A significantly wider statutory liability regime for issuers came into force on 1 October. The changes are particularly important for issuers with securities traded on any UK market (whether regulated or unregulated), or which have the UK as their home state.
The original statutory liability regime has been expanded in a variety of ways. For example, the new liability regime covers not just periodic financial disclosures that are required under the Transparency Directive but all information published, or the availability of which is announced, using an RIS. It also permits recovery in respect of losses caused by dishonest delay and gives a right of action to sellers and those who continue to hold securities, as well as to purchasers. Section 90A liability continues to attach to issuers only, it does not directly apply to directors. The general principle is that an issuer is then not subject to any other form of liability for the specific losses covered by the section 90A regime. There are exceptions to this safe harbour including civil liability under section 90 of the Financial Services and Markets Act 2000 (FSMA) (compensation for statements in prospectuses or listing particulars), liability for breach of contract, and civil liability arising from someone “having assumed responsibility, to a particular person for a particular purpose, for the accuracy or completeness of the information concerned”. For further information on the new regime together with practical guidance on its impact please see the detailed e-bulletin that we have produced. The e-bulletin is available at http://www.herbertsmith. com/NR/rdonlyres/52C7D6A2-22BB-462B-BE53- 0F32A115F569/0/2010corporate_ebulletin_issue_29.html.