3 - (Maximum) harmonisation

Summary

Introduction

Among the FSAP directives in the financial markets field, it is perhaps the Prospectus Directive (‘PD’) that is most often associated with the concept of maximum harmonisation, the most ambitious form of harmonisation. Paradoxically, however, the directive does not explicitly pin down the basis of the maximum harmonisation regime. It is more readily apparent in the PD's implementing legislation, the Level 2 Prospectus Regulation (‘PR’) that requires a person, who wishes to make a public offer or seek admission to trading on a regulated market, to comply with specific and detailed disclosure requirements. These disclosure requirements – or information items – form the core of a first prospectus disclosure model, a maximum harmonisation model, which is meant to ensure a level playing field and ultimately contribute to the EU's integrationist ambitions. The EU, as opposed to the Member States acting individually, emerges as the main actor, or the main force, shaping this disclosure model. The purpose of this chapter is to examine the harmonised content of this regime (or model) and the various obligations that relate to it. In the maze of rules and requirements, it identifies three core obligations on which the regime is built: (i) the obligation to draw up a prospectus in accordance with the rules of the PD and PR, (ii) the obligation to seek approval of the prospectus with the competent authorities of the issuer's home Member State, and (iii) the obligation to publish the prospectus and comply with the PD's and PR's rules and principles governing advertisement.