Cautious welcome for latest Prospectus Directive advice

Author: | Published: 6 Mar 2012

The European Securities and Markets Authority (Esma)’s latest advice on retail cascades in the Prospectus Directive has been cautiously welcomed by the legal industry, however minor clarifications are still required.
In the second part of its level two advice on the Prospectus Directive, released on March 1, Esma acknowledged that there is no uniform model of retail cascades, so consent to use a prospectus will need to be included in the base prospectus or the final terms.
This consent can be in two forms: individual and general consent. For general consent, any financial intermediary can rely on the prospectus as long as it publicly states that it has general consent on its website.
For the individual consent approach issuers will need to identify the specific financial intermediaries that are allowed to rely on the prospectus. Should an issuer not know the identity of a financial...