ITALY: Consob consultation on extension of Italy major shareholding reporting regime

Monday May 16 2011

Consob, the Italian securities regulator, has submitted amendments it intends to make to the Issuers` Regulation (IR) to market consultation, in order to adjust it to the altered national and European Community regulatory framework. The amendments concern prospectuses, collective investment undertakings (UCITs IV) and, most notably, the disclosure of holdings in cash settled derivative instruments. The consultation paper examines three regulatory hypotheses by which to extend ownership transparency to include cash-settled derivative instruments. The three options, along with the cost-benefit analysis, are as follows:

1. the introduction of a new third basket, in addition to those currently existing [the first related to effective Italy shareholding (art. 117 of the IR) and the second, as mentioned, concerning potential physical-settled shareholdings (art. 119 of the IR)], which includes the potential cash-settled shareholdings, with compulsory disclosure as from the threshold of 10%;

2. the maintenance, also for this option, of the disclosure model currently in force, additionally providing for the introduction of an aggregated disclosure duty (“”comprehensive economic interest””), which includes all effective and potential, including cash-settled, shareholdings that, when calculated together, exceed the threshold of 10% (with subsequent thresholds of 20%, 30% and 50%);

3. the extension of the current transparency regime to include cash-settled derivatives through maintenance of the current basket in relation to effective Italy shareholdings and the extension of the second, to include all potential shareholdings, regardless of the method of settlement.

Consob has expressed a preference for the second option and has developed the related proposal to amend the regulation. The consultation paper is available in Italian only from the web site www.consob.it. Comments are to be received by 6 June 2011.

Click on the above link for more details.