Changes to the Rules and Regulations of the Luxembourg Stock Exchange
The Luxembourg Stock Exchange (the LuxSE) has implemented changes to its Rules and Regulations (the Rules) to adapt them to new practices and requirements of the market and its operators, as well as to bring the Rules into compliance with local and European regulations, including the Transparency Directive 2013/50/EU1 and Regulation (EC) 809/20042.
These changes to the Rules may be summarized as follows:
The Rules now contain an explanation of the information to be included in the prospectus for the admission to trading, on a market operated by the LuxSE, of shares and units issued by undertakings for collective investment other than closed-end type whose securities are not publicly exposed, offered or sold in or from Luxembourg. The revamped Appendix VI of the Rules sets forth an entirely new schedule, focused on information to be included by such investment funds. Specifically, this appendix sets forth information that must be provided with respect to, inter alia, the various actors associated with a listed fund.
Another notable change is that the Rules no longer require that hard copies of documents be made available in Luxembourg by issuers to investors. In a nod to the digital era, documents now need only be accessible to investors in an electronic format. Another simplification of the Rules is that they no longer require issuers with debt securities admitted to trading on the Euro MTF3 to inform investors of any new debt security issues traded on a market other than one operated by the LuxSE.
In order to harmonize the Rules relating to securities having a denomination equivalent to at least EUR 100,000 with the requirements of Regulation (EC) 809/2004 related to regulated markets, the LuxSE has incorporated certain exceptions or special rules into the Rules, which target this specific type of security. These changes concern the layout of prospectuses for the admission to trading of debt securities issued by companies and other legal persons4 as well as by states and their local authorities.5
As per Regulation (EC) 809/2004, the updated Rules also provide clarification on certain listing requirements as follows:
- The information required to be included in, or attached to, a prospectus for securities listed on the Euro MTF has been reviewed and updated in the Schedules to Appendix III and Appendix V of the Rules.
- Issuers with both consolidated and non-consolidated annual accounts are no longer required to attach non-consolidated annual accounts to the prospectus, though the obligation to provide consolidated accounts remains.
- Henceforth only information on an issuer’s main subsidiaries need be provided, thereby eliminating the previous requirement to provide information on each entity in which an issuer holds at least 10% of the shares.
The LuxSE also used this opportunity to review the Rules to add the Banque Ouest Africaine de Développement to the list of supranational institutions and organizations that are exempted from the requirement to publish a prospectus for the admission to trading on a market regulated by the LuxSE.
More generally, certain terms of the Rules have been updated to improve clarity and readability, as well as to align them with terms used in applicable laws and regulations, notably Regulation (EC) 809/2004. Likewise, references to laws and regulations that have been repealed or are otherwise obsolete have been removed.
All of these changes took effect as from January 1, 2016 and are part of the LuxSE’s ongoing process of reviewing and updating the Rules. Based on a publication by the LuxSE, it appears that further amendments to the Rules may follow in the future.
1) Directive 2013/50/EU of the European Parliament and of the Council of 22 October 2013 amending Directive 2004/109/EC on the harmonization of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market, Directive 2003/71/EC on the prospectus to be published when securities are offered to the public or admitted to trading and Commission Directive 2007/14/EC laying down detailed rules for the implementation of certain provisions of Directive 2004/109/EC.
2) Commission Regulation (EC) No 809/2004 of 29 April 2004 implementing Directive 2003/71/EC as regards information contained in prospectuses as well as the format, incorporation by reference and publication of such prospectuses and dissemination of advertisements.
3) The Euro MTF market is a multilateral trading facility (MTF) created in 2005 and operated by the LuxSE, which, as opposed to the LuxSE’s main market, the “Bourse de Luxembourg” market, is not an EU-regulated market.
4) Appendix III, Schedule B of the Rules.
5) Appendix III, Schedule D of the Rules.