The Companies (Cross-Border Mergers) Regulations 2007

Directors’ report

8.—(1) The directors of the UK merging company must draw up and adopt a report.

(2) The report must—

(a) explain the effect of the cross-border merger for members, creditors and employees of the company; and

(b) state—

(i) the legal and economic grounds for the draft terms;

(ii) any material interests of the directors (whether as directors or as members or as creditors or otherwise);

(iii) the effect on those interests of the cross-border merger, in so far as it is different from the effect on the like interests of other persons.

(3) Where the cross-border merger affects the rights of debenture holders of the company, the report must state—

(a) any material interests of the trustees of any deed for securing the issue of the debentures (whether as trustees or as members or as creditors or otherwise);

(b) the effect on those interests of the cross-border merger, in so far as it is different from the effect on the like interests of other persons.

(4) It is the duty of any trustee for the company’s debenture holders to give notice to the company’s directors of such matters relating to himself as may be necessary for the purposes of paragraph (3).

(5) The directors of the UK merging company must deliver copies of the report to its employee representatives (or if there are no such representatives, the employees) not less than 2 months before the date of the first meeting of the members, or any class of members, of the company (see regulation 13).

(6) If the employee representatives deliver an opinion on the report to the company’s registered office not less than 1 month before the date of the first meeting of the members, or any class of members, of the company, every copy of the report issued after the date on which the opinion was delivered must be accompanied by the opinion.

(7) Any person who makes default in complying with paragraph (4) commits an offence.

(8) A person guilty of an offence under this regulation is liable on summary conviction to a fine not exceeding level 3 on the standard scale.