FRANCE: Bill on changes to rules on France major shareholdings regarding cash-settled instruments

Tuesday March 13 2012

The French Parliament has approved a bill, known as “the bill for simplification of the law and facilitation of administrative processes” (currently only available in French), which will require aggregation of holdings in cash-settled instruments with holdings through shares for the purposes of disclosure of France major shareholdings.

Currently, the AMF General Regulation and the French Commercial Code require disclosure of cash-settled instruments, but no aggregation is required with shareholdings – holdings in cash-settled instruments are disclosed separately once the investor has crossed the thresholds through holdings in shares and other assimilated instruments. The bill amends Article L 233-9 of the Commercial Code on assimilation of situations to shares or voting rights.

The move follows several high-profile cases of “stealth takeovers”, in particular the Hermes and Saint-Gobain cases. The measures largely mirror those of the proposed Amendment Directive to the Transparency Directive published by the Commission in October 2011, which is soon to go before the European Parliament and Council for approval.

As with the German reforms which took effect in February 2012, cash-settled instruments will remain excluded from the calculation of the mandatory bid thresholds.

The new bill remains to be enacted by the President and will come into effect on the first day of the seventh month thereafter. The AMF General Regulation, which implements the major shareholdings provisions, will also be amended.

Click on the above link for more details.