SME growth market
MiFID II will bring about important changes in the market structure of European capital markets. MiFID II introduces a new sub-category of MTFs: the SME growth market. The aim of the introduction of SME growth markets is to facilitate access to capital for small and medium-sized enterprises (SMEs).
An example of the difference in requirements governing trading on an SME growth market compared to trading on an MTF is that it is possible for the issuers of financial instruments to draw up an 'admission document’ instead of a more detailed prospectus. In addition, it serves to promote the development of markets that cater to the needs of SMEs. It is important in this case to maintain the right balance between adequate investor protection and as low as possible administrative expenses for the issuers of financial instruments that are traded on an SME growth market.
In order to qualify as an SME growth market at least 50% of the issuing companies must fall in the SME category. This is assessed annually based on the market capitalisation of the three prior calendar years. If the criterion has not been met, the registration as SME growth market does not have to be cancelled or rejected if there is a reasonable prospect that the criterion will be met at the beginning of the next year.