Contributed By Walkers
A prospectus prepared in connection with the listing of debt securities must meet the requirements of Irish and EU prospectus law and the Euronext Rules. The GEM Rules set out the content requirements for listing particulars in respect of debt securities to be listed on GEM.
Where the minimum denomination of the debt securities being offered is less than EUR100,000 (ie, a retail offering) it will be necessary for the prospectus to include a summary.
Under the existing prospectus regime in Ireland, the summary is required, in concise and plain terms, to provide key information in the language in which the prospectus was originally drawn up. Summaries are required to be prepared in a common format that facilitates comparison with other similar securities. The summary should include key information on the underlying debt securities to assist investors in determining whether or not to invest in the debt securities. Summaries are required to take into account the complexity of the issuer and the underlying debt securities, but should not exceed 7% of the length of a prospectus or 15 pages, whichever is the longer. Summaries must not contain cross-references to other parts of the prospectus.
Summaries must also contain a warning that:
Regulation (EU) 2017/1129 (the “New Prospectus Regulation”) entered into force in Ireland on 20 July 2017. The New Prospectus Regulation will take effect from 21 July 2019 (noting that certain provision of the New Prospectus Regulation are already in force in Ireland). The New Prospectus Regulation forms part of the EU’s Capital Markets Union initiative which aims to ensure investor protection and market efficiency, while enhancing the internal market for capital.
The New Prospectus Regulation has retained the requirement to include a summary. While the New Prospectus Regulation prescribes a uniform structure, issuers have discretion to include information in the summary that they deem to be material and meaningful provided that such information is presented in a fair and balanced way. The summary should not be a mere compilation of excerpts from the prospectus.
Under the New Prospectus Regulation and, subject to certain exceptions, the summary shall be drawn up as a short document written in a concise manner and of a maximum length of seven sides of A4-sized paper when printed. The summary shall comprise four sections:
A brief description of the risk factors that the issuer considers most material must be included in the summary but cannot exceed 15 risk factors in total.