Disclosure Requirements - Luxembourg
Disclosure Category: 3
Background and legal basis
Luxembourg law has implemented transparency principles of disclosure to the supervisory authorities and to the issuers of the identities of the shareholders in the following legal texts:
- the law of 19 May 2006 implementing Directive 2004/25/EC of the European Parliament and of the Council of 21 April 2004 on takeover bids, as amended (“Takeover Bids Law”);
- the law of 11 January 2008 implementing the EU directive 2004/109/EC on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market, as amended (“Transparency Law”);
- the law of 21 July 2012 on mandatory squeeze-out and sell-out of securities of companies currently admitted or previously admitted to trading on a regulated market or having been offered to the public (“Squeeze-out Law”);
- the law of 6 April 2013 on the dematerialised securities (“Dematerialisation Law”).
Obligation of information and notification for approval concerning bids as set out in the Takeover Bids Law
The Takeover Bids Law is applicable to takeover bids for the securities of companies governed by the laws of a Member State of the European Union or the European Economic Area (hereinafter referred to as a “Member State”) where all or some of those securities are admitted to trading on a regulated market in one or more Member States.
For the purpose of the Takeover Bids Law, “takeover bid” or “bid” shall mean a public offer (other than by the offeree company itself) made to the holders of the securities of a company to acquire all or some of those securities, whether mandatory or voluntary, which follows or has as its objective the acquisition of control of the offeree company in accordance with national law.
Decision to make a bid shall be notified to the Luxembourg supervisory authority, the Commission de Surveillance du Secteur Financier (the “CSSF”), before such decision is made public by the offeror.
The CSSF is competent to supervise a bid if the offeree company has its registered office in Luxembourg and if the securities of that company are admitted to trading on a regulated market in Luxembourg.
The offeror is required to draw up and make public in good time an offer document containing the information necessary to enable the holders of the offeree company’s securities to reach a properly informed decision on the bid. Before this document is made public, the offeror shall communicate it to the CSSF for approval within ten (10) Luxembourg working days from the day on which the bid has been made public.
The CSSF notifies its decision concerning the approval of the offer document within thirty (30) Luxembourg working days following the submission of the draft offer document.
If there are reasonable grounds for the CSSF to consider that the document submitted is incomplete or that additional information is necessary, the CSSF shall inform the offeror within ten (10) Luxembourg working days following the day the offer document has been submitted for approval. In this case, the time delay set out above (that is, the thirty (30) Luxembourg working days period) only runs from the date on which the offeror provides the required information.
The offer document shall be drawn up in a language accepted by the CSSF (Luxembourgish, French, German, or English).
In the event of a bid for which the CSSF is not competent, the offer document shall be recognised in Luxembourg, subject to its approval by the competent authority and a translation into Luxembourgish, French, German or English language, where the securities of the offeree company are admitted to trading in Luxembourg, without it being necessary to obtain the approval of the CSSF. The CSSF may require the inclusion of additional information in the offer document only if such information is specific to the Luxembourg market and relates to the formalities to be complied with to accept the bid and to receive the consideration due at the close of the bid as well as to the tax arrangements to which the consideration offered to the holders of the securities will be subject.
For further information, please refer to the translation in English language of the Takeover Bids Law (on the CSSF’s website).
Obligation to report threshold crossings as set out in the Transparency Law
Any holder (natural or legal person) of securities, of certificates representing securities or of financial instruments giving an entitlement to vote in a company incorporated in Luxembourg and listed in Luxembourg or in any other EU member state, must notify the company issuing the securities and the CSSF of any acquisition, transfer or similar operation concerning such shares or rights that causes its holding to reach, exceed or fall below the 5%, 10%, 15%, 20%, 25%, 33 1/3%, 50% and 66 2/3 % thresholds.
Notification to the issuer
The notification of the proportion of voting rights, where that proportion reaches, exceeds or falls below the thresholds provided above, as a result of events changing the breakdown of voting rights, shall be addressed to the issuer’s registered office.
It shall be effected promptly, but not later than four (4) trading days after the date on which the shareholder:
(a) learns of the acquisition or disposal or of the possibility of exercising voting rights, or on which, having regard to the circumstances, should have learned of it, regardless of the date on which the acquisition, disposal or possibility of exercising voting rights takes effect; or
(b) is informed about the event mentioned in Article 8 (2) of the Transparency Law (i.e. a shareholder shall notify the issuer of the proportion of voting rights, where that proportion reaches, exceeds or falls below the aforesaid thresholds, as a result of events changing the breakdown of voting rights, and on the basis of the information disclosed).
Such notification requirements are also applicable to a natural person or legal entity to the extent it is entitled to acquire, to dispose of, or to exercise voting rights in any of the following cases or a combination of them:
(i) voting rights held by a third party with whom that person or entity has concluded an agreement, which obliges them to adopt, by concerted exercise of the voting rights they hold, a lasting common policy towards the management of the issuer in question;
(ii) voting rights held by a third party under an agreement concluded with that person or entity providing for the temporary transfer for consideration of the voting rights in question;
(iii) voting rights attaching to shares which are lodged as collateral with that person or entity, provided the person or entity controls the voting rights and declares its intention of exercising them;
(iv) voting rights attaching to shares in which that person or entity has the life interest;
(v) voting rights which are held, or may be exercised within the meaning of points (a) to (d), by an undertaking controlled by that person or entity;
(vi) voting rights attaching to shares deposited with that person or entity which the person or entity can exercise at its discretion in the absence of specific instructions from the shareholders;
(vii) voting rights held by a third party in its own name on behalf of that person or entity;
(viii) voting rights which that person or entity may exercise as a proxy where the person or entity can exercise the voting rights at its discretion in the absence of specific instructions from the shareholders.
Notification to the CSSF
The notification shall also be addressed at the same time to the CSSF in compliance with its applicable provisions. Such notification shall be promptly filed within no later than four (4) trading days following the disclosure of information by the issuer of an event changing the breakdown of voting rights or not later than six (6) trading days following a transaction1. The notification to the CSSF shall be filed with a confirmation of the date on which this notification was sent to the issuer.
The CSSF defines the content and the form of the notification required pursuant to Articles 8 and 9 of the Transparency Law. The notification shall include the following information:
(a) the resulting situation in terms of voting rights;
(b) the chain of controlled undertakings through which voting rights are effectively held, if applicable;
(c) the date on which the threshold was reached or crossed; and
(d) the identity of the shareholder, even if that shareholder is not entitled to exercise voting rights under the conditions laid down in Article 9 of the Transparency Law, and of the natural person or legal entity entitled to exercise voting rights on behalf of that shareholder.
The content of the notification will be made public by the issuer within three (3) Luxembourg trading days following its reception.
Note: Bonds that can be converted into voting shares and rights to acquire voting shares are not taken into account as long as the right to acquire the underlying shares is not exercised.
Investment funds listed on the Luxembourg Stock Exchange are exempt from such disclosure requirements.
For further information, please refer to the translation in English language of the Transparency Law (on the CSSF’s website).
Obligation to disclose as set out by the Squeeze-out Law
(a) The Squeeze-out Law governs the mandatory squeeze-out, the mandatory sell-out and certain notification and disclosure obligations, where a company has its registered office in Luxembourg and all or part of its securities:
(i) are admitted to trading on a regulated market in one or several Member States; or
(ii) were admitted on a regulated market in one or several Member States, but are no longer admitted, provided that the date on which the withdrawal from trading on such a regulated market has become effective not more than five years earlier; or
(iii) were offered to the public, which triggered the obligation to publish a prospectus in accordance with Article 3 of Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 or for which the obligation to publish a prospectus did not apply in accordance with Article 4 (1) of this Directive, where the offer did not start more than five years earlier.
(b) According to Article 3 of the Squeeze-out Law, a holder of securities (as described above) shall notify the below information to the issuer and to the CSSF where:
(i) it becomes a majority shareholder within the meaning of the Squeeze-out Law;
(ii) it is a majority shareholder within the meaning of this law and falls below one of the thresholds laid down in the Article 1 (1) of the Squeeze-out Law (i.e. at least 95 percent of a company's capital carrying voting rights and 95 percent of a issuer's voting rights);
(iii) it is a majority shareholder within the meaning of this law and acquires additional securities of the company concerned.
Such notification shall be effected as soon as possible but not later than four (4) Luxembourg working days, the first of which shall be the working day after that on which the holder of securities has knowledge of the effective acquisition or disposal, or of the possibility of exercising or not the voting rights, or on which it should have knowledge of it, having regard to the circumstances, regardless of the date on which the acquisition, disposal or possibility of exercising the voting rights takes effect.
The notification shall at least include the following information:
- the exact percentage of the holding;
- a description of the transaction that triggered the notification requirement;
- the date on which the operation became effective;
- the identity of the shareholder; and
- the way securities are held.
The CSSF may require the holder of securities to provide the CSSF as well as the issuer concerned with any other useful information that allows it to exercise its mission imposed by the Squeeze-out Law.
Upon receipt of the notification but not later than three (3) Luxembourg working days thereafter, the issuer concerned shall make public all the information contained in the notification in a manner ensuring fast access to such information and on a non-discriminatory basis. The issuer shall ensure that the information is also communicated or sent to the holders of securities that are not admitted to trading on a regulated market in one or several Member States through the usual channels of communication or dispatch to these holders.
The CSSF shall publish on its website, during a period of at least twelve months, a list of the issuers for which this information has been validly notified.
For further information, please refer to the translation in English language of the Squeeze-out Law (on the CSSF’s website).
Obligation to disclose the identity of the securities holders as set out in the Dematerialisation Law (Article 17)
If included in the articles of incorporation or the management regulation of the issuer which securities are in dematerialised form in accordance with the Dematerialisation Law, the issuer may, at its expense and for the purpose of identifying the securities holders for own account, request Clearstream, as organisme de liquidation (settlement organisation) the following information:
- name or the denomination;
- the nationality;
- the date of birth or the date of incorporation; and
- the address;
of the securities holders recorded in its books.
According to the Article 17 (1) of the Dematerialisation Law, the settlement organisation has the obligation to provide the issuer with the above-mentioned identification data that it has on the securities account holders in its books and the number of securities held by each one of them.
The same information on the securities holders for own account shall be gathered by the issuer throughout the account holders or other persons, whether from Luxembourg or abroad, who have a securities account in a settlement organisation credited with the relevant securities.
The issuer may request the persons indicated on the lists given to it to confirm that they have the securities for own account.
When a person who holds an account with a settlement organisation or a person who holds an account with an account keeper or a foreign account keeper does not communicate the information requested by the issuer in accordance with the article 17 of the Dematerialisation Law within two (2) months as from the request or if he communicated incomplete or erroneous information relating to his quality or the quantity of securities held by him, the issuer is entitled to suspend until settlement the voting rights up to the amount of the share of securities for which the information requested was not received.
For further information, please refer to the translation in English language of the Dematerialisation Law (on the CSSF’s website).
1. CSSF Circular 08/349 as amended on details regarding the information to be notified with respect to major holdings in accordance with the Law of 11 January 2008 on transparency requirements for issuers, as amended.