The stem that goes with it has an internal diameter a fraction bigger than a normal stem would and it slides up and down the sleeve until you tighten its bolts, at which point the stem height is fixed and the sleeve can no longer rotate about the steerer. The notch in the stem and the ridge along the sleeve mean the stem can't rotate around the sleeve. For someone not tall enough to look down on the front wheel/handlebar assembly, this helps a little bit in lining things up!
I get that but how does the sleeve not rotate around the steerer? I presume there must be enough tension, or rather compression (I think?), from the stem bolts to just clamp the sleeve in place.
Edit: Doh! Of course the sleeve can't rotate independently of the stem, due to the ridge.
It's quite a nice set-up I think, if you assume an entry level bike and an owner wanting adjustment but not likely to get into the realm of swapping out components or dismantling the steering set-up to rearrange spacers. It didn't look out of place at all when it was where it was supposed to be.
It doesn't look bad, I think, and compared to an adjustable stem it allows a greater range of height adjustment without involving the complication of angles and reach. Probably weighs less too, if that were important.
