On 4 July 2012, the Council of the European Union adopted a regulation on OTC derivative transactions, central counterparties and transaction registers. The regulation is likely to enter into force in late 2012 and will greatly impact OTC derivatives trading.
The exemption threshold for offers of securities to fewer than 100 persons was raised to 150 persons as from 1 July. A requirement has been added that the exemption of offers having a cash equivalent of less than EUR 100,000 is to be calculated by adding the cash equivalents of all offers made in the European Economic Area (EEA).
The employee exemption has also been broadened as from 1 July. Until this date, the class of securities that an employer (or a group company of the employer) offered to employees was required to be listed in the EEA. Although this requirement has been cancelled as from 1 July, the employer (or the relevant group company) that offers the securities must still have its registered office or head office in the EEA. Another obligation that continues to have effect is that employees must be provided with a document containing information about the number of securities offered, the characteristics of the securities, the reasons for the offer and the specifics.
Within the context of the implementation of the revised Directive, the "50,000 euros exemption" was already raised to 100,000 euros as from 1 January 2012. This applies to both the offering of securities with a nominal value of at least EUR 100,00 and the "block exemption" (securities that can only be acquired in blocks of no less than EUR 100,000). As from 1 January, the law also includes an obligation to add a warning to documents and advertising materials when use is made of certain exemptions from publishing a prospectus (offers to fewer than 150 persons and the EUR 100,000 exemptions). The warning must say that no prospectus, or no approved prospectus, is available and that the relevant offer is not regulated by the Netherlands Authority for the Financial Markets (AFM). The warning must satisfy requirements set by the AFM. The mandatory warnings (texts and symbols) are available on the AFM website.
For more information, please contact our Finance team.