Invest Europe welcomes publication of Prospectus Regulation

New EU reform set to improve access to public markets for growing companies.

Thousands of Europe’s growing companies could soon find it easier to raise finance on the public markets following new EU reform proposals published today, according to trade association Invest Europe.

Representing private equity, venture capital and infrastructure funds and their investors, Invest Europe – formerly called the European Private Equity and Venture Capital Association – welcomes the EU Commission’s draft revision of the Prospectus Regulation, which aims to alleviate the administrative burdens and costs for companies seeking to raise finance on Europe’s public markets.

Part of the Capital Markets Union action plan announced by EU Commissioner Lord Jonathan Hill in September, the revision is particularly focused on improving access to the stock markets for small and medium sized enterprises (SMEs) by:

• reducing barriers to cross-border investments

• cutting the cost of issuing new debt and equity

• offering simplified versions of the required prospectus documents

“Prospectuses should not act as a barrier for companies wanting to access the public markets,” said Dörte Höppner, Chief Executive of Invest Europe. “Currently many small and medium sized companies find it too costly to prepare these lengthy and complicated documents. The new regulation promotes simpler prospectuses, better tailored to the size of the company, which will help many more European businesses present themselves to potential investors.”

“Enabling European companies to access equity finance is a core objective of the Capital Markets Union, whether through a private equity investor or the public markets,” added Höppner. “This revision, one of its first official steps, will help more of the 5,100 European companies per year backed by private equity – of which 80% are SMEs - to get access to the stock markets.”

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