The UK threshold for offers to the public within the EU not requiring publication of a prospectus will increase to €8 million from 21 July 2018. The current €5 million exemption has frequently been used in connection with secondary fundraisings, often in the context of a bolt-on open offer alongside an institutional placing, allowing minority shareholders to participate in a fundraising without triggering a prospectus obligation.
From 21 July 2019, the new EU Prospectus Regulation will replace the current EU Prospectus Directive. A few provisions were due to come into effect before that date, including a reduction in the exemption from the prospectus requirements for EU offerings from the current value of €5 million during a 12-month period to €1 million. However, each member state has been given the discretion to establish a country-specific threshold of up to €8 million. As hoped for, the UK has now exercised its discretion and passed secondary legislation so that from 21 July 2018:
- whilst the threshold for securities exempt from the regime will reduce from €5 million to €1 million;
- the UK threshold for offers to the public within the EU that are exempt from the obligation to publish a prospectus will increase from €100,000 to €8 million.
Source: The Financial Services and Markets Act 2000 (Prospectus and Markets in Financial Instruments) Regulations 2018
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