CESR's final advice to the European Commission sets out the agreed:
- Minimum information to be included in any EU prospectus, in particular adding new schedules: CESR proposes technical implementing measures related to schedules applicable to securities issued by Member States, Non-EU States and their regional or local authorities, by public international bodies and, if legally possible, by collective investment undertakings of the closed-end type.
- Minimum information to be included in any EU prospectus: historical financial information. The final proposal on historical financial information both for EU and non-EU issuers is also delivered in this advice. CESR had already published its proposals in this area in July and September package of advice but due to the complexity of the matter it decided to take advantage of the last consultation to gather more input from the market.
- Dissemination of advertisements: CESR proposes technical advice in relation to possible implementing rules concerning the dissemination of advertisements announcing the intention to offer securities to the public or the admission to trading.
After considering the responses received to the consultation, CESR has amended its initial proposals. The most significant changes are described below:<
- A separate schedule for public international bodies has been produced based on the states' schedule. The decision to adopt a similar approach to that of sovereign issuers is driven by the fact that their risk profiles are more similar to sovereign issuers, despite being structurally similar to corporates.
- In relation to the accounting principles used to prepare the historical financial information, CESR's final advice has introduced three main changes to the proposal released in July's consultation paper.
- In relation to the 'restatement rule', under which the historical financial information must be presented and prepared in a form consistent with that which will be adopted in the issuer's next published annual financial statements, CESR advice recommends, almost unanimously, that debt issuers should restate only one year of accounts when there is a change in the accounting principles instead of two years which is the case for equity issuers.
- Regarding the transition to IAS, CESR has proposed in its advice to the Commission, a transitional provision to make it clear that issuers should not be under an obligation to produce IAS numbers in the prospectus for any period earlier than 1st January 2004. In the case of national provision set in accordance with Article 9 of Regulation 1606/2002 (IAS Regulation) the obligation to produce IAS numbers should not be earlier than 1st January 2006.
- In relation to third countries' issuers, CESR proposes some transitional arrangements that will allow non-EU companies using internationally accepted standards to continue to do so until 2007. In addition, non-EU issuers having securities already admitted to trading on a regulated market, will be required to include IAS accounts in their prospectuses only when obliged to report under IAS by the future transparency directive. CESR also recommends that in due course and in consistency with the future Transparency Directive, a procedure to evaluate equivalence of non-EU-GAAPs be set up by the Commission.
- Finally, in relation to the dissemination of advertisements announcing the intention to offer securities to the public or the admission to trading, CESR advises that all means of dissemination should be permitted.
All responses to the consultation and an indication of how CESR has decided to take forward comments are included in the feedback statement also published today.
