A review of the Prospectus Directive was launched by the European Commission on 18 February 2015. The purpose of the review is to address the shortcomings of the Prospectus Directive, in particular:

  • Whether the principle that a prospectus is required whenever securities are admitted on a regulated market or offered to the public is still valid; and
  • The costs of producing and getting a prospectus approved.

The European Commission has identified a number of the following fundamental aspects of the Prospectus Directive which are the subject of the review, including:

  • When is a prospectus is needed and what information should it include:
    • Potential adjustment of the existing exemption thresholds so that a larger number of offers can be carried out without a prospectus;
    • Potential harmonisation in areas such as the flexibility of member states to require a prospectus for offers of securities with a total consideration below €5 million;
    • Potential wider range of securities to be covered in the Prospectus Directive;
    • Potential extension of the Prospectus Directive to the admission of securities to trading on multilateral trading facilities;
    • Potential extension of the scope of the exemption from the requirement to issue a prospectus provided to employee share schemes to non-EEA private companies wishing to offer their shares to employees in the EU;
    • Potential modification and extension of the proportionate disclosure regime;
    • Streamlining of the disclosure requirements under the Transparency Directive, the Market Abuse Directive and the Prospectus Directive;
    • Potential reassessment of the rules regarding the summary and maximum length of the prospectus; and
    • Reassessment of the adequacy of liabilities and sanctions under the Prospectus Directive.
  • Prospectus approval:
    • Assessment of the involvement of national competent authorities in relation to prospectuses, the material differences in the way national competent authorities assess draft prospectuses and the scrutiny and approval procedures applied;
    • Potential relaxation of the prohibition on marketing activities by the issuer in the period between the first submission of a draft prospectus and its final approval, providing that no legally binding purchase takes place until the prospectus is approved, coupled with potential publication of draft prospectuses;
    • Potential simplification of the notification procedure between the competent authorities of home and host EU member states;
    • Potential extension of the base prospectus facility for all types of issuers; and
    • Creation of a single integrated EU filing system for all prospectuses produced in the EU.

The consultation closes on 13 May 2015.

A copy of the consultation paper is available at: http://ec.europa.eu/finance/consultations/2015/prospectus-directive/docs/consultation-document_en.pdf.

A copy of the Prospectus Directive (2003/71/EC) is available at: http://eur-lex.europa.eu/legal-content/EN/TXT/?qid=1424435617380&uri=CELEX:32003L0071.

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