Position on the Listing Act

Strong capital markets play a key role in economies as one of the most powerful drivers of growth and wealth creation.  FESE very much welcomed the opportunity earlier this year to provide feedback to the Commission on several pieces of legislation that together form the basis of the European listing regime.

In this paper, we summarise FESE’s input, highlighting the key changes that we believe would be most beneficial to the current legislative framework.

FESE’s Key Messages

Prospectus Regulation

• FESE proposes further harmonising and simplifying the prospectus for equity instruments. The table of contents should be standardised. Issuers should have the possibility to publish a prospectus only in English and in electronic format. Henceforth, with a harmonised EU approach, NCAs should not require additional documentation and could introduce a flexible page limit on the overall prospectus.
• Make the Recovery Prospectus regime permanent and use it to replace the simplified disclosure regime for secondary issuances.
• Keep the threshold in Art.3(2) at EUR 8 million and harmonise across the EU.
• Retain the wholesale regime exemption for the offer of securities whose denomination per unit amounts to at least EUR 100 000.
• We believe in the primacy of the autonomy of NCAs for the scrutiny and approval of prospectuses, appropriately complemented with direction and oversight by ESMA.

Market Abuse Regulation

• More concrete guidelines from ESMA (Level 3) are necessary to further clarify the applicability of the definition of inside information. More concrete clarifications would also be welcomed from ESMA on the delay of disclosure of inside information.
• The EUR 5 000 threshold for disclosing managers’ transactions should be raised to EUR 20 000 and harmonised across the EU.
• Insider lists, for issuers in SME GMs, should contain only the minimum number of personal information fields necessary for supervisory purposes.
• We recommend amending MAR and the ESMA draft RTS on liquidity contracts so that market operators are not required to “agree to the contracts’ terms and conditions”.
• Order book data formats could benefit from further standardisation. However, a thorough cost-benefit analysis should be carried out before any provision is introduced.

Listing Directive

• The Listing Directive should not be repealed.
• The Commission should amend this legislation, while maintaining it in the form of a Directive. FESE recommends preserving the established regulatory framework for “official listing”, while adopting a more streamlined European approach on certain key topics.

Other points

• Provide legal clarity on the matter of dual listing by amending Art. 33(7) of MiFID II.
• Promote research coverage of SMEs beyond MiFID II cost re-bundling through additional measures to increase the production and distribution of research.
• The EU to support the SPACs listing process in its capital markets.
• Introduce in EU law an option for issuers to adopt multiple voting rights structures, leaving the technical details to be decided at national level.