The Luxembourg Parliament has adopted the Luxembourg law on prospectuses for securities (the "New Prospectus Law") on 2 July 2019. The New Prospectus Law will enter into force on 21 July 2019.
The purpose of the New Prospectus Law is to adapt national law and take necessary measures in the context of the Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market and repealing Directive 2003/71/EC ("Prospectus Regulation").
The Prospectus Law will repeal the Luxembourg law of 10 July 2005 on prospectuses for securities, which had transposed Directive 2003/71/EC (the "2005 Prospectus Law"). For the purpose of any prospectus approved prior to 21 July 2019 and on the basis of the 2005 Prospectus Law, the 2005 Prospectus Law will continue to apply to such prospectus until the earlier of the end of the validity period of such a prospectus or twelve months after 21 July 2019.
New exemption for public offers for a total amount of less than EUR 8 million
Luxembourg has taken the opportunity to introduce and allow an additional exemption from the obligation to publish a prospectus in case of an offer of securities to the public of a total amount of less than EUR 8 million (such amount being calculated over a period of 12 months). Under the Prospectus Regulation the Member States have been given the choice to implement this exemption. Where such an exemption applies, the Commission de Surveillance du Secteur Financier ("CSSF") shall solely be informed of the contemplated offer prior to the actual offer, without the need of any approval. If the total amount of the offer is EUR 5 million or more (and less than EUR 8 million), the issuer shall make available to its investors a summary containing certain information. The precise information to be provided in the summary is detailed in the New Prospectus Law, and include inter alia details about the issuer, its activities, its financial indebtedness, a description of the issued securities and the purpose of the issue.
The previous regime of a simplified prospectus as existing under the 2005 Prospectus has been reflected in the New Prospectus Law with additional alleviations and exemptions. This regime applies to offers of securities to the public as well as admission to trading of securities on a regulated market, which in each case would not fall within the scope of the Prospectus Regulation. In the interests of simplification and investor protection, the regime of such an alleviated prospectus provides for more exemptions, new rules to ensure easy access to the prospectus, as well as quicker review periods by the CSSF in specific cases.
In addition, the above mentioned exemption to the obligation to draw up a prospectus in case of an offer of securities for a total amount of less than EUR 8 million has also been introduced in the alleviated prospectus regime. Hence, if securities are offered to the public outside of the scope of the Prospectus Regulation for a total amount of less than EUR 8 million, no prospectus at all, including no alleviated prospectus, is required to be published or approved. The CSSF shall just be notified of the contemplated offer prior to the actual offer. Where the total amount of an offer of securities to the public is EUR 5 million or more (and less than EUR 8 million) a summary containing certain information shall be drawn up and published.
Furthermore the option provided for in the Prospectus Regulation to draw up a prospectus on a voluntary basis has also been introduced in the alleviated prospectus regime.