On 7 March 2024, the Central Bank of Ireland (the "Central Bank") published its Prospectus Regulatory Framework – Questions & Answers 2nd Edition (the "Revised Q&A"). This document replaces the Prospectus Regulatory Framework Questions and Answers dated August 2017 (the "Original Q&A"). The Revised Q&A sets out the Central Bank's approach to certain points concerning the approval, publication and passporting of prospectuses under the Prospectus Regulation ((EU) 2017/1129) and subordinate measures. The principal changes are outlined below.
Dialogue with Central Bank
The Original Q&A recommended that market participants who were uncertain about the application or otherwise of EU and Irish prospectus law, notwithstanding having obtained legal advice, engage in dialogue with the Central Bank prior to the final submission of a prospectus for approval. The guidance for market participants in these circumstances is now to engage with the Central Bank prior to the first submission of a prospectus for approval. We do not expect this to impact the regular discussion that occurs in the course of the submission and approval process for prospectuses. However, it is a reminder to issuers and other market participants to engage early in the transaction timetable with the Central Bank where required.
Incorporation by reference – ESEF
The ESEF Regulation (Commission Delegated Regulation (EU) 2018/815) introduced a single electronic reporting format ("ESEF") for financial statements of issuers with securities admitted to trading on EU regulated markets. The Revised Q&A confirms that financial statements that have been prepared in ESEF may be submitted in that format to the Central Bank for incorporation by reference into a prospectus as an alternative to portable document format (or pdf).
Passporting
Where a translated summary is required for passporting, the Revised Q&A specifies that the translation must be accurate. The Original Q&A had called for exact translation. It is likely that the aim behind this edit is alignment to Article 7 of the Prospectus Regulation rather than a lowering of the standard required.
The Revised Q&A also confirms that a passport request should be submitted to the Central Bank in respect of each supplement to a passported prospectus, following which the Central Bank will send a passport notification in respect of the supplement to the relevant host member state(s). This revision is reflective of current practice in the Irish market and does not create an additional obligation for issuers.
Status
The Revised Q&A is published by the Central Bank to limit uncertainty in relation to the matters that it addresses, although we note that the Central Bank reserves its right to alter its approach as set out in the Revised Q&A at any time.
The Revised Q&A should be applied to prospectuses drawn up under the Prospectus Regulation to the extent of their correlation with the provisions of that Regulation and implementing Irish law.
Expansion of Euronext Dublin's GEM to retail debt securities
On 6 March 2024, Euronext Dublin issued a notice (the "Notice") to market participants in respect of amendments to the Listing and Admission to Trading Rules for Debt Securities for its Global Exchange Market (respectively, the "GEM Rules" and the "GEM"). The Notice outlines amendments (the "Amendments") to the GEM Rules which facilitate the listing on the GEM of debt securities marketed to retail investors with effect from 11 March 2024. The stated aim of the Amendments is to ensure a level playing field with other listing venues for debt securities across Europe.
Issuers seeking listing and admission to trading of retail securities on the GEM will be required to include in their listing particulars the following:
- A legend noting the status the GEM as a multilateral trading facility ("MTF") and the investment risk involved in investing in debt securities listed on an MTF as opposed to a regulated market; and
- Confirmation of compliance with the product governance requirements contained in the Markets in Financial Instruments Directive (2014/65/EU), as amended.
Historically, the GEM has been a market for professional investors and the Notice confirms, helpfully, that the changes to the GEM Rules will not impact debt securities already admitted to the GEM.
The Notice advises that the Amendments will be incorporated into the GEM Rules and published on the website of the Euronext in due course.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
