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- Questions arising from the Swiss Federal Supreme Court judgment from 2013 clarified in the year under review
- Number of notifications again higher, with the number of potential violations declining once more
Effects of the Swiss Federal Supreme Court judgment
The Swiss Stock Exchange Ordinance-FINMA requires disclosure of anyone who is entitled to exercise voting rights of shares without being a beneficial owner of these shares. In its judgment from 2013, the Swiss Federal Supreme Court ruled that this provision is not covered by the wording of the Swiss Stock Exchange Act (SESTA). This judgment was explained in the 2013 Annual Report.
The Disclosure Office was requested in the year under review to assess in a recommendation how a specific affiliated group was to comply with its disclosure obligations subsequent to this judgment. Third parties had contractually authorized companies within the group to exercise voting rights on their behalf. The Disclosure Office determined that in accordance with current legislation following the Supreme Court judgment, such authorizations to exercise voting rights do not trigger disclosure obligations for the group.
Furthermore, the group was also comprised of companies that themselves acquired shares listed in Switzerland. In this case, the Disclosure Office classified the activity as an indirect acquisition by the group, making the transaction subject to the disclosure obligations. The fact that most of the investors with economic interests in these investments were from outside the group was immaterial for this ruling.
The Federal Supreme Court judgment also had an effect on legislation. The provision in the Swiss Stock Exchange Ordinance-FINMA that is not covered by the wording of the law pursuant to the Supreme Court ruling has been incorporated into the Swiss Financial Market Infrastructure Act (FMIA). The transfer of the related regulation into the new law is a welcome step because it creates transparency regarding the exercise of voting rights.
Number of notifications rises – number of potential violations falls
The number of disclosure notifications increased by about 10% to 1,371 compared with the previous year (2013: 1,240), while the number of suspected cases of notification violations declined to 87 (2013: 103).
Therefore, the number of potential violations in relation to the number of notifications has decreased for the second year in a row. This is probably due to the intensified enforcement of the disclosure regulations by the Swiss Federal Financial Market Supervisory Authority (FINMA) and the Swiss Federal Department of Finance (FDF).
You will find the 2014 Annual Report of the Disclosure Office of SIX Swiss Exchange at the following link: https://www.six-exchange-regulation.com/en/shared/component/redirected/disclosure-annual-reports.html
Further information can also be found at: https://www.six-exchange- regulation.com/en/home/investor/obligations/disclosure-of-shareholdings.html
