Brussels, 28/08/2002 (Agence Europe) - Following the European Commission's decision to issue a revised proposal for a directive on prospectuses containing key financial information for fund raisers, which takes on board many of the concerns raised by Parliament through amendments to the previous proposal adopted on 14 March 2002, the EP's Economic and Monetary Committee has decided to organise a public hearing to listen to the views of the financial services industry on 2 October. (See EUROPE/Documents No 2282, dated 14 August 2002).
The parliamentary committee also decided to reserve its position on whether or not to proceed with another first reading or allow the new revised proposal to go to Council. Christopher Huhne (ELDR, United Kingdom), rapporteur on this issue, explained on 27 August before the Committee on Economic and Monetary Affairs that the new proposal was an "enormous improvement on the Commission's first draft" in the sense that it was now "user friendly" and accepted Parliament's desire to see a short summary and a comprehensible document for investors. The proposal lightens the burden for SMEs and has removed the original provisions for compulsory shelf registration. Nevertheless, there are still a number of controversial points, not least regarding the choice of regulator for issues of bonds. The Commission is now proposing that, except for large denomination issues worth more than EUR 50,000, this should be the regulator of the country where the finance company is based rather than of the country where it is intended to raise the funds. Member States, however, are divided over this question so reaching agreement will be no easy matter, say parliamentary circles. Mr Huhne remains, however, convinced that the Parliament can fast-track the legislation - an important part of the financial services action plan - so that it can be approved by the end of the year. The new proposal also reflects the EP's wish to see that companies with market capitalisation of less than EUR 350 million and wishing to raise funds in the home state are exempt from the new rules.