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Regulation

The Prospectus Regime

The EU Prospectus Regulation entered into force on 21 July 2019, along with the Luxembourg Prospectus Act, which lay down requirements for the drawing up, approval and distribution of the prospectus that must be published when a security is offered to the public or admitted to trading on a regulated market.

At a European Level

The EU Prospectus Regime, and its implementing measures, have been fully applicable since 21 July 2019. However, for prospectuses approved in accordance with the national laws transposing the previous EU Prospectus Directive before 21 July 2019, continue to be governed by the previous national law until either the end of the prospectus’ validity or until 12 months have elapsed 21 July 2019.

Overview of the main changes

1. On 21 July 2019, the old EU Prospectus Directive and its implementing regulations were fully repealed and replaced by the new EU Prospectus Regulation. Unlike the EU Prospectus Directive, which needed to be transposed by all EU Member States, the EU Prospectus Regulation has direct effect in all EU Member States without the need for additional national implementing acts, except for certain provisions related to, among others, the scope and exemption of the new regime, the designation of competent authorities, their powers, and the sanctioning regime. 
 
2. The fundamental distinction between wholesale versus retail was preserved and extended. 
 
3. The requirements for the prospectus summary were revised but remain highly prescriptive. Prospectus summaries are required to be a maximum of 7 sides of A4-sized paper, when printed, and the content must be accurate, fair, clear and not misleading. 
 
4. The requirements for risk factors were also revised. Risk factors need to be presented in a limited number of categories and, within each category, be presented in order of priority. 
 
5. Two new types of documents were created: The first, known as the Universal Registration Document (URD), which aims to accelerate the prospectus approval process for frequent issuers. The other document, known as the "EU Growth Prospectus", aims to facilitate access to financing on capital markets, in particular, for SMEs in the European Union. 
 
6. A simplified disclosure regime for secondary issuances allows issuers - under certain conditions - to draw up a simplified prospectus. For example, issuers whose securities have been admitted to trading on a regulated market continuously for at least the last 18 months and that issue securities fungible with existing securities which have been previously issued can avail of this option. 
 
7. Annexes setting out the content of the prospectus have been amended and reorganised. 
 
8. Paper copies are no longer required unless specifically requested by an investor. The publication of a prospectus on the following websites is accepted: 
  • Issuer website 

  • Website of offeror or the person asking for admission to trading 

  • Financial intermediaries website 

  • Website of the market where the admission to trading is sought 
9. The approved prospectus shall remain publicly available, in electronic form, for at least 10 years after its publication on any of the above-mentioned websites. 
 
10. The sanctioning regime was revised. 

Level 1

  • Regulation (EU) 2021/337 amending Regulation (EU) 2019/1129 as regards the EU Recovery prospectus and targeted adjustments for financial intermediaries and Directive 2004/109/EC as regards the use of the single electronic reporting format for annual financial reports, to support the recovery from COVID-19.
  • Available here
  • Regulation (EU) 2017/1129, of 14 June 2017, on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC
  • Available here

Level 2

  • Commission Delegated Regulation (EU) 2019/980, of 14 March 2019, supplementing Regulation (EU) 2017/1129 as regards the format, content, scrutiny and approval of the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Commission Regulation (EC) No 809/2004

  • Available here

  • Commission Delegated Regulation (EU) 2019/979, of 14 March 2019, supplementing Regulation (EU) 2017/1129 with regard to regulatory technical standards on key financial information in the summary of a prospectus, the publication and classification of prospectuses, advertisements for securities, supplements to a prospectus, and the notification portal, and repealing Commission Delegated Regulation (EU) 382/2014 and Commission Delegated Regulation (EU) 2016/301

  • Available here

  • Commission Delegated Regulation (EU) 2020/1272, of 4 June 2020, amending and correcting Delegated Regulation (EU) 2019/979 supplementing Regulation (EU) 2017/1129 of the European Parliament and of the Council with regard to regulatory technical standards on key financial information in the summary of a prospectus, the publication and classification of prospectuses, advertisements for securities, supplements to a prospectus, and the notification portal

  • Available here

  • Commission Delegated Regulation (EU) 2020/1273, of 4 June 2020, amending and correcting Delegated Regulation (EU) 2019/980 supplementing Regulation (EU) 2017/1129 of the European Parliament and of the Council as regards the format, content, scrutiny and approval of the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market

  • Available here 

Level 3

  • ESMA Questions and Answers on the Prospectus Regulation — 27 July 2021

    Available here

  • ESMA Public Statement — Update Prospectus - 30 September 2020

    Available here

  • ESMA Public Statement - Applicability of Level 3 Guidance published under Prospectus Directive - 30 September 2020

    Available here

  • ESMA Guidelines on disclosure requirements under the Prospectus Regulation - 4 March 2021

    Available here

  • ESMA Guidelines on risk factors under the Prospectus Regulation - 1 October 2019

    Available here

  • ESMA Guidelines on Alternative Performance Measures (APMs) - 5 October 2015 - and related Questions and Answers - 30 October 2017

    Available here and here, respectively

  • ESMA update of the CESR recommendations - The consistent implementation of Commission Regulation (EC) No 809/2004 implementing the Prospectus Directive - 20 March 2013

  • Available here

Note: According to the ESMA, the ESMA Questions and Answers on Prospectuses and the ESMA update of the CESR recommendations apply to prospectuses drawn up under the new EU Prospectus Regulation to the extent they are compatible with the new EU Prospectus Regulation.

In Luxembourg

In Luxembourg, the Prospectus Act repealed and replaced the Luxembourg Act of 10 June 2005 on prospectuses for securities, as of 21 July 2019. Prospectuses (or simplified prospectuses) approved in accordance with the Luxembourg Act of 10 June 2005 prior to 21 July 2019 shall continue to be governed by the Luxembourg Act of 10 June 2005 until the end of their validity, or until 12 months have elapsed after 21 July 2019, whichever occurs first.

Overview of the main changes

1. Part II of the Prospectus Act – Implementing the EU Prospectus Regulation 

  • Offers of securities to the public with a total consideration of less than EUR 8 million in the European Union over a period of 12 months are exempted from the obligation to publish a prospectus as set forth by the new EU Prospectus Regulation. However, the Commission de Survaillance du Secteur Financier (CSSF) needs to be informed in advance.

  • If, however, the total consideration of an offer amounts to at least EUR 5 million an information note (note d’information) needs to be published (with the content set forth by Part II of the Prospectus Act).

2. Part III of the Prospectus Act – Offers to the public and admissions to trading on a regulated market of securities not covered by the EU Prospectus Regulation

  • Obligation to publish an alleviated prospectus (prospectus allégé) and exemptions

  • In line with the prospectus regime set forth by the Luxembourg Act of 10 June 2005, offers to the public and admissions to trading on a regulated market of securities which are not within the scope of the EU Prospectus Regulation shall fall under Part III of the Prospectus Act.

  • Similar to the exemptions set forth by the EU Prospectus Regulation, the Prospectus Act applies the same thresholds to the national regime, i.e. offers of securities to the public with a total consideration - calculated over a period of 12 months - of:

    - less than EUR 8 million are exempted from the obligation to publish an alleviated prospectus; but prior notification to the CSSF is required.

    - EUR 5 million or more (but lower than EUR 8 million) are also exempted from the obligation to publish an alleviated prospectus; in this case, however, an information note (note d’information) needs to be published (with the content set forth by Part III of the Prospectus Act).
  • Alleviated prospectus on a voluntary basis. Issuers exempted by the Prospectus Act from the obligation to publish an alleviated prospectus are, however, allowed to prepare and publish such prospectus on a voluntary basis.
  • The obligation to publish an alleviated prospectus shall not apply to the admission to trading on a regulated market of non-equity securities issued by the Luxembourg State, the municipalities of the country (communes), by another Member State or by public international bodies of which one or more Member States are members; only a document with the content set out by Part III (Chapter 2) of the Prospectus Act needs to be published.


The section below lists the underlying national texts.

National Law

Law of 16 July 2019 on prospectus for securities and implementing Regulation (EU) 2017/1129, of 14 June 2017, on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (in French only).

Available here

CSSF Circulars and Q&A

  • Circular CSSF 21/771 - Application of the guidelines of the European Securities and Markets Authority on disclosure requirements under the Prospectus Regulation
  • Available here
  • NEW: Circular CSSF 21/766 - Update of Circular CSSF 19/724 on technical specifications regarding the submission to the CSSF of documents under Regulation (EU) 2017/1129 and the Law of 16 July 2019 on prospectuses for securities and general overview of the regulatory framework on prospectuses
  • Available here
  • Circular CSSF 19/724: Technical specifications regarding the submission to the CSSF of documents under Regulation (EU) 2017/1129 and the Law of 16 July 2019 on prospectuses for securities and general overview of the regulatory framework on prospectuses (in French only)
  • Available here
  • NEW: CSSF e-Prospectus web application for the filing of prospectuses and related documents, as well as notification requests as of 1 March 2021
  • Available here
  • CSSF New Final Terms submission form as of 30 November 2020 - 2 November 2020
  • Available here

Note: According to the CSSF, the previous CSSF Circulars and CSSF Q&A available here are in the process of being updated. In the meantime, they apply to prospectuses drawn up under the new regime to the extent they are compatible with it.

Last updated: 16 March 2022

Disclaimer
The information contained herein is provided for information purposes only and is not meant to be exhaustive. Although the Luxembourg Stock Exchange (LuxSE) has made reasonable efforts to ensure that the information is accurate and not misleading, LuxSE does not accept any responsibility or liability of any kind whether for the accuracy, reliability or completeness of the information or for any action refrained or taken or results obtained from the use of the information. The information does not constitute and is not construed as any advice, recommendation, undertaking or commitment from or on behalf of LuxSE. The information shall not be substitute for your own researches, investigations, verifications or consultation for professional or legal advice.
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