GENERAL CORPORATE

Third Parties given the right to bring claims directly against dissolved companies' insurers

The Third Parties (Rights against Insurers) Act 2010 has been amended by the Insurance Act 2015 ("2015 Act") and the Third Parties (Rights against Insurers) Regulations 2016 ("2016 Regulations") to remove the requirement that insolvent and dissolved companies are restored to the register of companies before a claimant can bring a claim under a dissolved company's insurance policy. Instead, the 2015 Act and the 2016 Regulations transfer the rights bestowed on a company by its insurance policy (following the company's dissolution) to a third party claimant, allowing that claimant to claim directly against the company's insurer.

The changes implemented by the 2015 Act and 2016 Regulations will apply to any claim brought by a claimant where either the liability and / or the insolvency of the dissolved company arises on or after 1 August 2016. Any situation in which the liability and insolvency of the company occurs before 1 August 2016 will still require the company to be restored to the register of companies before a claimant can benefit from the insolvent company's insurance cover.

Impact - As restoring a dissolved company to the companies register requires an application to court, the removal of the requirement will reduce the time and money that a claimant must invest when making a claim under a dissolved company's insurance policy.

The Council of the European Union ("The Council") announces its support for the European Commission's ("EC") proposed overhaul of the Prospectus Directive

As covered previously, in November 2015 the EC published a proposal to improve the EU's prospectus regime by making it "simpler, faster and cheaper". The Council's Permanent Representatives Committee (COREPER) has now announced its backing for the new prospectus regime, marking another step forward towards a Capital Markets Union. The next stage for the prospectus reforms will be for the European Parliament to agree its position on the EC's proposals.

Impact  - the EC's proposed prospectus regime reflects its "Action Plan on Building a Capital Markets Union" published in September last year. The ultimate goal of the EC's prospectus proposals are to reduce the administrative burden on issuers, make the prospectus a more useful tool for investors and achieve more convergence between the EU's prospectus and disclosure rules. In turn the EC hopes this will help to build a true single market for capital across the 28 EU Member States.

PUBLIC COMPANY

London Stock Exchange ("LSE") confirms proposed changes to the AIM Rules

The LSE has confirmed in AIM Notice 45 ("the Notice") that it will be implementing the changes to the AIM rules that were set out in AIM Notice 44, as discussed here, with only minor amendments. The changes seek to prepare the AIM rules for the implementation of the Market Abuse Regulations ("MAR") on 3 July 2016.

The LSE has confirmed that:

  • rule 11 of AIM (General disclosure of price-sensitive information) will be retained and the rule's guidance notes will be supplemented with signposts to AIM companies' separate obligations to comply with Article 17 of MAR (Public disclosure of inside information). The LSE justifies the retention of rule 11 on the basis of its lack of authority to enforce Article 17 of MAR (which, in the UK, will fall within the remit of the FCA), highlighting that "retaining a disclosure obligation which is principles-based and which can be enforced by the exchange, is important for the maintenance of the integrity of AIM";
  • the requirement in rule 17 of the AIM rules (Directors' dealings) that requires companies to disclose directors' dealings, will be deleted. Instead additional guidance will be added to rule 17 to signpost an AIM company's equivalent obligations under Article 19 of MAR (Managers' transactions); and
  • rule 21 of the AIM rules (Restrictions on dealings) will be completely replaced, as MAR will provide a legal prohibition on trading during close periods. The new version of rule 21 will require AIM companies to have a `dealing policy'. The content of the dealing policy will not be prescribed, instead rule 21 will detail the minimum provisions that are expected to be included in a company's policy. In the Notice the LSE justifies its decision to require a dealing policy in contrast to the UKLA's decision to remove the Model Code in respect of premium listed companies on the basis of "the different profile and resources of premium listed issuers when compared to AIM companies".

The LSE has also noted the FCA's recent publication of supervisory guidance in relation to `closed periods' under Article 19(11) of MAR. The LSE states that it will consider making any necessary changes to the AIM rules once further clarification has been given by the FCA or the European Commission on this issue.

The LSE has published clean and marked up versions of the new AIM rules on its website. It has also published amended versions of the NOMAD and Investment Companies rules, that have been updated to reflect the amendments to the AIM rules.

Impact - The new rules will come into force on 3 July 2016, in alignment with the implementation of MAR.

OTHER ITEMS

  • The following European Commission Delegated Regulations, that supplement the Market Abuse Regulations, have been published in the Official Journal of the European Union ("Official Journal"):

The delegated regulations published in the Official Journal make no changes or alterations to the draft versions that had been previously published by the European Commission.