On Thursday 8 December, the European Commission welcomed the agreement reached the day before between the Council of ministers and the European Parliament, on the proposed regulation to modify the rules on the prospectuses that European companies wishing to raise capital must publish to provide potential investors with information.
For small capital-raising activities and crowdfunding projects of up to €1 million, businesses will not have to produce prospectuses, according to a Commission press release. Prospectuses will be compulsory only for issuances of more than €8 million. The text provides for a simplified regime or SMEs and a specific regime for companies frequently participating in the capital markets. These frequent issuers will be able to draw up and annually update a sort of reference prospectus ('universal registration document'). As in the Commission's text, the national supervisor will be able to validate this document in five working days rather than ten.
The European Securities and Markets Authority (ESMA) will additionally set up a free European online prospectus database.
European law requires companies wishing to raise funds on the markets to publish a prospectus containing information on the securities issued and the issuing company. The Commission takes the view that this obligation is too much of an administrative burden and excessively expensive for SMEs, due to the amount of information required. Once a prospectus has been validated by the national supervisor, the company in question will be able to raise capital within the European Economic Area. In 2014, fewer than 4,000 prospectuses were issued. In 2015, the Commission proposed relaxing the requirements, in the framework of its planned Capital Markets Union (see EUROPE 11442).
The Parliament and the Council have not yet formally approved the inter-institutional agreement. (Original version in French by Élodie Lamer)