The Prospectus Directive aims to ensure that investors, especially non-professionals, are provided with sufficient information when making an investment decision to acquire shares that are offered through a public offer procedure, or that are admitted to public trading. It also ensures a Europe-wide "single passport for issuers" that avoids companies seeking investors having to go through lengthy approval procedures in every EU Member State.
Following discussions with stakeholders and national regulators, the European Commission has come to the conclusion that the Prospectus Directive should be simplified. As a consequence, a number of proposals have been drawn up to improve and simplify the Directive. The main issues with the Directive in its present form lie in the fact that companies seeking investors and intermediaries are sometimes faced with unnecessary costs and burdens.
The Commission is requesting stakeholders' views on the proposals as they now stand with regard to exemptions, annual disclosure obligations, the time limit for exercise of right of withdrawal and a number of thresholds in the Directive.
The Commission will also welcome comments on a number of other issues not yet addressed by the current Commission proposals. In particular: effectiveness of the prospectus summary, disclosure requirements for offers with Government guarantee schemes, disclosure requirements for offers regarding small quoted companies and rights issues (publicly traded options and strips).
Stakeholders are invited to submit their comments to the Commission by 10 March 2009.