January 2013


On 31 December 2012 Royal Decree 1698/2012 of 21 December, amending the regulations on securities’ prospectuses and transparency requirements in relation to the issuance of securities ( “RD 1698/2012”), was published in the Spanish Official Gazette (Boletín Oficial del Estado) and came into force on the date following its publication.

This regulation completes the transposition into Spanish law of Directive 2010/73/EU of 24 November 2010, amending Directive 2003/71/EC (the Prospectus Directive) and Directive 2004/109/EC (the Transparency Directive), which had already been partially transposed by Royal Decree-Law 24/2012 of 31 August (subsequently validated by Law 9/2012 of 14 November), amending Law 24/1988 of 28 July on the Securities Market (the “Securities Market Law”).

The transposition of Directive 2010/73/EU mainly affects Royal Decree 1310/2005 of 4 November (“RD 1310/2005”), although it also amends, to a lesser extent, Royal Decree 1362/2007 of 19 October (“RD 1362/2007”). Likewise, RD 1698/2012 introduces amendments to RD 1310/2005 which exceed the mere transposition of the abovementioned Directive (see paragraph 1.4).


1.1. The summary of the prospectus: format, content and liability regime

With regard to its format and content, the summary of the prospectus must: (i) be «drawn up in a common format» (in accordance with the applicable regulations, as provided under Annex XXII to the Commission Delegated Regulation (EU) No. 486/2012 of 30 March) and; (ii) its content should convey «the key information, taken together with the rest of the prospectus, to aid investors when considering whether to invest in the securities».

The new concept of key information is defined in RD 1310/2005 (Art. 4.l)) as that information which allows investors to «[…] understand the nature and the risks of the issuer, guarantor and securities that are being offered or admitted to trading […]».

In connection with the foregoing, the liability regime for the content of the summary of the prospectus is also modified, providing that civil liability may arise not only when its content is misleading, inaccurate or inconsistent, but also when «[…] it does not provide, when read together with the other parts of the prospectus, key information in order to aid investors when considering whether to invest in the securities».

Although RD 1698/2012 transposes the new EU regime in connection with the summary of the prospectus into Spanish law, these changes concerning its format, content and liability regime have been applicable in Spain since 1 July 2012 by virtue of the direct effect of the aforementioned Commission Delegated Regulation (EU) No. 486/2012.


1.2. The definition of public offer and the exemptions from the obligation to publish an offer prospectus

The definition of “public offer”

Pursuant to the latest drafting of Art. 30 bis of the Securities Market Law, which has been consistent with the EU regulations since 31 August 2012, the following thresholds which determine whether an offer qualifies as a public offer, and is therefore exempt from the obligation to publish an offer prospectus, have increased:

(i) the maximum number of investors to which the offer is addressed (from 100 to 150);

(ii) the minimum amount per investor (from EUR 50,000 to 100,000);

(iii) the minimum denomination of the securities (from EUR 50,000 to 100,000); and

(iv) the total maximum aggregated value of the offer(s) made in the European Union (EU) within the previous twelve months (from EUR 2.5 to 5 million).

Therefore, the requirements of high nominal value offers (items (ii) and (iii)) have been tightened up, while offers with a reduced scope have been granted greater flexibility (items (i) and (iv)).

Exemption from the obligation to publish a public offer prospectus

Directive 2010/73/EU introduces certain technical improvements that have been included in RD 1698/2012. Possibly, the most significant of these consists of the removal of the exemption from the obligation to publish a prospectus when shares are offered, allotted or are to be allotted at no cost to the shareholders. Given that such offers are free and, therefore, below the minimum total value provided under the definition of a public offer, they cannot be considered as such (and, therefore, no express exemption is required in this regard).

Likewise, it was considered that the current exemptions for securities offered, allotted or to be allotted to existing or former employees or directors of the issuer or of an affiliate thereof were too restrictive to be useful to a significant number of employers operating share schemes for employees. Therefore, this exemption has been extended to: (i) companies having their head office or registered office in the EU (regardless of whether or not they are admitted to trading on a secondary market in the EU); and (ii) companies of third countries admitted to trading, either on a regulated market in the EU or on a third-country market (provided that in the latter case the European Commission has adopted an equivalence decision regarding the regulations and supervision in the third country concerned).

It must be noted that the amendments described in the two preceding paragraphs are only applicable with regard to the exemptions from the obligation to publish a public offer prospectus (Art. 41.1.d) and e)); the exemptions from the obligation to publish a prospectus in connection with the admission to trading (Art. 26.1.e) and f)) have not been adjusted accordingly.

Likewise, the limit provided for “plain vanilla” debt offers made in the EU within a twelve-month period making it exempt from the obligation to publish an offer prospectus has increased from EUR 50 to 75 million.

Finally, the resale of securities carried out through financial intermediaries is also exempt from the obligation to publish a public offer prospectus, provided that a valid prospectus is already available to the public and the issuer has consented in writing to its use.


1.3. Other modifications

Right of withdrawal upon publication of a supplement to the prospectus

The acceptors’ right to withdraw their acceptance of an offer will apply when a new factor, mistake or inaccuracy arises that may affect the assessment of the securities and require the publication of a supplement, provided this event arose before the delivery of the securities.

“Qualified investor” definition and investors registry

The definition of qualified investor has been adjusted in accordance with arts. 78bis.3 and 78 ter of the Securities Market Law (which is aligned with the MiFID definition of professional investor).

The legal regime has also been further developed regarding the potential issuers’ right of access to the qualified investors registries created by investment firms and credit entities providing for investment firms detailing the natural persons and SMEs that voluntarily requested them to be considered as qualified investors.

Final terms to a base prospectus passporting

Issuers willing to launch a tender offer or request for the admission to trading of debt securities under a base prospectus previously filed with the competent authorities of other Member States must communicate the final terms to the competent authority of the relevant host Member State (this communication was already market practice since European legislation only required the issuer to file the final terms with the competent authority of the home Member State).

Exemptions from publishing or translating the summary of the prospectus

As regards the admission to trading of non-equity securities, the minimum denomination per unit threshold to apply the exemptions to the obligations to publish a summary or translate it into Spanish is increased from EUR 50,000 to 100,000.


1.4. Amendments introduced outside the transposition of Directive 2010/73/EU

Admission to trading requirements

  • Annual accounts

In relation to the exemption to deliver the annual accounts for the last three years where the CNMV so decides, whether in the issuer’s or the investors’ best interest, it has been clarified that, in the case of issuers with a complex financial history, investors will be deemed to have all necessary information as long as the prospectus includes the information required by Commission Regulation (EC) no. 211/2007 of 27 February regarding financial information in prospectuses where the issuer has a complex financial history or has made a significant financial commitment.

  • Securities already admitted to trading on an official secondary market

The admission to trading process of securities already admitted to trading on a different Spanish official secondary market, where all requirements will be deemed to be complied with, has been simplified, except for the obligation to prepare an informative prospectus, without prejudice to the availability of the exemption established in Art. 26.1.h) of RD 1310/2005 relating to securities previously admitted to trading on an EU regulated market.

Regime of commercial papers with maximum maturity of 12 months

The issue of commercial papers with a maximum maturity of 12 months will not require the preparation of the final terms; instead, it will suffice to supplement the base prospectus with the certificate referred to in Art. 6.2 of Royal Decree 116/1992.


Certain cases have been clarified where Spain will be considered as home Member State for issuers of debt securities in a currency other than the euro with a minimum denomination per unit equivalent to less than EUR 1,000.

Likewise, following Directive 2010/73/EU, the thresholds related to the issuers’ right to choose: (i) the language for the disclosure of the regulated information; and (ii) the location to hold a meeting of bondholders in another Member State, have increased from EUR 50,000 to EUR 100,000.


The information contained in this Newsletter is of a general nature and does not constitute legal advice