Public Consultation Questions - Question 1.

Public consultation on the exercise of the national discretions in the Listings Act 2024
Open4 Feb, 2025, 14:41 - 18 Mar, 2025, 18:00

There are two areas where Member States can apply discretions, the first is the dual option of selecting the prospectus exemption threshold. The second gives the discretion for the requirement of a summary prospectus (7 pages) of any issuance that falls within the prospectus exemption threshold level.

Discretion 1 – Exception Threshold

Article 3(1) & (2) of Regulation (EU) 2017/1129 details the obligations and exemptions of publishing a prospectus document. 

1.   Without prejudice to Article 1(4), securities shall only be offered to the public in the Union after prior publication of a prospectus in accordance with this Regulation.

2.   Without prejudice to Article 4, a Member State may decide to exempt offers of securities to the public from the obligation to publish a prospectus set out in paragraph 1 provided that:

(a) such offers are not subject to notification in accordance with Article 25; and

(b) the total consideration of each such offer in the Union is less than a monetary amount calculated over a period of 12 months which shall not exceed EUR 8 000 000. 

Member States shall notify the Commission and ESMA whether and how they decide to apply the exemption pursuant to the first subparagraph, including the monetary amount below which the exemption for offers in that Member State applies. They shall also notify the Commission and ESMA of any subsequent changes to that monetary amount.

 

 

 

This Regulation allowed Ireland to select a prospectus exemption level at any monetary level between €1,000,000 and €8,000,000 expressed as the total consideration of the offer in the Union over a period of 12 months. After research and consultation with stakeholders, Ireland opted for a threshold amount of €8,000,000, provided for in the Finance (Tax Appeals and Prospectus Regulation) Act 2019.

Under the Listings Act 2024, Article 1(3) of Regulation (EU) 2024/2809 amends Article 3(1) & (2) of Regulation (EU) 2017/1129 now states:

 

(3)

in Article 3, paragraphs 1 and 2 are replaced by the following:

‘1.   Without prejudice to Article 1(4) and to paragraphs 2 and 2a of this Article, securities shall only be offered to the public in the Union after prior publication of a prospectus in accordance with this Regulation.

2.   Without prejudice to Article 4, offers of securities to the public shall be exempted from the obligation to publish a prospectus set out in paragraph 1 provided that:

(a)

such offers are not subject to notification in accordance with Article 25;

(b)

the total aggregated consideration in the Union for the securities offered is less than EUR 12 000 000 per issuer or offer or calculated over a period of 12 months.

2a.   By way of derogation from paragraph 2, point (b), Member States may exempt offers of securities to the public from the obligation to publish a prospectus set out in paragraph 1 provided that the total aggregated consideration in the Union for the securities offered is less than EUR 5 000 000 per issuer or offer or calculated over a period of 12 months.

2b.   Member States shall notify the Commission and ESMA where they decide to adopt the exemption threshold of EUR 5 000 000 laid down in paragraph 2a. Member States shall also notify the Commission and ESMA where they subsequently decide to adopt instead the exemption threshold of EUR 12 000 000 referred to in paragraph 2, point (b).

2c.   The total aggregated consideration for the securities offered to the public, as referred to in paragraph 2, point (b), and in paragraph 2a, shall take into account the total aggregated consideration of all ongoing offers of securities to the public and offers of securities to the public made within the 12 months preceding the start date of a new offer of securities to the public, except for those offers of securities to the public for which a prospectus was published or that were subject to any exemption from the obligation to publish a prospectus pursuant to Article 1(4), first subparagraph. Moreover, the total aggregated consideration of the securities offered to the public shall include all types and classes of securities offered.

2d.   Where an offer of securities to the public is exempted from the obligation to publish a prospectus pursuant to paragraph 2, point (b), or paragraph 2a, a Member State may require the issuer to file and make available to the public in accordance with the arrangements set out in Article 21(2) a document containing the information set out in Article 7(3) to (10) and (12), or a document containing the information requirements at national level, provided that the extent and level of such information is equivalent to or lower than the information set out in Article 7(4) to (10) and (12).'

The amendment to the text in the Regulation was to decrease market fragmentation while also having regard of the varying sizes of national capital markets within the Union. The regulation achieves this by replacing the €1,000,000 to €8,000,000 range of prospectus exemption limit over a 12-month period, with a dual threshold system. The higher threshold is now set at €12,000,000 in the Regulation. There is a possibility to apply a Member State discretion, and reduce this limit to €5,000,000. Both limits apply to issuances over a 12-month rolling period. Below the proposed limit (€12 or €5 Million depending on each Member State decision) a prospectus will not be required.

Question 1

Should Ireland exercise its discretion and opt for a €12,000,000 or €5,000,000 prospectus exemption threshold, bearing in mind that it currently stands at €8,000,000, in accordance with Article 1(3) of Regulation 2024/2809 (EU)?

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