FRANCE Law and Practice Contributed by: Karl Hepp de Sevelinges, Nicolas Martin, Cyril Deniaud and Benjamin Cohu, Jeantet
eign investment laws. These regulations, such as those outlined in the French Monetary and Financial Code ( Code monétaire et financier ), can require prior authorisation for acquiring stakes as low as 10% of the share capital, in sectors deemed sensitive or strategic. See 2.3 Restrictions on Foreign Investments . 4.4 Dealings in Derivatives French legislation permits the use of derivatives, provided they adhere to the Market Abuse Regu - lation (MAR). Certain derivatives require disclosure when they allow the holder to either acquire target shares or voting rights at their discretion or gain an eco - nomic exposure equivalent to share ownership. This includes instruments like contracts for dif - ference, share swaps and those tied to a basket or index of shares. Notably, these economically- exposed derivatives are excluded from calcula - tions for mandatory tender offer thresholds. These requirements are designed to maintain transparency and regulatory compliance in derivatives transactions related to corporate activities. 4.5 Filing/Reporting Obligations In France, derivatives are subject to specific fil - ing and reporting obligations under securities and competition laws. These regulations aim to maintain market integrity and prevent anti-com - petitive behaviour. Securities Disclosure • Threshold reporting – derivatives that enable share acquisition or provide economic expo - sure must be disclosed when crossing certain thresholds (see 4.2 Material Shareholding Disclosure Threshold and 4.4 Dealings in Derivatives ).
• Intent declaration – certain threshold cross - ings require a notification of intent, in line with AMF guidelines and MAR. EMIR Compliance Derivatives transactions must adhere to the European Market Infrastructure Regulation (EMIR), which requires reporting, clearing and risk mitigation to ensure market transparency and reduce systemic risk. Competition Law Merger control – acquiring control via derivatives may trigger notifications under Articles L.430-1 to L.430-10 of the French Commercial Code and the EU Merger Regulation. 4.6 Transparency In France, shareholders crossing thresholds of 10%, 15%, 20%, or 25% in a company’s share capital or voting rights must disclose their intentions to the company and the AMF. See 4.2 Material Shareholding Disclosure Threshold and the discussion on the material shareholding disclosure threshold (notification of intent). 5. Negotiation Phase 5.1 Requirement to Disclose a Deal In France, disclosure obligations differ depend - ing on whether the target is a listed or non-listed company. For listed companies, the disclosure requirement is governed by the EU Market Abuse Regula - tion (MAR) (Regulation (EU) No 596/2014) and the AMF General Regulation. Any inside infor - mation – meaning specific, non-public informa - tion likely to significantly impact the price of the company’s securities – must be disclosed to the public as soon as possible (Article 17 MAR).
697 CHAMBERS.COM
Powered by FlippingBook