On 5 November 2018, UK TO Panel proposed Brexit amends to takeover code.
- Follows UK Treasury Jul. 2018 SIs amending retained EU provisions.
- Code Committee invites comments on the amendments proposed in PCP 2018/2.
- Section 2 of paper describes legislative framework within which the Code currently operates and changes which will be made to that framework as a result of Brexit.
- In summary directive 2004/25/EC on takeover bids will cease to apply in the UK.
- And section 943(1) of the Companies Act 2006, which currently requires panel to
make rules giving effect to certain articles of takeovers directive will be amended.
- To require panel to make rules, in accordance with a new schedule 1C to the Act.
- Amendment to be made by Takeovers (Amendment) (EU Exit) Regulations 2019.
- Takeovers (EU Exit) Regulations set out in appendix A and the amendment which those rules will make to part 1 of chapter 28 of the Act are set out in appendix B.
- Section 3 explains the implications of the shared jurisdiction regime not applying.
- Shared jurisdiction regime applies to offers for companies which have registered
office in one MS of EEA and the securities admitted to trading in another EEA MS.
- Proposes deletion of section 3(a)(iii) (shared jurisdiction) of introduction to code.
- Which sets out rules re: offers for shared jurisdiction companies code applies to.
- Upon the deletion of section 3(a)(iii), code would no longer apply to the following.
- A company which has registered office in EEA member state (i.e. not in the UK),
whose securities admitted to trading on a market in UK (but not in that EEA MS).
- A company which has registered office in UK, and whose securities are admitted
to trading on regulated market in EEA MS (and not on a regulated marked in UK).
- And which does not satisfy residency test, in section 3(a)(ii) of the introduction.
- Code would then apply (in full) to an offer for company which has its registered
office in UK and whose securities are admitted to trading on a market in EEA MS.
- If that company satisfies the residency test in section 3(a)(ii) of the introduction.
- Details of companies to which code currently applies are set out in Appendix C.
- Comments to be received by Monday, 17 December 2018.