Tallinn Stock Exchange January Round-Up

The Estonian Parliament on January 18 passed amendments to the Securities Market Act to regulate take-overs of public companies. The law now stipulates that a person obtaining a controlling interest in a listed company has an obligation to make a take-over bid to all remain-ing shareholders. The offeror must ensure equal treatment for all share-holders, and is obliged to follow the take-over rules of the TSE. The second substantial change in the Act will allow licensed securities intermediaries from the European Union member states to obtain Estonian licenses in simplified manner. From now on the European brokerages no longer need to open a local branch office in order to operate on the Estonian market, thus enabling them to become remote members of the Tallinn Stock Exchange. The third major change in the Act clarifies the definitions for public issue and offering of securities, and also defines the program issue. According to the current law, all individual issues of securities con-ducted under a program, were to be separately registered with the Securities Inspectorate. This was regarded as a major obstacle for development of the market, as the issuers had to go through expensive and time-consuming bureaucratic procedures. The amendments also contain provisions which should increase the effectiveness of the Securities Inspectorate in dealing with insider dealing cases. The amendments to the Act prohibit the use of inside information, and transactions conducted based on such information, and expand the Securities Inspectorate's rights to obtain necessary information in order to carry out its functions.