Market Infrastructure

Equivalence under the current Prospectus Directive will not be the way out for the UK as it is not binding on member states’ competent authorities, and will not prevent local authorities to review and reject a third country issuer’s prospectuses, but is meant to assist competent authorities in their review of prospectuses.

Also, as of to date, the European Commission has not acknowledged a single jurisdiction to be equivalent for prospectus purposes.

The planned new Prospectus Directive still provides for equivalent third country’s rules but additionally requires the conclusion of a “cooperation arrangement” between the competent authority of the EEA member state and the relevant supervisory authorities of the third country issuer, which was added to the draft Directive following the Brexit vote. Technical standards that prescribe the minimum content of such cooperation arrangements may be developed by ESMA.

Besides, there is also uncertainty regarding a range of technical issues such as applicable accounting standards and the usage of the EU-adopted IFRS.