Primary Markets
Primary Markets by Ruari Ewing, Charlotte Bellamy, Katie Kelly and Mushtaq Kapasi
EU Listing Act consultation The European Commission published in November a targeted consultation on various aspects of EU legislation relating to listing, including the EU Prospectus Regulation, Market Abuse Regulation (MAR), MiFID II, Transparency Directive and Listing Directive. Alongside this, the European Commission also published a general public consultation document containing certain high-level questions that are also included in the targeted consultation. The European Commission advises stakeholders to reply to only one of the two versions (either the targeted consultation or the general public consultation) to avoid unnecessary duplications. The overarching objectives of these consultations are to make public markets more attractive for EU companies and to facilitate access to capital for SMEs. This is one initiative under the EU’s 2020 Capital Markets Union Action Plan (Action 2). Following informal engagement with the European Commission prior to the publication of the targeted consultation, ICMA is now looking carefully at the wideranging questions in the targeted consultation and preparing a response in time for the deadline of 11 February 2022. In relation to the EU Prospectus Regulation, the overall message in ICMA’s response is likely to be that the EU Prospectus Regulation works well from the perspective of the wholesale international bond markets, and there are limited areas that need fixing. To the extent that changes are made to the regime in order to address concerns in other parts of the EU’s capital markets, this should be done in a way that does not impose unnecessary additional or disproportionate costs for users of the wholesale international bond markets. ICMA members do, however, have some suggestions for how the EU Prospectus Regulation could function even more effectively for the international bond market. These include targeted amendments to make the incorporation by reference and prospectus supplement regimes more efficient.
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Regarding the MAR aspects, ICMA’s response is expected to repeat prior ICMA positions around scope, the definition of inside information and the soundings regime (with a few potential additional nuances relating to mid-cap issuers). ICMA is also considering the European Commission’s questions related to the Transparency Directive and other areas of the targeted consultation paper. Separately, as highlighted in the feature article on the Capital Markets Union Package in this Quarterly Report, ICMA is considering submitting feedback on the European Commission’s proposal for a European Single Access Point by the 7 March 2022 deadline for comments. ICMA is also considering a response to the UK FCA further consultation on a new Consumer Duty, with a 15 February deadline, with a likely focus on the apparent policy intention to exclude mainstream bond issuance. Contacts: Ruari Ewing and Charlotte Bellamy ruari.ewing@icmagroup.org charlotte.bellamy@icmagroup.org
