From the issuers’ perspective, MAR has led to a situation in which issuers face constant legal uncertainties. This position paper identifies existing problems and proposes concrete amendments. Deutsches Aktieninstituts sees as problematic in particular the very broad and vague term of inside information, the treatment of early stages of protracted processes as inside information and the poor protection of reasonable interests in the event of delay disclosure.
The submitted ministerial draft on the European Single Electronic Format (ESEF) law is critically seen by Deutsches Aktieninstitut. The fact that annual financial statements are to be prepared in XHTML/iXBRL format is neither required by Union law nor expedient from a practical point of view. Deutsches Aktieninstitut advocates instead the implementation of a disclosure solution. With its ministerial draft, the legislator has overshoot the mark and unnecessarily burdens companies.
In its response to the ESMA consultation on Guidelines on Disclosure Requirements under the Prospectus Regulation, Deutsches Aktieninstitut welcomes that ESMA provides the possibility to refer to existing financial reporting rather than duplicating the figures in the prospectus. Deutsches Aktieninstitut demands to consistently pursue this intention. Only in this way information asymmetries can be reduced in relation to financial reports that are important for investors.
Deutsches Aktieninstitut participates in the evaluation of § 43 WpHG by the Federal Ministry of Finance. In its current form, the provision provides little added value for stakeholders. Deutsches Aktieninstitut supports specifications and extensions of the regulation and recommends, among other things, the reduction of the reporting period to four days and the possibility of administrative fines for infringements of notification obligations.
Starting in 2020 listed companies will be obliged to file annual reports as an XHTML-file, in which core financial information has to be tagged in iXBRL. This is laid down in a Delegated Regulation on the EU Transparency Directive. Currently it is discussed whether the iXBRL tagging must be audited or not. From Deutsches Aktieninstitut's perspective this is neither necessary from a material perspective nor can it be derived from other EU legislation.
Regarding the consultation on the ESMA Guidelines on presentation of risk factors in the prospectus Deutsches Aktieninstitut points out the right balance between the objective of ESMA to avoid overly generic/lengthy descriptions of risk factors and flexibility for issuers in their assessment of relevant risk factors to be included in the prospectus. Proportionality and coherence are key factors for guidance on risk factors. For instance, the requirement for specificity should not result in the ...
In its response to the Fitness Check Public Reporting for Companies, Deutsches Aktieninstitut criticizes disproportional reporting obligations causing high compliance costs to companies without offering corresponding benefits to investors. Deutsches Aktieninstitut furthermore points at a partly wrong focus of the consultation since legislation of crucial relevance for issuers, such as the Market Abuse Regulation, is not included in the Fitness Check. You can find a letter regarding this topic ...
In its response to the consultation on draft RTS, concretizing the new European Prospectus Regulation in more detail, Deutsches Aktieninstitut stresses the importance of more flexibility in drawing up prospectuses. For instance, Deutsches Aktieninstitut opposes to a fixed number of KFI (Key Financial Information) and APMs (Alternative Performance Measures) in the prospectus summary. Such a restriction is neither necessary nor useful. The 7-page limit foreseen for the summary by the new ...
Deutsches Aktieninstitut supports the aim of the European Commission to reduce administrative burden for stock listed SMEs. In its position paper on the respective consultation Deutsches Aktieninstitut stresses that capital market rules, that does not enhance investor protection, should be abandoned for every issuer irrespective of its size. In addition, to facilitate more IPOs of SMEs it is of utmost importance to raise capital of retail investors via an extension of share possession in the ...
Starting in 2020 listed companies in Europe will have to file their yearly financial reports in the inline extrensible business reporting (iXBRL) format. This is proposed by ESMA in a draft Regulatory Technical Standard amending the EU Transparency Directive despite of negative experiences made by companies during a field test conducted over the summer 2017. We reniew our critique on iXBRL-reporting and call for a public debate on the results of test before the endorsement of the RTS.
Deutsches Aktieninstitut welcomes the suggestions made by ESMA for prospectus simplification, such as removing the auditor's report in case of profit estimates and forecasts. At the same time, however, it warns against new burdens, which ESMA's proposal contains, too. It reminds that already on Level 1 of the revised European Prospectus Regulation, new burdens had been introduced. In order to achieve the objectives to simplify prospectus, the new burdens at level 1 must be compensated on ...
European Supervisory Authorities (ESAs) neither need more competences nor a new funding structure. The ESA review should rather focus on making the ESAs mandate more concrete and on improving stakeholder participation, in order to
ensure practicable compliance and to avoid the overstretching of mandates by the ESAs. These are the core messages of Deutsches Aktieninstitut’s position paper on that issue
Deutsches Aktieninstitut urges the EU Commission to reflect consequently the needs of companies seeking capital market finance and using derivates for risk management purposes in the Capital Markets Union. The current direction of the Capital Market Union still fails to meet this objective. This position paper has been contributed to the mid term review of the Capital Market Union project.
With regard to the second capital market amendment law Deutsches Aktieninstitut emphasizes not to go beyond the existing European legal provisions, e.g. in the field of the key information document (KID) which have not to be prepared for shares according to the Europen legislation. The same is true for sanctions where the German legislator tends to go beyond the European minimum harmonisation.
With the fourth EU Anti-Money Laundering Directive and its current amendment, every EU member state has, among other changes for companies, to implement a beneficial ownership register. Deutsches Aktieninstitut wrote a letter to the responsible ministries emphasizing that this beneficial ownership register has to be based on existing registers, instead of creating a completely independent, new register. Moreover, Deutsches Aktieninstitut advocates that obliged entities can efficiently and ...
In a proposal for a supervisory guideline ESMA is currently about to narrow down the right to delay the publication of inside information of listed companies. This is notin line with the text of the Market Abuse Regulation. Even worse, the ESMA proposal would de facto eliminate the possibility of a delay for a number of situations that currently constitute "a legitimate interest" in two tier board system. This position paper summarizes the concerns of the German listed companies.
Deutsches Aktieninstitut criticises ESMA for the proposal to make XBRL reporting mandatory for listed companies by 2020. Such an obligation would cause significant additional compliance costs and risks for issuers although there is no evidence that analysts or investors are interested in XBRL reporting. The paper is Deutsches Aktieninstitut's response to an ESMA-consultation on the concretisation of the EU Transparency Directive.
The transposition of the amended EU Transparency Directive into German law still needs some improvement. In particular, the regime of major holdings notifications should be me made more efficient and risks for issuers resulting from incorrect notifications should be reduced. These are the requests of Deutsches Aktieninstitut laid down in this position paper for the German parliamentary debate.
In its comments Deutsches Aktieninstitut supports the European Commission’s initiative on building a Capital Markets Union. Further to the steps proposed by the Commission the demand-side of capital markets should, however, be addressed more precisely. This applies especially to the aspect of corporate finance. In addition, a cumulative impact-assessment of the regulatory initiatives launched in the aftermath of the financial crisis is necessary in order to identify and remove barriers for ...
This comment summarises Deutsches Aktieninstitut's position on the national implemention of the revised EU Transparency Directive. From Deutsches Aktieninstitut's point of view the possibility to suspend voting rights in case of false notifications of major holdings deserves close attention. The German legislator currently does not fully uses the options granted by the Transparency Directive and thus creates additional risks for the general meetings of listed companies.
Deutsches Aktieninstituts welcomes the idea of promoting shareholders' engagement. However, the proposal of the EU Commission goes too far especially concerning the regulation on related parties' transactions.
Furthermore Deutsches Aktieninstituts is against a binding vote of the general meeting on remuneration policy. It also asks for appropriate regulation on questions of shareholders' identification and of transparency of proxy advisors.
This position paper critisises ESMA's draft delegated acts on the Market Abuse Regulation. Because ESMA's interpretation reaches too far listed companies in Europe face massive additional compliance risks and costs regarding insider lists, the publication of inside information and the notificatio of managers' transactions.
This position paper on ESMA's draft technical advice on the Market Abuse Regulation raises the concern that the notifications of managers' transactions will likely create misleading signals. According to ESMA's proposal transactions will have to be notified even if the manager has no discretion as to whether the purchase/sale of the share will take place. From Deutsches Aktieninstitut's point of view the notification of such 'passive transactions' would clearly contradict the regulatory ...
Deutsches Aktieninstitut is concerned about a possible mandatory use of an single European electronic format for financial reports of listed companies. This is principally forseen in the revised Transparency Directive. The critique holds true for a possible mandatory implementation of XBRL (eXtensible Business Reporting Language) in particular. This comment summarises Deutsches Aktieninstitut's point of view for the purpose of an impact assessment which is currently conducted by an ...
This position paper comments on the level-2-implementing measures of ESMA under the revised Transparency Directive. The main issue is ESMA's interpretation of the exemptions from the major sharehholdings notificatons requirements. Deutsches Aktieninstitut generally calls for applying the exemptions rather narrowly since experience has shown that exemptions may also be used for secret stakebuilding.
ESMA plans to harmonise the presentation of so called alternative performances measures in the financial communication of listed companies. Frequently used measures such as EBITDA could only be presented with less prominence compared to financial measures stemming directly from the IFRS framework. This approach interferes with capital market communication, creates legal risks and is stricter than comparable rules of the SEC as is pointed out in this comment by Deutsches Aktieninstitut.
Deutsches Aktieninstitut's comment on ESMA's draft technical advice on the EU short selling regulation (in German)
Response of Deutsches Aktieninstitut in regard of the modification proposals of the Government Commission German Corporate Governance Code 2012
Listed companies observe increasing bureaucratic burden as well as decreasing legal certainty from the EU Market Abuse Regulation. In particular, regarding the obligation to publish inside information companies call for guidance. This is the key result of this study conducted by Deutsches Aktieninstitut and Hengeler Mueller. The study is based on a survey among German listed companies on their experiences two years after the Market Abuse Regulation went into ...
Kurvenlage - Semi-Annual Report of Deutsches Aktieninstitut, 1st Term 2016 (in German)
Focus: Retirement Planning
Focus: Capital Markets Union
Focus: 50 years German stock corporation law
Focus: A New Start in Brussels
Die Aufsichtspraxis hinsichtlich der Ad-hoc-Publizität muss aus Sicht des Deutschen Aktieninstituts für Emittenten besser handhabbar werden. Das ist das Kernanliegen eines Positionspapiers des Aktieninstituts zur Überarbeitung des Moduls C des BaFin-Emittentenleitfadens, das die Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) gerade konsultiert. „Wir begrüßen den offenen und produktiven Dialog mit der BaFin und nutzen die Konsultation gerne, um gemeinsam praktikable Lösungen ...
Companies are pleading for more precise legal provisions on ad-hoc publicity and less red tape regarding insider lists and managers´ transactions. This shows the survey “Two Years of EU Market Abuse Regulation”, which has been published byDeutsches Aktieninstitut and the law firm Hengeler Mueller today.
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