Brexit and the provision of financial services into the EU and into the UK

Brexit is likely to lead to the relocation of UK financial services firms to the EU in order to be able to access EU markets, mainly through the EU passport. The same applies to the EU firms intending to be active on the UK markets. The access conditions to the EU markets are numerous and complex, laid down in EU and national legislation and regulation, and applied by the national supervisory authorities. The European Supervisory Authorities or "ESAs" have published elaborate statements, called Opinions, on the detailed access conditions and the way they intend to apply these. The two main objectives are the full application of EU law, and the avoidance of authorizing EU firms that would be "empty boxes" for activity that would in fact be exercised in the UK, and this mainly by delegating activities to another firm. Underlying is a policy of competition between national economies for relocations of EU firms, or of business activities to be developed on the UK financial markets

Response to the European Commission\u27s Report on the Application of the Takeover Bids Directive

This paper contains the European Company Law Experts\u27 response to the report of the European Commission of 28 June 2012 on the application of the Takeover Bids Directive of 2004 and the reform initiatives announced. For evaluating these initiatives the rationale of the mandatory bid rule is relevant (exit rationale, control premium rationale and undistorted choice rationale). On this basis the paper discusses each of the concerns raised by the European Commission: 1) The concept of acting in concert : The ECLE are of the opinion that a uniform concept for the Takeover Bids Directive, the Transparency Directive and the Acquisition Directive is not useful because of the different objectives of these Directives. As to the Takeover Directive it should be made clear that joint engagement activities of investors should not trigger a mandatory offer. 2) National derogations to the mandatory offer rule differ widely, but there are different types of derogations that pose different concerns. The ECLE recommend that the Directive should provide for a review process with respect to national derogations. 3) The ECLE believe that there are good reasons to close the loopholes against the “creep in” and the “creep on” acquisitions. 4) As to board neutrality and the break-through rule the ECLE believe that the default rules should be changed. The option rights should be given to the shareholders, not to the member states. The reciprocity rule is flawed. 5) The protection of the rights of employees should be addressed in a wider context and should not be taken up specifically for one type of transaction such as takeover bids