EUROPE: Council approves changes to Transparency Directive for EU major shareholdings

Thursday October 17 2013

The Council has announced that it has adopted an amending Directive to the 2004 Transparency Directive for the EU major shareholdings.

The amendment to the Transparency Directive are aimed at ensuring a high level of investor confidence throughout the EU. The changes will require issuers of securities traded on regulated markets to publish periodic financial information about the issuer`s performance over the financial year and on-going information on major holdings of voting rights.

In relation to the EU major shareholdings rules, the amendments will improve legal clarity and effectiveness, notably with respect to the disclosure of corporate ownership. The directive reviews the definition of which types of financial instruments are covered, as well as the calculation of thresholds for the notification of major holdings. Going forward, the rules will require disclosure of holdings through cash-settled derivatives, and it will be mandatory to aggregate holdings of voting rights with holdings of financial instruments in calculating notifiable interests. Member states will still be permitted to set lower notification thresholds than the thresholds mandated by the Transparency Directive, however they will not be able to impose different requirements regarding calculation or aggregation of interests.

Adoption of the directive comes after an agreement was reached with the European Parliament at first reading at a “trilogue” meeting with the Parliament and the Commission on 14 May. The Parliament approved the text on 12 June.

Click on the above link for the Council press release. Click here for the text of 10th October 2013.