Listing small companies on small  exchanges

Listing entities on small stock exhanges will generally not meet the definition of

"regularly traded"

The CRS states that a regularly traded entity is a non-reportable person when reviewing the the account holder.

Also regularly traded entities are an Active NFE and hence the controlling persons will not be reported.

The CRS describes stock is "regularly traded"...

  1. If there is a meaningful volume of trading with respect to the stock on an on-going basis:

    • Trades in each such class are effected, other than in de minimis quantities, on one or more established securities markets on at least 60 business days during the prior calendar year
    • The aggregate number of shares in each such class that are traded on such market or markets during the prior year are at least 10% of the average number of shares outstanding in that class during the prior calendar year.
    • A class of stock would generally be treated as meeting the "regularly traded" requirement for a calendar year if the stock is traded during such year on an established securities market and is regularly quoted by dealers making a market in the stock. A dealer makes a market in a stock only if the dealer regularly and actively offers to, and in fact does, purchase the stock from, and sell the stock to, customers who are not related persons with respect to the dealer in the ordinary course of a business.
  2. Trades on an "established securities market":

    • Means an exchange that is officially recognised and supervised by a governmental authority in which the market is located and that has a meaningful annual value of shares traded on the exchange.
    • An exchange has a “meaningful annual value of shares traded on the exchange” if it has an annual value of shares traded on the exchange (or a predecessor exchange) exceeding USD 1 billion during each of the three calendar years immediately preceding the calendar year in which the determination is being made. If an exchange has more than one tier of market level on which stock may be separately listed or traded, each such tier mustbe treated as a separate exchange.

For example, Curacao Stock Exchange will not qualify for meaningful volume