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M&A and CorporateRegulatory & Competition
Author: Mantas Gofmanas, Associate Partner of law firm TGS Baltic
As you may know, though free movement of capital is one of the fundamental EU functioning principles, it is actually not fully implemented in the capital markets for many reasons (different regulatory requirements, taxation aspects in the Member States, etc.). In order to change this situation, on 30 September 2015, the European Commission presented an action plan for creation of the capital markets union.
A breakthrough is expected in this context on 21 July 2019 when Regulation (EU) 2017/1129 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC will come into full force on the EU scale. After the Regulation comes into effect, the procedure of public offering of securities (drafting, approval, publication of the prospectus, as well as exemptions when a prospectus is not necessary, requirements for advertising of securities, many other related issues) will be finally unified on the EU scale, also uniformity of released information will be ensured, at the same time reinforcing the cross-border passporting mechanism operation in the whole of the EU, when after approval of a prospectus in one Member State, public offering of securities and/or their admission to trading on a regulated market can be performed in any other Member State or States.
As currently the said issues are regulated by the Directive and legal acts of each of the Member States implementing the Directive (in Lithuania, by the Law on Securities and other laws to a certain extent), after the directly applicable legal act comes into force in the whole of the EU, national laws must be modified accordingly. Lithuania has already started doing relevant homework, drafting a new version of the Law on Securities, preparing draft amendments to the Law on the Markets in Financial Instruments, the Law on Companies and other related laws.
Thus, the main changes, which will come into force on 21 July 2019, are as follows:
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