Companies Act 2006

Companies Act 2006

2006 CHAPTER 46

ANNEX A:: TRANSPOSITION NOTES

Part 28: Takeovers, etc. – Directive on Takeovers Bids (2004/25/EC)

The Takeovers Directive

1731. Part 28 of the Act implements Directive 2004/25 EC of the European Parliament and of the Council of 21 April 2004 on Takeover Bids (OJ L142, 30 April 2004).

1732. The Takeovers Directive lays down, for the first time, minimum EU rules concerning the regulation of takeovers of companies whose shares are traded on a regulated market. The Directive was one of the measures adopted under the EU Financial Services Action Plan and aims to strengthen the Single Market in financial services by facilitating cross-border restructuring and enhancing minority shareholder protection.

1733. The Takeovers Directive contains general principles that Member States must adhere to in regulating takeover activity and a framework relating to the functions and jurisdiction of takeover regulatory authorities. It also lays down provisions relating to the mandatory bid (a requirement whereby a party gaining control of a company must make an offer to all shareholders at an equitable price), takeover bid documentation, time allowed for acceptance of the bid, the obligations of the board of the offeree company and other matters related to the bid.

1734. Additionally, the Takeovers Directive has provisions addressing barriers to takeovers (such as action that might be taken by a company or its board before or during a bid to prevent a takeover), requiring disclosure of certain information by companies traded on a regulated market and dealing with the problems of, and for, residual minority shareholders following a successful takeover bid (so-called ‘squeeze-out’ and ‘sell-out’ provisions).

The Takeovers Directive (Interim Implementation) Regulations 2006

1735. In view of the fact that the Takeovers Directive was required to be implemented by 20 May 2006, by which date the Act had not completed Parliamentary passage and received Royal Assent, interim implementation provisions were introduced under section 2(2) of the European Communities Act 1972 (ECA 1972). These provisions are contained in The Takeovers Directive (Interim Implementation) Regulations 2006 (S.I. 2006 No.1183). A copy of those Regulations together with the accompanying Explanatory Memorandum, Regulatory Impact Assessment and Transposition Notes is available on the website of the Office of Public Sector Information (http://www.opsi.gov.uk/stat.htm). The Regulations will be repealed and replaced on commencement of Part 28 of the Act.

Part 28 – Takeovers etc

1736. Since 1968, takeover regulation in the UK has been overseen by the Takeover Panel administering rules and principles contained in the “City Code on Takeovers and Mergers”. In order to bring UK takeover regulation within the requirements laid down in the Directive, Part 28 of the Act is designed to place it within a complete and coherent statutory framework.

1737. The detailed rules relating to takeover regulation in compliance with the Directive will be prescribed by the Panel in its Takeover Code, under a statutory rule-making obligation imposed upon the Panel by the Act (section 943(1)). The Takeover Code has already been revised with effect from 20 May 2006, on an interim basis under the 2006 Regulations, to make it wholly consistent with the requirements of the Takeovers Directive.

1738. ‘Squeeze-out’ and ‘sell-out’ provisions were previously prescribed by Part 13A of the 1985 Act. Chapter 3 of Part 28 of the Act replaces those provisions in their entirety with certain amendments which ensure they are wholly consistent with the Takeovers Directive requirements.

1739. Provisions related to disclosures by companies are contained in Part 7 of the 1985 Act and amendments to that Part are made in Chapter 4 of Part 28 to give effect to the additional disclosure requirements imposed by the Takeovers Directive on companies traded on a regulated market.

1740. Responsibility for the measures, described in this transposition note, taken to implement the Takeovers Directive lies with the Secretary of State for Trade and Industry.

1741. The table below describes the substantive provisions implementing the Takeovers Directive.

Part 24: Takeovers etc: Transposition Measures

Article	Objective	Implementation
1	Defines the scope of Directive in terms of transactions and types of company to which it applies (“takeover bids for the securities of companies governed by the laws of Member States, where all or some of those securities are admitted to trading on a regulated market”).	No specific implementing provision necessary.
2	Contains key definitions for the purposes of the Directive (such as, “takeover bid”, “offeree company”, and “securities”).	No specific implementing provision necessary.
3.1	Lays down general principles which Member States shall ensure are adhered to for the purpose of implementing the Directive.	Section 943(1) requires that the Panel give effect to the general principles set out at Article 3.1 of the Directive in the exercise of their statutory rule-making duty.
3.2	Provides that Member States may, in ensuring that the minimum requirements laid down by the Directive are adhered to, lay down additional conditions and provisions more stringent than those of the Directive.	No specific implementing provision necessary.
4.1	Requires Member States to designate supervisory authorities (which must act independently of parties to a bid).	This will be achieved by administrative designation of the Takeover Panel as supervisory authority for the purposes of the Directive.
4.2	Lays down jurisdictional rules in relation to takeover regulation	Section 943(1) requires that the Panel give effect to the jurisdictional provisions of the Directive in the exercise of their statutory rule-making duty.
4.3	Requires Member States to ensure that persons employed or formerly employed by takeover regulatory authorities are bound by professional secrecy (information covered by this obligation should not be disclosed other than under conditions laid down by national law).	Section 949 makes it a criminal offence to disclose information provided to the Takeover Panel other than under the circumstances and gateways laid down in section 948 and Schedule 2.
4.4	Lays down cooperation obligations in relation to EU takeover and financial markets supervisory authorities.	Section 950 requires the Takeover Panel to cooperate with EU takeover and financial services regulators. The existing cooperation duties of the Financial Services Authority under section 354 of the Financial Services and Markets Act 2000 are extended to include relevant authorities (section 964).
4.5	Requires that takeover supervisory authorities be provided with all powers necessary for carrying out their duties and provides that Member States may, provided that the general principles are respected, permit derogation from the rules of the Directive in certain circumstances and grant supervisory authorities the power to grant waivers.	In addition to the rule-making duty at section 943(1) and rule-making powers at section 943(2), the following powers are provided to the Takeover Panel: Section 945 – power to make rulings Section 946 – power to give directions Section 947 – power to require documents and information Section 952 – power to set down sanctions by rules Section 954 – power to order compensation in certain circumstances Section 955 – power to apply to the court for enforcement Section 960 – power to bring and defend proceedings. Section 944(1) authorises the Takeover Panel to provide for derogations and waivers in certain circumstances from rules made under section 943.
4.6	Makes provision for certain Member States’ powers to be unaffected by the Directive (for instance, designation of judicial or other authorities responsible for dealing with disputes, the circumstances in which parties may bring administrative or judicial proceedings, any capacity of the courts to decline to hear legal proceedings and the liability of supervisory authorities).	Section 945(2) provides that a ruling of the Takeover Panel is to have binding effect (subject to provisions in the Panel’s rules and any review or appeal).
		Section 951 provides for matters relating to reviews of and appeals from Takeover Panel decisions to be contained in the rules made by the Panel.
		Section 956 provides that there shall be no action for breach of statutory duty, or any voidness or unenforceability of transactions, as a result of breach of rules made by the Panel.
		Section 961 provides for exemption of the Takeover Panel (and those involved in its functions) from liability in damages in certain circumstances related to the regulatory activities of the Panel.
5	Requires that a “mandatory bid rule” is introduced requiring a person acquiring “control” of a company to make a bid to all holders of securities at an equitable price	Section 943(1) requires that the Panel give effect to the “mandatory bid” and “equitable price” provisions in the exercise of their statutory rule-making duty.
	Contains rules related to the calculation of the equitable price.
6	Requires that the decision to make a takeover bid is made public. Contains detailed provision related to the contents of the takeover offer document. Requires that the parties to a bid are obliged to provide supervisory authorities with information related to the bid.	Section 943(1) requires that the Panel give effect to the “bid” disclosure and documentation provisions in the exercise of its statutory rule-making duty. Section 947 provides the Takeover Panel with power to require documents and information.
7	Lays down rules related to the time allowed for acceptance of the takeover bid.	Section 943(1) requires that the Panel give effect to the offer “acceptance” period provision in the exercise of its statutory rule-making duty.
8	Requires that takeover bids are made public so as to ensure market transparency. It also provides for the disclosure of bid documentation to shareholders and employees’ representatives (or, where there are no such representatives, the employees directly).	Section 943(1) requires that the Panel give effect to the bid disclosure provisions in the exercise of their statutory rule-making duty.
9	Imposes obligations on the board of the offeree company, including the obligation not to take action to frustrate the bid without the approval of shareholders at the time of the bid and to draw up and make public a statement containing their views on the effects of implementation of the bid.	Section 943(1) requires that the Panel give effect to the provisions relating to the obligations of the board of the offeree company in the exercise of their statutory rule-making duty.
10	Requires that companies shall publish detailed information on their share and control structures, etc. in their annual report and present an explanatory report on such matters to the annual general meeting of shareholders.	Section 992 (amending Part 7 of the 1985 Act) requires that the relevant information, including necessary explanatory material, is set out in the annual report of companies.
11	“Breakthrough” – This provision overrides, in certain circumstances connected with a takeover, provisions in the articles of companies and contractual arrangements related to restrictions on transfer and voting rights of shares, etc. It does not apply to special shares held by Member States or to cooperative. This provision may be made optional by Member States for companies under the provisions of article 12.	The right to make these provisions optional for companies is exercised in the implementing provisions. Sections 966 and 967 define the types of companies, circumstances and mechanisms by which a company may opt-in to “breakthrough”. Section 968 lays down the effect on contractual restrictions overridden by “breakthrough”.
12.1	Provides that Member States may make optional the provisions of articles 9(2) and (3) and/or Article 11.	Exercise of this option has been taken only in relation to the provisions of Article 11 (the relevant implementing provisions of which are described above).
12.2 (and 12.4)	Requires, where optional arrangements are in place, that companies have the right to voluntarily opt-in to the provisions of the relevant articles. Such a decision must be communicated to the supervisory authorities and be disclosed.	Section 970 requires that any opting-in decision be communicated to the Takeover Panel without delay.
		The opting-in resolution passed by the company must be filed with the Registrar of Companies under section 30.
12.3 (and 12.5)	Permits Member States to provide that the effects of Articles 9(2) and (3) and/or Article 11 only apply on a “reciprocal” basis, i.e. where the takeover bid is made by a company also subject to the effects of the relevant articles. Such restrictions on the application of Articles 9(2) and (3) and Article 11 shall be subject to the authorisation of the general meeting of shareholders of the offeree company.	The Member State option to provide for “reciprocity” has not been exercised.
13	Requires that rules relating to the lapsing or revision of bids, competing bids, disclosure of results of bids and irrevocability of bids be put in place.	Section 943(1) requires that the Panel give effect to the requirement that such rules be put in place in the exercise of its statutory rule-making duty.
14	Provides that the Directive shall be without prejudice to various provisions relating to information and consultation of employees and their representatives.	No specific implementing provision necessary.
15	Requires Member States to put in place rules enabling a bidder to compulsorily purchase the shares of minority shareholders following a successful takeover bid (“squeeze-out” rights). The circumstances in which such a right must apply (including time periods and relevant thresholds) and relating to the price that must be paid are set out.	“Squeeze-out” rights were previously contained in the 1985 Act (Part 13A (sections 428-430F)). These have been replaced by Chapter 3 of Part 28 of the Act (necessary amendments to ensure these provisions are consistent with Article 15 have been made).
16	Requires Member States to put in place rules enabling minority shareholders to require a bidder to compulsorily purchase their shares following a successful takeover bid (“sell-out” rights). The circumstances in which such a rule must apply (including time periods and relevant thresholds) and relating to the price that must be paid are set out.	Sell-out” rights were previously contained in the 1985 Act (Part 13A). These have been replaced by Chapter 3 of Part 28 of the Act (necessary amendments to ensure these provisions are consistent with article 16 have been made).
17	Requires that effective, proportionate and dissuasive sanctions be put in place.	Sections 952 and 954 provide that the rules made by the Takeover Panel may confer power on the Panel to impose sanctions on those who transgress its rules or order compensation in certain circumstances.
		Section 949 makes it an offence to contravene the provisions of section 948 (relating to the restrictions on disclosure of information provided to the Takeover Panel).
		Section 953 provides an offence where takeover bid documentation does not comply with Panel rules giving effect to Articles 6.3 and 9.5 of the Directive.
		Misconduct in relation to takeover activity also needs to be viewed in the wider context of the overall regulatory framework and the protections available to shareholders and others.
		A robust market regulatory regime and company law framework is in place in the UK to investigate and pursue misconduct in relation to takeover activity (for instance, sanctions with stringent sanctions are already in place to deter fraudulent misrepresentation or market abuse).
18	Lays down a Committee procedure whereby the Commission may adopt rules related to the application of Article 6.3 (contents of takeover bid documentation).	No implementing provision necessary (no such rules have been adopted).
19	Requires the EU Commission to establish a Contact Committee to facilitate the harmonised application of the Directive and advise the Commission, if necessary, on any additions or amendments to the Directive.	No implementing provision necessary.
20	Provides for the review of the Directive by the EU Commission five years after its entry into force.	No implementing provision necessary.
	Requires that Member States provide the Commission annually with certain information related to takeover bids.	Such information will be provided to the EU Commission as an administrative process.
21	Requires that the relevant provisions of the Directive be transposed no later than 20 May 2006. Details of transposition measures shall be communicated to the Commission.	No specific implementing provision necessary (NB paragraph 5 above regarding the Takeovers Directive (Interim Implementation) Regulations 2006 which came into force on 20th May 2006). Details of the transposition measures will be communicated to the EU Commission by administrative process.
22	Provides that the Directive enters into force on 20 May 2004	No implementing provision necessary.
23	Addresses the Directive to the Member States.	No implementing provision necessary.

Part 35: The Registrar of Companies – Directive 2003/58/EC (which amends Council Directive 68/151/EEC as regards disclosure requirements in respect of certain types of companies)

1742. Various provisions within Part 35 of the Act serve to implement Directive 2003/58/EEC, which amends section I of the First Company Law Directive (68/151/EEC), primarily to enable companies to register certain documents electronically and searchers to access them electronically.

1743. Section I of the First Company Law Directive requires that basic company documents be disclosed via filing with a company registry, and by publication in the national gazette either of the full or partial text of the document or by reference to the document deposited in the company registry. It also requires that those documents be available for inspection. In addition, the First Company Law Directive specifies minimum information that companies must include on their letters and order forms. The First Company Law Directive assumes the use of paper documents. The amended directive reflects the use of information technology and electronic communications.

1744. In practice, the 1985 Act already allows the Registrar to accept electronic filing of all documents covered by the First Company Law Directive, although specific directions as to the form and manner of filing any particular document electronically have to be given by the Registrar. At present, the Registrar has mechanisms for the electronic filing of many of those documents.

1745. The 1985 Act also already allows the Registrar to keep documents in electronic form, and to provide for inspection by electronic means. Legislation is however necessary to impose formal obligations on the Registrar in relation to electronic filing, so as to transpose the amending Directive properly.

1746. Responsibility for the transposition of the amending Directive lies with the Secretary of State for Trade and Industry. The table below describes the substantive provisions in the Act which implement it.

Part 35: The Registrar of Companies

Article	Objective	Implementation
2.	(Which amends Article 2.1(f) of the First Company Law Directive) requires certain accounting documents to be filed.	Part 35 of the Act contains the relevant filing requirements (which are restated from the current legislation).
3.	(So far as it amends Article 3.2.) Company Registries must allow companies to file electronically all basic documents (those specified in Article 2 of the First Company Law Directive, and those to which Article 3 of the First Company Law Directive is applied by other legislation).	Section 1078 lists the documents which are now subject to the Directive disclosure requirements under Article 2 of the First Company Law Directive as amended.
		Section 1068(5) provides that all such documents may be delivered to the Registrar in electronic form.
3.	( So far as it also amends Article 3.2.) Company Registries must allow requests for inspection of such documents to be made electronically.	Section 1089(2) provides that applications in respect of such documents may be submitted electronically.
3.	( So far as it also amends Article 3.2.) Company Registries must offer electronic copies of such documents to those inspecting the register (subject to a permitted derogation in respect of documents filed before 1 January 2007).	Section 1090(2) provides that copies of such documents must be provided in electronic form if the applicant so chooses (subject to section 1090(3) which takes advantage of the permitted derogation).
3.	( So far as it also amends Article 3.2.) Company Registries must keep all such documents (whether submitted electronically or in hard copy) in electronic form.	Section 1080(3) provides that information from such documents must be kept in electronic form.
3.	( So far as it amends Article 3.3) In the case of electronic copies, Company Registries need only provide certified copies if they are asked to do so. Member States need to take measures to ensure the authenticity of electronic certified copies.	Section 1091 contains provision about certifying copies and allows the Secretary of State to make regulations about how electronic copies are certified.
3.	( So far as it amends Article 3.4.) The option is provided to Members States of using an alternative to publication in the National Gazette as a means of publicising information received.	Section 1077 specifies that notices must be published either in the Gazette, or in accordance with section 1116. The latter section enables the Secretary of State to make regulations specifying alternative means of publication.
4.	(Which inserts a new Article 3a.) This provides that, while documents must be submitted in a language permitted by the language rules of the member state in question, voluntary translations in other Community languages must also be accepted.	Sections 1106 and 1107 provide that companies may deliver certified translations of documents. The languages and types of document in respect of which this facility is available will be specified in regulations made by the Secretary of State, but subsection (3) of section 1106 provides that these regulations must as a minimum cover the documents subject to the directive disclosure requirements and the official languages of the EU.
5.	(Which replaces the previous Article 4). This provides that certain information (already currently required on hard copy letters and order forms) must be stated in documents in any form and displayed on websites.	This will be implemented by regulations under section 82.
6.	This provides that that there must be appropriate penalties for breach of new Articles 2(1)(f) and 4 of the First Company Law Directive.	See entries for new Articles 2(1)(f) and 4 above.

Part 43: Transparency obligations and related matters – Transparency Directive (2004/109/EC)

1747. Sections 1265, 1266, 1267, 1268, 1270, 1271, and 1272 in Part 43 (Transparency obligations and related matters) of the Act implement Directive 2004/109/EC on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC. Section 1266 inserts seven new sections into Part 6 of the Financial Services and Markets Act 2000; sections 89A, 89B, 89C, 89D, 89E, 89F and 89G. The new sections give power to the competent authority (at present the Financial Services Authority (“FSA”)) to make rules for the purposes of the Transparency Directive (2004/109/EC) (“Transparency Directive”) and connected regulatory purposes. Sections 1267 and 1268 insert three and four sections, respectively, into Part 6 of FSMA (89H to 89N) setting out the regulatory powers of the FSA in connection with the Directive. Section 1270 inserts new sections 90A and 90B into FSMA, which set out the issuers’ liability in damages for disclosures required under the Transparency Directive, and section 1271 inserts a new section 100A into FSMA setting out provisions in relation to the exercise of the FSA’s powers where the UK is a host member state.

1748. The Transparency Directive imposes minimum harmonisation requirements on the information to be provided to the public about issuers whose securities are traded on a regulated market and the control of votes attached to shares in those issuers. It permits Home Member States to impose more stringent requirements on entities that they regulate but Host Member States, i.e. those states in which the issuers securities are traded on a regulated market but whose competent authority are not responsible for primary oversight of that issuer, are not permitted to impose any requirements more stringent than those contained in the Transparency Directive.

1749. There are three main categories of obligation that are imposed under the Transparency Directive and that the FSA’s transparency rules will implement in respect of UK markets and issuers:

a)

requirements for issuers to make public, at regular intervals, information about their financial position and the progress and management of the business of the issuer;

b)

requirements for holders of votes attached to shares of issuers to notify the issuers when the number of votes they control reaches specified proportions of the total votes available; and

c)

requirements for issuers to treat the holders of the same securities equally.

1750. The detailed and technical provisions about the required notifications, disclosures and treatment of security-holders will be prescribed in rules made by the FSA under the new rule-making power at section 89A of the Financial Services and Markets Act 2000. The FSA is required by that Act to carry out consultation and a cost benefit analysis when making any rules under this power.

1751. Having the power to make these rules will promote the harmonisation of practice with other EU jurisdictions, and help enhance investor confidence through increased transparency of the financial markets.

1752. Responsibility for the transposition of the Transparency Directive lies both with HM Treasury and with the FSA. The measures in the Companies Act that implement the Transparency Directive are the responsibility of HM Treasury.

1753. The table below describes the substantive provisions in the Act implementing the Transparency Directive.

Part 43: Transparency obligations and related matters

Article	Objective	Implementation
1.	Sets out scope of the Directive and two derogations from the requirements of the Directive. The Member States may apply the derogations in respect of securities issued by the government, local government or a state’s national central bank.	Part 43 of the Act inserts new provisions into the Financial Services and Markets Act 2000 (“FSMA”) to give the Financial Services Authority power to make Transparency Rules.
		Most provisions in the Transparency Directive will be implemented by the FSA’s Transparency Rules. Other provisions in the Act or in FSMA implement the other requirements.
If the derogations are to be implemented, the FSA’s Transparency Rules will do this.
2.	Provides various definitions used in the Directive.	These will be applied in Transparency Rules, or apply in relation to the implementation of the Article to which they relate.
3.	Limits the circumstances in which Member States may impose more stringent requirements than those contained in the Directive on issuers of securities and holders of interests in those issuers’ shares.	Transparency Rules and new FSMA section 100A(2) introduced by section 1271 of the Act.
4.	Requires issuers of securities which are traded on regulated markets to make public its annual financial report consisting of its audited financial statements and the management report.	Transparency Rules: see in particular new sections 89A and 89C of FSMA, inserted by section 1266 of the Act.
5.	Requires issuers of shares or debt securities which are traded on a regulated market to make public a half-yearly financial report.	Transparency Rules: see in particular new sections 89A and 89C of FSMA, inserted by section 1266 of the Act.
6.	Requires issuers whose shares are traded on a regulated market to make public an interim quarterly statement.	Transparency Rules: see in particular new sections 89A and 89C of FSMA, inserted by section 1266 of the Act.
7.	Requires Member States to ensure that responsibility for the information to be drawn up and made public in accordance with Articles 4, 5, 6 and 16 lies at least with the issuer or its administrative, management or supervisory bodies and to ensure that their laws, regulations and administrative provisions on liability apply to the issuers, the bodies referred to in this article or the persons responsible within the issuers.	Provisions relating to liability inserted into FSMA as new sections 90A and 90B by section 1270 of the Act.
8.	Provides various exemptions from the requirements of articles 4, 5 and 6 including to optional exemptions.	Transparency Rules.
9.	Provides that where a shareholder with a significant level of holding acquires or disposes of shares of an issuer whose shares are admitted to trading on a regulated market and to which voting rights are attached, such shareholder notifies the issuer of the proportion of voting rights in the issuer held by the shareholder as a result of the acquisition or disposal where that proportion reaches, exceeds or falls below the thresholds of 5%, 10%, 15%, 20%, 25%, 30%, 50% and 75%.	Transparency Rules: see in particular new sections 89A and 89B of FSMA, inserted by section 1266 of the Act.
10.	The notification requirements in Article 9 shall also apply to a natural person or legal entity to the extent it is entitled to acquire, to dispose of, or to exercise voting rights in any of the cases set out in the Article or a combination of them.	Transparency Rules.
	(Voting rights acquired through agreement or interest).
11.	Exempts shares provided to or by the members of the ESCB in certain circumstances from the notification requirements imposed by Articles 9 and 10.	Transparency Rules.
12.	Sets out the information that must be included in the notification under Articles 9 and 10 and includes provision on the timing of the notification and when aggregation of holdings required. Paragraph (6) requires the issuer to make public all information contained within a notification within 3 days.	Transparency Rules.
13.	Requires the holders of financial instruments, which are to be specified by the Commission, to notify the issuer of their control of votes in accordance with the requirements in Article 9.	Transparency Rules.
14.	Requires an issuer of shares admitted to trading on a regulated market to make public the proportion of its own shares that it holds when those proportions reach, exceed or fall below the thresholds of 5% or 10%.	Transparency Rules: see in particular new sections 89A and 89C of FSMA, inserted by section 1266 of the Act.
15.	Requires the Member State to ensure that an issuer of shares traded on a regulated market, makes public the total number of voting rights and capital at the end of each month during which the number changes.	Transparency Rules.
16.	Requires issuers of securities to make public information about any changes in the rights attached to their securities and any new loan issues and any guarantee or security in respect of such loans.	Transparency Rules: see in particular new sections 89A and 89C of FSMA, inserted by section 1266 of the Act.
17.	Requires issuers of shares admitted to trading on a regulated market to treat their shareholders, who are in the same position, equally. It provides for information to be distributed in particular ways and for shareholders to be able to exercise their rights in specified ways.	Transparency Rules.
18.	Makes similar provision as that contained in Article 17 but in respect of issuers whose debt securities are admitted to trading on a regulated market.	Transparency Rules.
19.	Requires issuers to file information that they are required to make public under the Directive, with the FSA and permits the FSA to publish that information itself. It also requires issuers to inform the FSA and the regulated market to which its securities are admitted of any proposed change to its instrument of incorporation.	Transparency Rules.
20.	Sets out the rules for determining which language the issuer must use to disclose regulated information in various circumstances.	Transparency Rules.
21.	Requires issuers to disclose regulated information in a manner ensuring fast access to such information on a non-discriminatory basis.	Transparency Rules.
	Also requires each Member State to have an officially appointed mechanism for the central storage of regulated information.
22.	Requires the competent authorities of the Member States (for the UK it is the FSA) to draw up guidelines to create an electronic network at national level to share information between the various competent authorities, operators of regulated markets and national company registers. Such guidelines must aim to further facilitate public access to be disclosed under this Directive, Directive 2003/6/EC (the Market Abuse Directive) and Directive 2003/71/EC (Prospectus Directive).	The FSA will draw up guidelines in accordance with the obligations under this Article.
23.	Enables the FSA to exempt issuers based in third countries from certain disclosure requirements if there are equivalent provisions in the third country. Requires the FSA to ensure that where a third country issuer is regulated in the UK for EU purposes, any information which may be important to the public in the Community is disclosed in accordance with Articles 20 and 21.	Transparency Rules.
24.	Requires each Member State to designate a central competent authority responsible for ensuring that the Directive is applied and to give that competent authority specified powers which are necessary for the performance of its functions. Permits each Member State to designate a competent authority for examining that information is drawn up in accordance with the relevant reporting framework.	The central competent authority in the UK will be the FSA, by virtue of the amendments being inserted into Part 6 of FSMA. The FSA already has various powers under FSMA. Other powers for the FSA to perform its functions are contained in new FSMA sections 89H to 89N inserted by sections 1267 and 1268 of the Act. The Act provides power to designate a competent authority for reporting framework purposes by amending the Companies (Audit, Investigations and Community Enterprise) Act 2004. See Schedule 15 (Part 2) of the Act.
25.	Imposes a requirement for professional secrecy on those who work for the competent authority and requires cooperation between the competent authorities of the various Member States.	FSMA already contains provisions relating to professional secrecy for those who work for the FSA and the Companies (Audit, Investigations and Community Enterprise) Act 2004 also contains provisions in relation to authorities appointed under that Act.
26.	Provides for host Member States to take action in relation to infringements where an issuer or security holder continues to infringe the requirements of the Directive.	New section 100A of FSMA introduced by section 1271 of the Act.
27.	Sets out the committee procedure for the Commission to make implementing measures required by the Directive.	No implementing provision required.
28.	Requires, without prejudice to the right of Member States to impose criminal penalties, Member States to ensure, in conformity with their national law that at least the appropriate administrative measure may be taken or civil and/or administrative penalties imposed in respect of the persons responsible.	Schedule 15 (Part 1) of the Act amends section 91 of FSMA to enable the FSA to impose financial penalties for breach of the Transparency Rules.
29.	Requires a right of appeal to the courts to be in place.	No further implementation is required. FSMA already makes provision for appeals of FSA decisions to the Financial Services and Markets Tribunal and to the Court of Appeal.
30 – 35	These articles contain transitional and final provisions, including the date by which the Directive must be transposed – 20 January 2007.	No specific implementation is required for most of these provisions. New sections 89B(4) and 89D(1) introduced by section 1266 of the Act make provision for transitional arrangements.