BOSNIA & HERZEGOVINA Law and Practice Contributed by: Bojana Bošnjak-London and Nebojša Marić, Marić & Co Ltd
3.2 Significant Changes to Takeover Law Mandatory takeover regimes remain regulated sepa - rately at entity and district levels. There have been no significant legislative amendments to takeover laws in the past three years. The regulatory framework remains stable, with estab - lished disclosure, mandatory offer and procedural requirements continuing to apply. 4. Stakebuilding 4.1 Principal Stakebuilding Strategies The capital market in Bosnia and Herzegovina remains relatively limited in size and liquidity. The number of actively traded joint stock companies is modest, and trading volumes are generally low. As a result, stakebuilding strategies are not commonly used as a standalone tactic. Where implemented, they are typi - cally employed to secure a strategic minority position ahead of a mandatory or voluntary takeover bid, or to strengthen governance influence in concentrated ownership structures. 4.2 Material Shareholding Disclosure Threshold Investors are required to disclose their holdings once they acquire 5% or more of a company’s shares, as well as upon exceeding or falling below certain thresh - olds (eg, 10%, 20%, 25%, 33%, 50% and 66.6% of voting rights). Acquisition of a controlling stake (25% or more in the Federation of Bosnia and Herzegovina or 30% or more in Republika Srpska) triggers an obli - gation to publish a mandatory takeover bid. 4.3 Hurdles to Stakebuilding Reporting and mandatory takeover bid thresholds are regulated by the applicable entity laws and therefore are not subject to separate regulation by the com - panies. There are strict prohibitions against trading based on non-public, material information, and insider trading. Further, share acquisitions must not involve deceptive practices or market manipulation. 4.4 Dealings in Derivatives The derivatives market in Bosnia and Herzegovina is underdeveloped and lacks a liquid, organised trad -
ing environment. While financial regulation continues to evolve in line with broader EU-alignment efforts, derivatives trading does not currently play a material role in public M&A activity. Accordingly, derivatives- based stakebuilding or complex synthetic acquisition
structures are not common in practice. 4.5 Filing/Reporting Obligations
In addition to statutory shareholding disclosure thresholds and mandatory takeover bid triggers, gen - eral securities and capital markets regulations apply to acquisitions of significant stakes in public com - panies. Investors must comply with ongoing disclo - sure obligations once relevant ownership thresholds are crossed. Insider trading prohibitions and market abuse rules also apply, ensuring transparency and market integrity. The regulatory framework is clear in terms of reporting triggers and procedural require - ments. 4.6 Transparency In Bosnia and Herzegovina, shareholders acquiring significant stakes in a company are subject to specific disclosure requirements, particularly when their hold - ings reach certain thresholds. While these regulations mandate the disclosure of share ownership, they do not explicitly require shareholders to declare the pur - pose of their acquisition or their intentions regarding control of the company. The regulatory framework does not explicitly mandate the disclosure of a potential merger or acquisition at the initial approach or during preliminary negotiations. However, certain obligations arise as the transaction progresses, such as merger notification, mandatory takeover bid notification, and regulatory procedures, among others. 5.2 Market Practice on Timing The rules and deadlines for disclosure are prescribed by the law and should be strictly adhered to. Fines may be applicable for non-compliance. 5. Negotiation Phase 5.1 Requirement to Disclose a Deal
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