Takeover Panel publishes response statement and instrument following the consultation paper "The communication and distribution of information during an offer (PCP 2016/1)"
In February, as covered here, the Takeover Panel published a consultation paper that set out proposed amendments to the Takeover Code in a number of key areas and sought to reinforce the existing requirement in General Principles 1 and 2 (reflected in Rule 20.1) that target company shareholders are treated equally and must have sufficient time and information to enable them to reach a properly informed decision on a bid. The proposals included:
new provisions restricting the use of social media and videos;
enhancing the provisions in Rule 20.1 to formally apply the rule more broadly to cover not only information about a party but also information relating to, and opinions on, the offer itself;
new provisions requiring that the following must be promptly published on a website and announced via a RIS:
any presentation (however transmitted or received) or other document relating to an offer, or a party to an offer, provided to, or used in any meeting (however held) with, any shareholder or other relevant person; or
any article, letter or other written communication relating to an offer, or a party to an offer, provided to the media; and
a new Rule 20.2, replacing note 3 to Rule 20.1, regarding the attendance of advisers.
The Takeover Panel has now published a Response Statement (RS 2016/1) and Instrument (2016/1) that implement the changes proposed in February with only minor amendments. One of the biggest changes to the proposed alterations was the removal of the requirement to announce via a RIS the publication of new presentations, documents and media communications on the offeror's website. The Takeover Panel has published a marked-up version of the Instrument to clarify the extent and impact of the final changes.
Impact - The amendments set out in the Response Statement and Instrument will not come into effect until 12 September 2016. It should be noted that the amended Takeover Code will apply to any on-going offers on 12 September 2016.
The Companies (Disclosure of Information) (Specified Persons) Order 2016
The Companies (Disclosure of Information) (Specified Persons) Order 2016 (the "Amending Order") has amended the Companies Act 1985 (the "1985 Act") to include, amongst others, the Commissioners for Her Majesty's Revenue and Customs ("HMRC") and the Director of the Serious Fraud Office ("SFO") within the definition of "specified persons" under Schedule 15C of the 1985 Act. The significance of this change is due to its effect upon investigations conducted under section 447 of the 1985 Act.
Section 447 is one of a few sections of the 1985 Act that was not repealed following the implementation of the Companies Act 2006. The powers under section 447 are civil, fact finding powers used by the Insolvency Service to investigate registered companies and limited liability partnerships that have a business address in England, Wales, Scotland or Northern Ireland. Section 447 investigations are confidential enquires into companies that are actively trading or which have ceased trading without going into any formal insolvency proceedings.
Disclosure of information in connection with these enquiries is only permitted to a limited category of recipients specified in Schedule 15C of the 1985 Act. The amendments now extend this category of recipients to include HRMC and the SFO.
As set out in the Amending Order's explanatory memorandum, "These amendments will ensure that Schedule 15C is fit for purpose and enable the Insolvency Service to maximise the benefit to the wider regulatory regime of the information it obtains through its investigations and enforcement activities; and of the intelligence received from third party complainants in cases where another public body might be better placed to act".
Impact - The Order was laid before Parliament on 13 July 2016. It will come into force on 1 October 2016.