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France

New Economic Regulations Bill

The New Economic Regulations Bill which was tabled before the Conseil des Ministres on March 15 2000, covers a wide range of topics and will, in certain respects, substantially modify existing legislation in France relating to the responsibilities and obligations of public listed companies and aspects of competition and company law. The Bill also includes provisions relating to money-laundering.

Public listed companies

The emphasis is on disclosure obligations. Agreements which incorporate preferential terms for the acquisition or disposal of publicly quoted shares will have to be made publicly available where the terms in question relate to 0.5% or more of either the company's share capital or the shares in the company carrying voting rights.

Public offerings

Reforms include requiring the chairman of the target company to inform its works council (comité d'entreprise) of the bid as soon as its existence is known. The works council must be sent a copy of the information memorandum delivered to the COB (Commission des Opérations de Bourse) and will be entitled to request a meeting with representatives of the bidding company.

Competition law

The reforms are wide-ranging and include changes intended to modify commercial distribution practices, in particular the strengthening of restrictions contained in article 36 of the Order of December 1 1986 which relates to unfair practices commonly used in large-scale distributions. The Bill also includes provisions designed to improve the running of the Competition Commission (Conseil de la concurrence) and the fundamental reform of merger controls, inspired by mechanisms used at EU level.

Company law

The reforms include the separation of executive powers within a Société Anonyme, certain amendments to shareholders' rights and the requirement for management reports to contain details of the remuneration and benefits packages granted to the company's officers. The Bill also contains provisions relating to shares held by nominees who will be required to disclose, at the request of the company, the identity of the shareholders on whose behalf they are holding shares. Provided they comply with this obligation, nominees will be entitled to vote on behalf of the shareholders.

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