A distressed market

Author: | Published: 11 Jul 2011

The European Securities and Markets Authority's (Esma) Prospectus Directive consultation raises several major concerns in its treatment of final terms and summaries, according to the International Capital Market Association (ICMA).

The paper, released on June 15, is seeking comments on the technical advice it proposes to give the EC on delegated acts. Esma is seeking comments until July 15.

Much attention has centred on final terms. The consultation has requested a fully completed summary for the individual issue merged into the final terms. "I find this slightly worrying," said one source.

As it stands, often significant pieces of information appear in final terms which are not viewed by regulators. For instance, the formula for redemptions on structured products has, until now, often been included in final terms. "In terms of making documentation short and simple that is probably the easiest way to do it," said Ruari Ewing, director of primary...