This content is from: Local Insights


On January 28 2005, the Luxembourg government adopted a Bill of Law to implement the EU Prospectus Directive, which is due to be implemented by June 30 2005.

The goal of the Directive is to create common standards for the issue of securities in the EU and to allow passporting of approved prospectuses throughout the EU. The Prospectus Directive applies where EU and non-EU issuers want to offer to the public or list securities admitted to a regulated market in the EU.

After implementation of the Prospectus Directive, prospectuses will have to comply with the Prospectus Directive and the Commission Regulation (EC) 809/2004 implementing the Prospectus Directive (to become directly effective on July 1 2005), which will replace the legislation now in effect (that is, the grand-ducal regulation of December 28 1990).

By implementing the Prospectus Directive into national law, the definition of the concept of offer of securities to the public will change. The Commission de Surveillance du Secteur Financier will be the authority in charge of reviewing and authorizing prospectuses, formerly the remit of the Luxembourg stock exchange.

The Bill also foresees the possibility for the Luxembourg Stock Exchange to organize an alternative market aimed at international issuers who do not want to be subject to the Prospectus Directive. The Luxembourg stock exchange has recently announced its decision to set up an alternative market, which should be launched concurrently with the implementation of the Prospectus Directive. It is expected that the rules for this market will be similar to those that govern the existing regulated market in Luxembourg.

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