IHTM18339 - Investments on alternative markets: USM

The Unlisted Securities Market (USM) was opened on 1 November 1980 and was intended by the Stock Exchange to be a regulated replacement for Rule 4.2(a) ( IHTM18338).

Despite the name, USM shares were traded on the Stock Exchange and subject to the same regulations.

• These shares were only "unlisted" in the sense that they have not been admitted to the full listing on the main market.
• It is best to think of the Stock Exchange as a two tier market, with the USM as a second tier.

The USM did not admit new applicants after December 1994, and ceased trading in December 1996. Companies previously traded on the USM either joined AIM ( IHTM18336) or went off market.

The shares had a listing on the SEDOL ( IHTM18092) and are usually valued in the same way as listed shares.

Business relief

Shareholdings in USM companies were regarded as "unlisted" for the purposes of business relief ( IHTM25131) and instalments ( IHTM30191) before 16 March 87 and after 10 March 1992.

For transfers between that time, USM shares were treated as listed and were not allowed relief.