Introduction

1. The European Union has always believed that easier access to capital would increase productivity, job creation and growth in Europe. Although the importance of access to capital was recognised, the existing prospectus regime did not provide a coherent system and, rather, created obstacles to raising capital across the European Union. The biggest obstacle was the lack of harmonised procedures and regulations across Member States.

Therefore, the Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 on the prospectus to be published when securities are offered to the public or admitted to trading and amending Directive 2001/34/EC (further the ‘Prospectus Directive’) was introduced. The Prospectus Directive improved market efficiency through the possibility of issuing a single approved prospectus that enables issuers to raise capital across the European Union without further approval or administrative arrangements.

Furthermore, the Prospectus Directive requires harmonised standards of publication for issues of securities that are offered to the public or admitted to trading on a regulated market in the European Union. The aim is to ensure better investor protection.

The Prospectus Directive is complemented by Commission Regulation No. 809/2004 of 29 April 2004, implementing the Prospectus Directive as regards information contained in the prospectus as well as the format, incorporation by reference and publication of such prospectuses and dissemination of advertisements (further the ‘Prospectus Regulation’).