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Volume X, Number 225

August 11, 2020

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August 10, 2020

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COVID-19: EC Adopts Measures for Recovery of EU Capital Markets & Proposal to Amend Prospectus Regulation

COVID-19: European Commission Adopts a Set of Measures for the Recovery of EU Capital Markets

On July 24, the European Commission adopted a set of measures to help facilitate bank lending to households and businesses throughout the EU (the Measures).

The Measures aim to make it easier for capital markets to support EU businesses in their recovery from the COVID-19 pandemic by encouraging greater investments in the economy, allowing for the rapid recapitalization of companies and increasing banks’ capacity to finance the recovery.

The Measures propose changes to:

  1. the Capital Requirements Regulation;

  2. the revised Markets in Financial Instruments Directive (MiFID II);

  3. the Prospectus Regulation (for more information on the changes to the Prospectus Regulation, see the July 31, 2020 edition of Corporate & Financial Weekly Digest (below); and

  4. the Securitisation Regulation.

The Measures are available here.

COVID-19: European Commission Adopts Proposal to Amend Prospectus Regulation

On July 24, the European Commission (the Commission) adopted a legislative proposal to amend the Prospectus Regulation and assist with the recapitalization of companies that have been affected by the COVID-19 pandemic (the Proposal).

The key changes under the Proposal are:

  1. the introduction of a new simplified, short-form, temporary prospectus. The temporary prospectus reduces the number of pages typically required for a prospectus from hundreds to just 30. It will be available in relation to secondary issuances of shares by issuers that are already admitted to trading on a regulated market or a small and medium enterprises (SME) growth market for a continuous period of at least 18 months;

  2. extensions to certain deadlines regarding supplementary prospectuses; and

  3. temporarily increasing the prospectus exemption threshold from EUR 75 million to EUR 150 million for certain non-equity securities issued by a credit institution in a continuous or repeated manner.

The Commission has confirmed that the temporary prospectus regime and the measures mentioned above will expire 18 months after the date of application of the amending Prospectus Regulation.

In order for the proposal to go into effect, it must be adopted by the European Parliament and the Council of the EU.

The Proposal is available here.

©2020 Katten Muchin Rosenman LLPNational Law Review, Volume X, Number 213

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About this Author

Carolyn H. Jackson, International Attorney, Katten Muchin law firm
Partner

Carolyn Jackson is a partner in Katten Muchin Rosenman UK LLP and is a Registered Foreign Lawyer. She provides US financial regulatory legal advice to a broad range of market participants, including commercial banks, investment banks, investment managers, broker-dealers, electronic trading platforms, clearinghouses, trade associations and over-the-counter derivatives service providers.

Carolyn guides clients in the structuring and offering of complex securities, commodities and derivatives transactions and in complying with US securities and commodities laws...

+44 0 20 7776 7625
Nathaniel Lalone, Katten Muchin Law Firm, Financial Institutions Attorney
Senior Associate

Nathaniel Lalone, a partner at Katten Muchin Rosenman UK LLP, has a broad range of experience in the regulation of financial products and financial markets, and frequently provides regulatory and compliance advice to trading venues, clearing houses and buy-side firms active in the over-the-counter (OTC) derivatives, futures and securities markets. He is actively involved in advising clients on the implementation of MiFID 2 and MiFIR in the European Union as well as the international reach of US financial services regulation. He also has significant experience with structuring and documentation relating to OTC derivatives and structured products.

Prior to joining Katten, Nathaniel was a member of the US Regulatory and the Derivatives and Structured Finance practices at Allen & Overy LLP.

+44 0 20 7776 7629
Neil Robson, private equity fund managers counselor, Katten Law Firm, London
Partner

Neil Robson, a regulatory and compliance partner with Katten Muchin Rosenman LLP, focuses his practice on counseling hedge and private equity fund managers and other investment advisers on operational, regulatory and compliance issues. He regularly addresses Financial Conduct Authority (FCA) and EU authorization and compliance under both the EU Alternative Investment Fund Managers Directive (AIFM Directive) and MiFID, cross-border issues in the financial services sector, market abuse, anti-money laundering and regulatory capital requirements, formations and buyouts of...

44-0-20-7776-7666