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Applicability and exemptions
When must a prospectus be filed? Are there any notable exemptions?
There are two situations where a prospectus must be filed: where transferable securities are offered to the general public and where such securities are admitted to trading on a regulated market.
There are a few exemptions pursuant to which a prospectus does not have to be prepared, of which the most relevant ones are:
- where the offering is directed solely towards qualified investors (the definition of which is set out in the Swedish Financial Instruments Trading Act (1991:980) and the Swedish Securities Market Act (2007:528));
- where an offering is made to fewer than 150 persons (other than qualified investors) per European Economic Area state;
- where an offering amounts to at least €100,000 per investor or where the nominal value of the securities offered amounts to at least €100,000;
- where the aggregate amount to be paid for the securities relating to an offering corresponds to a maximum of €2.5 million over 12 months; and
- where the number of new shares offered amounts to less than 10% of the number of shares of the same class that is already admitted to trading on the relevant regulated market.
What must the prospectus contain?
In general terms, a prospectus must contain all the information that is necessary for an investor to be able to make an informed assessment of the issuer and the transferable securities that are being offered or admitted to trading. Detailed requirements are set out in the Prospectus Regulation (Commission Regulation 809/2004) and the Swedish Financial Instruments Trading Act.
Filing and approval procedure
What is the procedure for filing for and obtaining prospectus approval from the regulator? Can draft prospectuses be submitted to the regulator for preliminary comment?
The procedure relating to the filing for and obtaining of prospectus approval is typically initiated by the submission of an application for prospectus approval to the Swedish Financial Supervisory Authority. The application shall include the prospectus, the authority’s checklists (which correspond to the annexes to the Prospectus Regulation), and the relevant application form. The Swedish Financial Instruments Trading Act provides that a decision by the authority generally must be taken within 10 business days of receiving a complete application. However, with respect to issuers that have not previously offered shares to the public or been admitted to trading on a regulated market, the processing time is 20 business days. The authority must release its decision and a potential request for additional information as soon as possible, and, in any case, no later than 10 business days after the date of the submission of the application. The processing time may be delayed if the issuer makes amendments to the prospectus, if such changes have not been requested by the authority. Once the prospectus has been approved by the authority, no amendments may be made. Subsequent to the obtaining of the approval, the prospectus must be made public (eg, on the issuer’s webpage).
It is possible to submit draft prospectuses to the Swedish Financial Supervisory Authority for preliminary comments.
What types of prospectus liability can arise (eg, statutory, contractual, tort)? Which parties may be held liable?
Under the Swedish Companies Act (2005:551), a founder, director, managing director or auditor of a company who, in performing his or her duties, intentionally or negligently causes damage to the company, must pay compensation for that damage. If a company has prepared a prospectus in accordance with the Swedish Financial Instruments Trading Act, the same applies to damage resulting from contravention of the prospectus rules of said act or of the Prospectus Regulation.
There is uncertainty as to whether under Swedish law the issuer can be held liable to pay damages to investors due to untrue statements or omissions in the prospectus.
What defences are available for liable parties?
Customary procedural defences are available in relation to proceedings regarding prospectus liability.
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