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CESR recommends amending the prospectus regulation

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11 Jul 2005

The Committee of European Securities Regulators (CESR) has published a consultation paper that sets out recommendations for a possible amendment of the Commission's Prospectus Regulation regarding historical financial information that must be included in a prospectus.

The Prospectus Regulation, which came into effect on 1 July 2005, requires (among other things) three years' audited historical information for the issuer as a whole. Sometimes, however, the issuer has not prepared its historical financial information as a single business during the whole of the three-year period, for example, because:
  • the issuer is a newly incorporated holding company inserted over an established business;
  • the issuer consists of companies that were under common control or ownership but that never formed a legal group;
  • the issuer has made a significant acquisition (representing more than 25% of the group) during the three-year historical period;
  • the issuer has disposed of a significant part of its business since the last audited accounts;
  • the issuer has changed the end of its financial year during the three year period.
CESR's recommendations relate to what additional information should be included in prospectuses in circumstances such as the foregoing. CESR requests replies by 15 September 2005 and will hold a hearing on 6 September 2005. Click to download:

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