7 June 2016 – European Investors, EuropeanIssuers, the Federation of European Securities Exchanges (FESE) and Invest Europe issued a joint proposal on the minimum disclosure regime for SMEs (Article 15). The associations fully support the European Commission’s willingness to ensure easier access to markets for all companies.
The Prospectus Regulation proposal is an important first step to reduce frictional costs and to deliver a more unified European capital market, improving funding choices for issuers and investment opportunities for investors. The associations fully support an ambitious approach to Article 15 focusing on the following aspects:
- Scope: Extend scope of regime to all trading venues and allow any company that qualifies based on their size to benefit from this initiative.
- Definition of mid-caps: Support the Parliament draft report definition of mid-caps as ‘companies that have an average market cap of between EUR 200 million and EUR 1 billion’.
- Content of disclosure regime: Provide proposal for a EU Growth Prospectus that is simpler, shorter in length and less costly for issuers, while still comprehensive for investor needs.
The amended regime as proposed by the associations does justice to the interests of all major players in the eco-system for SME public market financing. It reduces the burden for SMEs and mid-sized companies that want to obtain market financing and ensures a level playing field between different trading venues.
At the same time, the proposal ensures that prospectuses drawn up under the minimum disclosure regime still contain the information necessary to enable investors to make an informed assessment of the assets and liabilities, financial position, profit and losses, and prospects of the issuer and of any guarantor, and of the rights attaching to the securities. Such information is necessary for investors to make an informed investment decision no matter the size of the company.
Please find our detailed proposal here.