Secondary equity market, the latest development from PISCES in the United Kingdom

One of the issues that often acts as a brake on investment in start-ups by individuals or entities who, despite having liquidity, know little about the world of innovative businesses but would like to get involved, is the low level of liquidity. Therefore, when investing in a start-up, it is important to understand that such an investment supports the activities of the company itself and therefore cannot be entered into or exited from flexibly. These are patient investments that require a relatively long time to generate returns. One possible solution to this limitation is the so-called secondary market, where equity holders of innovative companies can, if they wish, sell and buy such assets. In Italy, this practice is not yet in place, or rather not in a massive and regulated way, which is why it is interesting to learn how the new system now operating in the United Kingdom works. Called PISCES, which stands for Private Intermittent Securities and Capital Exchange System, it is illustrated and explained in this article by experts from the London office of the law firm TLT.

Unlocking liquidity in private markets: an overview of the new PISCES regime in the UK. What is PISCES?

The Private Intermittent Securities and Capital Exchange System (PISCES) is a new innovative platform for trading shares in private companies. PISCES is a regulated private stock market that allows intermittent and secondary trading of shares in British and foreign private companies, developed in collaboration between the UK Treasury, the Financial Conduct Authority (FCA) and the London Stock Exchange (LSE). Unlike traditional public markets, PISCES will not allow companies to raise new capital through the issuance of new shares. It is strictly a secondary market, allowing shareholders to sell their existing shares to specific categories of investors.

What has happened so far?

To test the PISCES regulatory framework, the FCA is running a sandbox until June 2030, which will allow it to refine the model and, depending on the results, either end the sandbox or make it permanent at a later stage. The FCA opened the sandbox in June 2025 and published a set of rules for institutions hosting a PISCES platform. In August 2025, the LSE became the first PISCES operator approved by the FCA, followed by JP Jenkins, which obtained approval to operate a trading platform within the sandbox in November 2025. On 5 February 2026, the LSE published the Private Securities Market Rules and the Private Securities Market Handbook applicable to its PISCES platform, the Private Securities Market (PSM), which supplement the basic regulatory framework contained in the FCA’s Sourcebook.

Which companies can have their shares traded on a PISCES platform?

Both British and foreign private companies can trade their shares on PISCES platforms, provided that they are not listed on a public market in the UK or abroad. Although PISCES rules do not contain additional corporate governance requirements for PISCES companies, platform operators may (under their own rules) require minimum governance standards as a prerequisite for admission to trading.

How does it differ from AIM or Aquis?

Unlike AIM or Aquis, PISCES allows intermittent rather than continuous trading, which means that companies retain privacy and flexibility. Furthermore, as already mentioned, PISCES is only a secondary market and does not allow companies to raise new capital by issuing new shares.

Who can buy and sell shares on PISCES?

The following categories of investors will be able to purchase shares on PISCES platforms:

• institutional investors;

• individuals with high net worth;

• sophisticated investors; and

• employees, officers and consultants of the participating companies.

Retail investors are generally excluded, reflecting the regulatory framework’s focus on professional market participants. Subject to any applicable contractual restrictions, all existing shareholders of PISCES companies will be able to sell their shares in relevant trading events.

How will PISCES trading events work and what information will companies be required to disclose?

Each FCA-approved PISCES platform will operate intermittent trading windows with the following key features:

• intermittent is defined as “occasional, infrequent and of limited duration”, which in practice will probably mean monthly, quarterly, annually or ad hoc; and

• companies will be able to: 1) choose when and how often to open trading windows, offering flexibility and control over liquidity events; 2) set a minimum and maximum price for the sale of shares; and 3) restrict access to trading events in order to promote or protect the legitimate interests of the company (for example, by allowing them to customise access to specific investor profiles or exclude competitors) .

Participating companies are not subject to the full disclosure requirements applicable to companies listed in the United Kingdom, but must instead provide a set of key information prior to each trading event, including:

• an overview of the business and management, and the financial statements;

• details of the share capital, significant shareholders and any employee share ownership schemes; and

• information on relevant contracts and the main risk factors specific to the company and its shares.

Operators of PISCES platforms have the right to request further information if the basic information is not sufficient for investors to make a decision.

The PISCES rules require operators to take measures to ensure the secure disclosure of information by companies. In practice, investors will likely access information in a manner similar to the electronic data rooms used in private merger and acquisition transactions (PISCES operators may outsource the management of such measures). For example, in the case of the London Stock Exchange’s PSM, companies must upload all information to the PSM disclosure portal, with investor access managed through registered third-party auction agents who verify investor eligibility and authorisation to access the information. Any communication made by a company outside the PSM disclosure portal is not part of the disclosure arrangements.

What are the tax implications?

Transfers of shares on PISCES are exempt from UK stamp duty, which would otherwise be levied at 0.5% of the consideration on transfers of private shares. The UK government has also indicated that further legislative measures will be introduced to ensure that Enterprise Management Incentives (EMI) and Company Share Option Plan (CSOP) contracts can be amended so that PISCES trading transactions can be exercised without losing the associated tax benefits.

What are the potential benefits of PISCES?

For investors, PISCES represents an attractive alternative for acquiring stakes in unlisted companies in a regulated, efficient and cost-effective manner. It offers investment opportunities in high-growth private companies that were previously only accessible through private fundraising rounds and improves liquidity by allowing existing investors to exit their positions more flexibly than in traditional venture capital-funded companies.

PISCES offers companies a flexible route to providing liquidity to shareholders without the burdens of a public listing. It enables companies to manage their capitalisation tables more effectively, allowing early investors to exit and new strategic investors to purchase shares, while maintaining control over disclosure levels, investor suitability and trading frequency. Participation in PISCES can also serve as a preparatory step towards an IPO, helping companies build governance and transparency practices in a regulated environment and providing greater credibility to potential institutional investors.

Preparing for the future

PISCES reflects broader trends in capital market reform, with governments and regulators seeking ways to bridge the gap between private and public markets. In line with the UK’s long-standing strategic ambition to channel more investment into private companies, PISCES could encourage institutional investors (e.g. pension funds) to invest more in shares traditionally considered illiquid and high-risk.

Looking ahead, an important question will be whether PISCES will serve as a “stepping stone” to a full listing and lead to more IPOs, or whether it will have the opposite effect, offering companies another option for providing liquidity to shareholders and thus incentivising them to remain private for longer. More importantly, the success of PISCES will ultimately depend on the number of companies that decide to use it. Early adoption by one or more high-profile private companies would be a positive sign, and in early 2026, it will be interesting to gauge the level of interest as awareness of the platform grows.

This publication is for informational purposes only and represents our interpretation of the laws and practices in force as of February 2026. For specific cases, it is advisable to seek specific advice.

About TLT

TLT LLP is a national law firm offering comprehensive services with approximately 1,800 employees and 700 solicitors operating from six offices in the United Kingdom and one office in Piraeus, Greece. The firm’s venture capital and fast-growing team supports a variety of investors, early-stage companies and entrepreneurs on a wide range of issues, including investments, commercial contracts, intellectual property, data protection, employment/human resources, employee incentives and taxation. TLT represents founders, companies, angel investors and venture capital funds in capital raising transactions from seed to Series A, B, C and larger rounds. TLT’s UK offices are supported by a global network of trusted independent partners and preferred law firms in all key jurisdictions. Specifically, the authors of this article are Adam Kuan, Paul Keohane, Nina Searle and Joe Gallon from TLT’s Corporate team. (in the photo by Francais a Londres on Unsplash, the London Stock Exchange)

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