(1)

Directive 2004/109/EC establishes the general principles for the harmonisation of transparency requirements in respect of the holding of voting rights or financial instruments that result in an entitlement to acquire existing shares with voting rights. It seeks to ensure that, through the disclosure of accurate, comprehensive and timely information about security issuers, investor confidence is built up and sustained. By the same token, by requiring issuers to be informed of movements affecting major holdings in companies, it seeks to ensure that the latter are in a position to keep the public informed.

(2)

The rules for the implementation of the rules governing transparency requirements should likewise be designed to ensure a high level of investor protection, to enhance market efficiency, and to be applied in a uniform manner.

(3)

As regards the procedural arrangements in accordance with which investors are to be informed of the issuer's choice of home Member State, it is appropriate that such choices be disclosed in accordance with the same procedure as regulated information under Directive 2004/109/EC.

(4)

As regards the minimum content of the condensed set of half-yearly financial statements, where that set is not prepared in accordance with international accounting standards, this should be such as to avoid giving a misleading view of the assets, liabilities, financial position and profit or loss of the issuer. The content of half-yearly reports should be such as to ensure appropriate transparency for investors through a regular flow of information about the performance of the issuer, and that information should be presented in such a way that it is easy to compare it with the information provided in the annual report of the preceding year.

(5)

Issuers of shares who prepare consolidated accounts in accordance with International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) should apply the same definition of related party transactions in annual and half-yearly reports under Directive 2004/109/EC. Issuers of shares who do not prepare consolidated accounts and are not required to apply IAS and IFRS should, in their half-yearly reports under Directive 2004/109/EC, apply the definition of related party transactions set out in Council Directive 78/660/EEC of 25 July 1978 based on Article 54(3)(g) of the Treaty on the annual accounts of certain types of companies (3).

(6)

For the purposes of benefiting from the exemption from the notification of major holdings under Directive 2004/109/EC in the case of shares acquired for the sole purpose of clearing and settling, the maximum length of the ‘short settlement cycle’ should be as short as possible.

(7)

In order for the relevant competent authority to be able to monitor compliance as regards the derogation for market makers with respect to the notification of information about major holdings, the market maker seeking to benefit from that derogation should make known that it is acting or intends to act as market maker and for which shares or financial instruments.

(8)

Conducting market making activities in full transparency is particularly important. Thus, the market maker should be capable upon request from the relevant competent authority of identifying the activities conducted in relation to the issuer in question, and in particular the shares or financial instruments held for market making activities purposes.

(9)

As regards the calendar of trading days, it is appropriate, for the sake of ease of operation, that time limits be calculated by reference to the trading days in the Member State of the issuer. However, in order to enhance transparency, provision should be made for each competent authority to inform investors and market participants of the calendar of trading days applicable for the various regulated markets situated or operating on its territory.

(10)

As regards the circumstances in which notification of major holdings is to be made, it is appropriate to determine when that obligation is triggered either individually or collectively, and how that obligation is to be complied with in the case of proxies.

(11)

It is reasonable to assume that natural persons or legal entities exercise a high duty of care when acquiring or disposing of major holdings. It follows that such persons or entities will very quickly become aware of such acquisitions or disposals, or of the possibility to exercise voting rights, and it is therefore appropriate to specify only a very short period following the relevant transaction as the period after which they are deemed to have knowledge.

(12)

The exemption from the obligation to aggregate major holdings should be available only to parent undertakings that can demonstrate that their subsidiary management companies or investment firms fulfil adequate conditions of independence. To ensure full transparency, a statement to that effect should be notified ex ante to the relevant competent authority. In this regard, it is important that the notification mentions the competent authority supervising the management companies’ activities under the conditions laid down pursuant to Council Directive 85/611/EEC of 20 December 1985 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) (4), irrespective of whether or not they are authorised under that Directive, provided in the latter case that they are supervised under national legislation.

(13)

For the purposes of Directive 2004/109/EC, financial instruments should be taken into account in the context of notifying major holdings, to the extent that such instruments give the holder an unconditional right to acquire the underlying shares or discretion as to whether to acquire the underlying shares or cash on maturity. Consequently, financial instruments should not be considered to include instruments entitling the holder to receive shares depending on the price of the underlying share reaching a certain level at a certain moment in time. Nor should they be considered to cover those instruments that allow the instrument issuer or a third party to give shares or cash to the instrument holder on maturity.

(14)

The financial instruments in Section C of Annex I of Directive 2004/39/EC of the European Parliament and of the Council (5) which are not mentioned in Article 11(1) of this Commission directive do not qualify as financial instruments within the meaning of Article 13(1) of Directive 2004/109/EC.

(15)

Directive 2004/109/EC sets high-level requirements in the area of dissemination of regulated information. The mere availability of information, which means that investors must actively seek it out, is therefore not sufficient for the purposes of that Directive. Accordingly, dissemination should involve the active distribution of information from the issuers to the media, with a view to reaching investors.

(16)

Minimum quality standards for the dissemination of regulated information are necessary to ensure that investors, even if situated in a Member State other than that of the issuer, have equal access to regulated information. Issuers should ensure that those minimum standards are met, whether by disseminating the regulated information themselves or by entrusting a third party to do so on their behalf. In the latter case, the third party should be capable of dissemination in adequate conditions and have adequate mechanisms in place to ensure that the regulated information it receives emanates from the relevant issuer and that there is no significant risk of data corruption or of unauthorised access to unpublished inside information. Where the third party provides other services or performs other functions, such as media, competent authorities, stock exchanges or the entity in charge of the officially appointed storage mechanism, such services or functions should be kept clearly separated from the services and functions relating to the dissemination of regulated information. When communicating information to the media, issuers or third parties should give priority to the use of electronic means and industry standard formats so as to facilitate and accelerate the processing of the information.

(17)

Additionally, by way of minimum standards, regulated information should be disseminated in a way that ensures the widest possible public access, and where possible reaching the public simultaneously inside and outside the issuer’s home Member State. That is without prejudice to the right of Member States to request issuers to publish parts or all regulated information through newspapers, and to the possibility for issuers to make regulated information available on their own or other websites accessible to investors.

(18)

Equivalence should be able to be declared when general disclosure rules of third countries provide users with understandable and broadly equivalent assessment of issuers’ position that enable them to make similar decisions as if they were provided with the information according to requirements under Directive 2004/109/EC, even if the requirements are not identical. However, equivalence should be limited to the substance of the relevant information and no exception as regards the time limits set by Directive 2004/109/EC should be accepted.

(19)

In order to establish whether or not a third country issuer is meeting equivalent requirements to those laid down in Article 4(3) of Directive 2004/109/EC, it is important to ensure that there is consistency with Commission Regulation (EC) No 809/2004 of 29 April 2004 implementing Directive 2003/71/EC of the European Parliament and of the Council as regards information contained in prospectuses as well as the format, incorporation by reference and publication of such prospectuses and dissemination of advertisements (6), in particular the items dealing with Historical Financial Information to be included in a prospectus.

(20)

As regards the equivalence of independence requirements, a parent undertaking of a management company or investment firm registered in a third country should be able to benefit from the exemption under Article 12(4) or (5) of Directive 2004/109/EC, independently of whether the authorisation is required by the law of the third country for the controlled management company or investment firm to conduct management activities or portfolio management activities, provided that certain conditions of independence are respected.

(21)

The measures provided for in this Directive are in accordance with the opinion of the European Securities Committee,