Following implementation of the Transparency (Directive 2004/109/EC) Regulations 2007 (the "Transparency Regulations"), Regulation 25(6) eliminated the requirement to appoint an Irish Paying Agent for transactions seeking a listing on the regulated market of the Irish Stock Exchange.
Regulation 25(6) states that the issuer shall "designate as its agent a financial institution through which debt securities holders may exercise their financial rights".
In accordance with Regulation 25(6) an issuer must appoint a financial institution for investors to exercise their financial rights. This financial institution is not required by the wording of Regulation 25(6) to be located in Ireland or within the E.U. and can be located anywhere in the world. The Principal Paying Agent normally fulfils this role.
NON FINANCIAL RIGHTS
Regulation 25(4) states "the issuer shall ensure that all the facilities and information necessary to enable debt securities holders to exercise their rights are publicly available in the home Member State and that the integrity of data is preserved".
The Irish Stock Exchange and Central Bank do not regard this as a requirement to appoint an Irish Paying Agent.
However, the issuer needs to ensure that all the facilities and information necessary to enable debt securities holders to exercise their rights are publicly available in the home Member State and that the integrity of data is preserved. It is up to each issuer to determine how to comply with this requirement. We discussed with the Central Bank the following advice and it was confirmed that it was reasonable and acceptable:
- An Irish Paying Agent is not required while the bonds are in the clearing systems.
- In the unlikely event that the bonds are taken outside the clearing systems, a paying agent in Ireland should be appointed.
- If an issuer is incorporated in Ireland, it can hold documents available for display.
- If an issuer is not incorporated in Ireland, either the Listing Agent or an agent appointed for this purpose can hold documents available for display. As the listing agent is already involved in the transaction, it makes sense for the Listing Agent to do this.
This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.