a regulated market.

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2. 2

   Implementing the process

   The next step in going public is to execute the offering. The process consists of two main phases:

   • premarketing: presentation of an analytical report on the issuer by an analyst of the investment firm (or analysts of investment firms in the case of a consortium) addressed to institutional investors;
   • marketing: company presentation by the issuer’s management as a key phase of the placement, following the publication of the prospectus, concluded with bookbuilding. Bookbuilding identifies the parameters of the offer by compiling and analysing demand declarations of institutional investors. A declaration of demand specifies the issue/selling price of the offered securities and the number of securities to be taken up by the investor provided that the price is not higher than that set in the declaration.

   After reviewing demand for the shares, the company decides about the issue/selling price of the shares in the public offer as well as the number of securities to be offered, broken down into tranches addressed to specific groups of investors.

   The last phase of the offering process is to open a subscription for the shares and to book the subscriptions in each investor tranche. After closing the subscription, when the offered shares are taken up on the terms and conditions of the subscription defined in the prospectus, the offered shares are allocated to the subscribed investors.

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3. 3

   First listing on GPW

   Before the introduction of securities into trading on the exchange, the issuer should file the appropriate documents with the Central Securities Depository of Poland (“KDPW”) together with an application for the registration of the securities which are to be introduced into exchange trading (for shares in a public offer, not earlier than the allocation of the shares to the subscribed investors).

   Once the offer is closed, the company submits an application to GPW for the admission of the shares (and possibly also rights to new issue shares - PDA) and their introduction to trading on the main or the parallel market of the exchange. The application must include, among others, the prospectus approved by KNF.

   Shares may be admitted to trading on the exchange (on the main or the parallel market) provided that:

   • an appropriate information document has been prepared and approved by the relevant supervision authority (KNF), unless such information document is not required to be prepared or approved;
   • transferability of the shares is not restricted;
   • no bankruptcy or liquidation proceedings are pending with respect to their issuer;
   • the capitalisation of the company* (understood as the product of the number of all the issuer’s shares and the forecasted market price) is equal at least to PLN 60,000,000 or the PLN equivalent of EUR 15,000,000 (except for issuers whose shares of at least one issue were listed on another regulated market or on NewConnect for at least 6 months – their capitalisation may be equal at least to PLN 48,000,000 or the PLN equivalent of EUR 12,000,000);
     * or the issuer’s equity where the forecasted market price cannot be determined
   • shareholders, each of which may exercise less than 5% of votes at the issuer’s meeting of shareholders, hold at least:
     1. a. 15% of shares referred to in the application for admission to exchange trading, and
     2. b. 100,000 shares referred to in the application for admission to exchange trading with a value equal at least to PLN 4,000,000 or the PLN equivalent of EUR 1,000,000, calculated based on the last selling or issue price;
   • the shares are held by such a number of shareholders that gives sufficient grounds to develop liquidity of exchange trading.

   Together with the application for admission, the issuer should present to GPW an investment firm opinion on the fulfilment of the requirements of admission to exchange trading.

   Shares may be admitted to exchange trading on the main market subject to the following additional conditions:

   • transferability of the shares is not restricted;
   • all shares of the same type are referred to in the application for admission;
   • the product of the number of all shares and the forecasted market price (or the issuer’s equity where the forecasted market price cannot be determined) of the shares referred to in the application is equal at least to the PLN equivalent of EUR 1,000,000;
   • dispersion of the shares referred to in the application: shareholders, each of which may exercise no more than 5% of votes at the meeting of shareholders, hold at least 25% of the shares referred to in the application for admission, or shareholders, each of which may exercise no more than 5% of votes at the meeting of shareholders, hold at least 500,000 shares of the company with a value equal at least to the PLN equivalent of EUR 17,000,000 (shares may be admitted even if this condition is not fulfilled where the Exchange Management Board decides that the number of shares referred to in the application and the subscription or sale procedure give sufficient grounds that shares on the main market will develop liquidity of trading, or shareholders, each of which may exercise no more than 5% of votes at the meeting of shareholders, hold at least 25% of the shares of the same issuer referred to in the application for admission to exchange trading and shares already traded on that market, or dispersion of the shares referred to in the application takes place on another market of official exchange trading in one or more member states);
   • the issuer has published financial statements with an auditor opinion at least for three consecutive financial years preceding the submission of the application for admission or there is a reasonable interest of the company or investors and the company has published information necessary for investors to assess its financial standing and the risks involved in the acquisition of the shares referred to in the application.

   When considering the application for admission of securities to exchange trading, the GPW Management Board takes into consideration:

   • the issuer’s current and projected financial standing, in particular the profitability, liquidity and creditworthiness, as well as other factors influencing the issuer’s financial results;
   • the growth prospects of the issuer, in particular a feasibility study of its investment plans with an account of the sources of financing;
   • the experience and competence of members of the issuer’s managing and supervisory bodies;
   • the terms and conditions upon which the securities were issued and their compliance with the rules of public exchange trading set out in joint resolutions of the Exchange Supervisory Board and Management Board;
   • the safety of exchange trading and interests of trading participants.

   The issuer should submit the application for admission to exchange trading directly to the Exchange Management Board in a formavailable from the Exchange.

   The Exchange Management Board shall pass a resolution on the admission of financial instruments to exchange trading within 14 days of the date of submission of the complete application.

   The detailed terms and conditions of admission of shares and other financial instruments to exchange trading are set out in the GPW Exchange Rules (Chapter II of the Rules) and the the Regulation of the Minister of Finance of 25 April 2019 concerning detailed terms and conditions that must be satisfied by the official trading market and issuers of securities admitted to trading on such market.

   Information about the details to be covered by the application for admission of shares to exchange trading and the required documents to be attached to the application is available in Chapter I of the GPW Detailed Exchange Trading Rules in UTP System.

   Shares which have been admitted to trading under a resolution of the Exchange Management Board are eligible to be introduced to exchange trading on the relevant market. Financial instruments are introduced to exchange trading in the regular procedure at the request of the issuer which specifies the code under which the instruments are to be registered in the central securities depository.
   The Exchange Management Board acting at the request of the issuer determines the trading session when the instruments will be first traded.

   Information about the details to be covered by the application for introduction of shares to exchange trading and the required documents to be attached to the application is available in Chapter II of the GPW Detailed Exchange Trading Rules in UTP System.

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4. 4

   The public life of the company

   Disclosure obligations

   The disclosure obligations of companies whose securities have been admitted to trading on the GPW regulated market are not materially different from the requirements imposed on companies listed in other developed capital markets of the European Union.

   Disclosure requirements are there to ensure that both current and future holders of financial instruments have access to all significant information about a public company, and are meant to eliminate information asymmetries among market participants. Information disclosed by public companies is used by investors as a basis for the assessment of their operating and financial position and growth prospects. Therefore, compliance with disclosure requirements by public companies enhances investors’ confidence in the capital market in general, which also brings a number of benefits to the issuers in the longer term: good image, higher stock valuation, and lower financing costs in the future. In order to satisfy disclosure requirements, the company must be well prepared to face new challenges, which will involve building the awareness among the issuer’s management and supervisory board members, introducing new disclosure responsibilities for selected staff members, as well as adopting and effectively rolling out disclosure-related procedures. Disclosure requirements include the obligation to publish inside information as well as current and periodic reports. Mandatory immediate publication of reports containing inside information is provided for in Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (“Market Abuse Regulation”, “MAR”), and applies to all issuers who have requested admission of their financial instruments to trading on a regulated market, or whose securities have been admitted to trading on a regulated market.

   Compliance of listed companies with those obligations is supervised by the Polish Financial Supervision Authority (“UKNF”, “KNF”).

   Issuers are also obliged to publish current and periodic reports (including quarterly, half-year and full-year financial statements). Their scope, content and manner of publication are set out in the Regulation of the Minister of Finance of 29 March 2018 on current and periodic information to be disclosed by issuers of securities and conditions for recognising as equivalent of information required under the laws of a non-member state.
   Financial statements presented in periodic reports should be prepared according to the applicable accounting policies of the issuer, in particular those applicable to listed companies traded on the regulated market.

   The immediate publication clause applies also to any notifications from shareholders on exceeding a certain threshold of total voting rights, as well as the information on any transactions in the issuer’s shares concluded by persons discharging managerial responsibilities (primary insiders), as well as persons closely associated with them, which is communicated by those persons pursuant to the Act on Public Offering or the Market Abuse Regulation.

   All reports containing inside information as well as current and periodic reports must be transferred and filed via the electronic report filing system (ESPI) managed by the KNF. For more information on how to access and use the ESPI system, visit the KNF website.

   Compliance with the disclosure requirements is supervised by the KNF. In the event of any identified non-compliance, the KNF may impose administrative sanctions both on the noncomplying company and on members of its management or supervisory board.

   The code of best practice

   To create conducive conditions for the development of strong investor relations, the Warsaw Stock Exchange (“GPW”) has approved a code of best practice (corporate governance). The code is a set of principles which help to improve the transparency of companies, their image and reputation. The code of corporate governance (“Best Practice of GPW-listed Companies”) is soft law, which means that companies are expected to comply with it (by going public on the exchange, companies are deemed to have approved and agreed to comply with such obligations); however, non-compliance or incomplete compliance are not subject to any penalties imposed by GPW. According to the comply-or-explain approach, companies may refuse to comply with the Code of Best Practice; however, when they fail to comply with any principle (permanently or incidentally), they are required to disclose that fact. A current report (provided via the EBI system) should disclose the non-compliance and describe the circumstances and reasons of the non-compliance as well as the ways the issuer intends to remedy the non-compliance and future steps to be taken in order to mitigate the risk of future non-compliance with the Code of Best Practice. While non-compliance is not subject to any penalties (issuers are only subject to penalties under internal regulations in the event of non-compliance or undue compliance with the disclosure obligations under corporate governance), the market may penalise companies which fail to comply with the principles of corporate governance by driving down their share price.

   Issuers are not required to file any declarations on future compliance with the principles of the Code. However, they are required to disclose permanent or incidental non-compliance with any principle. When a non-compliance discontinues, the issuer should immediately disclose that fact.

   Issuers are required to prepare an annual report on the company’s compliance with the code of corporate governance. Annual reports on compliance with the code of corporate governance are a part of the company’s annual reports published under the Act on Public Offering.

   The code of best practice approved by GPW is simple and transparent. As such, it may be followed by companies established under different legal regimes and operating in many different countries. Exchanges in other EU member states have approved similar codes of corporate governance With the implementation of the Code of Best Practice, the Polish capital market has become more transparent and more competitive in Europe. The positive impact of the Code has been appreciated by both individual and institutional investors. Compliance of listed companies with the principles of the Code improves corporate governance in Poland. For many companies, compliance with the Code supports their share price on the exchange.

   For more information about the Code of Best Practice, visit the Best Practice website.

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If you are interested in introducing shares to exchange trading on NewConnect, please visit the market website.

If you are interested in issuing and introducing bonds to trading on Catalyst, please visit the market website.