Equity capital markets in Belgium: regulatory overview

A Q&A guide to equity capital markets law in Belgium. The country-specific Q&A looks at main equity markets/exchanges, regulators and legislation, listing requirements, offering structures, advisers, prospectus/offer document, marketing, bookbuilding, underwriting, timetables, stabilisation, tax, continuing obligations and de-listing.

To compare answers across multiple jurisdictions visit the Equity Capital Markets Country Q&A tool.

This Q&A is part of the multi-jurisdictional guide to capital markets law. For a full list of jurisdictional Q&As visit www.practicallaw.com/capitalmarkets-mjg.

Contents

Main equity markets/exchanges

1. What are the main equity markets/exchanges in your jurisdiction? Outline the main market activity and deals in the past year.

Main equity markets/exchanges

Euronext Brussels. This regulated market consists of three compartments based on the issuers' market capitalisation:

  • Compartment A (large capitalisations): issuers with a market capitalisation greater than EUR1 billion.

  • Compartment B (medium capitalisations): issuers with a market capitalisation of between EUR150 million and EUR1 billion.

  • Compartment C (small capitalisations): issuers with a market capitalisation of less than EUR150 million.

Alternext. This is a non-regulated market or multi-lateral trading facility with a less stringent regulatory regime designed for small and medium-sized enterprises (SMEs), enabling them to avoid the requirement to publish International Financial Reporting Standards (IFRS) compliant financial statements. However, NYSE Euronext has created a body of rules to ensure investor transparency and protection.

Free Market (Vrije Markt/Marché Libre). This is a non-regulated market or multi-lateral trading facility. The requirements for the SMEs listed on this non-regulated market are significantly less demanding (for example, on free float and transparency) than those for companies listed on Euronext Brussels or Alternext. This chapter concentrates on the provisions concerning Euronext Brussels: Alternext and the Free Market are not discussed further.

Listings of foreign companies in Belgium are limited, though there are notable exceptions. For example, the following companies all have (secondary) listings on Euronext Brussels:

  • Delta Lloyd (part of the BEL 20 index).

  • GDF SUEZ (part of the BEL 20 index).

  • ArcelorMittal.

  • ING Groep.

  • RTL Group.

  • Saint-Gobain.

  • Total.

Market activity and deals

Belgium has seen a slight increase in new listings activity in 2013. The stand-out equity transaction was the successful IPO of bpost on Euronext Brussels, the first IPO on that market since 2009. In total, four IPOs took place on Euronext Brussels in 2013 (bpost, Cardio3 BioSciences, Viohalco, QRF).

Notable secondary issues included:

  • Retail Estates NV's rights issue (approximately EUR72 million).

  • Leasinvest Real Estate Comm VA's rights issue (approximately EUR60 million).

 
2. What are the main regulators and legislation that applies to the equity markets/exchanges in your jurisdiction?

Regulatory bodies

The Financial Services and Markets Authority (FSMA) is the regulator responsible for Belgium's financial markets. The FSMA has authority to review and approve the prospectus while Euronext Brussels decides on the request for admission to listing (see Question 3).

Legislative framework

In addition to the provisions of the Belgian Companies Code, listed companies must also comply with rules on:

  • Regulated markets and market abuse under:

    • Law of 2 August 2002 on the supervision of the financial sector and on financial services;

    • Royal Decree of 5 March 2006 on market abuse.

  • Public offerings and admissions to trading on a regulated market under:

    • Law of 16 June 2006 on public offerings of investment instruments and on admissions of investment instruments to trading on a regulated market (Prospectus Law);

    • Regulation (EC) 809/2004 implementing Directive 2003/71/EC as regards prospectuses and dissemination of advertisements (Prospectuses Regulation);

    • Royal Decree of 26 September 2006 on the register of eligible investors and on the modification of the concept of eligible investors;

    • Royal Decree of 17 May 2007 on primary market practices.

  • Transparency and information under:

    • Law of 2 May 2007 on disclosure of significant shareholdings in issuers whose shares are admitted to trading on a regulated market;

    • Royal Decree of 14 November 2007 on obligations of issuers of financial instruments that are admitted to trading on a regulated market;

    • Royal Decree of 14 February 2008 on the disclosure of significant shareholdings.

  • Takeover bids under:

    • Law of 1 April 2007 on public acquisition offers;

    • Royal Decree of 27 April 2007 on public acquisition offers; and

    • Royal Decree of 27 April 2007 on public squeeze-out offers.

 

Equity offerings

3. What are the main requirements for a primary listing on the main markets/exchanges?

Main requirements

Any public offering of securities in Belgium and/or admission to trading on Euronext Brussels requires the prior publication of a prospectus (subject to certain exemptions (see Questions 10 and 11)). The application for admission to trading must be filed with Euronext Brussels. The draft prospectus must be provided to Euronext Brussels, although it does not formally approve the prospectus, which is the FSMA's responsibility (see Question 2, Regulatory bodies).

A foreign company seeking a primary listing must provide evidence of the listing of the issuer's securities on another market, if any. In addition, non-European issuers must provide an audit report (certified by an international audit firm approved by Euronext Brussels) attesting that their legal position and structure accord with applicable laws and regulations.

Minimum size requirements

There are no formal minimum market capitalisation requirements but all securities are assigned to one of three market capitalisation compartments of Euronext Brussels (see Question 1).

Trading record and accounts

At the time of admission to listing, the issuer must have published or filed audited annual financial statements or pro forma accounts (consolidated where applicable) for the preceding three financial years. These must be drawn up in accordance with the accounting standards of the country where the issuer has its registered office, that is, either:

  • International Financial Reporting Standards (IFRS).

  • Any other accounting standards allowed by national regulations for the period covered by the financial information.

If the financial year closed more than nine months before the date of the admission to listing, the issuer must have published or filed audited semi-annual accounts.

Euronext Brussels can grant an exemption if it is in the issuer's interests and the issuer has made available the necessary information allowing an informed judgement of the company, its financial position and its business. In this case, Euronext Brussels can impose additional conditions on the admission to listing.

These information requirements are in addition to those required under the Prospectuses Regulation, for example in respect of pro forma financial information and interim financial information.

If the head office of the issuer is located outside the EU, Euronext Brussels can request that the issuer's financial statements be restated in Belgian Generally Accepted Accounting Principles (GAAP) and that the restatement is reviewed by an auditor acceptable to it.

Euronext Brussels does not impose any specific working capital requirements in addition to those provided for by the Prospectuses Regulation, which requires the issuer to state that it has sufficient working capital for:

  • Its present requirements (or, if not, how the issuer proposes to provide the additional working capital needed).

  • The 12-month period following the approval date of the prospectus.

Minimum shares in public hands

At the time of admission to listing, at least 25% of the company's subscribed capital represented by the class of shares concerned must be publicly held (that is, there must be a minimum 25% free float), unless Euronext Brussels decides otherwise in view of the fact that the market can function with a lower percentage given the large number of shares of the same class and the extent of their distribution to the public. However, at least 5% of the capital, with a minimum value of EUR5 million calculated on the basis of the offering price, must be publicly held.

 
4. What are the main requirements for a secondary listing on the main markets/exchanges?

For the purpose of this guide, secondary listing means a listing of a security on Euronext Brussels, the latter not being its primary exchange.

Main requirements

This is the same as for a primary listing (see Question 3). However, a secondary listing on Euronext Brussels generally takes place simultaneously with a public offering of securities and/or an admission to trading on another regulated market within the European Economic Area (EEA). In that case, the prospectus approved in the framework of the latter transaction is valid for the secondary listing on Euronext Brussels (single passport), subject to translation requirements that may in certain cases be limited to the translation of the summary. See also Question 11, Exempt admissions to trading.

Minimum size requirements

There are no formal minimum market capitalisation requirements but all securities are assigned to one of three market capitalisation compartments of Euronext Brussels (see Question 1).

Trading record and accounts

This is the same as for a primary listing (see Question 3).

Minimum shares in public hands

This is the same as for a primary listing (see Question 3).

 
5. What are the main ways of structuring an IPO?

Structuring an IPO

The most common ways of structuring an IPO are through a public offering and an admission to trading.

A public offering can be either or both a:

  • Public subscription offer (to new shares).

  • Public sale offer (of existing shares).

There must be a retail tranche (that is, a portion of the shares designated for retail investors) in a public offering (see Question 16).

Less common ways of structuring an IPO are direct listings without a public offering following a private placement (for example, RHJ International) or a spin-off from another listed company (for example, Exmar, Euronav and Cumerio).

The bookbuilding procedure is almost always used for pricing (see Question 16).

Postponement of an IPO

IPOs can be postponed in a number of situations. After an IPO has been announced through the publication of the intention to float (ItF) (see Question 9, Main documents), but before the start of the offering period, the issuer's board of directors can decide to postpone the offering period. The board can do this under its own authority if the capital is increased within the framework of the authorised capital. If the capital is increased by a decision of the shareholders' meeting, the shareholders' meeting deciding on this increase usually delegates the right to postpone the offering period to the board.

After the start of the offering period, the board of directors can decide to either extend the offering period (in which case a supplement to the prospectus must be published after approval by the Financial Services and Markets Authority (FSMA) (see Question 2, Regulatory bodies); or call off the offering period (through a press announcement).

The decision to proceed with the offering will usually contain wording covering that situation. When the demand does not meet the issuer's expectations, it is possible to restructure the deal during the offering period by either:

  • Lowering the price below the price range determined at the beginning of the offering period.

  • Reducing the size of the offering.

In this case, the issuer must discuss the appropriate procedure with the FSMA.

 
6. What are the main ways of structuring a subsequent equity offering?

The two main ways of structuring a subsequent equity offering are through a rights issue or an accelerated bookbuilt offering (see Question 7).

 
7. What are the advantages and disadvantages of rights issues/other types of follow on equity offerings?

Rights issue

A rights issue allows existing shareholders to exercise or sell their preferential subscription rights to avoid dilution. It comprises both a public offering and an admission to trading and therefore requires a prospectus (see Question 10).

Under the Belgian Companies Code, the subscription period for a rights issue, during which the rights trade on Euronext Brussels, must be:

  • At least 15 calendar days.

  • Announced at least eight calendar days in advance through a notice in the Belgian State Gazette.

In a synthetic rights issue, where technically the preferential subscription right of existing shareholders is cancelled, the 15-calendar-day period does not apply, enabling the timetable to be shortened (with the FSMA's prior agreement). Synthetic rights issues have only recently come to prominence in the Belgian market, although traditional rights issues continue to be done as well.

Generally, unexercised rights are converted into and sold as scrips in a private placement, with the net proceeds remitted to the non-exercising shareholders. The price for the scrips is determined following their placement, which lasts for one day or a very limited number of days after the end of the subscription period.

In both traditional rights issues and synthetic rights issues, the issue price has so far been determined before the opening of the subscription period to enable the trading of the right.

There is no limitation on the extent of the discount (on the issue price compared to the share price). However, if the offering is made from existing authorised capital the issue price cannot be lower than the accounting par value of the existing shares.

Accelerated bookbuilt offering

An accelerated bookbuilt offering is a private placement with qualified investors, following the cancellation of the preferential subscription right of existing shareholders. As it is limited to qualified investors, there is no public offering and there is no need to prepare a prospectus, provided the newly issued shares admitted to trading on Euronext Brussels represent less than 10% of the number of shares of the same class that have already been admitted to trading (calculated over a 12-month period). If this requirement is not met, a listing prospectus is required.

The issue price is determined after the closing of the subscription period on the basis of a bookbuilding procedure (see Question 16). There must be no agreement with subscribers on allocation or price before the bookbuilding starts. If that requirement is not met and the preferential subscription right is deemed to be cancelled in favour of determined persons, the issue price must be set at or above the average closing share price over the 30-day period preceding launch (Article 598, Belgian Companies Code).

Given the accelerated nature of this transaction, the board of directors must decide the capital increase within the framework of the authorised capital, avoiding the considerably lengthier process of a shareholders' meeting to issue new shares. This also means that the issue price cannot be below the accounting par value of the existing shares (see above, Rights issue).

 
8. What are the main steps for a company applying for a primary listing of its shares? Is the procedure different for a foreign company and is a foreign company likely to seek a listing for shares or depositary receipts?

Procedure for a primary listing

The main requirements are the same as for equity offerings (see Question 3).

Procedure for a foreign company

The procedure is not fundamentally different for a foreign company, which usually seeks a listing for shares rather than depository receipts.

 

Advisers: equity offering

9. Outline the role of advisers used and main documents produced in an equity offering. Does it differ for an IPO?

Investment banks

The investment banks assume several roles in an equity offering, including:

  • Advising the issuer on the timing and the structuring of the offering.

  • Advising the issuer on the implementation of the offering, for example:

    • compliance with the prospectus and listing rules;

    • update on market conditions; and

    • pricing.

  • Advising the issuer on its marketing, for example:

    • road shows;

    • marketing materials.

  • Acting as underwriters for the offered shares (whether they are newly issued shares or existing shares).

  • Managing the offering process (one or several of the banks involved will act as lead managers or co-ordinators).

  • Acting as stabilisation manager (see Question 19).

In addition, research reports are prepared by the analysts of the investment banks' research departments. Information barriers (that is, Chinese walls) apply between the employees of the banks advising on the offering and the research analysts.

International investment banks are used in global offerings, together with domestic banks.

For a first admission to listing of securities and for any subsequent admission to listing of securities requiring the approval of a prospectus, issuers must appoint a listing agent.

Legal advisers

The issuer must obtain legal advice from a law firm. Essentially, the issuer's counsel will assist its client in relation to:

  • The structuring of the transaction.

  • The prior reorganisation of the issuer's group and due diligence with a view to the drafting of the prospectus.

  • The drafting of the main offering documents, including the prospectus and any supplements.

  • The communication with the FSMA in relation to the submission and the approval of the offering documents.

  • The drafting of the corporate resolutions.

The underwriters usually obtain external legal advice from a law firm. Essentially, the underwriters' counsel will assist its clients in:

  • Due diligence on the issuer (to the extent that the underwriters' liability could be put at stake).

  • The review of the main offering documents, including the prospectus and any supplements (to the extent that the underwriters' liability could be put at stake).

  • The drafting and the negotiating of the underwriting agreement.

  • The drafting of the marketing materials (see Question 15).

When part of the offered shares are already issued shares sold by shareholders, the main selling shareholders usually obtain legal advice from a different law firm than the issuer's law firm. In some transactions, the issuer and the main selling shareholder are advised by the same law firm, which is possible only to the extent that the interests of both parties do not materially diverge.

Issuer's statutory auditor

The issuer's auditor issues a comfort letter addressed to the underwriters and the issuer stating that, among other things, the auditor has reviewed the financial information included in the prospectus, the minutes of the boards and the shareholders and has made certain inquiries from officials of the issuer to assure that, to the best of its knowledge, the financial information disclosed in the prospectus is correctly prepared and up to date. One comfort letter is issued at the time of approval of the prospectus and typically a second comfort letter is issued at the time of the closing of the transaction.

For Belgian transactions that involve the application of Rule 144A (that is, a US rule providing a safe harbour from the registration requirements of the Securities Act of 1933 for certain offerings of securities to qualified institutional buyers), separate comfort letters are issued for the offering in the US and outside the US. The comfort letter for the offering in the US must be prepared in accordance with Statements on Auditing Standards 72.

The auditors will accept different levels of liability for each offering. For the offering outside the US, Belgian auditors typically argue, on the basis of a circular of the Belgian Institute of Auditors of 20 December 2006, that their liability should be capped at EUR12 million in relation to issuing comfort letters, under the Law of 22 July 1953 establishing the Belgian Institute of Auditors. The auditors will ask the issuer and the lead managers to agree to this interpretation.

Financial public relations agents

On major offerings, the issuer often instructs a specialised public relations agent to help with marketing and the media.

Main documents

The main documents produced in an equity offering are the following:

  • A mandate letter in which the investment banks are instructed by the issuer.

  • An engagement letter in which the auditor is instructed.

  • Marketing materials.

  • In the case of an IPO, the "intention to float" (ItF) (a statement by the board of directors of the issuer informing the public that the company is planning an IPO in the near future).

  • An underwriting agreement.

  • Board resolutions recommending the offering to the shareholders (where it is necessary to issue new shares and the authorised capital is not used, so that shareholder approval is required) and approving the prospectus.

  • Shareholders' resolutions approving the issue of new shares or board resolutions to the same effect if the board makes the decision within the framework of the authorised capital.

  • The prospectus and any supplements to the prospectus (see Questions 10 to 13).

  • An application to the FSMA for approval of the prospectus.

  • An application for admission to trading on Euronext Brussels.

  • Comfort letters issued by the issuer's auditor (see above, Issuer's statutory auditor).

  • Legal opinions issued by various legal advisers (see above, Legal advisers).

 

Equity prospectus/main offering document

10. When is a prospectus (or other main offering document) required? What are the main publication, regulatory filing or delivery requirements?

A prospectus is required for any:

  • Public offering of investment instruments in Belgium.

  • Admission of investment instruments to trading on Euronext Brussels.

The FSMA must make a decision on a request for prospectus approval within ten business days following receipt of a complete application. The deadline is extended to 20 business days if, during the previous ten years, the FSMA has not approved any registration document or any prospectus in relation to a public offering of securities or an application for admission to trading on Euronext Brussels by the same issuer.

In practice, the timetable for prospectus approval is usually agreed on informally with the FSMA when the proposed transaction is presented to it.

Once approved, the prospectus must be made public at least three business days before the end of the offering period and, in any case, at the latest on the first day of the offering period. For an IPO, the prospectus must be made public at least six business days before the end of the offering period. If an admission to trading on Euronext Brussels takes place without any public offering, the prospectus must be made public at the latest one business day before the date of the admission to trading.

The prospectus can be made public through any of the following principal means:

  • Making the prospectus in printed form freely available at the issuer's registered office, and at the offices of the financial intermediaries placing or trading the relevant investment instruments, including the paying agents.

  • Posting the prospectus on the website of the issuer.

  • Posting the prospectus, where applicable, on the website of the financial intermediaries placing or trading the relevant investment instruments, including the paying agents.

When the prospectus is made available in printed form, it must also be posted on the issuer's website or, where applicable, on the website of any of its financial intermediaries or paying agents. When the prospectus is made public in electronic form only, that is deemed to be a valid publication and it must only be additionally communicated in printed form, free of charge, to any investors at their request.

An electronic version of the prospectus must be sent to the FSMA. The FSMA will publish the prospectus on its website and will forward it to the European Securities and Markets Authority (ESMA).

If not disclosed in the prospectus, final terms of the offering are published separately, and that publication must receive prior approval by the FSMA.

The prospectus can be composed of several documents (with or without documents incorporated by reference):

  • Registration document and securities note.

  • Base prospectus and final terms.

  • Stand-alone prospectus.

In such a case, the documents and information that together form the prospectus can be published separately, provided that the publication is made available in accordance with the above rules.

 
11. What are the main exemptions from the requirements for publication or delivery of a prospectus (or other main offering document)?

Exempt offers

A prospectus is not required when it is not a "public offering" because:

  • The offering is addressed solely to qualified investors.

  • The offering is addressed to investors other than qualified investors belonging to a limited circle of fewer than 150 natural or legal persons per member state of the EEA.

  • The offering is addressed to investors acquiring investment instruments for a total consideration of at least EUR100,000 per investor, for each separate offer.

  • The offering relates to investment instruments with a minimum denomination of at least EUR100,000.

  • The total amount of the offering in the EEA is less than EUR100,000 over a 12-month period.

A free allocation of investment instruments does not constitute an offering and, therefore, does not require a prospectus.

In addition, qualified financial intermediaries holding securities in custody for their clients located in Belgium and not acting on behalf of the issuer of the securities or the bidder may, without running the risk of having this qualified as a public offering in Belgium (which would require the publication of a prospectus) inform their clients about a public exchange offer or a public takeover bid, conducted mainly outside Belgium, with respect to such securities they have under custody (and so allow their Belgian resident clients to participate in the exchange offer or takeover bid and tender their securities).

A new prospectus is also not required in the case of a subsequent resale of securities or final placement of securities through financial intermediaries provided a valid prospectus is available and the issuer (or the person responsible for drawing up such prospectus) has consented to using the existing prospectus by means of a written agreement. If no such consent has been obtained, a financial intermediary could be required to publish, and be liable for, a new prospectus.

A prospectus is also not required for any of the following public offerings:

  • Shares issued in substitution for already issued shares of the same class (where that issuance does not increase the stated capital).

  • Investment instruments offered in connection with a public exchange offer, if a document containing information equivalent to a prospectus is made available and filed with the FSMA for review.

  • Securities allocated in connection with a merger, division or contribution in kind (provided such transactions constitute an offering), if a document containing information equivalent to a prospectus is made available and filed with the FSMA for review.

  • Dividends paid to existing shareholders in the form of free shares belonging to the same class as those giving entitlement to the dividends, if a document containing the number and nature of the shares and the reasons and details of the offering is made available.

  • Under certain conditions, securities offered to board members or employees, if a document containing the number and nature of the securities and the reasons and details of the offering is made available.

However, if any of these offers concerns new investment instruments to be listed on Euronext Brussels, a prospectus must in any case be submitted for the FSMA's approval unless one of the exemptions below apply.

Exempt admissions to trading

Admission to trading of the following investment instruments requires no prospectus:

  • Shares that represent, during a 12-month period, less than 10% in shares of the same class already listed on Euronext Brussels.

  • Shares issued in substitution for already issued shares of the same class (where that issuance does not increase the stated capital).

  • Investment instruments offered in connection with a public exchange offer, if a document containing information equivalent to a prospectus is made available and filed with the FSMA for review.

  • Securities offered or allocated in connection with a merger, division or contribution in kind, if a document containing information equivalent to a prospectus is made available and filed with the FSMA for review.

  • Dividends paid in the form of free shares belonging to the same class as those giving entitlement to the dividends, if a document containing the number and nature of the shares and the reasons and details of the offering and the admission is made available.

  • Under certain conditions, securities offered to board members or employees, if a document containing the number and nature of the securities and the reasons and details of the offering and the admission is made available.

  • Shares resulting from the conversion or exchange of other securities or from the exercise of rights conferred by other securities if the shares belong to the same class as those already admitted to trading on Euronext Brussels.

  • Securities already admitted to trading on another regulated market, subject to certain conditions.

 
12. What are the main content or disclosure requirements for a prospectus (or other main offering document)? What main categories of information are included?

The prospectus must contain all information that is necessary to enable investors to make an informed assessment of the:

  • Assets and liabilities, financial position, profit and losses, and prospects of the issuer and of any guarantor.

  • Rights attached to those securities.

The information must be presented in an easy-to-analyse and comprehensible form.

The minimum information to be included in the prospectus is set out in the Prospectuses Regulation. The specific features of the securities offered and the type of issuer will determine how much and which type of information is required.

A summary must also be included in accordance with a specific format to enable comparisons to be made against the summaries relating to similar securities.

The prospectus must be supplemented if a significant new factor, material mistake or inaccuracy relating to the information included in the prospectus, which is capable of affecting the assessment of the securities, arises or is noted between the time when the prospectus is approved and the later of either:

  • The final closing of the offering to the public.

  • When trading on Euronext Brussels begins.

The FSMA must approve the supplement within seven business days, and the supplement must be published using the same methods that were applied when the original prospectus was published.

Investors who have already agreed to purchase or subscribe for the securities before the supplement is published have the right, exercisable within two business days after the publication of the supplement, to withdraw their acceptances. Issuers may extend the period for withdrawal.

Withdrawal rights only apply if the new development, mistake or inaccuracy requiring a supplement has arisen prior to the final closing of the offer and the delivery of the securities. Withdrawal rights do not apply where the trigger event for the supplement is a new event that arises after the securities offered have been delivered or in the context of a prospectus produced only for admission to trading. Moreover, where a supplement to a prospectus is to be published, investors should be expressly notified of their withdrawal rights at the time of publication of the supplement, either through the press or individually, unless the new development, (rectification of the) material mistake or inaccuracy that triggered the supplement has no impact or positively impacts the assessment of the investment instruments in Belgium. A mere mention of the withdrawal rights in the supplement or on the issuer's website will not suffice.

 
13. How is the prospectus (or other main offering document) prepared? Who is responsible and/or may be liable for its contents?

The prospectus is generally prepared by the issuer's legal advisers, with input from the issuer, the statutory auditors and the investment banks (see Question 9).

The prospectus must designate the persons responsible for the content of the prospectus, which can only be any of the following:

  • Issuer and its administrative, management or supervisory bodies.

  • Offeror.

  • Person requesting the admission to trading on Euronext Brussels.

  • Guarantor.

The persons responsible must declare that, to their knowledge, the information contained in the prospectus is in accordance with the facts and that the prospectus makes no omission likely to affect its content. They are jointly and severally liable towards investors for damage caused due to any misleading or inaccurate information in the prospectus or its supplements, or lack of information required to be contained in the prospectus or its supplements (Article 61, Prospectus Law). Except if proven otherwise, damage is presumed to result from this cause where the misleading or inaccurate information or lack of information was liable to either:

  • Create a positive climate on the market.

  • Positively affect the price of the investment instruments.

There exists a specific safe harbour against any civil liability on the basis of the prospectus summary alone. This applies unless the summary, when read with the rest of the prospectus, is misleading, inaccurate or inconsistent or does not meet the objective of providing the key information.

 

Marketing equity offerings

14. How are offered equity securities marketed?

The marketing of an IPO consists of:

  • Analyst presentation. The analysts are given a briefing on the issuer and on the offering, as well as research guidelines, to allow them to prepare research reports.

  • Pre-marketing. The investment banks contact a limited number of institutional investors to:

    • generate and, to some extent, test investors' interest;

    • identify issues to be addressed by management on the road shows.

  • Road shows. During the offering period, the issuer's management organises presentations to the investor community (mostly institutional investors, although separate presentations to retail investors can also be organised) to present the:

    • equity story (that is, the reasons why the shares should be bought by investors);

    • main features of the offering.

  • Advertisement. During the offering period, broader advertising means are also used by the issuer and the investment banks, the extent of which depends on the expected interest of retail investors.

In the case of a secondary offering, insider dealing rules limit the marketing process, making it difficult to test the market before it has made public its intention to make the offering.

 
15. Outline any potential liability for publishing research reports by participating brokers/dealers and ways used to avoid such liability.

Potential liability

There is potential liability for the issuer and investment banks advising the issuer from research reports prepared by analysts connected to the investment banks advising the issuer that are:

  • Perceived as issued on behalf of, or at least with the authority and approval of, the issuer and/or the investment banks.

  • Regarded as forming part of the prospectus (while they are unlikely to be prepared to the same standards as the prospectus or to cover the same areas).

In these circumstances, the issuer can incur liability in the same way as for a flaw in the prospectus under Article 61 of the Prospectus Law (see Question 13). The investment banks can be liable in tort.

Methods to avoid or limit liability

Generally, the following methods are used:

  • A prohibition on distributing the research reports during the blackout period. The blackout period is a period starting immediately after the publication of the research reports and ending after the date of listing. It can sometimes be up to 40 days after the listing date. However, there is no legal requirement as to the blackout period and its duration under Belgian law. The purpose of the blackout period is to ensure that sufficient time elapses between publication of the research reports and the offering period so that one can argue that investors relied on the prospectus to make their investment decision, rather than on research reports.

  • Information barriers must be put in place between the research department of the investment bank and the team working on the offering within the same bank.

  • Clear and prominent disclaimers are usually contained in the research report.

  • Restrictions on distribution of research reports, which can include:

    • no electronic distribution before the blackout period (see above);

    • in many cases, limiting the distribution to institutional investors.

These measures are usually set out in the research guidelines.

 

Bookbuilding

16. Is the bookbuilding procedure used and in what circumstances? How is any related retail offer dealt with? How are orders confirmed?

The bookbuilding procedure is used to price an IPO on Euronext Brussels. The price range is typically determined based on pre-marketing and made public concurrently with the prospectus at the start of the offering period. The final offer price is then determined, on the basis of a bookbuilding process conducted during the offering period in which only institutional investors participate. The final offer price is subsequently published in a separate pricing statement.

Where an IPO involves a public offering in Belgium, which is not mandatory but is almost always the case in practice (Royal Decree of 17 May 2007):

  • At least 10% of the shares must be reserved for retail investors.

  • The conditions of the offering, including, in particular, the price of the tranche reserved for retail investors, must in principle be the same as those offered in the tranche reserved for qualified investors.

This means that the offer price must be identical for retail and institutional investors. However, a limited discount for retail investors is allowed.

In addition, the retail tranche cannot be closed before the tranche reserved for qualified investors unless the prospectus specifically provides for this and sets out the circumstances in which the retail tranche can be closed earlier. In that case, measures must be taken to ensure that the book remains confidential until all tranches have been closed.

Retail applications are binding. The prospectus, therefore, typically provides that:

  • Retail investors are legally bound to purchase or subscribe to the number of shares indicated in their application form at the offer price. The final offer price can be lower than the lower end of the price range (see Question 1, Market activity and deals).

  • The final price for retail investors will not exceed the upper end of the price range.

The bookbuilding procedure is also a common way of structuring and pricing a secondary offering when it takes the form of an accelerated bookbuilt offering (see Question 5, Accelerated bookbuilt offering). As the offering is not public in this case, the mandatory retail tranche does not apply.

 

Underwriting: equity offering

17. How is the underwriting for an equity offering typically structured? What are the key terms of the underwriting agreement and what is a typical underwriting fee and/or commission?

Under the underwriting agreement, the underwriters must find subscribers or purchasers for all or a portion of the securities. In addition, depending on the type of underwriting, the agreement can also provide that if the underwriters fail to procure subscribers or purchasers for the securities, the underwriters themselves will purchase or subscribe for them (hard underwriting).

The fee to be paid by the issuer and/or the selling shareholders to the underwriters is usually structured as a percentage of the aggregate price of the shares offered and supplemented by a discretionary fee. Fee levels vary depending on a number of factors, such as the type and size of the offering, its expected success rate, the situation of the issuer or whether the underwriting commitment is soft or hard.

The underwriting agreement also sets out the terms of any lock-up of significant shareholders and any over-allotment option that the bank(s) can be given for stabilisation purposes.

In addition, underwriting agreements contain covenants, representations and warranties made by:

  • The issuer and/or selling shareholders with respect to information on the issuer and the offering of securities.

  • The underwriters with respect to selling restrictions in connection with their placement of the securities.

A breach of the covenants, representations and warranties entitles the non-breaching party to terminate the underwriting agreement. Underwriting agreements also typically indemnify the underwriters for false or misleading information in the issuer's offering document.

Underwriting agreements are subject to a number of conditions and usually contain a material adverse change (MAC) clause triggered if certain material adverse events affect the market on which the securities are (to be) listed, or affect the issuer's:

  • Assets.

  • Results.

  • Financial condition.

  • Indebtedness.

  • Business activities.

 

Timetable: equity offerings

18. What is the timetable for a typical equity offering? Does it differ for an IPO?

A typical simplified timetable for an institutional and retail IPO (where "T" is the date of closing and settlement) would be:

  • T minus 5 to 4 months. In this period, the issuer and, when appointed, its advisers, should:

    • draft a business plan and equity story;

    • analyse and determine the offering structure;

    • prepare the company for listing (through due diligence, restructuring, if needed, and compliance with conditions for listing).

  • T minus 4 to 3 months. The issuer and its advisers should:

    • begin preparation of key documents, such as the prospectus;

    • informally present the IPO project to the FSMA and Euronext Brussels.

  • T minus 2 months. The issuer should file an initial draft of the prospectus with the FSMA and apply for admission to trading with Euronext Brussels. The issuer is presented to financial analysts. The ItF press release is published (see Question 9, Main documents).

  • T minus 1 month. Analysts' research is published and pre-marketing starts.

  • T minus 3 to 2 weeks. The FSMA approves the prospectus, which is then published. The retail offering and institutional offering (bookbuilding) start, usually based on a price range. Road shows are started.

  • T minus 4 days. The retail offering and institutional offering close.

  • T minus 3 days. The final price is determined. The underwriting agreement is signed. Shares are allocated to the investors. Trading starts on an if-and-when issued or delivered basis. The stabilisation period starts.

  • T. Closing and settlement.

  • T plus 27 days. The stabilisation period ends. This is the final date for exercise of any over-allotment option (that is, an option allowing underwriters to sell additional shares, at the offering price, if the demand for the shares exceeds the original amount offered).

Timetables for other equity offerings very much depend on their type. For a rights issue, the total duration will typically be around four months when a shareholders' meeting is needed to decide on the capital increase and a quorum is not present at the first meeting, so that a second meeting must be convened. If the decision can be made by the board of directors within the framework of the authorised capital, the total duration will be shorter (that is, around two and a half months).

For an accelerated bookbuilding offering, the total duration will be much shorter (that is, generally a couple of weeks or even less for the entire process).

 

Stabilisation

19. Are there rules on price stabilisation and market manipulation in connection with an equity offering?

Transactions undertaken by investment service providers to stabilise securities are not considered market manipulation if they comply with the applicable rules, the most important of which are (Regulation (EC) 2273/2003 implementing Directive 2003/6/EC as regards exemptions for buy-back programmes and stabilisation of financial instruments (Buyback and Stabilisation Regulation), and ancillary Belgian rules):

  • The possibility of stabilisation activities must be disclosed in the prospectus.

  • Stabilisation cannot be made at a price higher than the issue price of the offering.

  • The stabilisation period must be limited in duration (generally to 30 days with the starting point depending on the nature of the offering).

  • The issuer, offeror or entity undertaking the stabilisation must provide the FSMA with details of all stabilisation transactions within seven trading days of execution.

  • Information concerning the existence of, and arrangements for, stabilisation must be made public within five business days of the end of the stabilisation period through a press release.

 

Tax: equity issues

20. What are the main tax issues when issuing and listing equity securities?

No specific tax issues arise relating to the issuance of new shares in Belgium.

Regarding the offering of existing shares, a number of tax issues can arise requiring specialist tax advice. These issues are summarised below.

Capital gains tax on the realisation of shares

Belgian private individuals. In principle, Belgian resident individuals acquiring shares as a private investment should not be subject to Belgian capital gains tax when they dispose of those shares. Capital losses are not tax deductible.

However, capital gains realised by a private individual are taxable at 33% (plus local surcharges) if the capital gain is deemed to be realised outside the scope of the normal management of the individual's private estate. Capital losses are not tax deductible.

Belgian resident companies. Belgian resident companies (not being SMEs) are subject to Belgian capital gains taxation at a separate rate of 0.412% on gains realised on the disposal of shares provided that both:

  • The "Dividend Received Deduction" taxation requirements (Taxation Requirements) are met.

  • The shares have been held in full legal ownership for an uninterrupted period of at least one year.

Belgian resident companies qualifying as SMEs (within the meaning of Article 15 of the Belgian Companies Code) are in principle not subject to Belgian capital gains taxation on gains realised on the disposal of shares provided that the above two conditions are met.

If the one-year minimum holding period condition would not be met (but the Taxation Requirements are met), the capital gains realised on the disposal of shares by Belgian resident companies (both non-SMEs and SMEs) are taxable at a separate corporate income tax rate of 25.75%.

If the Taxation Requirements are not met, the capital gains realised on the disposal of shares by Belgian resident companies (both non-SMEs and SMEs) are fully taxable at the ordinary corporate income tax rate of 33.99%.

Belgian non-residents. Under a strict reading of a particular provision of the Belgian Income Tax Code, capital gains realised on shares by Belgian non-residents could be subject to Belgian taxation, levied in the form of a professional withholding tax, if the following three conditions are cumulatively met:

  • The capital gain would have been taxable if the non-resident were a Belgian tax resident.

  • The income is "borne by" a Belgian resident (including a Belgian establishment of a foreign entity) which would, in such a context, mean that the capital gain is realised upon a transfer of the shares to a Belgian resident (including a Belgian establishment of a foreign entity).

  • Belgium has the right to tax that capital gain under the applicable double tax treaty, or, if no such tax treaty applies, the non-resident does not demonstrate that the capital gain is effectively taxed in its state of residence.

However, it is unclear whether a capital gain included in the purchase price of an asset can be considered to be "borne by" the purchaser of the asset within the meaning of the second condition mentioned above. Furthermore, this tax requires that the Belgian resident purchaser is aware of:

  • The identity of the Belgian non-resident (to assess the third condition mentioned above).

  • The amount of the capital gain realised by the Belgian non-resident (since that amount determines the amount of professional withholding tax to be levied by the Belgian purchaser).

Consequently, the application of this tax on transactions with respect to the shares occurring on Euronext Brussels will give rise to practical difficulties as the seller and purchaser in principle do not know each other.

In addition to the uncertainties referred to above, the statutory history of the law that introduced this particular provision supports the view that the legislator did not intend for that provision to apply to a capital gain included in the purchase price of an asset. The Belgian Tax Administration is aware of the issues raised by this provision in relation to its broad and imprecise scope of application. The Belgian Tax Administration has informed the Minister of Finance of these issues and has reportedly issued recommendations to the Minister of Finance in order to clarify that the scope of application of the provision does not extend to the above-mentioned capital gains.

Dividend withholding tax (WHT)

Belgian domestic tax law provides for a 25% dividend WHT to be levied on ordinary dividend distributions. There are certain dividend WHT exemptions and/or reduced rates under Belgian domestic tax law and/or double tax treaties entered into by Belgium which can, subject to certain conditions, be relied upon.

Stock exchange tax

A tax on stock exchange tax transactions could be levied on the purchase and sale in Belgium of existing shares on the secondary market through a professional intermediary in Belgium. Primary market transactions are not subject to the tax on stock exchange tax transactions. Certain investors benefit (subject to certain conditions) from an exemption from the tax on stock exchange tax transactions on secondary market transactions. The rate is 0.25% of the sales price, capped at EUR740 per transaction and per party. Under current Belgian tax law, this rate and this cap will reduce to 0.22% and EUR650, respectively, for transactions occurring as from 1 January 2015. The tax on stock exchange tax transactions should therefore be assessed in connection with the listing of shares.

Financial transactions tax

In the future it may be necessary to take into account the Financial Transactions Tax (FTT) if that tax is adopted. On 14 February 2013, the EU Commission proposed a draft directive on a common Financial Transaction Tax (Draft FTT Directive) in the context of an enhanced cooperation procedure involving 11 EU member states (note that this procedure is unprecedented in tax matters). Under the Draft FTT Directive, the FTT will, subject to certain conditions, be payable on financial transactions relating to shares (among other things). The proposed minimum rate is 0.1%. According to the Draft FTT Directive, primary market transactions would not be subject to FTT.

A statement made 6 May 2014 by the participating member states (other than Slovenia) indicates that a progressive implementation of the FTT is being considered, and that the FTT may initially apply only to transactions involving shares and certain derivatives, with implementation occurring by 1 January 2016. However, full details are not available. In addition, the UK has legally challenged certain aspects of the Draft FTT Directive. The Court of Justice of the EU (CJEU) dismissed, on 30 April 2014, the UK's legal challenge to the EU Council decision authorising 11 member states to use the enhanced co-operation procedure in order to implement a common financial transaction tax in those member states. However, the case does not amount to a defeat on the substantive points of concern but rather is a decision that the timing of the challenge was premature. The CJEU has left the way open for legal challenge to the FTT itself if and when the measure is finally adopted.

The Draft FTT Directive currently provides that once the FTT enters into force, the participating member states shall not maintain or introduce taxes on financial transactions other than the FTT. For Belgium, the stock exchange tax should therefore be abolished if and when the FTT enters into force.

 

Continuing obligations

21. What are the main areas of continuing obligations applicable to listed companies and the legislation that applies?

The following summarised rules apply to companies that have selected Belgium as their home member state, unless otherwise indicated. Certain of these rules have recently changed following the entry into force of the Royal Decree of 26 March 2014 amending the Royal Decree of 14 November 2007 concerning obligations of issuers of financial instruments admitted to trading on a regulated market.

Periodic financial reporting

Issuers must ensure that the following regulated information is periodically distributed to the public and sent to the FSMA:

  • Annual financial report. The issuer must publish, within four months after the end of the financial year, an annual financial report that contains:

    • the audited financial statements (when accounts are prepared on a consolidated basis, both the consolidated and standalone or condensed standalone accounts);

    • the board report (which must be prepared by issuers having their real seat in Belgium, in accordance with the rules set out in the Belgian Companies Code (which require, among other things, to set out the most important aspects of the internal control and risk management systems regarding financial reporting) and, for other issuers, in accordance with the applicable rules implementing similar rules set out in EU Directive 83/349/EEC (Seventh Directive: Consolidated accounts of companies with limited liability));

    • a declaration from the issuer's officials that the accounts provide a true and fair view of the current assets, the financial condition, the results and the consolidated group companies of the issuer and that the board report provides a true and fair view of the developments, the results, the position and the consolidated group entities of the issuer, together with a description of the most important risks and uncertainties; and

    • the signed auditor's report.

  • Annual communiqué. If the issuer chooses to publish an annual communiqué before the annual financial report has been published, the communiqué must contain:

    • certain specified financial information;

    • explanatory disclosures; and

    • information on the status of the audit process of the annual accounts.

  • Half-yearly financial report. The issuer who has issued shares or debt instruments must publish, as soon as possible, and at the latest three months after the end of the first half-year, a half-yearly financial report that contains:

    • a condensed financial overview;

    • the interim board report;

    • a declaration of the issuer's officials confirming that the condensed overview provides a true and fair view of the assets, the financial condition, the results and the consolidated group companies of the issuer and that the board report provides a true and fair view of the most important events during the reporting period and the effect on the financial information, together with an overview of the most important risks and uncertainties for the remainder of the relevant financial year; and

    • the auditor's report on the condensed financial overview (this report is optional).

Other disclosure obligations

The issuer must comply with the following disclosure obligations:

  • Inside information. The issuer must immediately disclose any inside information directly related to it. This disclosure can only be postponed under strict conditions and under the issuer's own responsibility.

  • Major shareholdings. Every person that acquires or disposes of securities with voting rights in an issuer of shares must notify the issuer and the FSMA if the proportion of voting rights attached to these securities reaches, exceeds or falls below certain thresholds. This notification must be done as soon as possible, and at the latest within four trading days. The issuer must disclose this information within three trading days after receipt. The relevant thresholds are 5% of the total voting rights and every multiple of 5%. However, the articles of association of Belgian issuers can set additional thresholds of 1%, 2%, 3%, 4% or 7.5%.

Significant transactions and related party transactions

Issuers of shares that are Belgian companies must comply with a special procedure that requires the involvement of the auditor and a committee of three independent directors when certain decisions or transactions relate to relationships between the issuer and its affiliated companies (subsidiaries excluded). This procedure does not apply to:

  • Common decisions and transactions that occurred at market conditions.

  • Decisions and transactions that represent less than 1% of the issuer's consolidated net assets.

Significant shareholder voting restrictions

The articles of association of Belgian companies can (but rarely do) limit the number of votes each shareholder disposes of, on condition that the limitation applies to every shareholder. It is also possible to include voting arrangements in a shareholders' agreement, but this will only be valid if the agreement is limited in duration and in the company's interest.

 
22. Do the continuing obligations apply to listed foreign companies and to issuers of depositary receipts?

The FSMA can exempt issuers that have their registered office in a country that is not a member of the EEA if the legislation of that country imposes equivalent obligations. The FSMA will notify any such exemption to ESMA.

Issuers within the EEA for which Belgium is not the home member state but whose securities are exclusively admitted to trading on Euronext Brussels must publish in Belgium the regulated information set out in the applicable legislation of the home member state. These issuers must simultaneously send the regulated information to the FSMA.

 
23. What are the penalties for breaching the continuing obligations?

Failure to comply with continuing obligations can, depending on the circumstances and the obligations being breached, result in a variety of sanctions, including:

  • Tort liability.

  • The publication of warnings.

  • The suspension or prohibition of trading of the relevant financial instrument.

  • Administrative fines or criminal sanctions.

 

Market abuse and insider dealing

24. What are the restrictions on market abuse and insider dealing?

Restrictions on market abuse/insider dealing

Under Belgian law, market abuse (consisting of insider dealing and market manipulation) is governed by the Law of 2 August 2002 on the supervision of the financial sector and on financial services (Law) and the Royal Decree of 5 March 2006 on market abuse.

Market abuse is, general speaking, relevant for:

  • Financial instruments admitted to trading on Euronext Brussels (among others).

  • Financial instruments admitted to trading on a foreign regulated market to the extent that the relevant transactions have been executed in Belgium.

  • Derivatives of financial instruments admitted to trading on Euronext Brussels (among others).

  • Derivatives of financial instruments admitted to trading on a foreign regulated market to the extent that the relevant transactions have been executed in Belgium.

  • Issuers of financial instruments admitted to trading on Euronext Brussels (among others) and its affiliated companies.

  • Issuers of financial instruments admitted to trading on a foreign regulated market to the extent that the relevant transactions have been executed in Belgium and its affiliated companies.

The European Council adopted a new Market Abuse Regulation and a new Market Abuse Directive in April 2014. These upcoming changes to the existing rules are not reflected in the following text.

Definition of inside information. The Law defines inside information both for administrative and for criminal offences as any information that (cumulatively):

  • Has not been made public.

  • Is of a precise nature.

  • Relates, directly or indirectly, to one or more issuers of financial instruments or to one or more financial instruments.

  • If it were made public, would be likely to have a significant effect on the price of the financial instruments concerned or of related derivative financial instruments.

Prohibited actions. Any person in possession of inside information who knows, or reasonably ought to know, that the information concerned is inside information is prohibited from:

  • Acquiring or disposing of, or trying to acquire or dispose of, for his own account or for the account of a third party, either directly or indirectly, financial instruments to which the information relates.

  • Disclosing the inside information to another person unless that disclosure is made in the normal course of the exercise of his employment, profession or duties.

  • Recommending to another person, on the basis of the inside information, to acquire or dispose of, or have others acquire or dispose of, financial instruments to which the information relates.

The Law also prohibits participating in any arrangement that would lead to the performance of any of the above acts, and inducing others to perform any of the above acts if these would be prohibited if the person himself were to perform them.

Market manipulation. The Law defines market manipulation as:

  • Transactions or orders to trade that give, or are likely to give, false or misleading signals as to the supply of, demand for or price of financial instruments.

  • Transactions or orders to trade that secure, by a person, or persons acting in collaboration, the price of one or several financial instruments at an abnormal or artificial level (unless the person who entered into the transactions or issued the orders to trade establishes that his reasons for so doing are legitimate and that these transactions or orders to trade conform to accepted market practices on the regulated market concerned).

  • Transactions or orders to trade that employ fictitious devices or any other form of deception or contrivance.

  • Dissemination of information through the media, including the Internet, or by any other means, which gives, or is likely to give, false or misleading signals as to listed financial instruments and financial institutions that can damage its financial stability, where the person who made the dissemination knew, or ought to have known, that the information was false or misleading.

The Law also prohibits participating in any arrangement that would lead to the performance of any of the above acts, and inducing others to perform any of the above acts if these would be prohibited if the person himself were to perform them.

Finally, it is prohibited to give false or misleading information or give false facts or commit any other act which constitutes a manipulation of a reference index.

Penalties for market abuse/insider dealing

Administrative penalties. These can be imposed on any person committing any of the prohibited actions listed above. Administrative fines of up to EUR2.5 million can be issued.

Criminal penalties for insider trading. Criminal sanctions can be imposed, among others, if the inside information is used to commit any of the prohibited actions listed above, which requires a causal link between the possession of inside information and the act of acquiring or disposing of financial instruments.

Criminal penalties for market manipulation. Criminal sanctions can be imposed for market manipulation involving the following:

  • Financial instruments admitted to trading on Euronext Brussels (among others).

  • Financial instruments admitted to trading on a foreign regulated market to the extent that the relevant transactions have been executed in Belgium.

  • Derivatives of financial instruments admitted to trading on Euronext Brussels (among others).

  • Derivatives of financial instruments admitted to trading on a foreign regulated market to the extent that the relevant transactions have been executed in Belgium.

  • Issuers of financial instruments admitted to trading on Euronext Brussels (among others) and its affiliated companies.

  • Issuers of financial instruments admitted to trading on a foreign regulated market to the extent that the relevant transactions have been executed in Belgium and its affiliated companies.

Criminal sanctions consist of:

  • Imprisonment of between three months to up to one year and criminal fines of between EUR300 up to EUR60,000 (for insider trading).

  • Imprisonment of between one month to two years and criminal fines of between EUR1,800 to EUR60,000 (for market manipulation).

In addition, any person convicted of the criminal offence of insider dealing may face an additional criminal fine of no more than three times the amount of the financial benefit that the offender obtained, directly or indirectly, from the criminal offence. That person may also be prohibited from further exercising certain professions or functions, including those of director of a company.

 

De-listing

25. When can a company be de-listed?

Euronext can de-list securities listed on Euronext Brussels either at the request of the issuer, where this is permitted by applicable law, or at its own initiative on any appropriate grounds. Euronext can subject any de-listing of securities to such requirements as it deems appropriate.

The Euronext Rule Book sets out appropriate grounds for de-listing at the initiative of Euronext Brussels, including without limitation:

  • The issuer's manifest failure to comply with its obligations under the Euronext Rule Book or the listing agreement.

  • Facts or developments occurring concerning a security that:

    • prevents the continued listing of that security;

    • causes Euronext to believe that a fair, orderly and efficient market for a security cannot be maintained.

  • Adequate clearing and/or settlement services for a type of security being no longer available.

  • The issuer or its beneficial owners are on the EU Sanction List or the list drawn up by the Office of Foreign Assets Control (OFAC).

Instances of de-listing at the initiative of Euronext Brussels (that is, compulsory de-listings) are uncommon.

De-listing at the initiative of the issuer for which Euronext Brussels constitutes the primary market will in principle only be accepted as a result of another, prior step taken under the relevant rules (such as a squeeze-out offer, a merger by absorption by another company or liquidation). However, when Euronext Brussels does not constitute the primary market and the securities continue to be listed on at least one other EEA regulated market, and when it is demonstrated that trading volumes are significantly higher on that other market, Euronext and the FSMA generally accept the de-listing. In such a case, the de-listing from Euronext Brussels will in principle take place without any prior step, simply following the procedure set out in the Euronext Rule Book. The only condition that Euronext and the FSMA will typically impose is that a minimum three-month period elapses between the Euronext notice announcing the upcoming de-listing and the effective de-listing date, so that shareholders who would prefer to sell their shares before the de-listing can do so.

 

Reform

26. Are there any proposals for reform of equity capital markets/exchanges? Are these proposals likely to come into force and, if so, when?

No definite proposals for reform of Euronext Brussels have been made publicly available.

 

Online resources

Belgisch Staatsblad/Moniteur Belge

W www.ejustice.just.fgov.be/cgi/welcome.pl

Description. Belgian legislation published in the Belgian State Gazette.

Justel

W www.ejustice.just.fgov.be/wet/wet/htm

Description. Consolidated Belgian legislation (the legislation is regularly updated).

Euronext

W www.euronext.com

Description. The official website of Euronext Brussels.

FSMA

W www.fsma.be

Description. The official website of the FSMA.



Contributor profiles

Thierry L'Homme, Counsel

Linklaters LLP

T +32 2 501 9186
F +32 2 501 9577
E thierry.lhomme@linklaters.com
W www.linklaters.com

Professional qualifications. Brussels, 1995

Areas of practice. Equity, equity-linked and debt capital markets transactions including IPOs, public M&A, company law and corporate governance. A trusted advisor to a large number of listed companies, including many BEL 20 companies. Leads the executive incentives practice of Linklaters in Belgium.

Recent transactions

  • Advising on the largest IPO that took place on Euronext Brussels in 2013.

  • Advising on a EUR1 billion exchangeable bond for a BEL20 company.

  • Advising on a complex convertible bond for a BEL20 company.

  • Advising one of the largest Belgian listed companies on a substantial international bought deal.

  • Advising one of the leading energy providers in the world on the disposal and reorganisation of several strategic assets following its merger as well as on its subsequent combination with another large energy company.

  • Advising a number of listed companies on their annual shareholders' meetings as well as their international stock option plans and executive incentive schemes.

Languages. French, English, Dutch

Publications. Has written on numerous subjects on company law, corporate governance and incentive schemes. A regular speaker at conferences on these topics.

Arnaud Coibion, Partner

Linklaters LLP

T +32 2 501 9018
F +32 2 501 9577
E arnaud.coibion@linklaters.com
W www.linklaters.com

Professional qualifications. Brussels, 1999; England & Wales, 2003

Areas of practice. Corporate law, corporate finance transactions and equity offerings, joint ventures and mergers and acquisitions, including private equity transactions, mostly with a cross-border element. Co-head of Linklaters' global Energy & Utilities sector.

Recent transactions

  • Advising three systemic banks, a large insurance company and a large asset manager on the disposal of their joint IT infrastructure vehicle and on a major outsourcing agreement with a global IT player.

  • Advising one of the leading energy providers in the world on the disposal and reorganisation of several strategic assets following its merger as well as on its subsequent combination with another large energy company.

  • Advising the financial advisor to an IT service company on the latter’s tender offer and exchange offer on a French listed company.

  • Advising issuers and underwriters on IPOs and other capital market transactions on Euronext Brussels.

  • Advising a global steel manufacturer on the spin-off and listing of its stainless steel business.

Languages. French, English, Dutch

Professional associations/memberships. Lecturer on company law, financial law and M&A at the Louvain School of Management, the business school of the University of Louvain.

Publications. Has written on numerous subjects on company and financial law, including a book on shareholders’ agreements in a private equity context.

Gilles Nejman, Counsel

Linklaters LLP

T +32 2 501 9140
F +32 2 501 9116
E gilles.nejman@linklaters.com
W www.linklaters.com

Areas of practice. Corporate finance transactions, listed companies, corporate governance, public M&A, corporate restructurings, equity(-linked) or debt capital markets transactions, structured financing and collateral structures.

Recent transactions

  • Advising on the largest IPO that took place on Euronext Brussels in 2013.

  • Advising the underwriters on a significant ABB over shares of a company listed on Euronext Brussels.

  • Advising a Belgium-listed company and its wholly-owned subsidiary as well as some of the co-investors on their acquisition of a bank.

Languages. French, English, Dutch

Publications. Has written on numerous subjects on company and financial law.

Ilse Brouwers, Managing Associate

Linklaters LLP

T +32 2 501 9325
F +32 2 501 9577
E ilse.brouwers@linklaters.com
W www.linklaters.com

Professional qualifications. Brussels, 2006

Areas of practice. Cross-border M&A, private equity, joint ventures, equity offerings and restructurings in various sectors. Advises on general corporate and financial law, both for listed and non-listed entities.

Recent transactions

  • Advising the global asset management division of a major financial institution on the management buy-out of its clean energy fund by its senior management.

  • Advising one of the largest mineral fertilizer producers on the carve-out and acquisition of part of the worldwide assets of a leading chemical company.

  • Advising a major energy company on the voluntary bid on another industry player (followed by squeeze-out/de-listing).

  • Advising a number of BEL20 companies on their shareholders' meetings as well as their international stock option plans and executive incentive schemes.

Languages. Dutch, English, French


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