What legislation governs M&A activity in Ireland?
Mergers and acquisitions in Ireland are governed by the Irish Takeover Panel Act, 1997 and the:
Takeover Rules, 2007; Substantial Acquisitions Rules, 2007; and The EC (Takeover Bids (Directive 2004/25/EC)) Regulations 2006 (the "Takeover Regulations"). The Takeover Rules apply to public companies incorporated in Ireland that trade, or have in the previous 5 years traded on the Irish Stock Exchange or the London Stock Exchange, New York Stock Exchange or the NASDAQ.
They will also apply in circumstances where the Irish Takeover Panel would have jurisdiction in respect of a bid for the securities of the company under the Takeover Regulations.
The EC Merger Control Regulation applies when the merger or acquisition has a Community dimension. If not, the merger or acquisition may be subject to the Competition Act, 2002.
The Companies Acts 1963 to 2009 legislate for various aspects of public and private mergers and acquisitions transactions, in addition to governing the formation and administration of companies incorporated in Ireland and the duties of their directors and officers, including rules relating to prospectuses, financial assistance, compulsory acquisition of minority interests and minority shareholder remedies.
The European Communities (Stock Exchange) Regulations, 1984, which implemented the Admissions Directive 79/279/EEC and the Interim Reports Directive 82/121/EEC designate the Irish Stock Exchange as the competent authority and empower it to administer the requirements of the Directives.
The Listing Rules issued by the Irish Stock Exchange apply in Ireland to companies admitted or seeking admission to the Irish Stock Exchange. The Irish Enterprise Exchange (the Irish AIM) was established on 12th April 2005 and the IEX Rules cover admission to this market of the Exchange.
The Prospectus (Directive 2003/71/EC) Regulations 2005 and the Market Abuse (Directive 2003/6/EC) Regulations 2005 supplement the Listing Rules and contain rules regarding the content of prospectuses, and the disclosure of inside information, respectively.
The Transparency (Directive 2004/109/EC) Regulations 2007 and the Transparency Rules require the disclosure of periodic and ongoing information by issuers, and of major holdings and voting rights by holders.
The Investment Intermediaries Act, 1995 (for IIA authorised investment business firms) and the EC (Markets in Financial Instruments) Regulations 2007 (for MiFID authorised investment firms) state that when a party proposes to acquire directly or indirectly shareholdings exceeding 10%, 20%, 33% or 50% of an authorised investment business firm, that party and the disposing party must notify the Financial Regulator of the proposal as soon as possible. The Financial Regulator then has one month to request additional information and has the ability to approve or impose conditions on the acquisition. Under the Financial Regulator's Prudential Handbook for Investment and Stock Broking Firms and its Supplementary Supervisory Requirements for Investment Firms, notification to the Financial Regulator is also required in respect of any direct or indirect acquisition or disposal of shares or other interest in any other undertaking or business by an authorised investment business/ firm, other than for the purpose of trading book activities.
The EC (Licensing and Supervision of Credit Institutions) Regulations, 1992 contain provisions relating to holdings by credit institutions in other entities. A credit institution must not acquire, directly or indirectly, more than 10% in any undertaking or business without written approval of the Financial Regulator, and the credit institution must notify the Financial Regulator of any divestment of the whole or part of such holdings. A party proposing to acquire holdings exceeding 10%, 20%, 33% or 50% of the holding in a credit institution, must notify and receive the approval of the Financial Regulator.
The EC (Non-Life Insurance) Framework Regulations 1994 and the EC (Life Assurance) Framework Regulations 1994 govern the operation and supervision of insurance undertakings in Ireland and provide that any party who proposes to acquire either directly or indirectly, a holding 10% or more of the voting rights in an insurance undertaking, or a holding that makes it possible to exercise significant influence over the management of the undertaking must notify the Financial Regulator and on a proposed increase in the holding to 20%, 33% or 50% or more. The Financial Regulator must consult with competent authorities in other Member States when the insurance undertaking would become a subsidiary of a credit institution, investment firm or another insurance undertaking in the Member State concerned. The Financial Regulator will have 3 months to oppose the acquisition. Disposals must also be notified to the Financial Regulator. The insurance undertaking itself must notify the Financial Regulator on becoming aware of any of the above acquisitions or disposals and must notify the Financial Regulator annually of the names of qualifying shareholders and the size of the shareholdings.
The UCITS Regulations/ Unit Trusts Act, 1990/ Part XIII of the Companies Act, 1990 / Investment Limited Partnerships Act, 1994 regulate firms which provide services to collective investment schemes (management/ administration companies of unit trust schemes and investment companies and the general partner of an investment limited partnership). Approval from the Financial Regulator is required in respect of any proposed change in ownership or in 'significant shareholdings' (10% of more) of those firms. The UCITS Regulations bring the qualifying shareholder requirements for management companies into line with the standards for insurance undertakings noted above.
The EC (Assessment of Acquisitions in the Financial Sector) Regulations, 2009 (the "2009 Regulations") recently introduced harmonised procedural rules and evaluation criteria for the assessment of acquisitions and increases in holdings of financial sector companies. Previously this area was governed by the separate sectoral legislation outlined above. However, the 2009 Regulations have established a harmonised legal framework setting out the entire procedure to be applied by the Financial Regulator when assessing acquisitions of or increases in holdings in the shares of credit...