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Prospectus to be published when securities are offered to the public or admitted to trading
This Directive is designed to improve the quality of information provided to investors by companies wishing to raise capital in the European Union. To this end, the harmonisation of rules governing the drafting and content of prospectuses is to be stepped up. A single authorisation system for prospectuses which may be used in all EU Member States ('single passport for issuers') is also introduced.
Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 on the prospectus to be published when securities are offered to the public or admitted to trading and amending Directive 2001/34/EC [See amending act(s)].
The purpose of the Directive is to harmonise requirements for the drafting, approval and distribution of the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market situated or operating within a Member State.
The Directive introduces rules making it easier and cheaper for companies to raise capital throughout the EU on the basis of approval from a regulatory authority in one Member State ('home competent authority'). It reinforces protection for investors by guaranteeing that all prospectuses, wherever they are issued in the EU, provide them with the clear and comprehensive information they need to make investment decisions.
Obligation to publish a prospectus
The Member States do not authorise any offering of securities to the public on their territory unless a prospectus has been published previously, except where an offer of securities:
- is addressed solely to qualified investors; and/or
- is addressed to fewer than 150 natural or legal persons other than qualified investors; and/or
- is addressed to investors who acquire securities for a total consideration of at least EUR 100 000 per investor, for each separate offer; and/or
- has a denomination of at least EUR 100 000; and/or
- has a total value in the EU, over a period of 12 months, of less than EU 100 000.
This Directive therefore provides for derogations. The latter are regulated by technical standards prepared by the European Securities and Markets Authority (ESMA) and adopted by the European Commission.
Characteristics of the prospectus
A prospectus is a disclosure document containing financial information which concerns the issuer and the securities to be offered to the public or admitted to trading on regulated markets. It must contain a summary of the information relating to the securities in question, acting as a guide for investors. Nevertheless, the summary is not generally mandatory if the prospectus relates to the admission to trading on a regulated market of non-equity securities with a denomination of at least EUR 100 000.
Information to be included
Information to be included in the prospectus relates in particular to:
- securities (equity and non-equity);
- the various types and characteristics of offers and admissions to trading on a regulated market of non-equity securities;
- the activities and size of the issuer;
- the public status of the issuer.
Some items of information may not be disclosed if they are contrary to the public interest, likely to seriously prejudice the issuer, or of minor importance. The ESMA participates in drafting norms relating to the omission of this kind of information.
The validity of a prospectus is 12 months, provided it is updated and supplemented with the required items.
Approval of the prospectus
No prospectus can be published until it has been approved by the competent authority of the home Member State. This competent authority must notify the ESMA at the same time as the issuer, the person offering the securities or the person seeking admission to trading on a regulated market, of its decision regarding the approval of the prospectus. This notification must be given within ten working days of the submission of the draft prospectus (twenty working days if the public offer involves securities issued by an issuer who does not have any securities admitted to trading on a regulated market and who has not previously offered securities to the public).
Publication of the prospectus
As soon as the prospectus has been approved, it is deposited with the competent authority of the home Member State and made available to the ESMA. It is also published by one of the following methods:
- in a newspaper disseminated nationally or having a wide readership;
- in printed form;
- on the issuer’s website;
- on the website of the regulated market;
- on the website of the competent authority of the home Member State.
The ESMA publishes a list of approved prospectuses on its website.
|Act||Entry into force||Deadline for transposition in the Member States||Official Journal|
OJ L 345, 31.12.2003
|Amending Act(s)||Entry into force||Deadline for transposition in the Member States||Official Journal|
OJ L 327, 11.12.2010
OJ L 331, 15.12.2010
- Directorate-General for Internal Market and Services, Prospectus Directive