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Explanatory note

Original text. Later amendments are not shown.

(This note is not part of the Regulations)

These Regulations make provision about public offers of securities and the admission of transferable securities to trading on a regulated market (as defined in regulation 3) or a primary MTF (as defined in regulation 8). The legislation being replaced includes:

  • Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003 (which is to be revoked by section 1 of the Financial Services and Markets Act 2023 (c. 29)), and

  • certain related provisions of Part 6 of the Financial Services and Markets Act 2000 (c. 8) (“FSMA 2000”).

Regulations 9 to 11 specify certain activities under section 71K of FSMA 2000 as designated activities for the purposes of that Act.

Regulation 12 prohibits the offer to the public in the United Kingdom of “relevant securities” (as defined in regulation 5) unless the offer falls within the exemptions in Schedule 1. As a result of the amendments of section 85 of FSMA 2000 in Schedule 3 to the Regulations, a person who contravenes this prohibition commits an offence. Regulation 13 requires the disclosure of information by the issuer or offeror in certain cases where a public offer is exempt from the prohibition.

Regulations 14 to 20 enable the Financial Conduct Authority to make “designated activity rules” (as defined in section 71L(3) of FSMA 2000) regulating the activities that are specified in regulations 9 to 11.

Regulations 21 to 31 and Schedule 2 contain further provision about prospectuses, including provision about the rights of investors to compensation for loss suffered as a result of statements in prospectuses.

Regulations 32 to 45 contain further provisions about the powers of the Financial Conduct Authority in relation to public offers and admissions to trading and about enforcement.

Regulation 46 amends the Financial Services and Markets Act 2001 (Regulated Activities) Order 2001 (S.I. 2001/544) so as to provide a separate regulated activity of operating an electronic system for making public offers of relevant securities in a case where the public offer is not otherwise exempt from the prohibition in regulation 12.

Regulation 47 and Schedule 3 make amendments of other legislation.

Regulations 48 to 50 contain transitional and saving provisions.

Regulation 51 makes provision for review.

A full impact assessment of the effect that this instrument will have on the costs of business is available from HM Treasury, 1 Horse Guards Road, London SW1A 2HQ and is published alongside this instrument at www.legislation.gov.uk.