Procedure for the Notification of Changes in Material Information in Approved Prospectuses

At its 75th Meeting held on 26 November 2019, the Commission unanimously agreed to adopt administrative procedures for the notification of changes in material information contained in approved prospectuses. Material information, as defined in the revised Securities (Accounting and Financial Reports) Rules that were reissued to the market in June 2019, is “information relating to the business, operations or securities of an issuer that would reasonably be expected to significantly affect the value or market price of the issuer or a security of the issuer.”

In accordance with section 92(3) of the Securities Act 2001 (Securities Act) “no person shall make a public offer of securities unless the issuer or offeror of the securities has submitted for approval of the Commission a prospectus which complies with this Act, and the Commission has approved the prospectus.” Further, section 92(5) of the Securities Act provides that a prospectus approved by the Commission shall be valid only for a period of up to twelve months from the date of such approval.

The aim of the prospectus is to provide prospectiveThe aim of the prospectus is to provide prospective investors with information about an offering of securities for the purpose of making an informed assessment of an issuer of securities and the securities that are being offered for sale. It is therefore critical that the information contained in the prospectus is comprehensive, accurate and not misleading, but more importantly that it is reliable and as far as possible, reflects the most up-to-date status or position of the issuer/offeror.

To protect investors and to promote fairness, efficiency and transparency in the ECSM, the following procedure must be used by all issuers/offerors to notify the Commission and the market of changes in material information in approved prospectuses:

1. the issuer/offeror must prepare and submit to the Commission, a prospectus addendum outlining the change to any material information contained in the prospectus, as soon as practicable and in any event within 10 business days;
   
   
2. where a prospectus is approved for an offering of a series of issues over a 12-month period, the issuer/offeror shall prepare and file a prospectus addendum with the Commission, at least 10 business days in advance of any new issue in the series of issues, if the change to material information contained in the approved prospectus, occurs prior to the date of any one in the series of issues;
   
   
3. the prospectus addendum shall be forwarded to or be made available to each person to whom the original prospectus had been sent and every prospectus which is sent or delivered to any person after the submission of the addendum to the Commission, shall include a copy of the addendum.

This procedure shall be implemented with immediate effect and will continue until the coming into force of any provision or rule contained in any revised securities laws in the member countries.