On 7 December 2022, the European Commission submitted a package of measures referred as the "Listing Act" (the Act). Its primary objective is to streamline and modernise the regulatory framework for companies seeking to list on public markets across the European Union (the EU), with the overarching goal of bolstering the competitiveness of EU capital markets and encourage broader participation by small and medium-sized companies.
Following a provisional agreement reached between the European Parliament (the EP) and the Council on 1 February 2024, the Council of the European Union (the Council) adopted, on 8 October 2024, Regulation (EU) 2024/2809 of the EP and of the Council of 23 October 2024 (the Regulation), which amends:
- Regulation (EU) 2017/1129 of the EP and of the Council (the Prospectus Regulation),
- Regulation No 596/2014 of the EP and of the Council - the Market Abuse Regulation, and
- Regulation No 600/2014 of the EP and of the Council - MiFIR.
Please refer to our previous newsflash on the topic for further background.
CSSF Circular 24/867
On 6 December 2024, the Luxembourg Commission de Surveillance du Secteur Financier (the CSSF) published Circular CSSF 24/867 (the Circular) updating the Circular CSSF 19/724 on technical specifications regarding submission to the CSSF of documents under the Prospectus Regulation and the law of 16 July 2019 on prospectuses for securities and general overview of the regulatory framework on prospectuses.
The Circular outlines that changes made to the previous circular aim at enhancing the appeal of public capital markets in the EU by simplifying and reducing costs associated with the prospectus documentation.
The Circular namely introduces the exemption from the obligation to publish a prospectus for public offers with a total aggregated consideration below EUR 12,000,000. However, Member States may choose to apply a lower exemption threshold of EUR 5,000,000. This new rule replaces the previous system which allowed Member States to set varying exemption thresholds ranging from EUR 1,000,000 to EUR 8,000,000.
Additional key changes are outlined as follows:
- the introduction of new exemptions from the obligation to publish a prospectus for secondary issuances of fungible securities provided that certain conditions are fulfilled;
- the introduction of two alleviated disclosure regimes: the EU Follow-on prospectus regime and the EU Growth issuance prospectus regime, and the removal of the regimes for secondary issuances and the EU Growth prospectus;
- the reduction of information to be provided in a standard prospectus and the length restriction for a prospectus that relates to shares;
- the addition of new provisions to increase the effectiveness of the incorporation into the prospectus of information by reference; and
- the specification of information related to environmental, social or/and governance to be provided where relevant in a prospectus, by means of delegated acts.
Additionally, the Circular notably expands the list of documents to be submitted to the CSSF as part of the approval procedure by including the exemption document in case of issuances of fungible securities.
The final notable change introduced by the Circular is the addition of a dedicated section addressing the exemption document for fungible securities. Fungible securities referred in the points (da) and (db) of the first subparagraph of Article 1(4) or in point (ba) of the first subparagraph of Article 1(5) of the Prospectus Regulation are exempted from the from the obligation to publish a prospectus provided that certain conditions are fulfilled, including the filing with the competent authority of the home Member State of a document containing the information set out in Annex IX of the Prospectus Regulation, which must be sent to a dedicated CSSF email address if Luxembourg is the home Member State.
Application
Key changes apply as from the dates set out in Article 4 of the Regulation. While most amendments to the Prospectus Regulation brought by the Listing Act apply as from 4 December 2024, some key amendments, including the small offers threshold, the page limit or rules on ESG disclosure, will not apply before Q1-Q2 2026.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
