ROMANIA Law and Practice Contributed by: Lucian Bondoc, Bogdan Bunrau and Diana Ispas, Bondoc si Asociatii
Implementation of the amendments included in the Listing Act to the EU Market Abuse Regulation will alleviate some of the disclosure burden, as it exempts intermediate steps in a protracted process: immediate disclosure will no longer be required for intermediate steps in a protracted process where those steps are connected with bringing about or resulting in particu - lar circumstances or in a particular event. Currently, ESMA, the EU’s financial markets regulator and super - visor, has launched a consultation to gather feedback following changes to the MAR, including feedback on a non-exhaustive list of the protracted process and the relevant moment of disclosure of the relevant inside information. 5.2 Market Practice on Timing Considering the severe sanctions applicable in con - nection with breaches related to disclosure and mis - use of inside information, the normal market practice on timing of the disclosure should not differ from the legal requirements. Even so, there may be cases of legal uncertainty as regards the exact moment when In public M&A deals, due diligence is typically made on the basis of publicly available information only. In some cases (eg, takeover or merger deals), it may be possible to have access to some additional non-pub - lic and price-sensitive information, subject to compli - ance with the EU Market Abuse Regulation as well as the obligation to ensure that investors have equal access to relevant information about the issuer prior to the deal. the disclosure obligation arises. 5.3 Scope of Due Diligence Disclosure of non-public and potentially price-sen - sitive information should be treated with great care, considering the severe applicable sanctioning regime, including criminal sanctions, with strict compliance with the legal provisions. The changes to the EU Market Abuse Regulation made in 2024 by the EU Listing Act clarified the optional nature of the market soundings regime. Market partici - pants that carry out a market sounding in accordance with the safe harbour requirements benefit from full protection against the allegation of unlawfully disclos - ing inside information. Conversely, the market sound -
ing that does not meet the safe harbour requirements is not automatically presumed unlawful. The revised regime allows each market participant to decide whether or not to follow the safe harbour regime. This simplified compliance offers more flexibility for market participants in capital markets transactions. When scoping due diligence exercises for private M&A deals, some factors are of particular relevance, such as the deal structure (eg, share or asset deal), the sector experience of the party commissioning the due diligence (ie, the vendor or the buyer), any ongo - ing investigation on the target entity, as well as the size of the deal. As a rule, however, nowadays there are more due diligence exercises limited in scope (usually covering title-related matters, material contracts, regulatory, employment, and litigation), than those covering all aspects of a company’s business. For example, where a vendor commissions a due diligence exercise to put its company up for sale (commonly known as a “ven - dor due diligence” or VDD), typically encountered in sizeable deals, while the buyer may still (legally) rely on the VDD findings, it often elects to conduct a supple - mentary review (top-up) departing from the VDD find - ings, aimed at identifying and filling potential “gaps”. 5.4 Standstills or Exclusivity In public M&A deals, standstill agreements imposing obligations on the bidder are in some cases conclud - ed, but they are uncommon. In the context of a man - datory takeover bid, the law prohibits the shareholder and persons acting in concert from acquiring shares in the issuer prior to carrying out the bid in question. Also, in voluntary takeover bids, the bidder or the per - sons acting in concert with it may not launch, for a period of one year from the closing of the previous takeover bid, another public takeover bid targeting the same issuer. Typically, in private M&A deals, exclusivity is agreed upon for the buyer’s benefit through term sheets or similar documents. This restricts the vendor for a spe - cific period, which is estimated to encompass all the main milestones of the transaction process, such as due diligence, negotiation, and up to the tentatively scheduled signing date of the definitive transaction
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