Welcome to the latest edition of Osborne Clarke’s quoted company legal and regulatory news update.
We hope that you find it interesting. If you would like to discuss any of the content, or have a subject that you would like us to cover in next edition, please let one of us know. Our contact details are set out below.
The Market Abuse Regulation: three months on
On 3 July 2016, the EU Market Abuse Regulation (MAR) finally came into effect, replacing the UK’s existing civil market abuse regime. The introduction of MAR in the UK was not particularly smooth, with finalised guidance coming out relatively late in the day, resulting in a bit of a scramble to get issuers ready for implementation day. The detailed requirements of MAR led to much debate (and, at times, confusion) among issuers and their advisers, although we are now seeing a consensus of approach forming and clients generally becoming more comfortable with the nuances of MAR.
We take stock of the first few months of the new regime and round up the helpful post-implementation guidance that has been issued by various bodies in relation to MAR.
First scheme to include post-offer undertakings sanctioned by the court
At the beginning of September 2016, the High Court sanctioned the high-profile takeover of ARM Holdings plc by SoftBank Corporation. Although the consideration was significant (£24.4 billion), the scheme itself was relatively straightforward, with shareholders being offered cash consideration at a premium of around 43% to the pre-takeover share price. However, the transaction was notable not only for its size but also the post-offer undertakings given by SoftBank to the Takeover Panel. The transaction represented the first time that post-offer undertakings were considered by the court following the post-Cadbury changes to the Takeover Code in 2015.
Andrew Thornton of Erskine Chambers, who acted for ARM on the scheme, looks at the background to the post-offer undertakings regime and the approach of the court to the undertakings given by SoftBank.
The Prospectus Regulation: where are we now?
With Brexit and the introduction of the Market Abuse Regulation taking up a great deal of attention over the summer, the acceleration of the EU’s plans for a Capital Markets Union has gone largely under the ECM radar. One of the key pieces of legislation forming the CMU will be the introduction, for the first time, of a directly effective Prospectus Regulation to harmonise and codify the ground rules for the offer of securities across the EU. The European Parliament has recently revised the Commission’s proposals for the Prospectus Regulation, setting out their position on a number of key areas as a prelude to the next informal negotiation stage of the EU legislative process. Parliament’s amendments include the introduction of a growth prospectus for SMEs and, unfortunately, a reduction from the Commission’s proposal for the size of offer that can be made without the need for a prospectus.
For issuers in the UK faced with the prospect of Brexit sometime in 2019, does any of this matter? The short answer is yes.
Data protection: the GDPR, Brexit and the benefits of proactive compliance
In the first of a series of articles on data protection, we look at the impact of the European General Data Protection Regulation, its relationship with Brexit, and how companies are seeking to exploit the commercial opportunities that can arise through engaged data protection compliance.
Electronic signatures: Law Society’s guidance gives green light for use in commercial transactions
Electronic signatures have been around for a number years, but the absence of definitive statutory or common law guidance on their legal efficacy has meant that their use on larger transactions has been somewhat restricted.
In order to help overcome this, the Law Society and the City of London Law Society jointly instructed leading counsel to distil some of the emerging law around electronic signatures and provide practitioners with some clarity around what electronic signatures can and can’t be used for in the context of commercial transactions. This has resulted in the publication of a new practice note. We have put together a Q&A explaining the key points raised in the guidance.
Changes to Takeover Code to ensure consistency of information flows during offers: now in force
In July 2016, the Takeover Panel published Instrument 2016/5 setting out amendments to the Takeover Code relating to the communication and distribution of information and opinions during an offer. These amendments came into effect last month.
The main purpose of the changes is to provide greater clarity and consistency of approach in relation to the requirement for information to be made equally available to all offeree company shareholders as nearly as possible at the same time. The updated rules also take into account developments in the use of electronic communications (including video and social media) during offers.