Free Market

In accordance with Act 256/2004 Coll. on trading on the capital market (the “Capital Market Act”), the free market is a regulated market. Investment instruments accepted on this market must comply with the conditions stipulated in Section 56 of the Capital Market Act and the Exchange Rules, Part V. – Conditions for the Acceptance of Securities for Trading on the Free Market of the Exchange (hereinafter the “Securities Conditions”) (freemark.pdf), or Exchange Rules, Part VI – Conditions for the Admission and Trading of Derivative Investment Instruments on the Free Market of the Exchange (hereinafter the “Investment Instrument Conditions”) (deriv_sec.pdf). On this market, the Stock Exchange does not impose higher requirements on issues and their issuers than those specified in the generally valid laws relating to the capital market.
It is also possible to trade short-term bonds on the free market, i.e. bonds with a maturity shorter than 12 months.

1. Acceptance of Securities (Shares, Bonds)

An application for the acceptance of an issue of securities is filed by the issuer of the security or by an Exchange member authorised by such an issuer or by an Exchange member, even without the issuer’s approval. Acceptance without the issuer’s approval requires that the issues concerned are issues of previously quoted securities. The application must be delivered in writing and in an electronic format if possible, with respect to the nature of the documents. The application must apply to all of the securities and the issue must be transferrable without restrictions.

The following documents must be submitted to ensure the successful acceptance of an issue:

• Application for acceptance;
• Prospectus of the securities concerned, stating the date, place and manner of publication;
• Certification of ISIN allocation;
• Confirmation from a central depository regarding the registration of the issue (as regards dematerialised investment instruments), or 4 templates of the physical investment instrument (as regards physical - certificated investment instruments);
• Extract from the Commercial Register;
• Memorandum of Association or Articles of Association of the issuer.

The application for the acceptance and the fulfilment of the disclosure duties may be submitted in English, if permitted by law and the specific conditions.

Acceptance Procedure

The General Director must decide about the acceptance of an issue or a tranche within 10 business days of the delivery of the respective application.
It further applies to the acceptance of the issues of bonds that if an accepted issue is issued under a bond programme, such a programme must be accepted for trading first.

Issuer’s Duties

The definition of basic information which companies are obliged to disclose is provided in Art. 6 of the Securities Conditions.

The most important information submitted to the Exchange is:

• Annual Report, submitted by the issuer not later than 4 months following the end of the fiscal year;
• Semi-annual Report, submitted by the issuer not later than 2 months following the end of the fiscal year;
• In case of the issuer of shares Report of the issuer´s statutory body;
• and all information that could directly or indirectly cause a change to the share price or rate of the securities.

The issuer of a security is a person obliged to comply with disclosure duty (i.e. the duty to inform), as regards the acceptance of a security issue, on the basis of the issuer’s application; or, as regards the acceptance of a security without the issuer’s consent, the obliged person is an Exchange member who has applied for the acceptance or an Exchange member to whom the duty to inform was transferred with the consent of the Exchange.

The information which the Stock Exchange obtains from the issuers as part of compliance with the disclosure duty will be published (see About Exchange/PSE Trading Data).

2. Acceptance of Derivative Investment Instruments

The acceptance application is filed by the issuer or an Exchange member authorized by the issuer. The application must be delivered in writing and in an electronic format if possible, with respect to the nature of the documents. The application must apply to all of the securities.

The following documents must be submitted to ensure the successful acceptance of an issue:

• Application for acceptance;
• Prospectus or summary document of an investment instrument;
• Final terms of issue.

The application for the acceptance and the fulfilment of the disclosure duties may be submitted in English, if so permitted by law and the specific conditions.

Acceptance Procedure

The General Director must decide about the acceptance of an issue within 10 business days of the delivery of the respective application. It further applies to the acceptance of the issues of investment instruments that if an accepted issue is issued under an offer programme, such a programme must be accepted for trading first.

The individual issues accepted in the course of an offer programme are accepted based on the issuer’s notification.

Issuer’s Duties

The definition of the basic information which the companies are obliged to provide can be found in Art. 6 of the Investment Instrument Conditions.
The most important information submitted to the Exchange is:

• Annual Report, submitted by the issuer not later than 4 months following the end of the fiscal year;
• Semi-annual Report, submitted by the issuer not later than 2 months following the end of the fiscal year;
• Changes in the rating of the issuer or the choice of a sponsor;
• and all information that may have an influence on the investment instrument rate.

The information which the Stock Exchange obtains from the issuers as part of compliance with the disclosure duty will be published (see About Exchange/PSE Trading Data).

Fees

Companies with issues traded on the free market are obliged to pay fees to the Stock Exchange in connection with the acceptance thereof. For detailed information, see Regulation Governing Fees and the Tariff of Exchange Fees (fees.pdf, tariff.pdf).

Fee (one time) for the acceptance of securities for trading	CZK 50,000.00
Lump-sum fee for the acceptance of a bond programme	CZK 100,000.00
Fee (one time) for the acceptance of derivative investment instruments	CZK 5,000.00 per issue, max. CZK 100,000.00 per year

Newly accepted issues of shares are exempt from all fees as of the date on which the issue was admitted to trading.

Investment instruments listed on the free market.