The Second Stage—Harmonizing Public Offer Prospectuses

Abstract When the first Proposal for a directive coordinating the information to be disclosed when unlisted securities are offered to the public for the first time (whether or not they are subsequently listed) was submitted by the Council to the Commission in January 1981, the Admissions and Listing Particulars Directives had already been adopted and the amended Proposal for the Interim Reports Directive was pending before the Council. The Commission saw the Public Offers Prospectus Directive as ‘the final link in a natural chain’, complementing the disclosure requirements imposed by the other three Directives on and after admission of securities to listing. At that time, Germany, the Netherlands, Italy, Denmark and Greece had no legislation on prospectuses, and there would have been a fundamental flaw in the developing edifice of investor protection if disclosure on offers to the public had continued to be unregulated. Moreover, the contribution made to investor protection by the introduction of harmonized information requirements on admission to listing through implementation of the Listing Particulars Directive would have been seriously undermined if, on offers to the public of shares for which a listing was subsequently sought, inadequate disclosure was required on the initial offer.