On Wednesday 14 June, the Council of the EU adopted its position with a view to future interinstitutional negotiations on the ‘Listing Act’ (see EUROPE 13190/28). The ultimate aim of the text is to make it easier for companies - particularly SMEs - to become listed on the stock exchange, thereby making the EU’s public capital markets more attractive.
“Today’s agreement will help European companies to access sources of funding that they have not made use of until now because of excessive bureaucracy”, commented Swedish Finance Minister Elisabeth Svantesson.
The text proposes several exemptions from the obligation to publish prospectuses, which must contain the detailed information that a company is required to produce in order to issue securities to the general public. For securities that are fungible with securities already admitted to trading on the same regulated market, for example, the company would be exempt provided that the newly admitted securities represent, over a 12-month period, less than 20% of the number of securities already admitted to trading on the same regulated market and that this admission is not combined with an offer of securities to the public.
Member States could decide to set a threshold of €5 million, below which offers of securities to the public would be exempt from the obligation to publish a prospectus. In the absence of a decision by the Member States, the threshold would remain at €12 million. These decisions should be notified to the Commission and the European Securities and Markets Authority (ESMA).
The text also proposes several provisions relating to additional information. For example, when the price indicated in the prospectus does not differ by more than 10% - as opposed to the 20% proposed by the Commission - the issuer would not be required to publish a supplement. “Nevertheless, the acceptances of the purchase or subscription of securities may be withdrawn for not less than 3 working days after the final offer price/or amount of securities to be offered to the public has been filed”, the document states.
Penalties are also provided for. In the event of repeated infringements, a ban on holding management positions in investment firms, as well as positions as benchmark administrators or supervised contributors, for a period of at least 10 years could be imposed. The Commission’s initial proposal was that this potential ban should be permanent.
In terms of follow-up, the text would oblige the European Commission to present to the European Parliament and the Council of the EU a report analysing the issue of liability relating to the information provided in a prospectus by 31 December 2025 at the latest.
Interinstitutional negotiations can begin as soon as Parliament has adopted its position.
View the document approved by Coreper: https://aeur.eu/f/7kh
View the annexes: https://aeur.eu/f/7kj (Original version in French by Thomas Mangin)