The new EU Prospectus Regulation will make important changes to the rules on when a prospectus is required to offer securities to the public or to admit them to listing on a regulated market, as well as the content requirements for a prospectus. Although the majority of the changes do not apply until 21 July 2019, two significant changes take effect on 21 July this year.
The first change provides an exemption from having to publish a prospectus for offers of securities to the public in the EEA to raise less than €1 million (or an equivalent amount) calculated over a period of 12 months (article 1 (3)). This is an EEA wide exemption – that is, it is not possible for an EEA member state to require a prospectus for offers below this threshold. However, companies should exercise care when using it as EEA states can still impose other disclosure requirements at the national level, provided that that they do not constitute a disproportionate or unnecessary burden. (For example, under UK financial promotion rules, offers to retail investors usually require the involvement of an FCA authorised financial adviser, unless one of a number of specific exemptions applies.)