LIECHTENSTEIN Law and Practice Contributed by: Alexander Appel and Hemma Kohlfürst, Schurti Partners Attorneys at Law Ltd
Some requirements to inform or consult with the tar - get’s employees or employee representative body can apply, but a transaction cannot be stopped or pre - vented by any of these bodies, nor by labour unions. If an M&A transaction leads to a mass dismissal of employees in Liechtenstein, specific proceedings before the Office of Public Economics must be ini - tiated, aimed at mitigating the financial and social consequences for the respective employees. In addi - tion, internal decision-taking processes that involve a company’s employee representative body must be complied with. The recent amendment to the Persons and Compa - nies Act and the statutory rules on the participation of employees in the event of a cross-border merger of limited liability companies include further protec - tive measures, such as information and consultation rights, as well as participation rights for employees. 2.6 National Security Review There is no such review in Liechtenstein. 3. Recent Legal Developments 3.1 Significant Court Decisions or Legal Developments The FMA is publishing an increasing amount of guid - ance and decisions on landmark cases regarding transactions with regulated and supervised financial services providers. Conversely, relatively little case law regarding litigation before the courts has been published. Most recently, a landmark decision shed more light on the legal situation regarding defects in shareholder resolutions. This Liechtenstein court decision clearly distinguished between defects that render a resolution null and void and defects that merely give rise to a right to challenge the resolution as voidable. A void - able resolution remains effective until it is repealed by a court judgment. In contrast, a resolution that is null and void has no legal effect unless it is remedied. The decision also clarified that disputes concerning defects in shareholder resolutions can be made sub - ject to arbitration. An arbitration clause included in
the articles of association binds all shareholders, the company itself, and its corporate bodies. The implementation of Directive (EU) 2019/2121 regarding cross-border conversions, mergers and spin-offs will constitute the most significant legal development directly related to M&A transactions in Liechtenstein. The new provisions are expected to enter into force before the end of 2026. 3.2 Significant Changes to Takeover Law The Liechtenstein Takeover Act ( Übernahmegesetz ) is the result of the implementation of EU Directive 2004/25. Once this EU Directive is amended, the Takeover Act is expected to be amended accordingly. However, the Takeover Act was adjusted to implement Directive 2013/50/EU regarding the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market. 4. Stakebuilding 4.1 Principal Stakebuilding Strategies It is quite customary for a bidder to build a stake in the target prior to launching an offer, with large and insti - tutional investors frequently building stakes in targets that qualify as start-up companies. In such cases, stakebuilding strategies and the legal steps for the implementation are usually dealt with in a shareholder agreement that is entered into between the investor and the other shareholder. 4.2 Material Shareholding Disclosure Threshold The material shareholding thresholds and filing obli - gations predominantly depend on the specific area in which the transaction takes place. Under statu - tory law, there are specific disclosure thresholds for licensed financial service providers such as banks, insurers, asset managers, etc. Recently, these rules have been extended to investment firms and stock exchange operators. Typically, these thresholds are 10%, 20%, 30% and 50% of the share capital and of the voting rights. For listed companies, the disclosure thresholds set forth by the Disclosure Act ( Offenle - gungsgesetz ) apply. The Act also contains additional
762 CHAMBERS.COM
Powered by FlippingBook