ANDORRA Law and Practice Contributed by: Marc Ambrós and David Cuesta, Cases & Lacambra
purpose of issuance, management, deposit or trading of any type of digital assets, such as programmable sovereign digital money (DDSP), cryptocurrencies, stablecoins or stable tokens. These companies must be registered before the Andorran Financial Authority (AFA). 3.2 Significant Changes to Takeover Law It should be noted that Andorra does not have a spe - cific law controlling takeovers. However, the compa - nies’ legislation and the merger and spin-off regimes are currently under review to identify gaps with Euro - pean Union regulations, so significant changes in such matters could occur in the coming 12 months. 4. Stakebuilding 4.1 Principal Stakebuilding Strategies As explained in 3.2 Significant Changes to Takeover Law , as there is no specific law controlling takeovers, there are no legal impediments to building a stake in the target prior to launching an offer. However, building a stake in the target prior to launch - ing an offer is not customary in Andorra due to the relatively small size of the companies, the concentra - tion of the share capital among a small number of shareholders, and the family character of companies in Andorra. 4.2 Material Shareholding Disclosure Threshold There are no material shareholding disclosure thresh - olds or filing obligations in Andorra regarding takeo - vers. However, a change in the share capital distribution of an operating entity in the Andorran financial system requires the previous authorisation of the AFA, if a shareholder: • reaches a qualified shareholding; • increases its qualified shareholding so it holds a share capital percentage or voting rights equal to or greater than 20%, 30% or 50%; or • by virtue of such acquisition, controls the entity.
Additionally, a legal obligation that applies to all com - panies in Andorra is the obligation to disclose infor - mation about each natural person who ultimately holds or controls, directly or indirectly, at least 25% of the capital or voting rights (a beneficial owner) to the Andorran Companies’ Register ( Registre de Soci - etats Mercantils ). This information is accessible to any person or organi - sation that can prove a legitimate interest. 4.3 Hurdles to Stakebuilding The regulatory reporting threshold is compulsory and cannot be modified by companies. However, non-reg - ulated companies can freely adopt internal reporting thresholds in their by-laws, but this kind of rule is not used since there is no stock market in Andorra and the size of the companies is quite small. Nevertheless, Andorran companies usually increase thresholds related to the majorities needed for the approval of certain agreements as reflected in their by-laws. 4.4 Dealings in Derivatives Dealing in derivatives is allowed in Andorra. However, since there is no stock market in the jurisdiction, this type of dealing is not commonly used as a strategy to acquire a company. 4.5 Filing/Reporting Obligations See 4.2 Material Shareholding Disclosure Threshold . 4.6 Transparency As there is no stock market in Andorra, all companies are private and there is no requirement to make known the purpose of an acquisition. The only sector where it is compulsory to request authorisation and, therefore, to disclose an acquisi - tion to the AFA, is the financial sector.
5. Negotiation Phase 5.1 Requirement to Disclose a Deal See 4.6 Transparency .
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