On November 27, 2015, the amendments to the regime for notification of major holdings will enter into force as a result of incorporating Directive 2013/50/EU1 into Spanish legislation. The main amendments are as follows:

  • New definition of financial instruments subject to notification

Under the regime for notification of major holdings, the acquisition or loss of a major holding, or its existence in the case of a first admission to trading, must be communicated when reaching, exceeding or lowering the following thresholds: 3%, 5%, 10%, 15%, 20%, 25% 30%, 35%, 40%, 45%, 50%, 60%, 70%, 75%, 80% and 90% of the voting rights of a company admitted to trading on an EU regulated market.

Until now, this obligation arose as a result of holding shares or financial instruments that conferred an unconditional right or discretion to acquireshares already issued under a binding agreement. From November 27, 2015, notification must be given of financial instruments2 with a financial effect similar to that of holding shares, regardless of whether settlement is made through shares or in cash.

  • New criterion for calculating thresholds for notification of major holdings

Unlike before, to calculate whether the thresholds for notification of major holdings have  been met, the voting rights corresponding to holding shares (physical position) and financial instruments (derivative position) will be added together.

The number of voting rights attributable to a financial instrument will be calculated by referring to the theoretical total amount of shares underlying the financial instrument. When the financial instrument is only settled in cash, the number of voting rights will be calculated by multiplying the number of underlying shares by the delta of the instrument (sensitivity of the price of the instrument to the price of the underlying value). To calculate the voting rights, only long positions, which cannot be netted with short positions relating to the same underlying issuer , will be considered. All these calculations will be made under the provisions of Commission Delegated Regulation (EU) 2015/761.3

The general deadline for submitting a notification of major holdings is still four trading days from the date on which the person becomes aware or should have become aware of the circumstance obliging him or her to notify. It is considered that the person should have been aware of the acquisition, assignment or possibility of exercising the voting rights within two trading days of the transaction and, as a new feature, it is clarified that this circumstance is independent of the date on which the acquisition, assignment or possibility of exercising the voting rights comes into effect.

  • Two further exceptions to the obligation to submit a notification of major holdings, as contained in national legislation

It will not be necessary to report voting rights:

  1. held by an entity in a trading portfolio, providing they do not exceed 5% of the voting rights, and they are not exercised or used in any other way to participate in the management of the issuer; or
  2. acquired for stabilization purposes under Regulation (EC) 2273/2003,4 providing they are not exercised or used in any other way to participate in the management of the issuer.
  • Coming into force and application of the new regime for notification of major holdings

The amendments to the regime for notification of major holdings will come into force on November 27, 2015. Those who, after its approval, must submit a notification of major holdings (because they have, for example, added together their positions in shares and derivatives, or applied the new definition of financial instrument) will have 15 days from November 27 to notify the CNMV of their voting rights. Within these 15 days, they must also submit notification of any changes affecting other prior communications of voting rights (including positions in trading portfolios and stabilization operations).