Requirement (MIFID)
Article 35 Transferable securities
Requirements MIFID - REGULATION (EC) No 1287/2006
Description
Description
1. Transferable securities shall be considered freely negotiable
for the purposes of Article 40(1) of Directive 2004/39/EC if they
can be traded between the parties to a transaction, and
subsequently transferred without restriction, and if all securities
within the same class as the security in question are fungible.
2. Transferable securities which are subject to a restriction on
transfer shall not be considered as freely negotiable unless that
restriction is not likely to disturb the market.
3. Transferable securities that are not fully paid may be
considered as freely negotiable if arrangements have been made
to ensure that the negotiability of such securities is not restricted
and that adequate information concerning the fact that the
securities are not fully paid, and the implications of that fact for
shareholders, is publicly available.
4. When exercising its discretion whether to admit a share to
trading, a regulated market shall, in assessing whether the share
is capable of being traded in a fair, orderly and efficient manner,
take into account the following:
(a) the distribution of those shares to the public;
(b) such historical financial information, information about the
issuer, and information providing a business overview as is
required to be prepared under Directive 2003/71/EC, or is
or will be otherwise publicly available.
5. A transferable security that is officially listed in accordance
with Directive 2001/34/EC of the European Parliament and of
the Council (1), and the listing of which is not suspended, shall be
deemed to be freely negotiable and capable of being traded in a
fair, orderly and efficient manner.
6. For the purposes of Article 40(1) of Directive 2004/39/EC,
when assessing whether a transferable security referred to in
Article 4(1)(18)(c) of that Directive is capable of being traded in a
fair, orderly and efficient manner, the regulated market shall take
into account, depending on the nature of the security being
admitted, whether the following criteria are satisfied:
(a) the terms of the security are clear and unambiguous and
allow for a correlation between the price of the security and
the price or other value measure of the underlying;
(b) the price or other value measure of the underlying is
reliable and publicly available;
(c) there is sufficient information publicly available of a kind
needed to value the security;
(d) the arrangements for determining the settlement price of
the security ensure that this price properly reflects the price
or other value measure of the underlying;
(e) where the settlement of the security requires or provides for
the possibility of the delivery of an underlying security or
asset rather than cash settlement, there are adequate
settlement and delivery procedures for that underlying as
well as adequate arrangements to obtain relevant information
about that underlying.
Comment
Applies to Article 40(1) of Directive 2004/39/EC