Inside this Topic Guide
The Prospectus Directive (PD) and Prospectus Regulation (PR) regulate and standardise prospectuses across the European Economic Area (EEA). The PD requires that an issuer of securities provides a prospectus where either:
- the offer is made to the public in the EEA; and/or
- an application is made for securities to be admitted to trading on an EEA regulated market. This includes all EEA main exchanges, e.g. London Stock Exchange's Main Market.
The PD sets out the initial disclosure requirements that must be included in the prospectus. It also provides a passport for issuers that enables them to raise capital across the EEA on the basis of a single prospectus. The PR sets out detailed technical disclosure requirements which differ according to the types of products and issuers. These are set out in the Annexes.
The Transparency Directive places on-going disclosure obligations on issuers, including annual and half-yearly accounts prepared to International Financial Reporting Standards (IFRS) or the equivalent.
There have been some recent Delegated Regulations (please see the Legislation, regulation and official documentation section below). However, the main focus currently is on a new Prospectus Regulation which will replace the existing Prospectus Directive regime in due course.
New Prospectus Regulation (EU) 2017/1129: Level 1
The starting point for the new Prospectus Regulation, which forms part of the EU Capital Markets Union (CMU) project, was a 30 November 2015 EU Commission proposal. Following the Trilogue process, the final text of the new Prospectus Regulation was agreed between the European Commission, Council and Parliament, in late 2016 / early 2017 and the final text of the new Prospectus Regulation (EU) 2017/1129 was published in the Official Journal of the European Union on 30 June 2017. Most provisions take effect 24 months after implementation, but a few will come into force straight away – see Clifford Chance summary chart.
Next steps: Level 2
The Prospectus Regulation represents a "Level 1" measure. The European Commission mandated ESMA to start work on the "Level 2" measures in February 2017. The mandate was revised for minor cross-referencing updates in June 2017. The Level 2 Regulations will, for example, contain detailed disclosure requirements for prospectuses.
On 6 July 2017, ESMA issued three consultation papers for technical advice which closed on 28 September 2017. The three consultation papers were: Consultation Paper on the format and content of the prospectus (ESMA31-62-532); Consultation Paper on EU Growth prospectus (ESMA31-62-649); and Consultation Paper on scrutiny and approval (ESMA31-62-650). A Final Report was published on 28 March 2018.
On 15 December 2017, ESMA issued a further consultation paper on regulatory technical standards (RTS) under the Prospectus Regulation. The further consultation covers: key financial information that should appear in the prospectus summary; data and machine readability of information to be sent to ESMA in order to provide free access to the public; advertisements for public offers or admissions to trading; instances which require the publication of a supplement to a prospectus; and publication of a prospectus. Comments closed on 9 March 2018.
In addition, on 24 April 2018, the EU Commission issued a Roadmap on a simplified prospectus for companies and investors in Europe with a deadline of 22 May 2018.
On 28 March 2018, ESMA published a Final Report on technical advice under the Prospectus Regulation. This Final Report relates to the three consultations published in July 2017.
On 20 September 2017, the European Commission published a proposal for a regulation ("Omnibus 3") which would make changes to various EU Regulations. If adopted in its current form, it would make significant changes to some key elements of Prospectus Regulation (EU) 2017/1129. The proposal as drafted would come into force in July 2019 with transitional provisions over 3 years. Changes include centralising approval of certain prospectuses so that ESMA would be the competent authority.
To find related amending instruments, as listed on the consolidated versions, type the instrument number into the Eur-lex search.
|Yolanda Azanza (Madrid)||Antonio Henriquez (Madrid)|
|Daniel Badea (Bucharest)||Christian Kremer (Luxembourg)|
|Cedric Burford (Paris)||Julia Machin (London)|
|Andrew Coats (London)||Sebastian Maerker (Frankfurt)|
|Lounia Czupper (London)||Habib Motani (London)|
|Stewart Dunlop (London)||Grzegorz Namiotkiewicz (Warsaw)|
|David Dunnigan (London)||Vlad Petrus (Prague)|
|Filippo Emanuele (Milan)||Reiko Sakimura (Tokyo)|
|Gregor Evenkamp (Frankfurt)||Simon Sinclair (London)|
|Matt Fairclough (Hong Kong)||Jessica Walker (London)|
|Frank Graaf (Amsterdam)|