Introduction

Purpose of the Takeover Directive and the European Passport

The purpose of Directive 2004/25 of 21 April 2004 on takeover bids (the ‘Directive’) is to establish minimum rules for the conduct of takeover bids on securities in the European Union, thereby ensuring the creation of an adequate and uniform level of protection for securities holders throughout the European Union and the European Economic Area.

However, as explained below, the Directive only regulates takeover bids for voting securities of companies governed by the laws of Member States where all or some of these securities are admitted to trading on a regulated market (see no. 1.6 of this report). Takeover bids for securities that are not traded on a regulated market or that are traded on a regulated market but issued by non-EEA companies are not subject to the provisions of the Directive; nor are takeover bids for non-voting securities. These bids will be governed entirely by the national laws of the Member States, with the resulting disparity. National law, however, may extend the application of the Directive to such bids.

The Directive also permits a European passport to be obtained for an offer document for a takeover bid, regardless of whether the bid is voluntary. A European passport allows the offeror to use the offer document without re-approval being required in other Member States where the offeree company's securities are admitted to trading.