The lack of liquidity in private company share sales can be frustrating to investors, founders, and employees. PISCES is a new type of private stock market designed to create a regulated environment for secondary trading of minority stakes in private companies. It's regulated by the Financial Conduct Authority (FCA), and platforms operating on PISCES must apply for a PISCES approval notice (PAN).
The FCA published its final rules in June 2025 and is now accepting applications. The treasury must report back to parliament on whether PISCES is working as expected by June 2030. The first trading activity is expected later in 2025, subject to operator approvals.
In this article we outline how PISCES will operate and some of the upsides and downsides of this new trading platform.
Unlike the London Stock Exchange or Alternative Investment Market (AIM), trading on PISCES will not be continuous – shares will only be tradeable during specific 'trading events' for example quarterly, six-monthly, or annually, as determined by the company. PISCES platforms cannot currently be used to raise new capital or support buybacks.
Companies using a PISCES platform can control:
The regime will initially operate through a sandbox, meaning that rules, requirements and costs may evolve during the trial period, creating some uncertainty for early adopters. The FCA has also confirmed that PISCES will operate under a bespoke disclosure and transparency framework – lighter than that applying to listed companies. Disclosures will be more limited, with the option for investors to submit specific requests for further information.
Investor participation is restricted – only institutional investors, high-net-worth or sophisticated investors, employees, and certain other categories will be eligible. Retail participation will be limited. Companies listed on recognised public markets in the UK or overseas are not eligible to use PISCES. In practice, eligibility standards will also depend on each operator’s rulebook – for example, the London Stock Exchange has proposed financial thresholds (turnover, asset base or fundraising history) for companies to be admitted.
Trading events will provide liquidity in a market that has historically been difficult to access. Transactions executed on PISCES are expected to be exempt from stamp duty and stamp duty reserve tax. It's also anticipated that the process of exercising and selling employee share options via PISCES will avoid triggering immediate tax liabilities.
For investors, PISCES may provide a new opportunity to build diversified portfolios of minority stakes in private limited companies – a market that was not readily available previously. Overseas investors may also prefer to buy shares in UK companies via UK-regulated platforms, particularly given volatility in some other markets.
For companies, there will be costs and administrative burdens associated with amending share capital structures and constitutional documents, managing the shareholder register, and preparing trading event disclosures with associated liability risk. Uncertainty remains as to how the rules and costs will evolve during the sandbox phase.
For investors, intermittent trading windows mean there is no guarantee of liquidity when desired. Participants will have no control over trading event timing. Pricing may be volatile and could reflect 'fire sale' dynamics if shareholders sell at low values simply to exit. Over time, greater standardisation of disclosure and trading practices may mitigate these risks, but early-stage adoption may be thin, limiting volume and depth of market.
Another potential downside is the lighter-touch disclosure regime, which reduces transparency compared with public markets. While operators may allow investors to request additional information, investors will need to assess carefully whether available data is sufficient to make informed decisions.
PISCES could offer a valuable new mechanism for private companies to facilitate partial liquidity for investors, founders and employees, while boosting the attractiveness of the UK market. However, it's not a route for raising fresh capital. Its success will depend on uptake by both companies and investors, the evolution of disclosure standards, and whether the FCA provides sufficient regulatory certainty following the sandbox phase.
Visit the FCA website for more information on PISCES. If you would like to discuss any of the above in more detail, please contact Sam Brown.
