October 2014
Duty of disclosure
for issuers of bonds
listed on the Oslo Børs and
Nordic ABM marketplaces
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
the original Norwegian document will apply
INTRODUCTION ...................................................................................................................................................... 5
1.
GENERAL ......................................................................................................................................................... 6
1.1
GENERAL COMMENTS ON THE CONTENT OF THE DUTY OF DISCLOSURE .................................................................... 6
1.1.1
Scope of the duty of disclosure ....................................................................................................... 6
1.1.2
Borrowers that also have shares or equity certificates listed on Oslo Børs/Oslo Axess .................. 6
1.1.3
What is covered by the duty of disclosure?..................................................................................... 7
1.1.4
Procedure for the publication of information, including sending information to Oslo Børs for
market surveillance and filing with the OAM ................................................................................................. 9
1.1.5
When does the borrower’s duty of disclosure first start? ............................................................. 12
1.1.6
Language ...................................................................................................................................... 12
1.1.6.1
1.1.6.2
1.1.7
2.
Language requirement for borrowers with stock exchange listed bonds ................................................. 12
Language requirement for borrowers with bonds listed on Nordic ABM ................................................. 13
General policy on information ...................................................................................................... 13
FINANCIAL REPORTING ................................................................................................................................ 15
2.1
MANAGEMENT OF FINANCIAL INFORMATION PRIOR TO ITS BEING MADE PUBLIC...................................................... 15
2.2
BORROWERS WITH STOCK EXCHANGE LISTED BONDS ......................................................................................... 16
2.2.1
Duty to publish an annual report .................................................................................................. 16
2.2.2
Publication of the annual report ................................................................................................... 17
2.2.3
Auditor’s report ............................................................................................................................. 18
2.2.4
Duty to produce interim reports ................................................................................................... 18
2.2.5
Publication of interim reports ....................................................................................................... 20
2.3
BORROWERS WITH BONDS LISTED ON NORDIC ABM......................................................................................... 21
2.3.1
Duty to publish an annual report .................................................................................................. 21
2.3.2
Publication of the annual report ................................................................................................... 22
2.3.3
Auditor’s report ............................................................................................................................. 23
2.3.4
Duty to produce interim reports ................................................................................................... 23
2.3.5
Publication of interim reports ....................................................................................................... 24
2.3.6
Scope for exemptions .................................................................................................................... 25
2.4
FINANCIAL CALENDAR ................................................................................................................................. 26
3.
INSIDE INFORMATION: DEFINITIONS AND EXAMPLES ............................................................................... 26
3.1
DEFINITION OF INSIDE INFORMATION ............................................................................................................. 26
3.2
“EXTERNAL CIRCUMSTANCES” THAT DIRECTLY CONCERN THE BORROWER .............................................................. 28
3.3
TIMING .................................................................................................................................................... 29
3.4
DELAYED PUBLICATION................................................................................................................................ 29
3.4.1
Minimum requirements for delayed publication .......................................................................... 29
3.4.2
Procedure for delaying publication ............................................................................................... 32
3.4.2.1
3.4.2.2
3.4.2.3
Information to be sent to Oslo Børs/Nordic ABM ..................................................................................... 32
Lists to be maintained in the event of delayed publication ...................................................................... 33
Routines for confidential management of inside information .................................................................. 34
3.5
DUTY OF NOTIFICATION WHEN PUBLICLY DISCLOSING PARTICULARLY PRICE SENSITIVE MATTERS .................................. 35
3.5.1
Presentations ................................................................................................................................ 35
3.6
BUDGETS AND FORECASTS ........................................................................................................................... 36
3.6.1
Budgets and forecasts for municipalities and county authorities ................................................. 36
3.6.2
Budgets and forecasts for other borrowers .................................................................................. 36
3.7
INVESTMENTS ........................................................................................................................................... 37
3.7.1
Matters to be taken into account ................................................................................................. 37
3.8
SPECIFIC MATTERS THAT WILL ROUTINELY REPRESENT INSIDE INFORMATION ........................................................... 39
3.8.1
Rating............................................................................................................................................ 39
3.8.2
Contracts and agreements............................................................................................................ 39
01.10.2014
Page 2 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
3.8.3
Entering into agreements that are of material significance for the borrower with one or more
subsidiaries ................................................................................................................................................... 40
3.9
EVENT OF DEFAULT IN RESPECT OF THE LOAN AGREEMENT .................................................................................. 41
3.10 MATTERS THAT MAY REPRESENT INSIDE INFORMATION AND MUST ACCORDINGLY ALWAYS BE ASSESSED WITH PARTICULAR
CARE
41
3.10.1 Changes in the borrower’s executive management, board of directors or key employees .......... 41
3.10.2 Change in a bank’s lending and deposit rates .............................................................................. 41
3.11 PLEDGES OF ASSETS AS COLLATERAL BY SUBSIDIARY COMPANIES .......................................................................... 41
4.
OTHER INFORMATION THAT MUST BE MADE PUBLIC ................................................................................ 42
4.1
MERGERS, DEMERGERS, SALES OF OR OFFERS FOR SUBSTANTIAL PORTIONS OF THE BORROWER’S ASSETS OR BUSINESS
ACTIVITY 42
CHANGE IN THE BORROWER’S OWNERSHIP STRUCTURE...................................................................................... 43
CHANGE IN THE BORROWER’S EQUITY ............................................................................................................ 43
CHANGE OF DEBTOR ................................................................................................................................... 44
CHANGE IN THE BORROWER’S REGISTERED NAME ............................................................................................. 44
CHANGE IN FORM OF INCORPORATION ........................................................................................................... 44
DECISIONS TO HALT PAYMENTS OR OPEN DEBT SETTLEMENT PROCEEDINGS (INCLUDING PRIVATE DEBT SETTLEMENT
PROCEEDINGS), RESOLUTIONS FOR VOLUNTARY DEBT SETTLEMENT, COMPULSORY DEBT SETTLEMENT, PUBLIC ADMINISTRATION OR
INSOLVENCY PROCEEDINGS ...................................................................................................................................... 45
4.8
TRADING BY THE BORROWER IN ITS OWN BONDS .............................................................................................. 46
4.8.1
Introduction .................................................................................................................................. 46
4.2
4.3
4.4
4.5
4.6
4.7
4.8.1.1
4.8.1.2
4.8.1.3
4.8.2
4.8.2.1
4.8.2.2
4.8.2.3
4.8.2.4
4.8.2.5
4.8.2.6
4.8.2.7
Trading represents inside information ...................................................................................................... 47
Borrower is in possession of inside information ....................................................................................... 47
Equal treatment ........................................................................................................................................ 48
Specific situations ......................................................................................................................... 48
The significance of whether the borrower’s level of activity is commonly known in the market ............. 48
Guidelines in the loan agreement ............................................................................................................. 49
Buy-back offers ......................................................................................................................................... 49
Large trades .............................................................................................................................................. 50
Switching between different maturity periods ......................................................................................... 51
Borrower’s consideration of specific bond lots ......................................................................................... 52
Trades in subordinated bonds and perpetual tier 1 bonds ....................................................................... 53
4.9
SUBSTANTIAL CHANGES IN THE OUTSTANDING AMOUNT OF A BOND LOAN ............................................................. 53
4.10 NEW LOANS.............................................................................................................................................. 53
4.11 CHANGE TO THE OVERALL LIMIT OF AN OPEN LOAN ........................................................................................... 54
4.12 CHANGES IN THE BORROWER’S HOLDINGS OF ITS OWN BONDS ............................................................................ 54
4.13 INTEREST RATE FIXINGS ............................................................................................................................... 55
4.14 EXERCISE BY THE BORROWER OF ITS RIGHT TO REDEEM BONDS (CALL) ................................................................... 55
4.15 EXERCISE BY INVESTORS OF THEIR RIGHT TO SELL BACK BONDS (PUT) .................................................................... 56
4.16 CHANGES TO THE LOAN AGREEMENT.............................................................................................................. 56
4.16.1 Changes to the loan agreement that must be made public by an announcement ....................... 56
4.16.2 Changes to the loan agreement that must be sent to Oslo Børs/Nordic ABM for information .... 57
4.17 CHANGE TO THE COLLATERAL FOR A LOAN ....................................................................................................... 57
4.17.1 Change to the collateral for a listed loan ...................................................................................... 57
4.18 INFORMATION TO BONDHOLDERS .................................................................................................................. 58
4.19 BONDHOLDERS’ MEETING ............................................................................................................................ 58
4.19.1 Notice calling a bondholders’ meeting ......................................................................................... 58
4.19.2 Resolutions passed by a bondholders’ meeting ............................................................................ 58
4.19.3 Minutes of a bondholders’ meeting .............................................................................................. 59
4.19.4 Particular requirements for convertible loans and loans where the yield is linked to the
performance of an underlying instrument .................................................................................................... 59
4.19.5 Conversion – requirements ........................................................................................................... 59
4.19.6 Changes in the conversion terms and conditions for convertible loans ........................................ 60
01.10.2014
Page 3 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
4.20
5.
CHANGES IN THE CHOICE OF LAW AND VENUE OF JURISDICTION FOR THE BORROWER ............................................... 61
INFORMATION TO BE PROVIDED TO OSLO BØRS AND/OR NORDIC ABM ................................................. 61
5.1
MINUTES OF A BONDHOLDERS’ MEETING ........................................................................................................ 61
5.2
CHANGE TO THE ISIN ................................................................................................................................. 62
5.3
CHANGE OF THE SECURITIES ACCOUNT OPERATOR AND PAYING AGENT FOR THE BORROWER ...................................... 62
5.4
NEW REPAYMENT PLAN IN THE EVENT OF A CHANGE IN OUTSTANDING VOLUME...................................................... 62
5.5
LISTING OR APPLICATION FOR LISTING OF BONDS ON ANOTHER REGULATED MARKET ................................................ 62
5.6
SUSPENSION OR REMOVAL FROM LISTING OF BONDS ON ANOTHER REGULATED MARKET ........................................... 63
5.7
CHANGES TO THE ARTICLES OF ASSOCIATION.................................................................................................... 63
5.7.1
Changes to the articles of association for borrowers with stock exchange listed bond loans ...... 63
5.7.2
Changes to the articles of association for borrowers with bond loans listed on Nordic ABM ...... 64
5.8
STATUS REPORTS FOR OPEN BOND LOANS ....................................................................................................... 64
5.9
FAILURE TO SATISFY THE CONDITIONS FOR LISTING ............................................................................................ 65
5.10 REGISTERING CHANGES IN COMPANY INFORMATION ......................................................................................... 65
01.10.2014
Page 4 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
Introduction
All borrowers that have bonds or certificates listed on Oslo Børs or Nordic ABM are subject to the duty of
disclosure. The objective of the duty of disclosure is to ensure that brokers and investors have sufficient
information to be able to determine a fair market price for the instruments in question. The rules on the duty
of disclosure are therefore directed at helping to ensure that all market participants are given simultaneous
access to price-relevant information in respect of the borrower and the instruments in question.
The question of what information represents information that is subject to the duty of disclosure can vary from
situation to situation, from borrower to borrower and between different loans. It can therefore be difficult in
some situations to determine what information must be made public. These guidelines are intended to help
issuers with bonds listed on Oslo Børs and Nordic ABM to understand which matters should be given particular
attention when considering whether the duty of disclosure applies to a particular situation.
The content of the duty of disclosure is set out in the Bond Rules and in the ABM Rules that apply to issuers of
1
bonds listed on Oslo Børs and Nordic ABM . More detailed commentary on certain areas is provided in Oslo
Børs circulars and in decisions and statements issued by Oslo Børs. The Oslo Børs rules, relevant legislation and
regulations, Oslo Børs circulars, Oslo Børs decisions and statements, etc. can be found on the Oslo Børs
website: http://www.oslobors.no/
In many areas, the rules on the duty of disclosure included in the Bond Rules for Oslo Børs and in the ABM
Rules are identical. Where there are differences between marketplaces, this is indicated in the relevant section
of the guide. The major area of difference relates to periodic financial reporting, where stock exchange listed
issuers report in accordance with IFRS while ABM listed issuers report in accordance with their national
accounting standards.
The fixed income market is developing all the time, and this has an impact on the duty of disclosure. Oslo Børs
therefore intends to update this document as and when necessary. New versions will be made available on our
website at www.oslobors.no and will also be distributed to borrowers with listed loans. We invite suggestions
on issues that interested parties would like to see addressed in this document, as well as any other comments
on the content of the guide. Please forward any suggestions or comments to the Listing Department.
Readers are asked to note that this guide is intended to provide general guidance and is not intended to be exhaustive in
its scope. Situations may arise that are subject to the duty of disclosure that are not addressed in this guide. Moreover,
where the guide refers in the text boxes in the introduction to each chapter to the relevant provisions of legislation or
regulation, the wording does not provide a complete or unedited statement of the relevant provisions of the legislation
or regulation. In the event of any discrepancy between the content of this guide and legislation, regulations pursuant to
legislation, the Bond Rules or the ABM Rules, the legislation, regulations or rules shall take precedence. Oslo Børs
reserves the right to decide that matters other than those described in this guide may be subject to the duty of
disclosure.
1
The Bond Rules incorporate to a large extent the provisions of the Securities Trading Act and the Securities Trading Regulations in respect
of the duty of disclosure, including the duty to disclose periodic information, because borrowers that have financial instruments listed on a
regulated market are subject to these statutory provisions. Nordic ABM is not a regulated market, but through the ABM Rules borrowers
that have fixed income issues listed on Nordic ABM are to a large extent subject to the same provisions in respect of duty of disclosure as
issuers listed on the Oslo Børs marketplace.
01.10.2014
Page 5 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
1.
General
1.1
General comments on the content of the duty of disclosure
1.1.1
Scope of the duty of disclosure
Requirement –
Oslo Børs and
Nordic ABM
The rules apply to issuers of bonds (“borrowers”) that either have bonds listed
on Oslo Børs/Nordic ABM or are applying to have bonds listed, including bonds
2
with an original maturity of less than 12 months ("certificates").
Borrowers that apply for bonds and/or certificates to be admitted to listing on Oslo
Børs/Nordic ABM are subject to a duty to disclose information to the market in
order to ensure that participants in the market can determine fair prices. This guide
provides a more detailed description of these rules.
References to “bonds” in this guide shall apply similarly to certificates unless
otherwise stated.
There are various exemptions from the rules described in this guide for borrowers
with stock exchange listed bond loans for which Norway is the host state, as well as
for borrowers with secondary listings of bond loans on Oslo Børs or Nordic ABM.
Borrowers in these categories are referred to Sections 4.3.3 and 4.3.6 of the Bond
Rules (Borrowers for which Norway is the host state) and to Sections 4.3.4, 4.3.5 and
4.3.6 of the Bond Rules and Section 4.3.2 of the ABM Rules (Borrowers with a
secondary listing), for further information on the exemptions that apply.
1.1.2
Borrowers that also have shares or equity certificates listed on Oslo Børs/Oslo Axess
Requirement –
Oslo Børs and
Nordic ABM
Borrowers that have shares or equity certificates listed on Oslo Børs/Oslo Axess as
well as bonds listed on Oslo Børs/Nordic ABM must comply with the rules on the
duty of disclosure for issuers of shares/equity certificates and the information rules
3
for bond loans.
Borrowers that also have shares or equity certificates listed on Oslo Børs/Oslo Axess
will, in principle, satisfy the duty of disclosure in respect of their listed bonds by
publicly disclosing information subject to the duty of disclosure in respect of their
shares or equity certificates. However, the way in which the duty of disclosure is
triggered will not always be the same, and it is therefore important to note that such
borrowers must comply with the rules on the duty of disclosure both in the
Continuing Obligations for listed companies and in the Bond Rules/ABM Rules.
Examples of information that is regulated by the Bond Rules/ABM Rules without
necessarily being regulated by the continuing obligations of listed companies include
information relevant for evaluating the borrower as an independent company (and
not solely for evaluating the group), information that applies to changes in the terms
and conditions for a specific bond loan (such as interest rate changes, changes in
borrower, early redemption, changes in guarantees etc.), as well as trading in the
borrower’s own bonds.
2
Cf. Bond Rules, Section 1.2 and ABM Rules, Section 1.2
Cf. Bond Rules, Section 1.2, ABM Rules, Section 1.2, Continuing obligations of stock exchange listed companies, Section 1.1 and
Continuing obligations of companies listed on Oslo Axess, Section 1.1
3
01.10.2014
Page 6 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
1.1.3
What is covered by the duty of disclosure?
Objectives for the duty of disclosure
The objectives for the duty of disclosure are as follows:
• To ensure correct pricing of the listed securities by ensuring that all inside
information is made public.
• To ensure equal treatment of investors by giving all investors simultaneous
access to inside information.
• To prevent insider trading by ensuring that no one can trade on the basis of
inside information that has not been made public.
Over the recent years, the market has become more professional, and is more active
in its pricing of credit. By complying with the duty of disclosure, a borrower helps to
maintain its cost of finance at the lowest possible level by reducing the level of
concern among investors over the possibility of “surprises” in respect of the
borrower. In addition, a high level of market confidence, attractive borrowers and
professional investors and brokers help to improve the market’s liquidity, which in
turn helps to reduce the cost of capital.
Matters that are included in the duty of disclosure can be divided into three
categories:
• Inside information
• Information that is subject to the duty of disclosure, including Information
that is subject to the duty to disclose periodic information
• Information to be provided to Oslo Børs/Nordic ABM
The following sections provide further commentary on the three categories.
Inside information
The main rule is that the borrower must, on its own initiative, immediately publish
4
inside information that directly concerns the borrower. As part of this requirement,
the borrower must in the same way publish information on changes in matters that
have previously been notified to the market. The question of which information is
affected by this requirement will vary from borrower to borrower, and will also
differ depending on the type of collateral pledged for a particular loan issue. In
general, the better the collateral pledged in the form of guarantees or the like, the
higher the threshold at which the price of listed bonds is affected by developments
affecting the borrower. However, no borrower is entirely free of the duty of
disclosure. It should also be noted that the wording of the Bond Rules/ABM Rules
represents a minimum requirement. Borrowers are entirely free to publish
information that is not necessarily inside information in itself, but is information that
the borrower believes should nonetheless be disclosed to brokers, investors and the
market in general.
The question of what information should be considered as inside information is
considered in greater detail in chapter 3.
4
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
01.10.2014
Page 7 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
Other information that is subject to the duty of disclosure
The Bond Rules and the ABM Rules also stipulate that various other types of
5
information must always be publicly disclosed by the borrower. These
requirements apply regardless of whether the matters in question are deemed to be
inside information. In the situations mentioned below, the borrower must, on its
own initiative, publicly disclose the information in question immediately the
relevant resolution is approved or the decision is made:
• Any changes in the rights attaching to the borrower’s loan, including
changes in terms or conditions that may indirectly affect the bondholder’s
legal status, in particular changes in borrowing terms or interest rates.
• The issue of new loans, including any guarantees or collateral provided in
6
that connection. The priority of any new loan must be stated .
• Proposals and resolutions by the borrower’s competent bodies on
corporate actions such as mergers, demergers, conversion and material
changes in the borrower’s equity capital.
• Sale of or offer for a substantial portion of the borrower’s assets or
business activity and the result of the offer.
• Any decision to halt payments, open debt settlement proceedings,
including private debt settlement proceedings, any resolution regarding
voluntary debt settlement, compulsory debt settlement, public
administration or insolvency proceedings on the part of the borrower.
• Substantial changes in the outstanding amount of the bond loan or the
borrower’s own holding in the loan. The announcement must include a new
repayment plan if the change is of significance in this respect.
• Any change to the overall limit of the loan.
• Factors of material importance as regards mortgaged or pledged items,
guarantees and other collateral furnished for the loan, including any new
valuation of a mortgaged or pledged item, as well as other factors with a
material bearing on the collateral.
• Factors of material importance as regards changes in the borrower’s
ownership structure.
• Resolutions passed by a bondholders’ meeting.
• Registered change of the borrower’s name.
• Buy-back offer sent to bondholders and the result of the offer.
• Changes in choice of law and venue of jurisdiction for the borrower.
• Financial reporting.
• Information distributed to bondholders.
These matters are described in more detail in chapters 2 and 4 of this Guide.
Information to be provided to Oslo Børs/Nordic ABM
In order to ensure that the marketplace has correct information, issuers are subject
to a duty to inform Oslo Børs/Nordic ABM of certain matters that are not included in
the duty to publicly disclose information to the market.
These matters are described in more detail in chapter 5 of this Guide.
5
6
Cf. Bond Rules, Sections 3.3, 3.4, 3.6 and ABM Rules, Sections 3.2.2, 3.2.3, 3.4
Does not apply to borrowers that only have fixed income issues listed on Nordic ABM.
01.10.2014
Page 8 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
1.1.4
Procedure for the publication of information, including sending information to Oslo Børs for market
surveillance and filing with the OAM
Requirement - Oslo
Børs
Information that is subject to the duty of disclosure must be made public in an
efficient and non-discriminatory manner. The information must be made public
without any charge to investors or potential investors in the bonds and through
media that shall to a reasonable degree ensure access to the information within
the EEA area. Publication shall to the greatest possible degree take place
simultaneously in Norway and other EEA states.
The borrower shall ensure that the information is sent to the media in a manner that
ensures secure communication, minimises the risk of interference and unauthorised
access and that gives certainty as to the source of the information. The information
shall be sent to the media in a manner that clearly identifies the borrower, the
content of the information and the date and time it is sent. In addition, it shall be
clearly stated that the information is subject to a duty of disclosure pursuant to
Section 5-12 of the Securities Trading Act or pursuant to the Bond Rules.
Annual and interim reports can be made public by giving notice in the media of the
website page on which the information is available. Such an announcement must
7
specify a website page other than Oslo Børs’ website.
Requirement- ABM
Information that is subject to the duty of disclosure must be made public in an
efficient and non-discriminatory manner. The information must be made public
without any charge to investors or potential investors in the bonds and through
media that shall to a reasonable degree ensure access to the information within
the EEA area. Publication shall to the greatest possible degree take place
simultaneously in Norway and other EEA states.
The borrower shall ensure that the information is sent to the media in a manner
that ensures secure communication, minimises the risk of interference and
unauthorised access and that gives certainty as to the source of the information.
The information shall be sent to the media in a manner that clearly identifies the
borrower, the content of the information and the date and time it is sent. In
addition, it shall be clearly stated that the information is subject to a duty of
disclosure pursuant to the ABM Rules.
The announcement shall state whom Nordic ABM can contact at the borrower in
respect of the announcement if this is someone other than the normal contact
person.
The borrower may provide a representative summary of the information in the text
of the announcement itself, with further information provided in an attachment
that is distributed through the company message system.
When publishing interim reports, figures may be presented as an attachment to
the announcement with a representative summary in the text of the
announcement. The financial accounts shall be submitted in pdf format as an
8
attachment to the announcement.
7
8
Cf. Bond Rules, Section 3.7.1
Cf. ABM Rules, Section 3.5
01.10.2014
Page 9 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
The borrower is itself responsible for ensuring that information subject to the rules
on duty of disclosure is published in accordance with the guidelines set out above.
Borrowers can purchase a service for this from Oslo Børs or other distributors. When
information is published through the Oslo Børs news service (Oslo Børs NewsPoint),
the announcement and attachments will simultaneously be filed in the officially
appointed mechanism (OAM), cf. further provisions below on the duty to file
information for issuers of stock exchange listed fixed income instruments. If a
borrower with securities listed on ABM uses a distributor other than Oslo Børs,
copies of all the information the company is required to publicly disclose must be
sent to Nordic ABM. Such copies of the information must be sent to Nordic ABM at
9
the same time as they are first publicly disclosed . The copies sent to Nordic ABM
shall be sent by publishing information on www.newsweb.no.
Publication of announcements to the market in accordance with the Bond Rules or
the ABM Rules outside the respective market’s trading hours must take place in a
satisfactory manner ensuring that the information becomes simultaneously and
generally available. The borrower can elect to wait to publish such information on
the next day before the market opens, but this is subject to the information
remaining confidential. It is not permissible to distribute information without
simultaneously publicly disclosing the information in the manner described in the
Bond Rules or the ABM Rules.
Filing with the OAM (officially appointed mechanism)
Requirement - Oslo
Børs
10
The borrower shall, simultaneously with the public disclosure of notifiable
11
information, send the information electronically to Oslo Børs for storage.
In addition to the requirements for notifiable information to be made public, such
information must also be sent to the officially appointed mechanism (OAM). The
Securities Trading Act nominates Oslo Børs as the OAM for borrowers that have
Norway as their home state. Borrowers that choose to use the Oslo Børs news
service (Oslo Børs NewsPoint)for the publication of information only need to send
each announcement to Oslo Børs once since the system will automatically file the
information with the OAM at the same time.
Borrowers for which Norway is the host state are subject to an equivalent duty to
send the information to the officially appointed mechanism in their home state.
The requirement for information to be sent to the OAM applies to the following
types of information:
12
• Announcements of price sensitive matters.
• Announcements required when the borrower suspects a leak of
13
information.
14
• Annual and interim reports.
• Change in the rights attaching to the borrower’s transferable securities,
including changes in terms or conditions that may indirectly affect the
9
Cf. ABM Rules, Section 3.5.1 (2)
The requirement to file information with the officially appointed mechanism (OAM) does not apply to borrowers on Nordic ABM.
11
Cf. Bond Rules, Section 3.7.2
12
Cf. Securities Trading Act, Section 5-2
13
Cf. Securities Trading Act, Section 5-3
14
Cf. Securities Trading Act, Section 5-4 et seq.
10
01.10.2014
Page 10 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
•
•
•
holder’s legal status, in particular changes in borrowing terms or interest
15
rates.
The issue of a new loan, including any guarantees or collateral provided in
16
that connection.
17
Proposals to change the articles of association.
18
Announcements of choice of home state.
When information is sent to the OAM, the entire document must be attached. This
means that it is not sufficient to send just a link to pages on the internet. This also
applies to the publication of financial information.
Making information available on the borrower's website
Requirement –
Oslo Børs and
Nordic ABM
Information that is published pursuant to the duty of disclosure must in addition be
made available on the borrower’s website after the information has been
published.
The borrower must not combine publication of information with marketing
19
material in such a manner that is likely to be misleading.
If the borrower does not have a website, it must set one up. The borrower is at
liberty to publish other information of interest to investors in addition to notifiable
information. It is a requirement that information remains available on the website
for as long as the content is current and relevant.
The following information should be made available on the website page:
•
•
•
•
Announcements to the market (and/or a link to the Oslo Børs News service
www.newsweb.no)
Annual reports
Interim reports
Prospectuses (subject to this being stated in the prospectus)
Format for attachments
Requirement –
Oslo Børs and
Nordic ABM
Attachments to announcements must be in Adobe Acrobat format (pdf).
Borrowers can use attachments when submitting notifiable information to the
company message system. This ensures that complete information can be rapidly
distributed to the market. Attachments must be in .pdf format. However, in view of
the need for the borrower to maintain control over the information distributed, it is
recommended that borrowers use pdf files that are protected against any changes
being made to the content. It is also recommended that files used as attachments
should never include links to internal documents that contain sensitive information.
15
Cf. Securities Trading Act, Section 5-8 third paragraph
Cf. Securities Trading Act, Section 5-8 fourth paragraph
17
Cf. Securities Trading Act, Section 5-8 sixth paragraph
18
Cf. Securities Trading Regulations Section 5-10
19
Cf. Bond Rules, Section 3.2.1.1 fifth paragraph, secon sentence and sixth paragraph, and ABM Rules, Section 3.5.1 sixth and seventh
paragraphs
16
01.10.2014
Page 11 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
Each announcement may include up to four attachments, with a maximum size of 50
MB per attachment.
It is recommended that all price sensitive information should be included in the
message field, with any attachment containing only supplementary information.
1.1.5
1.1.6
When does the borrower’s duty of disclosure first start?
Requirement –
Oslo Børs
The provisions on the borrower’s duty of disclosure in respect of inside information
shall apply to the borrower from the time the application for admission to listing is
20
submitted.
Requirement Nordic ABM
The provisions on the borrower’s duty of disclosure shall apply to the borrower
21
from the first day the borrower’s bonds are admitted to listing.
In common:
The rules that apply in respect of the prohibition on the misuse of inside
information, the duty of confidentiality, the duty to investigate, the duty to
maintain lists, etc. shall apply from the point in time at which the borrower first
becomes subject to the duty to disclose inside information.
Language
1.1.6.1 Language requirement for borrowers with stock exchange listed bonds
Requirement –
Oslo Børs
Issuers having Norway as their home state and whose transferable securities are
admitted to quotation solely on a Norwegian regulated market, shall disclose
information in Norwegian.
Issuers having Norway as their home state and whose transferable securities are
admitted to quotation both in Norway and in a host state shall disclose information in
Norwegian and, depending on the choice of the issuer, either in a language accepted
by the competent authority of the host state or in English.
Finanstilsynet may determine that an issuer as mentioned in the first and second
paragraphs may be exempted from the requirement to disclose information in
Norwegian. Finanstilsynet may delegate authority under the first sentence to a
regulated market.
Where securities with a denomination of at least EUR 100,000 or, in the case of bonds
in a currency other than the euro, with a denomination equivalent to at least EUR
100,000 on the date of issue, are admitted to trading on a regulated market in
22
Norway, the issuer shall disclose the information either in Norwegian or English.
The exemption for issuers of bonds with denomination per unit of at least EUR
100,000 also applies to issues of bonds with denomination per unit of at least EUR
50,000 that were admitted to listing prior to 31 December 2010.
20
Cf. Bond Rules, Section 2.7.2
Cf. ABM Rules, Section 1.2 first paragraph, second sentence
22
Cf. Securities Trading Act, Section 5-13 and related regulations and Bond Rules, Section 3.7.3
21
01.10.2014
Page 12 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
23
As a general rule, a borrower for which Norway is the home state must publish
information in Norwegian. If the borrower wishes to publish only in English, it must
seek an exemption from the requirement to publish in Norwegian.
The decision to grant such an exemption will be made in accordance with guidelines
laid down by Finanstilsynet (the Financial Supervisory Authority of Norway).
Finanstilsynet issued a Regulation dated 6 December 2007 on matters including the
delegation of the authority to grant exemptions from the language requirement.
Finanstilsynet has delegated the authority to grant such exemptions to Oslo Børs.
Finanstilsynet (the Financial Supervisory Authority of Norway) delegated the
authority to grant exemptions from the language requirement to Oslo Børs by
24
means of the Regulation of 6 December 2007 No. 1349 . Decisions on exemptions
from the requirement to publish information in Norwegian are decided in
accordance with the guidelines stipulated by Finanstilsynet. When deciding whether
to grant such exception, importance is attached to the investors for which the listed
instruments are intended. The application for exemption must provide information
in this respect, together with the proportion of foreign ownership as a percentage of
the total nominal value of the bonds issued. Consideration will also be given to how
onerous it is for the issuer to publish information in Norwegian in addition to other
languages, the issuer's working language, and whether the issuer was exempted
25
from the language requirement prior to the Regulation coming into force .
1.1.6.2 Language requirement for borrowers with bonds listed on Nordic ABM
Requirement –
Nordic ABM
1.1.7
Borrowers must provide information to the market in Norwegian, English, Danish or
26
Swedish.
General policy on information
Recommendation–
Oslo Børs and
Nordic ABM
The borrower should have a policy on information, and its policy should be well
communicated both within the borrower’s organisation and to the market.
It is not unusual for a borrower to receive requests for information from its own
employees, the media, brokers or investors. It is important that in such situations
the borrower has a clear understanding of which information can be released, taking
into account that it must not release inside information or other notifiable
information until such time as this information has been publicly disclosed to the
market in accordance with the requirements of the Securities Trading Act and the
Bond Rules or the ABM Rules.
A policy on information that is well communicated within the borrower’s
organisation will help to ensure that the borrower is consistent in its interaction
with market participants, and that information is handled internally in a secure and
23
The question of which borrowers have Norway as their home state is stipulated in the Securities Trading Act Section 5-4, and in the Bond
Rules, Section 4.3.1
24
Cf. Regulation of 6 December 2007 No. 1349 on submission of flagging announcements, publication of flagging announcements and
publication of notifiable trades, as well as delegation of authority to grant exemptions from the language requirements of the Securities
Trading Act. The Regulation came into force on 1 January 2008.
25
Explained in detail in Oslo Børs Circular No. 1/2008
26
Cf. ABM Rules, Section 3.5.4
01.10.2014
Page 13 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
proper manner. This helps to improve predictability, which can in turn help to
facilitate more attractive pricing of the borrower’s debt instruments.
A borrower’s policy on information should, at a minimum, include guidelines for the
following:
• Who should speak for the borrower when enquiries are received.
• What information can be released.
• Whether the borrower will comment on rumours.
• The manner in which information will be released (announcements to the
market, publication on the borrower’s website, e-mail, press releases etc.).
• An overview of which matters must always be deemed to be inside
information or other notifiable information and must therefore always be
disclosed first by an announcement to the market.
• Who shall be involved in evaluating whether information is inside
information or is subject to the duty of disclosure for other reasons.
• Who is responsible for ensuring that anyone external to the company who
has access to sensitive information has signed a confidentiality undertaking
and maintaining a register in this respect.
• Operating lists in respect of delayed disclosure of inside information, see
the commentary in section 3.4.
Information should be limited to as few people as possible prior to public disclosure.
Some borrowers enter into agreements with external parties for the publication of
notifiable information. This may, for example, involve contracting out publication to
a PR agency or the trustee for the bond loan.
Where the borrower decides to outsource the publication of notifiable information,
it nonetheless remains responsible for compliance with the duty of disclosure. If the
third party fails to publish the information in accordance with the relevant rules, the
borrower will be responsible to Oslo Børs/Nordic ABM for such failure. This is
because at the time the borrower applies for the bond loan to be admitted to listing,
it takes on the responsibility for compliance with the duty of disclosure.
Norwegian borrowers that also access the international capital markets are
recommended to publish all their announcements in both Norwegian and English.
Announcements of information made pursuant to the rules on duty of disclosure
must always be made first in the language that is compulsory for the borrower, cf.
Section 1.1.6. The borrower cannot delay making the required announcement to
wait for an English translation to be ready. Borrowers that wish to publish
information in both Norwegian and English are encouraged to prepare the two
announcements simultaneously so they can be published as close to the same time
as is practically possible and in accordance with the requirement for publication to
take place immediately. Simultaneous publication can, for example, be readily used
for publishing the accounts, notices of bondholder meetings, resolutions approved
at bondholder meetings, new loans etc.
Recommendation–
Oslo Børs and
Nordic ABM
01.10.2014
It is recommended that, at a minimum, the following information should be made
available on the borrower’s website:
• Financial calendar for the publication of the annual report and interim
reports
• Articles of association
• Information on the members of the borrower’s board of directors (or
Page 14 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
•
•
•
•
•
•
equivalent corporate body) and the executive management
List of the borrower's bond issues
Any prospectuses/listing documents the borrower has produced (and/or a
link to the relevant ticker(s) on the exchange’s website at www.oslobors.no)
A description of the borrower’s policy on corporate governance where the
borrower has such a policy
A description of the borrower’s policy on information in respect of the bond
market
Contact information for the borrower’s investor relations resources
A link to the exchange’s website for price information on the borrower’s
listed bond loans (www.oslobors.no).
See also the requirements stipulated at Section 1.1.4 above for information that the
borrower must provide on its website.
2.
Financial reporting
2.1
Management of financial information prior to its being made public
Requirement –
Oslo Børs and
Nordic ABM
The borrower shall ensure that no unauthorised person gains access to financial
27
information covered by the Bond Rules/ABM Rules prior to publication.
In addition to the requirements for the management of inside information, financial
information is subject to a duty of confidentiality until such time as it is published in
accordance with the requirements of the Bond Rules/ABM Rules. This applies
regardless of whether or not the financial information is considered to contain
inside information. This means that prior to publication the borrower must take
steps to limit access to this information, both in respect of its own employees and
externally. For example, the borrower must not disclose financial information to its
employees at staff meetings, through internal systems or in any other way unless
the information is simultaneously published in accordance with the rules on public
disclosure. In the same way, the borrower must not provide up-to-date information
to any external parties, including without limitation brokers, analysts, advisers,
journalists etc., unless the information is simultaneously published in accordance
with the rules on public disclosure.
Financial information may often represent inside information. If inside information
is in existence, the borrower has a duty to maintain lists of persons who have
received inside information, see Section 3.4.2.2 for further information this respect.
It may therefore be appropriate for borrowers to evaluate the processes involved in
preparing their accounts. This includes evaluating at which stage of this process it
becomes possible to form a view on the borrower’s financial situation and
considering which accounting data is typically material to or indicative of the
accounts being prepared since this data must be assumed to be inside information.
Taking steps to implement the recommendation will make it easier to identify which
individuals must normally be assumed to be insiders in respect of the borrower’s
accounts. Moreover, the process will help to identify at which stage of the process
inside information normally comes into existence.
27
Cf. Bond Rules, Section 3.6.1 and ABM Rules, Section 3.4.1
01.10.2014
Page 15 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
Financial information may also be subject to the duty of disclosure before the
accounts are formally approved. However, it would cause problems for the
borrower’s process of producing its accounts if the rules made it necessary to
disclose incomplete financial information. It is therefore assumed that financial
information should normally be exempt from the requirement for publication until it
is finally approved by the competent corporate body, normally the board of
directors.
2.2
Borrowers with stock exchange listed bonds
2.2.1
Duty to publish an annual report
Requirement - Oslo
Børs
The borrower must make public annual reports in accordance with Section 5-5 of
the Securities Trading Act and related regulations and in accordance with the
28
provisions laid down in the Bond Rules.
This requirement does not apply to a state, a public international body or
organisation of which at least one EEA state is a member, an EEA central bank or
the European Central Bank.
Consolidated accounts must be prepared in accordance with IFRS.
A borrower with stock exchange listed bonds and/or certificates must produce and
publish annual reports. The requirement to produce and publish annual reports also
applies to borrowers that only issue bonds with denomination per unit of at least
EUR 100,000, as well as to municipalities and county authorities. However, Oslo Børs
can grant exemptions for borrowers that only issue bonds with denomination per
29
unit of at least EUR 100,000 .
The annual report must include the following information:
• The audited annual accounts
• A management report (the directors’ report for the year)
• A statement by the persons responsible within the issuer, clearly stating
their names and job titles, to the effect that:
o to the best of their knowledge, the annual accounts have been
prepared in accordance with applicable accounting standards and
give a true and fair view of the assets, liabilities, financial position
and profit or loss of the borrower and the group taken as a whole
and that
o the management report includes a true and fair review of the
development and performance of the business and the position of
the issuer and the group taken as a whole, together with a
description of the principal risks and uncertainties that they face.
• Signed audit report
30
As a general rule, if the borrower produces consolidated accounts , the audited
annual accounts shall comprise consolidated accounts prepared in accordance with
28
Cf. Bond Rules, Section 3.6.2 first paragraph
Cf. Securities Trading Act, Section 5-4
Cf. Accounting Act, Section 3-2 third paragraph, national rules that implement the seventh Company Capital Directive 83/349/EEC of 13
June 1982 on consolidated accounts and equivalent rules in countries outside the EU
29
30
01.10.2014
Page 16 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
IFRS. The Securities Trading Act provides rules on exemptions at Section 5-5, third
paragraph.
The management report must be produced in accordance with the Norwegian
Accounting Act, Section 3-3a, or in accordance with national legislation that
implements Article 46 and 46a of Directive 78/660/EEC or the equivalent rules in a
country outside the EEA, and if the borrower is required to produce consolidated
accounts, in accordance with national legislation that implements Article 36 of
Directive 83/349/EEC or the equivalent rules in a country outside the EEA.
If a Norwegian borrower also prepares annual accounts in accordance with other
accounting principles, these accounts must also be published.
2.2.2
Publication of the annual report
Requirement - Oslo
Børs
The annual report shall be made public at the latest four months after the end of
each financial year. The borrower shall ensure that the annual report remains
publicly available for at least five years.
The annual report shall be made public immediately it has been approved by the
board of directors or equivalent corporate body. Oslo Børs may grant an
31
exemption from the first sentence if called for by special circumstances.
The annual report shall be made public immediately it has been approved by the
board of directors or equivalent corporate body, and in any case at the latest four
months after the end of the financial year. Accordingly, the borrower cannot wait to
publish the annual report until close to the end of the four-month deadline if it is
approved by the board at an earlier date. The proposed annual accounts and
management report must be approved by the board and must be published
immediately the board meeting has adopted a resolution to this effect. The board
must consider the annual report at a time that gives sufficient time for the report to
be published no later than four months after the end of the financial year.
When publishing annual and interim reports, the borrower must ensure that there is
no unnecessary delay over and above the time needed to prepare an announcement
and gather the necessary information. If the board meeting in question closes at a
time after the end of market trading hours at 16.00, the annual accounts and
management report must be published on the next day before the fixed income
market opens at 9.00. If the board meeting takes place on the last day of the period
permitted for public disclosure, the annual accounts and management report must
be published no later than 24:00 hours. The timing requirements are very important
since financial information must in the majority of cases be assumed to be price
sensitive information that is of great interest to the market. In order to ensure that
this kind of information does not spread through the market in a less than
appropriate manner, it is therefore important to have good procedures for prompt
publication.
Oslo Børs can exercise its discretion to grant exemptions from the requirement for
immediate publication following the board’s approval of the annual report if there
are special reasons so to do.
31
Cf. Bond Rules, Section 3.6.6
01.10.2014
Page 17 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
Oslo Børs applies a restrictive approach to granting such exemptions, and any
application from a borrower for such an exemption must explain why the borrower
is unable to publish the report immediately after its approval by the board of
directors or equivalent corporate body. It should be noted that no exemptions will
be granted from the requirement to publish the annual report no later than four
months after the end of the financial year.
The annual report shall be publicly disclosed as an attachment to a stock exchange
announcement. In addition to publication in this manner, the borrower shall ensure
that the annual report is publically available for at least five years on a website other
32
than the Oslo Børs website and the OAM website . The annual report can, for
example, be made available on the borrower's website.
Particular requirements on the annual report timetable for borrowers that are part
of a group
Requirement - Oslo
Børs
The requirements for the public disclosure of financial reports apply to every
borrower in the group.
As mentioned above, the annual accounts must be made public immediately they
have been approved by the borrower’s board of directors or equivalent
33
corporate body. As a general rule, this means that a borrower cannot delay the
publication of the accounts for one of the borrowers in its group to wait for the
accounts of the other group companies to be ready for publication. Such
publication can only be delayed if the specific criteria for delayed disclosure are
satisfied, see section 3.4 of this guide. In order to ensure simultaneous
publication, the borrower must strive to ensure that the companies that make up
the group hold their board meetings in such a way that the lapse of time
between the various meetings passing their resolutions is kept to a minimum.
Meetings could, for example, be held on the same day, or could be arranged so
that one meeting closes after the end of trading on one day and the next meeting
is held before the start of trading on the next trading day.
2.2.3
Auditor’s report
Requirement - Oslo
Børs
2.2.4
If the auditor cannot give a ‘clean’ report on the borrower’s annual accounts, or if a
competent corporate body has material objections to the board’s proposal for the
annual accounts and management report, the borrower must announce this
34
immediately.
Duty to produce interim reports
Requirement - Oslo
Børs
The borrower must make public a half-yearly report for the first six months of the
financial year in accordance with Section 5-6 of the Securities Trading Act and
related regulations and in accordance with the provisions laid down in the Bond
35
Rules.
This requirement does not apply to a state, a public international body or
32
The OAM for Norway is www.newsweb.no
Cf. Bond Rules, Section 3.6.6 second paragraph
Cf. Securities Trading Act, Section 5-5 fifth and seventh paragraphs
35
Cf. Bond Rules, Section 3.6.2 second paragraph
33
34
01.10.2014
Page 18 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
organisation of which at least one EEA state is a member, an EEA central bank or
the European Central Bank. In addition, this requirement does not apply to a
borrower founded prior to 1 July 2005 that only issues bond loans guaranteed by
36
the Norwegian state and listed on a regulated market.
A borrower with stock exchange listed bonds or certificates must produce and
publish half-yearly reports. The requirement to publish half-yearly reports also
applies to borrowers that issue bonds with denomination per unit of at least EUR
100,000 and to municipalities and county authorities. However, such borrowers may
37
seek to be exempt from the requirement to publish half-yearly reports .
A borrower incorporated before the Prospectus Directive came into force (1 July
2005) that only issues a bond loan or loans guaranteed by a Norwegian municipality
or county authority and listed on a regulated market, can apply to be exempted
from the requirement to publish half-yearly reports.
A half-yearly report must include the following information:
• The condensed set of financial statements (half-yearly accounts)
• An interim management report (half-yearly report by the board)
• Statements by the persons responsible within the issuer, clearly stating
their names and job titles, to the effect that
o to the best of their knowledge, the half-yearly accounts have been
prepared in accordance with applicable accounting standards and
give a true and fair view of the assets, liabilities, financial position
and profit or loss of the borrower and the group taken as a whole
and that
o to the best of their knowledge, the interim management report
includes a fair review of the information mentioned in the next
bullet point
• Important events that have occurred during the six month period, and their
impact on the half-yearly accounts, together with a description of the
principal risks and uncertainties for the next six month period.
If the borrower is under a duty to publish consolidated accounts, the half-yearly
38
report must meet the following requirements:
• The condensed balance sheet and the condensed profit and loss account
shall show each of the headings and subtotals included in the most recent
annual accounts of the borrower. Additional line items shall be included if,
as a result of their omission, the half-yearly accounts would give a
misleading view of the assets, liabilities, financial position and profit or loss
of the borrower. In addition, comparable balance sheet and profit and loss
information shall be provided for the same period in the preceding financial
year.
• The explanatory notes shall include sufficient information to ensure the
comparability of the condensed half-yearly accounts with the annual
accounts. The notes shall also be sufficient to allow a user to gain a proper
understanding of any material changes in amounts and of any
developments in the half-year period concerned that are reflected in the
balance sheet and the profit and loss account.
36
Cf. Bond Rules, Section 3.6.4 first paragraph
Cf. Bond Rules, Section 3.6.4 third paragraph
38
Securities Trading Regulations, Section 5-4
37
01.10.2014
Page 19 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
•
•
The half-yearly accounts shall include information on operating revenue
and operating profit analysed by business area and for the same period in
the preceding financial year. Where necessary, such figures shall be
restated to the same accounting standard in order that they are
comparable.
The half-yearly accounts shall include information that is of material
relevance to evaluating the company’s financial situation. The company
shall provide information on all particular factors that have had an effect on
its activities and earnings in the accounting period, including seasonal
variations and the effect these have had on the half-yearly result.
In certain circumstances, a borrower may wish to publish an interim report that has
not been considered by the board of directors. In such a case, this must be made
clear in the announcement.
There is no requirement for interim reports to be audited. If an audit report or
opinion has been given in respect of a limited scope audit of the half-yearly report,
this must be published together with the half-yearly report. If no audit report or
opinion has been given in respect of a limited scope audit of the half-yearly report,
this must be clearly stated in the half-yearly report.
2.2.5
Publication of interim reports
Requirement - Oslo
Børs
The half-yearly report shall be made public as soon as possible after the end of the
relevant period, but at the latest two months thereafter.
The borrower shall ensure that the half-yearly report remains available to the
39
public for at least five years.
The half-yearly report shall be made public immediately it has been approved by the
board of directors or equivalent corporate body, and in any case at the latest two
months after the end of the accounting period. Accordingly, the borrower cannot
wait to publish the half-yearly report until close to the end of the two-month
deadline if it is approved by the board at an earlier date. The board must consider
the half-yearly report at a time that gives sufficient time for the report to be
published no later than two months after the end of the accounting period.
The half-yearly report shall be publicly disclosed as an attachment to a stock
exchange announcement 40. In addition to publication in this manner, the borrower
shall ensure that the half-yearly report is publically available for at least five years on
41
a website other than the Oslo Børs website and the OAM website . The half-yearly
report can, for example, be made available on the borrower's website.
Oslo Børs does not insist that borrowers produce their half-year reports in printed
form.
39
Cf. Bond Rules, Section 3.6.5 first paragraph
In accordance with the duty to file information with the officially appointed mechanism, cf. Bond Rules, Section 3.7.2
41
The OAM for Norway is www.newsweb.no
40
01.10.2014
Page 20 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
Requirement - Oslo
Børs
If the borrower prepares an interim report for a period shorter than six months,
this report shall be made public in accordance with Section 3.7 of the Bond Rules
42
no later than at the same time the information is made public in another manner.
If the borrower chooses to produce, for example, quarterly reports, these must not
be distributed to employees in general, or to selected business connections or made
available on the borrower’s website until the report has been published in
accordance with the Bond Rules. This applies to the extent that the borrower
produces an interim report for a period shorter than six months and these reports
are made available to a wider audience than the borrower’s executive management
and employees in the accounting and finance function who are naturally involved in
producing such figures. Borrowers are free to choose how frequently they wish to
issue reports in excess of the minimum requirement.
2.3
Borrowers with bonds listed on Nordic ABM
2.3.1
Duty to publish an annual report
Requirement Nordic ABM
The borrower must make public annual and interim reports and accounts in
accordance with the relevant accounting legislation and the provisions laid down in
the ABM Rules.
A borrower with bonds listed on Nordic ABM must produce annual reports. This
requirement does not apply to a state, a public international body or organisation
of which at least one EEA state is a member, an EEA central bank or the European
Central Bank.
Foreign borrowers may present the annual accounts and management report in
accordance with the home state’s accounting rules in the absence of any
requirements to the contrary pursuant to the Norwegian Accounting Act.
The annual report must include the information set out in Section 3.4.3 of the ABM
Rules.
Nordic ABM expects borrowers to follow the provisions of the Accounting Act and
other relevant legislation, as well as relevant legal regulations, when preparing their
annual accounts and management report.
The definition of foreign borrower applies to all borrowers that are not Norwegian
borrowers, regardless of whether the borrower has its registered office within or
outside the EEA area.
If the borrower is required to prepare annual reports in accordance with the
requirements for content specified by the Accounting Act, the borrower shall satisfy
such requirements and this will be deemed to be sufficient to satisfy the ABM Rules
in this respect.
In the case of other borrowers, the annual report must include:
• The audited annual accounts
• A management report (the directors’ report for the year)
42
Cf. Bond Rules, Section 3.6.5 second paragraph
01.10.2014
Page 21 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
•
•
•
2.3.2
A statement by the persons responsible within the issuer, clearly stating their
names and job titles, to the effect that
o to the best of their knowledge, the annual accounts have been
prepared in accordance with applicable accounting standards and
give a true and fair view of the assets, liabilities, financial position
and profit or loss of the borrower and the group taken as a whole
and that
o the management report includes a true and fair review of the
development and performance of the business and the position of
the issuer and the group taken as a whole, together with a
description of the principal risks and uncertainties that they face.
Consolidated accounts if consolidated accounts are produced
Audit report
Publication of the annual report
Requirement Nordic ABM
The annual report shall be made public at the latest four months after the end of
each financial year. The annual report shall be made public immediately it has been
approved by the board of directors or equivalent corporate body.
The borrower shall ensure that the annual report remains publicly available for at
least five years, subject to the borrower continuing to have bonds listed on Nordic
43
ABM.
If a Norwegian borrower also publishes its annual accounts in accordance with
other accounting principles, these accounts must be published by an
44
announcement to the market.
The annual report shall be made public immediately it has been approved by the
board of directors or equivalent corporate body, and in any case at the latest four
months after the end of the financial year. Accordingly, the borrower cannot wait to
publish the annual report at the end of the four-month deadline if it is approved by
the board at an earlier date. The board must consider the annual report at a time
that gives sufficient time for the report to be published no later than four months
after the end of the financial year. The borrower must therefore take this deadline
into account when planning the timetable for meetings of the board.
When publishing annual and interim reports, the borrower must ensure that there is
no unnecessary delay over and above the time needed to prepare an announcement
and gather the necessary information. If the board meeting in question closes at a
time after the end of market trading hours at 16.00, the annual report must be
published on the next day before the fixed income market opens at 9.00. The timing
requirements are very important since financial information must in the majority of
cases be assumed to be price sensitive information that is of great interest to the
market. In order to ensure that this kind of information does not spread through the
market in a less than appropriate manner, it is therefore important to have good
procedures for prompt publication.
43
44
Cf. ABM Rules, Section 3.4.7
Cf. ABM Rules, Section 3.4.8 first paragraph
01.10.2014
Page 22 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
The annual report shall be published as an attachment to a stock exchange
announcement, and in addition the borrower must ensure that it remains publicly
available for at least five years.
2.3.3
Auditor’s report
Requirement –
Nordic ABM
If the auditor has determined that the accounts cannot be approved as they stand
or if the auditor has issued a qualified audit report or made comments or
clarifications in the report, this must be made public as soon as the audit report is
received by the borrower.
If the corporate assembly or supervisory board has raised any material objections
to the board’s proposal for the annual accounts or management report, or if the
general meeting does not approve the annual accounts or management report,
45
this must be made public immediately after the proceedings have closed.
2.3.4
Duty to produce interim reports
Requirement Nordic ABM
A borrower with bonds listed on Nordic ABM shall prepare a half-yearly report or
tertial reports. This requirement shall not apply to a state, a public international body
or organisation of which at least one EEA state is a member, an EEA central bank or
the European Central Bank. Nordic ABM may grant exemptions from the requirement
for half-yearly reports for a borrower that only issues bonds with denomination per
unit of at least EUR 100,000 and for regional or local authorities of a state.
Foreign borrowers may present interim reports in accordance with the home
state’s accounting rules in the absence of any requirements to the contrary
46
pursuant to the Norwegian Accounting Act.
The interim report shall contain the information specified in Section 3.4.4 of the
ABM Rules.
A borrower with a listed bond loan must at a minimum produce half-yearly reports
or tertial reports. Norwegian municipalities and county authorities can apply to be
exempted from the requirement to produce interim reports. Such borrowers must
explain in the application why they do not wish to prepare and publish interim
reports. The same provisions apply to issues of bonds with denomination per unit of
at least EUR 100,000.
Borrowers are only required to prepare a half-yearly report for the first six months
of the year unless the borrower publishes tertial interim reports.
If the borrower is subject to a requirement to produce interim reports with specific
content requirements pursuant to regulations issued in connection with the
Accounting Act, the borrower shall comply with such requirements and this will be
accepted as satisfying the requirements of the ABM Rules. 47
For all other borrowers, the interim report must include the following information:
• The condensed set of financial statements (interim accounts)
45
Cf. ABM Rules, Section 3.4.8 third and fourth paragraphs
Cf. ABM Rules, Section 3.4.3 (2)
47
Cf. ABM Rules, Section 3.4.5 (4)
46
01.10.2014
Page 23 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
•
•
•
•
2.3.5
An interim management report (interim report by the board)
Statements by the persons responsible within the issuer, clearly stating
their names and job titles, to the effect that
o to the best of their knowledge, the interim accounts have been
prepared in accordance with applicable accounting standards and
give a true and fair view of the assets, liabilities, financial position
and profit or loss of the borrower and the group taken as a whole,
and that
o the interim management report provides a true and fair review of
the development and performance of the business, and the
position of the borrower and the group taken as a whole, together
with a description of the principal risk uncertainties that they face.
The interim accounts shall at least contain a condensed balance sheet, a
condensed profit and loss account and explanatory notes to these
accounts.
The interim management report shall at least include an indication of
important events that have occurred during the accounting period and
their impact on the interim accounts, together with a description of the
principal risk and uncertainties for the next accounting period.
Publication of interim reports
Requirement –
Nordic ABM
The half-yearly or tertial report shall be made public as soon as possible after the
48
end of the relevant period, but at the latest two months thereafter.
The borrower shall ensure that the interim report remains available to the public
for at least five years, subject to the borrower continuing to have bonds listed on
49
ABM.
If the borrower produces interim reports more frequently than the minimum
requirement, these reports must be made public in accordance with Section 3.5 of
the ABM Rules no later than at the same time as they are made publicly available
50
in any other manner.
If a Norwegian borrower also prepares interim accounts in accordance with other
accounting principles, these accounts must also be published by an announcement
51
to the market.
If an auditor’s report or a statement in respect of a limited scope audit is issued in
respect of the interim report, the borrower must publish such report as soon as it
52
is available.
An interim report shall be made public immediately it has been approved by the
board of directors or equivalent corporate body, and in any case at the latest two
months after the end of the accounting period. Accordingly, the borrower cannot
wait to publish an interim report at the end of the two-month deadline if it is
approved by the board at an earlier date. The board must consider the interim
48
Cf. ABM Rules, Section 3.4.6 first paragraph, first sentence
Cf. ABM Rules, Section 3.4.6 first paragraph, second sentence
50
Cf. ABM Rules, Section 3.4.6 second paragraph second sentence
51
Cf. ABM Rules, Section 3.4.8 second paragraph
52
Cf. ABM Rules, Section 3.4.8 second paragraph
49
01.10.2014
Page 24 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
report at a time that gives sufficient time for the report to be published no later
than two months after the end of the accounting period.
The borrower must take the deadline mentioned above into account when planning
the timetable for meetings of the board. The borrower should normally not expect
to be granted permission to delay the publication of financial information because
the necessary board meeting has been held too late.
The interim report shall be published as an attachment to a stock exchange
announcement, and in addition the borrower must ensure that it remains publicly
53
available on the borrower's own website for at least five years.
In certain circumstances, a borrower may wish to publish an interim report that has
not been considered by the board of directors. In such a case, this must be made
clear in the announcement. There is no requirement for interim reports to be
audited. If an audit report or opinion has been given in respect of a limited scope
audit of the half-yearly report, this must be published as soon as it is available.
Nordic ABM does not insist that borrowers produce their interim reports in printed
form.
Requirement –
Nordic ABM
If the borrower prepares interim reports for other periods in addition to half-yearly
reports or tertial reports , these reports shall be made public at the same time as
54
they are made public in another manner.
If the borrower chooses to produce, for example, tertial reports, or quarterly reports
in addition to or instead of half-yearly reports, such reports must not be distributed
to employees in general, or to selected business connections or made available on
the borrower’s website until the report has been published in accordance with the
ABM Rules. This applies to the extent that the borrower produces interim report for
a shorter period than six months and these reports are made available to a wider
audience than the borrower’s executive management and employees in the
accounting and finance function who are naturally involved in producing such
figures. This also applies to municipalities and county authorities if they report more
frequently than the minimum requirement. Borrowers are free to choose how
frequently they wish to issue reports in excess of the minimum requirement
2.3.6
Scope for exemptions
Nordic ABM may grant exemptions from the requirements to produce and publish
annual and interim reports and from the related provisions if called for by special
55
circumstances. Nordic ABM applies a restrictive approach to granting such
exemptions. In considering such exemptions, Nordic ABM will take into account
inter alia the way in which the rules on exemptions for borrowers with stock
exchange listed bonds are applied.
53
Cf. ABM Rules, Section 3.5.1 second paragraph
Cf. ABM Rules, Section 3.4.6 second paragraph
55
Cf. ABM Rules, Section 3.4.9
54
01.10.2014
Page 25 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
2.4
Financial calendar
Recommendation –
Oslo Børs and
Nordic ABM
Borrowers are recommended to publish a financial calendar showing the dates
planned for publication of the annual and interim reports.
Borrowers are recommended to publish a financial calendar before the end of the
first month of each financial year. The announcement should state when the
borrower plans to publish its annual report and interim reports, as well as dates for
other significant events such as the annual general meeting, meeting of the
committee of representatives etc. If it subsequently proves necessary to change any
of the dates, this should be notified to the market by issuing a new announcement.
3.
Inside information: definitions and examples
3.1
Definition of inside information
Requirement –
Oslo Børs and
Nordic ABM
The borrower must, on its own initiative, as soon as possible publish inside
information that directly concerns the borrower.
Inside information refers to precise information about the bonds, the issuer of the
bonds or other matters that is likely to influence the price of the bonds or related
financial instruments appreciably and which is not publicly available or commonly
known in the market.
Precise information refers to information that indicates that one or more
circumstances or events have arisen or occurred, or can reasonably be expected to
arise or occur, that are sufficiently specific to lead to the conclusion that such
circumstance or event may have an affect on the price of the bonds or related
financial instruments.
Information that is likely to influence the price of the bonds or related financial
instruments appreciably refers to information that a reasonable investor would be
56
likely to use as part of the basis for investment decisions.
The general rule is that the borrower must, on its own initiative, as soon as possible
publish inside information that directly concerns the borrower. A number of the
matters addressed in this chapter relate to this requirement, and hence to the
definition of inside information.
Information that is publicly available or commonly known in the market will not
represent inside information. However, the situation should not be confused with a
leak of information in relation to delayed disclosure, cf. section 3.4.1, where there is
normally a requirement for the borrower to issue an announcement immediately.
It is also a requirement that for information to be inside information it must be
“precise”, i.e. that it relates to one or more circumstances or events that have
occurred or may occur that are sufficiently specific to lead to the conclusion that
they may have an effect on the price of the borrower’s bonds or related financial
instruments. The term “precise” is intended to exclude rumours, speculation and
general market expectations. It will not usually be problematic for a borrower to
56
Cf. Bond Rules, Section 3.2.1.1 first to fourth paragraphs and ABM Rules, Section 3.2.1.1 first to fourth paragraphs
01.10.2014
Page 26 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
determine whether a particular matter relates to an actual situation, or represents
unfounded speculation or rumours. Moreover, the wording makes clear that it is
sufficient that the information “indicates” that one or more circumstances or events
have arisen or occurred, which means that there is no requirement that information
must be complete or unconditional so long as it is sufficient to draw a conclusion
that it may have an effect on prices. This may typically be the case in negotiations
situations ("step-wise processes") where precise information may come into
existence long before the parties have reached agreement on a final form of formal
agreement. Accordingly a single step in a step-wise process may represent precise
information in itself. However, the criteria for an "appreciable" influence must also
be satisfied if information is to represent inside information. There are accordingly
two criteria that must be evaluated separately.
The starting point for the test of whether information is likely to influence the price
of the bonds or related financial instruments “appreciably” is whether a reasonable
investor would be likely to use the information as part of the basis for investment
decisions.
This evaluation must be carried out in advance, i.e. it is not dependent on whether
the matter in question does actually affect prices. The decision should take into
account previous experience of the impact that information of the kind in question
might have on prices if it becomes known on the market.
The question of whether information is inside information must be based on the
specific circumstances of the case in question.
It can be difficult to evaluate whether there is inside information, particularly in
relation to situations that develop over time. Typical examples are the negotiation
of major or strategically important contracts, mergers and acquisitions.
Intermediate developments in a step-wise process may in themselves represent
inside information that is subject to the duty of disclosure. Accordingly, each
intermediate development on the path towards the final event (which may be
entering into an agreement or some other decision) must be assessed separately in
order to determine whether information about such a development represents
inside information. Such intermediate developments may include the start of
negotiations, entering into a "non-disclosure agreement", board level decisions on
the 'in principle' basis for negotiations, instructing external advisers, arranging
financing etc.
Important factors when considering whether inside information has arisen in such
circumstances will be:
• Whether there is a realistic possibility that the final event will occur. If this
is the case, and the final event would in itself be subject to the duty of
disclosure, then it will typically be the case that inside information has
come into existence. However, it is also important to note that even if
there is no realistic possibility of the final event occurring, information
about intermediate developments may in itself represent inside
information that is subject to the duty of disclosure. In this situation,
consideration should be given to the anticipated impact of information on
the intermediate steps seen in the context of the totality of the borrower's
activity.
01.10.2014
Page 27 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
•
When evaluating whether information may be price sensitive for the
borrower's bonds, consideration must also be given to other variables
relating to the price of the borrower's bonds that may affect their market
price, including the contents of the loan agreement, bond pricing,
collateral, etc. If information about the intermediate developments is of
sufficient importance and character to indicate that a reasonable investor
would be likely to use the information as part of the basis for investment
decisions, then the duty of disclosure comes into effect.
The problem of information that develops over time and gradually gains a greater
degree of certainty has particular relevance to financial information. Financial
accounts take some time to produce, and individuals who have access to the
information during this period will be able to see the outline of the results before
the accounts are finalised. Once such financial information is sufficiently complete
to be classed as “precise information” it will, in principle, trigger the duty of
disclosure if it deviates from the company’s understanding of the market’s
expectations to such an extent that it will have a “appreciable” effect on prices. This
may mean that the duty of disclosure can arise before the accounts are approved by
the board. In such cases, the company must make this information public unless it
meets the conditions for delaying such publication. However, in such circumstances
the conditions for delaying disclosure will normally be satisfied, except where it is
apparent that the results will differ significantly from market expectations and the
company has itself contributed to these expectations.
Attention is drawn to section 2.1 in respect of the management of financial
information prior to publication.
Borrowers that elect to create expectations in the market by providing 'guiding'
must pay particular attention when preparing their financial accounts since in these
circumstances the borrower will have a general duty to disclose any material
57
changes to information that has been made public previously.
3.2
“External circumstances” that directly concern the borrower
The duty of disclosure only arises if the inside information in question “directly
concerns” the borrower. This includes matters that take place in the borrower or
that are, to a greater or lesser extent, generated by the borrower.
However, it is possible to envisage situations in which matters that arise externally
to the borrower but relate directly to the borrower, or that relate directly to some
other borrower, may be assumed to directly concern the borrower. This will typically
relate to matters that are outside the borrower’s control, but that may nonetheless
be assumed to directly concern the borrower.
Legal proceedings against the borrower, judgements involving major payments in
connection with environmental damage, insurance claims, tax disputes, decisions on
patents and decisions on granting licences are all examples of matters that are
outside the borrower’s control but may nonetheless give rise to inside information.
It is also possible that decisions notified by the official authorities, such as granting a
57
Cf. Further commentary in Finanstilsynet's consultation document of 14 January 2005, Section 3.2.2.4, and Oslo Børs Circular No. 4/2003
on companies' handling of comments on future prospects.
01.10.2014
Page 28 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
licence, or the borrower’s response to such decisions in the form of an appeal or
launch of legal proceedings, may be inside information.
In addition, decisions by the authorities to grant licences to competitors rather than
to the borrower, and rulings that affect the borrower’s business partners and/or
competitors, are also examples of matters that may be inside information for the
borrower to the extent that they have a direct effect on the borrower.
The specific evaluation of whether such information is also inside information must
be considered in the light of what factors affect the economic situation in general or
a particular industry. Examples of this may include changes in raw material prices or
in the general level of interest rates. Such matters fall outside the definition of inside
information.
The definition of information that “directly concerns” is not intended to limit the
scope of the duty of disclosure to exclude circumstances that arise in subsidiary
companies or in other companies that may have appreciable influence on the price
of the borrower’s listed bonds. If the subsidiary company has issued listed bonds in
its own right, matters that the subsidiary makes public will not be subject to a duty
of disclosure for the parent borrower, since the information will then already be
publicly available or generally known in the market.
3.3
Timing
Requirement –
Oslo Børs and
Nordic ABM
The borrower must, on its own initiative, immediately publish inside information that
58
directly concerns the borrower.
The requirement that the borrower must, on its own initiative, immediately publish
inside information means that the borrower must publish this type of information
without any unnecessary delay. In principle, inside information should be released
to the market immediately it is received by, or becomes apparent to, the borrower.
This means that the borrower must have routines and procedures in place that
enable it to manage the disclosure of inside information to the market as soon as it
arises.
The requirement implies that, as a general rule, the borrower cannot delay the
publication of such information to a later date for its own reasons. The borrower
cannot, for example, delay publishing information until it has informed its own
employees or until it holds a press conference. There are provisions for the
borrower to delay publication of inside information in certain circumstances, subject
to satisfying specific cumulative conditions and the information being treated as
inside information. This is described in more detail in section 3.4.
3.4
Delayed publication
3.4.1
Minimum requirements for delayed publication
Requirement –
Oslo Børs and
Nordic ABM
58
The borrower may delay the public disclosure of information that is subject to the
duty of disclosure, in order not to harm its own legitimate interests, provided that
59
the public is not misled by the delay and the information is kept confidential.
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
01.10.2014
Page 29 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
In general, the duty to disclose information requires that when a borrower becomes
aware of or should be aware of inside information it must publish this information,
“on its own initiative as soon as possible”. However, a borrower may delay
publishing notifiable information in certain circumstances.
It is important to note that borrowers are not under any duty to delay public
disclosure even if the conditions for such delay are satisfied.
In order to delay the public disclosure of notifiable information in accordance with
this provision, the borrower must satisfy three cumulative conditions:
- it must be the case that immediate public disclosure will prejudice the
borrower’s legitimate interests;
- the delay must not be likely to mislead the public; and
- the borrower must be able to ensure the confidentiality of the information in
question.
These conditions are discussed at greater length in the following sections.
It is for the borrower to decide whether these conditions are satisfied, and any such
delay will only be permissible for as long as the conditions continue to apply. Once
the conditions cease to apply, the borrower has a duty to publish the information on
its own initiative and as soon as possible.
The borrower must carefully weigh the need for confidentiality against the market’s
need for information. The scope to delay the public disclosure of information is
intended to be restrictive. In many cases, both the borrower and the market will be
better served by immediate public disclosure of the information in question.
Oslo Børs will not question the borrower’s evaluation of the situation when it
receives notice of a decision to delay public disclosure. However, if it is subsequently
found that the conditions for delayed publication were not satisfied, the borrower
may be subject to sanctions.
If the borrower has grounds to believe that information for which publication is
being delayed has become known to an unauthorised party, or there is an imminent
risk of this happening, the borrower must on its own initiative and as soon as
possible publicly disclose the information to the market. The borrower cannot delay
publishing information in such a situation since it can no longer satisfy the
requirement that the information is kept confidential.
Public disclosure will prejudice the borrower’s legitimate interests
The first condition that must be satisfied if public disclosure is to be delayed is that
immediate public disclosure will prejudice the borrower’s legitimate interests. This
requires an evaluation of the balance between the market’s need for information
and the borrower’s need for secrecy. There must be a clear balance in favour of the
borrower’s needs in order for the duty to disclose information to be delayed.
The Bond Rules and the ABM Rules repeat the examples of typical legitimate
interests provided in the Securities Trading Act:
59
Cf. Bond Rules, Section 3.2.1.2 first paragraph and ABM Rules, Section 3.2.1.2 first paragraph
01.10.2014
Page 30 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
•
Negotiations in course, or related elements, where the outcome or normal
pattern of those negotiations would be likely to be affected by public
disclosure. This is particularly relevant for negotiations in a situation where
the financial viability of the borrower is in grave and imminent danger,
although not within the scope of the applicable insolvency law, in which
case public disclosure may be delayed for a limited period where such
disclosure would seriously jeopardise the interests of existing and potential
bondholders by undermining the conclusion of specific negotiations
designed to ensure the long-term financial recovery of the borrower.
•
Decisions taken or contracts made which need the approval of another
body of the borrower in order to become effective due to the organisation
of the borrower, provided that public disclosure of the pending decision or
contract together with the simultaneous announcement that final approval
is still pending would jeopardise the correct assessment of the information
by the public.
This accordingly relates to situations where the organisation of the borrower is the
reason that an agreement or contract cannot be made public immediately and it is
not sufficient to delay publication by agreeing with the counterparty that
information shall not be made public. Moreover, there must be a genuine possibility
that the other corporate body involved will not approve the agreement. If the
agreement required is no more than a formality, then in principle the conditions for
delaying publication will not be satisfied.
The examples provided above are not exhaustive, hence other matters may also be
deemed to be legitimate interests.
Delay must not mislead the public
The second condition for a delay in making information public is that the delay will
not mislead the public. Any delay in disclosing inside information to the market will
by definition mislead the market in one way or another since it represents a failure
to provide the market with full information. The requirement that the delay will not
mislead the public must therefore be assumed to refer to a more qualified form of
misleading than that caused by a normal delay in disclosing information.
In general, the borrower cannot choose to delay publishing certain elements of the
information at its disposal if this will cause the announcement of the rest of
information to be misleading. The condition can also typically apply to restrict the
scope for delaying making information public in situations where the market has
justifiable expectations that a particular situation will occur at a certain time, for
example on the basis of information already provided, but where changes take place
that cause the information already known by the market to become incorrect. In
such situations, even if the borrower has legitimate reasons to delay the publication
of information about the changes, it will not be permitted to delay publication.
It must be possible to keep the information confidential
The final condition to be satisfied for a delay in making information public is that the
information can be kept confidential, i.e. that there is no danger of the information
being leaked. This condition must be seen in conjunction with the duty of
01.10.2014
Page 31 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
60
confidentiality that applies to everyone in possession of inside information. The
borrower does, to some extent, have direct control over the risk that inside
information falls into the hands of unauthorised persons. Important factors for the
risk of a leak of information are the degree to which information is price sensitive,
the number of individuals with access to information and who they are, as well as
the period of time over which the disclosure is delayed. The borrower is responsible
for ensuring that inside information is only made available to persons with an
absolute need for the information or who have a justifiable need for access, and that
confidentiality is maintained at all times.
If there is a leak of information, the borrower must on its own initiative and as soon
as possible publicly disclose the notifiable information to the market. The scale or
extent of the leak is irrelevant in this respect. The borrower has no right to delay
informing the market if information has leaked or if there is a risk of this happening.
The borrower’s duty is to make the information public on its own initiative and as
soon as possible. In such circumstances there may also be grounds to contact the
market surveillance function at Oslo Børs in respect of the possibility of a matching
halt to trading in anticipation of an announcement by the borrower.
3.4.2
Procedure for delaying publication
3.4.2.1 Information to be sent to Oslo Børs/Nordic ABM
Requirement –
Oslo Børs and
Nordic ABM
The borrower must, on its own initiative, promptly give notice to Oslo Børs/Nordic
ABM of any delay in disclosing information, including the background for the
decision to delay publication. This notification shall be given to the Surveillance and
Operations Department of Oslo Børs. The duty to notify Oslo Børs does not apply
61
to the delayed publication of financial information in interim reports.
If the borrower decides to delay the public disclosure of notifiable information, the
borrower must on its own initiative promptly notify Oslo Børs of this decision.
Notification may be given either in writing or verbally.
It is important that notification of a decision to delay publication is not confused
with other announcements to the market when it is sent to Oslo Børs. Notifications
sent in writing or by e-mail should therefore be addressed to the Surveillance and
Operations Department of Oslo Børs at moa@oslobors.no. The heading of the
message must be "Information subject to delayed publication". The borrower should
consider using encryption for the e-mail to be sent, and must take steps to ensure
that the e-mail has been received by Oslo Børs. Alternatively, the Surveillance and
Operations Department of Oslo Børs can be contacted by telephone on +47 22 34 19
11.
Regardless of how the information is submitted, the following requirements must be
observed:
• It must specify which bond issue(s) are affected.
• It must include a brief description of the event or circumstance that is
subject to the duty of disclosure and the background for the decision to
delay publication.
• It must indicate the period for which publication will be delayed.
60
61
Cf. Securities Trading Act, Section 3-4.
Cf. Bond Rules, Section 3.2.1.2 third paragraph and ABM Rules, Section 3.2.1.2 third paragraph
01.10.2014
Page 32 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
•
It must state the contact person and his or her telephone number.
3.4.2.2 Lists to be maintained in the event of delayed publication
Requirement –
Oslo Børs and
Nordic ABM
The borrower must ensure that a list is drawn up of persons who are given access
62
to inside information in accordance with Section 3-5 of the Securities Trading Act.
The Securities Trading Act sets out rules on the duty of confidentiality and the
management of inside information. The borrower must not disclose inside
information to unauthorised persons. Everyone who receives inside information is
subject to a duty of confidentiality, and the borrower must have routines to ensure
the secure handling of inside information, cf. below.
The borrower has a duty to maintain a list of persons who are given access to inside
information. Examples of the categories of people that may need to be included on
the list include the borrower’s employees, members of the board, the trustee for
the loan, parties to negotiations, the auditor, legal advisers, external consultants,
financial advisors, etc.
If a person given access to inside information is a legal entity, the list shall include
those of the entity’s employees, elected officers assistants etc. who are given access
to the information.
The list must be set up as soon as the inside information is made available to any
person, and the borrower has a duty to keep the list up-to-date. Anyone who is
given access to inside information during the course of a process must be added to
the list. Anyone who is given a verbal or written account of the matter becomes an
insider, but it is also the case that a person who in legal terms may become aware of
the matter in some other way must also be included on the list. This would include,
for example, an employee who has access to the information through the
company’s IT systems.
While the borrower may delegate the practical task of maintaining and updating the
list to a third party, the borrower remains responsible for maintaining the list
correctly.
The list must include information on the following:
• The identity of persons with access to the inside information.
• The date and time the person was given access to such information.
• The person’s office or employment.
• The reason the person is included on the list.
• The date on which the list was prepared and the date of any change to the
list.
Oslo Børs has issued a document that provides a summary of the provisions in the
63
Securities Trading Act that relate to handling inside information . This document
provides an example of a list of persons given access to inside information, as well as
an example of an e-mail that can be sent to recipients of inside information. The
62
Cf. Bond Rules, Section 3.2.1.3 fourth paragraph, first sentence and ABM Rules, Section 3.2.1.3 fourth paragraph
References to the Securities Trading Act do not apply to borrowers that only have fixed-income issues listed on Nordic ABM. In this
instance, borrowers are referred to the equivalent provisions in the ABM Rules at Section 3.2.1.3 and Section 3.3.
63
01.10.2014
Page 33 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
document is available on the Oslo Børs website at:
http://www.oslobors.no/ob_eng/Oslo-Boers/Regulations/The-Issuer-Rules/Insideinformation-list-example
The list must be securely stored for at least five years from the date it is prepared or
last updated. It is therefore not permissible to delete names from the list because
the inside information they have received has been published or ceases to be
relevant.
The borrower must ensure that persons given access to inside information are
aware of the duties and responsibilities this involves, as well as the criminal liability
associated with misuse or unwarranted distribution of such information. The
borrower must also ensure that persons are informed when they are no longer in an
insider position. The borrower must be able to satisfy Finanstilsynet that persons
given access to inside information are aware of their duties and responsibilities.
If Oslo Børs so requests, the borrower shall send a copy of the list to Oslo Børs
without delay. Similarly, the list must be sent to Finanstilsynet upon request.
Anyone who receives inside information is subject to a duty of confidentiality. Oslo
Børs is entitled to demand that the borrower, its officers and employees provide
such information to Oslo Børs as it may need to perform its statutory duties
notwithstanding this duty of confidentiality. Any such demand must be made in
writing and include the reasons for the demand.
3.4.2.3 Routines for confidential management of inside information
Requirement –
Oslo Børs and
Nordic ABM
The borrower must have routines in place to ensure that inside information is kept
64
confidential.
In order to ensure that no unauthorised party gains access to inside information
before it is made public, the borrower must have routines in place to maintain the
confidentiality of the information. In this context, unauthorised parties will include
investors (small, large, existing, potential), investment analysts, brokers, members of
the press, employees and other possible categories. Such parties are unauthorised
because they are not in the category of persons that have a genuine need for the
information or that need it to carry out their duties.
It should be noted that the requirement to have routines in place is an absolute
requirement, and is not dependent on when inside information may come into
existence. The reason for this is partly to ensure that inside information does not
find its way to unauthorised parties, and partly to ensure that everyone who might
receive inside information is fully aware of how it must be managed.
This means that the borrower must establish internal routines to ensure that inside
information is stored and communicated in a satisfactory manner. The borrower
should make arrangements to ensure that the storage of case documents, access to
databases, copying, archiving, document destruction, internal mail, use of e-mail
etc. takes place in a manner that ensures that price sensitive information does not
come into the possession of unauthorised parties. Furthermore, specific information
64
Cf. Bond Rules, Section 3.2.1.3 third paragraph and ABM Rules, Section 3.2.1.3 third paragraph
01.10.2014
Page 34 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
and issues should not be discussed in public places such as restaurants etc., nor
should they be discussed with employees in general.
The manner in which a borrower handles inside information has an impact on the
quality of the market and accordingly on market liquidity. The way in which
information is handled both internally and externally may also have an impact on
the borrower's reputation in the market.
3.5
Duty of notification when publicly disclosing particularly price sensitive matters
Requirement –
Oslo Børs and
Nordic ABM
If the borrower, at any time during the exchange’s opening hours, is to publicly
disclose information on specific matters that must be assumed to have a significant
effect on the price of its bonds, it must contact the Surveillance and Operations
65
Department of Oslo Børs prior to making such public disclosure.
The borrower has a duty to contact the Surveillance and Operations Department at
Oslo Børs before publishing any information during the market’s opening hours if
the announcement includes information on specific matters that must be assumed
to have a material effect on the price of its bonds. It should be noted that the duty
to give this prior notice is subject to a high threshold, and only applies to
information of a particularly price sensitive nature, and only information that is
made public during the market’s opening hours. The purpose of requiring such
advance notice is to allow Oslo Børs to consider whether to implement a matching
halt/trading halt in connection with the announcement in order to give investors the
opportunity to read the information and avoid a situation in which trades take place
at unfair prices. The advance notification can be given verbally by telephone.
3.5.1
Presentations
Requirement –
Oslo Børs and
Nordic ABM
The borrower must not publicly disclose inside information at presentations that
has not been made public by issuing an announcement either prior to the
66
presentation or, at the latest, at the same time as the presentation.
Borrowers may need from time to time to hold presentations about the borrower or
about events related to the borrower. This may typically involve presentations of
the borrower’s results, presentations in connection with the issue of a new bond
loan, etc. It is a requirement that the borrower does not make public at such
presentation any inside information that has not previously been made public. If the
borrower does intend to publicly disclose new, price sensitive, information at such a
presentation, it must publicly disclose this information in accordance with the
requirements for public disclosure by issuing an announcement no later than at the
same time as the presentation starts.
Recommendation –
Oslo Børs and
Nordic ABM
65
66
It is recommended that the content of a presentation made available to market
participants should be published no later than at the same time as the
presentation starts, regardless of whether or not the presentation includes
information that is new to the market.
Cf. Bond Rules, Section 3.2.1.4 and ABM Rules, Section 3.2.1.4
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
01.10.2014
Page 35 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
The background for this recommendation is to avoid any speculation of unequal
treatment of investors by the borrower. It is clearly beneficial for the borrower to
ensure that the same information is available to everyone.
3.6
Budgets and forecasts
3.6.1
Budgets and forecasts for municipalities and county authorities
Requirement –
Oslo Børs and
Nordic ABM
Municipalities and county authorities must make public any details of the annual
budget that may be deemed to be inside information at the latest at the same time
67
as the budget as a whole is made available to the public.
If any details of the budget represent inside information, the borrower must publish
this information at the latest at the same time as the budget is made available to the
public. Examples of such information are revenue, operating costs, investment
spending and how investment is to be financed (for example by sales of real estate,
shares, issuing new loans etc.).
3.6.2
Budgets and forecasts for other borrowers
Requirement –
Oslo Børs and
Nordic ABM
Budgets and forecasts that represent inside information must be made public.
Recommendation –
Oslo Børs and
Nordic ABM
It is recommended that access to information on budgets and forecasts is only
made available to a restricted core of the borrower’s employees.
68
Budgets and forecasts may be affected by factors that indicate a change in strategy,
cut backs, expansion or other changes in the borrower’s activities. If this is the case,
it is typically this information that is inside information, and not the budget itself.
To the extent that budgets and forecasts are considered to represent inside
information, the borrower will only be able to delay publication of this information if
it can satisfy the requirements for delayed publication, see section 3.3. If the
borrower does make a decision to delay publication, individuals with access to this
information will be prohibited from trading in the borrower’s securities. In addition,
the borrower must maintain lists at all times of the individuals with such access.
Budgets, forecasts, etc. will normally be of interest to investors, investment analysts
etc. If the borrower makes public such expressions of its future expectations, this
can readily be seen as a form of guiding in respect of future earnings. The
expectations established amongst those with access to such information will be
shaped by the borrower, and in the event of any material deviations from the
forecasts and budgets it has published, the borrower must consider on a case-bycase basis whether it has a duty to issue an announcement.
Oslo Børs is also of the view that granting access to such information selectively
without publishing it to the market as a whole may be seen as a breach of the
67
68
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
01.10.2014
Page 36 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
provisions on equal treatment, good stock exchange practice and good business
practice.
Moreover, the Bond Rules and the ABM Rules stipulate that whenever the borrower
wishes to make information available to individual investors or to all investors, any
such announcement to investors must be submitted to the exchange at the same
time as information is made public, and there are specific rules for this procedure.
While it cannot be assumed that budgets and forecasts always represent inside
information, there are a number of related issues that dictate that this form of
information should in any case be kept confidential.
3.7
Investments
Requirement –
Oslo Børs and
Nordic ABM
The borrower must make public information on investments that are likely to
69
influence the price of the borrower’s bonds.
Investments made in connection with mergers, demergers or acquisitions are dealt
with in section 4.1, and are not considered in this section.
The duty of disclosure in respect of investments is based on the general rule for
public disclosure of matters that are likely to influence the price of the borrower’s
bonds. Examples of such investments may be agreements that trigger a duty to
purchase, investments in shares or other securities, purchases of real estate, orders
for ships, investment spending as part of an internal strategy or increased
investment in on-going projects.
The question of whether, and if so when, inside information comes into existence is
determined by the underlying reality of the investment situation. A number of small
investments carried out over a shorter period may in aggregate represent inside
information, even if none of the investments in isolation is necessarily likely to
influence the price of the borrower’s bonds. Furthermore, it is important that the
borrower considers the commercial reality and the inside information aspect of an
investment that relates to a commitment that is not reflected in the borrower’s
balance sheet. Examples in this respect may include investments made in the form
of leasing contracts, and derivatives contracts.
If the duty of disclosure has been triggered, the borrower shall publish information
about the circumstances in question on its own initiative without delay. In the case
of investments, this will typically be at the time the decision is made to carry out the
investment.
3.7.1
Matters to be taken into account
The evaluation of whether information about investments represents inside
information requires a factual and comprehensive evaluation that takes into
account a number of matters. It is not the case that the duty of disclosure is only
triggered if the information will have a large effect on the borrower’s bonds. The
duty of disclosure may be triggered even if only a smaller price change may result
from investors becoming aware of the particular investments.
69
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
01.10.2014
Page 37 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
The following paragraphs point out a number of such matters. The list of matters
mentioned is not exhaustive, but includes some typical matters that may be
significant. It should be noted that the borrower must carry out a comprehensive
review of each case and ask itself “can it be envisaged that individual investors
might price the bonds differently if they were aware of the investment?” If the
answer is yes, the information must be communicated to the market.
Market expectations
The borrower should have an opinion of what information the market expects to
receive and what are the current market expectations in terms of its level of
investment and strategies/strategic direction. In general terms, smaller investments
that the borrower carries out as part of its normal business operations will often not
have the characteristics of notifiable information, so long as other factors such as
size or intention do not suggest otherwise. However, a borrower that seldom invests
must expect to give greater consideration to the duty of disclosure question when it
makes an investment decision. The reason for this is that information on investment
decisions may have a larger effect on the price of its bonds than would be the case
for a borrower in a business where investments are part of its normal daily activities.
Previous announcements and communications with the market also tend to create a
need for continuing information and create certain expectations that the borrower
must recognize. For example, an industrial borrower will typically have a higher
threshold for the duty of disclosure in respect of investments than would apply to a
borrower in other sectors such as the banking sector. This is because an industrial
company's activities will often be based around and be dependent on investments in
a quite different way to the activities of a bank.
Size
The size of an investment should be seen in relation to the size of the borrower. This
may mean that an investment triggers the duty of disclosure even though it is part
of the borrower’s normal business activities. This is because a large investment may
have an effect on the borrower’s creditworthiness. However, the size of the
investment in isolation will not always be the determining factor, since in some
cases a smaller investment may send important signals on future prospects, future
plans, positioning or strategy.
Reason for the investment
The borrower’s decision to undertake a certain investment may have its background
in a strategic choice made by the borrower, positioning in relation to competitors both existing and potential, or some other factors. It should be noted that the
particular reasons for the investment decision might in themselves trigger the duty
of disclosure. An investment that is outside what is normal for the borrower and/or
what the borrower has indicated in the past may say something about the
borrower’s view of future prospects, competitors, market situation etc. It may also
be the result of a strategic decision, for example a decision to enter a new market or
invest in new products. Investment decisions may often be evidence of an
underlying view on fundamental strategic choices.
Type of investment
The sensitivity of the borrower’s financial instruments to information depends to a
large extent on the industry or sector in which the borrower operates. The question
of which investment decisions may trigger the duty of disclosure is also specific to
individual borrowers. In other words, it is difficult to make comparisons or provide
specific guidance that will apply to all borrowers. However, some investments, such
01.10.2014
Page 38 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
as a decision to establish a new subsidiary with special objectives, will always be
based more on long-term strategic considerations than a decision to buy shares
simply on the basis of their attractiveness as a financial investment.
3.8
Specific matters that will routinely represent inside information
This section provides a non-exhaustive list of circumstances and events that will
routinely represent inside information that is subject to the duty of disclosure, and
70
also provides some commentary in this respect.
The borrower must always carry out an independent and specific assessment of
whether one or more circumstances have arisen, or can reasonably be expected to
arise, that are likely to influence the price of its bonds appreciably and are therefore
subject to the duty of disclosure.
3.8.1
Rating
Some borrowers have official ratings that apply in general to the borrower’s shortterm and long-term funding, or that apply to specific bond loans issued by the
borrower. These ratings are given following a dialogue between the borrower and
the rating agency whereby the borrower instructs the rating agency to evaluate the
borrower’s creditworthiness. Such ratings differ from unsolicited ratings, where an
external entity publishes an opinion on a borrower's creditworthiness on its own
initiative.
Official ratings, i.e. ratings that are prepared following a dialogue between the
borrower and the rating agency and/or as a result of the borrower's instructions to
71
the rating agency, may represent inside information and are therefore information
that the borrower has a duty to disclose to the market. This duty applies both when
the borrower is first given a rating and in circumstances where a rating agency
subsequently decides to change the borrower’s rating.
Recommendation–
Oslo Børs and
Nordic ABM
3.8.2
Oslo Børs recommends that borrowers disclose information about official credit
ratings to the market, and that this should also apply in circumstances where the
rating is not considered to be inside information.
Contracts and agreements
Most borrowers enter into contracts from time to time as a normal part of their
business. The size and content of such contracts will vary, and this in turn will have
an effect on whether the borrower should disclose them to the securities market.
Entering into new contractual arrangements that are of a strategic character or that
may be assumed to be of greater significance for evaluating the borrower’s future
earnings will routinely represent inside information that is subject to the duty of
disclosure. The announcement shall contain sufficient information for the market to
evaluate the significance of the contract for the pricing of the borrower’s bonds.
If the borrower enters into a number of smaller contracts over a period that would
not individually trigger the duty of disclosure, but which in aggregate are of material
significance or represent a strategic change, the overall effect may represent inside
70
71
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
01.10.2014
Page 39 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
information and accordingly be subject to the duty of disclosure. A change to a
contractual relationship or the end of a contractual relationship that is not expected
by the market may, if the information is inside information, also be subject to the
duty of disclosure.
In some cases, entering into a contract may also represent an investment. An
example of this would be a contract to acquire patents or licences. It may also be
the case that entering into an agreement or contract brings with it an assumption of
future investment on an appreciable scale in order to achieve the expected benefit.
If the scale of investment can be estimated with certainty at the time the agreement
is entered into, this would in itself suggest that the duty of disclosure may be
triggered. Further comments on investment can be found in section 3.7.
The signing of certain agreements may be of such great strategic significance for the
borrower that the agreement is for this reason inside information. Examples of this
may be agreements on public-private co-operation, joint ventures, etc. This may
also apply to signing letters of intent that are of strategic significance. Some
industries attach greater interest and importance than others to news of
agreements signed/orders received. The duty of disclosure will be triggered more
readily for a borrower in these industries, particularly in respect of signing new
contracts. Industries where this is the case include shipbuilding and the rig industry.
As discussed in section 3.1 above, the time when the disclosure obligation arises will
depend on the specific circumstances of the case in question.
3.8.3
Entering into agreements that are of material significance for the borrower with one or more
subsidiaries
If the borrower is part of a group, it is not unusual for the borrower to be the parent
company of the group and for a major part of the business activities to be carried
out by subsidiaries. In this section the term ‘borrower’ is used to indicate the
company that is the debtor for the listed bond loan(s). If the borrower enters into an
agreement or agreements with one or more subsidiaries, and the agreements are of
material significance, this will normally be information that is subject to the duty of
disclosure. Examples of such agreements may include pledging assets in the
subsidiary companies as collateral for borrowing taken up by the borrower,
agreements to transfer assets or liabilities between the borrower and subsidiaries,
guarantees that the borrower provides for debt issued by subsidiaries or guarantees
that subsidiaries provide for debts taken up by the borrower. This list is not
exhaustive.
It is not unusual for subsidiaries to make up a significant proportion of the group’s
overall value. If the borrower should experience financial problems during the life of
the bond loan, the net worth of subsidiaries may indirectly represent supplementary
asset cover for bondholders. In order to allow investors to evaluate the availability
of this supplementary asset cover, it is recommended that the borrower should
issue an announcement if any of its subsidiaries pledge their assets as collateral,
regardless of whether the collateral is pledged in favour of the parent company or in
favour of external lenders.
01.10.2014
Page 40 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
3.9
Event of default in respect of the loan agreement
The loan agreement for a specific bond loan specifies the events of default for the
loan. If the borrower is in default of any of the conditions of the loan, this will
72
normally be information that is subject to the duty of disclosure . The
announcement should state that the borrower is in breach of the loan agreement,
giving information on which provisions of the loan agreement it has breached and
what steps have been taken to rectify the default.
Following the publication of an announcement of an event of default, the borrower
should continue to publicly disclose new information as the matter develops to
ensure that the market is in possession of all price sensitive information. Similarly,
the borrower should issue an announcement when the situation is resolved and it is
no longer in breach of the loan agreement.
3.10
Matters that may represent inside information and must accordingly always be assessed with
particular care
3.10.1 Changes in the borrower’s executive management, board of directors or key employees
A change in the membership of the borrower’s executive management, board of
directors or equivalent corporate body, or a change in key employees, will not
normally be inside information. However, in some situations particular members of
the board of directors or executive management may be very strongly associated
with the borrower. The borrower must therefore consider whether any change in
the membership of the above-mentioned bodies or changes involving other key
employees might represent inside information. In such a case, the borrower must
issue an announcement of the change.
3.10.2 Change in a bank’s lending and deposit rates
A bank’s lending and deposit rates may be affected by factors such as the general
level of market interest rates and the state of competition. To the extent that a
decision by a borrower that is a bank to change the bank’s net interest rate will
affect the borrower’s earnings, it should issue an announcement of the changes to
be made.
3.11
Pledges of assets as collateral by subsidiary companies
In the case of some loans, the borrower may be the parent company of the group
and shares in subsidiaries may be the major part of its assets. The subsidiaries will
not in themselves be subject to the duty of disclosure (unless they have issued listed
bond loans). However, the way these subsidiaries manage their assets may indirectly
affect the creditworthiness of the borrower if a subsidiary causes its assets to no
longer be available to bondholders in the event, for example, that the listed bond
loan goes into default. This could, for example, be the case if a subsidiary pledges a
significant part of its assets in favour of a party other than the parent company or
the bondholders. If such a pledge of collateral represents inside information, this
information must be made public in accordance with the rules for inside
information. Moreover, it is recommended that borrowers should issue an
72
Cf. Bond Rules, Secton 3.2.1.1 first sentence and ABM Rules, Section 3.2.1.1 first paragraph
01.10.2014
Page 41 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
announcement if a subsidiary pledges a significant part of its assets even when this
does not represent inside information.
4.
Other information that must be made public
4.1
Mergers, demergers, sales of or offers for substantial portions of the borrower’s assets or business
activity
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately publicly disclose any proposals and resolutions by the
borrower’s competent bodies on corporate mergers or demergers.
This requirement shall also apply to any sale of or offer for a substantial portion of the
73
borrower’s assets or business activity, and the result of the offer.
If the borrower enters into negotiations on a merger or demerger, this process will
normally continue for some time. The fact that such a process has been initiated
may represent inside information. In evaluating this, the scale of the
merger/demerger and its strategic significance will be two of the elements to take
into account. If the merger/demerger must be assumed to be inside information,
the necessary information must be made public immediately unless the rules for
delayed publication apply, see chapter 3 and section 3.4.
Once the borrower’s competent corporate body has passed a resolution for a
merger/demerger, this must be made public regardless of whether the borrower has
already publicly disclosed the preceding process. If the borrower has previously
made such information public, it may refer to the earlier information and announce
the necessary additional information.
A similar evaluation must be carried out if the borrower decides to sell a substantial
portion of its assets or business activities, or receives an offer therefore.
The announcement must include sufficient information to allow investors to arrive
at an informed judgement of the value of the borrower’s bonds. If the transaction
affects the liability of the borrower or the collateral for the loan, this must be clearly
stated.
In such situations the borrower must also publicly disclose, as appropriate, changes
in collateral pledged, security etc. (see section 4.17) and any material change in its
ownership structure (see section 4.2).
Recommendation –
Oslo Børs and
Nordic ABM
73
It is recommended that the announcement includes the following information:
• Type of transaction (merger, demerger, acquisition etc.)
• Description of the business acquired or disposed of.
• Background for the transaction.
• Purchase or sales price.
• Form of settlement and how the transaction is financed.
• Whether the transaction is subject to any conditions or special terms.
• The most important items from the profit and loss account and balance
sheet of the business acquired or disposed of for the last two financial
years.
Cf. Bond Rules, Section 3.3 first paragraph item 3 and 4 and ABM Rules, Section 3.2.2 first paragraph item 2 and 3
01.10.2014
Page 42 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
4.2
Change in the borrower’s ownership structure
Requirement –
Oslo Børs and
Nordic ABM
The borrower must make public as soon as possible any changes of material
74
importance in its ownership structure.
It is possible that changes in the borrower’s ownership structure may affect the
price of its bonds. This may, for example be the case if one owner has a sufficiently
large interest to allow it to influence the borrower’s strategy. Similarly, a decision by
a large owner to make a significant reduction in its interest may affect the price of
the bonds. If there are changes of material importance in the borrower’s ownership
structure, the borrower must make this public as soon as possible. This is also the
case for shareholder-agreements in respect of the borrower.
The announcement must provide information on the size of the ownership interests
affected by the transaction or agreement, together with key information on any new
owner. If the change in ownership structure causes a not immaterial change in the
borrower’s equity, for example by a private placement of shares with the new
owner, the announcement must also provide information on this change, see also
section 4.3.
The borrower will not be required to issue its own announcement if the change in
ownership structure has already been publicly disclosed by an announcement issued
by the investor involved, and the announcement satisfies the requirements of the
duty of disclosure provisions.
4.3
Change in the borrower’s equity
Requirement –
Oslo Børs and
Nordic ABM
In the event of a not immaterial change in the borrower’s equity, this must be made
75
public.
Recommendation –
Oslo Børs and
Nordic ABM
The borrower should issue an announcement of any decision to change its dividend
policy, such as an increase in dividend or the reintroduction of a dividend.
If a not immaterial change is made to the borrower’s equity, this must be made
public. Such a change may result from a share issue, dividend payment or capital
reduction, or as the result of options being exercised. The announcement must
provide sufficient information for the investor to evaluate the borrower’s new
equity capital situation. In order to permit this, the announcement must contain at
least the following information:
•
•
•
•
•
74
75
The type of transaction.
The amount of the transaction and whether the equity is deemed to be
restricted equity or distributable equity.
The date on which the change comes into effect.
The size of the borrower’s equity following the transaction.
The borrower’s capital ratio.
Cf. Bond Rules, Section 3.3 first paragraph item 9 and ABM Rules, Section 3.2.2 first paragraph item 8
Cf. Bond Rules, Section 3.3 first paragraph item 3 and ABM Rules, Section 3.2.2 first paragraph item 2
01.10.2014
Page 43 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
The borrower should issue announcements both when a proposal to make a not
immaterial change in its equity is put forward, and when such a change is approved
by the competent corporate body of the borrower.
Where equity increases as a result of retained earnings, there will normally be no
need for the borrower to make a separate announcement of this so long as the
information is apparent from the announcement of the annual or interim results.
4.4
Change of debtor
Requirement– Oslo
Børs and Nordic
ABM
If there is a change of debtor, the borrower must make this public immediately .
76
If there is a change in the legal entity that has issued the bond loan, this must be
made public immediately. The reason for this is that a change of debtor is relevant
information for the market.
4.5
Change in the borrower’s registered name
Requirement –
Oslo Børs and
Nordic ABM
If the borrower changes its registered name, this must be made public immediately.
Recommendation –
Oslo Børs and
Nordic ABM
It is recommended that an announcement by the borrower of its change in name
should also state the company registration number, including the new company
registration number in the event of a change.
77
The announcement must state both the new name and the date for the change. The
reason for this is that the market needs to know the name of the borrower in order
to recognize the name that will continue to represent the loan debtor.
It is recommended that the borrower should include its company registration
number in the announcement. This is intended to simplify the updating task for
recipients of information since many investors use the company registration number
to sort entries in their databases.
4.6
Change in form of incorporation
Requirement Oslo
Børs and Nordic
ABM
The borrower must make public any proposal or resolution to change its form of
78
incorporation (conversion).
This section does not apply to the implications of mergers, demergers or other such
changes in ownership structure, which are dealt with in section 4.1. Rather, this
section deals with conversions from one form of incorporation to another. Examples
of this are when a company converts from AS to ASA or from AL to AS.
76
Cf. Bond Rules, Section 3.3 first paragraph item 11 and ABM Rules, Section 3.2.2 first paragraph item 10
Cf. Bond Rules, Section 3.3 first paragraph item 12 and ABM Rules, Section 3.2.2 first paragraph item 11
78
Cf. Bond Rules, Section 3.3 first paragraph item 3 and ABM Rules, Section 3.2.2 first paragraph item 2
77
01.10.2014
Page 44 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
When a borrower changes its form of incorporation (conversion) this triggers the
duty of disclosure. Both the proposal to convert and the resolution approving
conversion must be announced to the market. Similarly, during the process leading
to the proposal for conversion, the borrower must consider whether inside
information has come into existence (see chapter 3). If this is the case, the inside
information must be made public before the company makes a formal decision to
propose the change in its form of incorporation, save where the borrower decides to
delay the publication of this information in accordance with the provisions for
delayed publication (see section 3.4).
In addition to information on the conversion, the announcement must include
information on any effect this change may have on the collateral for the loan or the
credit risk. If any of the borrower’s listed bond loans are guaranteed by a
municipality or are otherwise guaranteed, the announcement must clarify whether
the guarantee will continue in force and the relevant terms. Any changes to
collateral pledged or to other security must also be stated in the announcement, see
4.17.
The announcement must also state the date the conversion will take place, together
with information on the main features of the conversion and any change to the
company name (see section 4.5). The borrower should also consider whether any
further information on the change in form of incorporation should be included in
the announcement pursuant to the general duty of disclosure. If the conversion
causes the creation of a new legal/corporate structure, this must also be explained
in accordance with the requirements of section 4.1.
4.7
Decisions to halt payments or open debt settlement proceedings (including private debt settlement
proceedings), resolutions for voluntary debt settlement, compulsory debt settlement, public administration
or insolvency proceedings
Requirement –
Oslo Børs and
Nordic ABM
If the borrower finds it necessary to make a decision to halt payments or open debt
settlement proceedings (including private debt settlement proceedings), or passes
any resolution regarding voluntary debt settlement, compulsory debt settlement,
public administration or insolvency proceedings, this must be made public by
79
issuing an announcement.
Information about the circumstances mentioned must be announced immediately,
regardless of whether the borrower has listed bonds that have been declared to be
in default. The announcement must provide sufficient information on the process
and possible outcome, as well as the basis for the negotiations or decisions that may
be made, in order for market participants to arrive at a proper valuation of the
borrower’s bonds.
It should be noted that the duty of disclosure in respect of a deterioration in the
borrower’s liquidity and capacity to meet its liabilities as they fall due may be
triggered at an earlier stage, cf. the general rule on duty of disclosure. The
announcement must include sufficient information to allow market participants to
evaluate the borrower’s creditworthiness and to estimate what proportion of the
loan must be regarded as lost. The borrower must then continually evaluate the
process under way, and issue new announcements as and when new circumstances
arise that represent inside information. However, in the circumstances mentioned
79
Cf. Bond Rules, Section 3.3 first paragraph item 5 and ABM Rules, Section 3.2.2 first paragraph item 4
01.10.2014
Page 45 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
above, it may well be the case that the borrower can satisfy the test of protecting its
legitimate interests in order to delay public disclosure of this information, see
section 3.4. In a situation such as that described, the borrower must have a clear
understanding of what information it can provide to the parties involved in the
process without compromising its responsibilities pursuant to the duty of disclosure.
Recommendation–
Oslo Børs and
Nordic ABM
If the borrower becomes insolvent, a receiver will be appointed. Once this has
happened, it may be difficult for the borrower to comply with the duty of disclosure to
the market since the receiver will then largely control the borrower’s conduct. In such
a situation, the borrower is strongly encouraged to contact Oslo Børs/Nordic ABM
immediately to discuss whether it is appropriate for the loan to continue to be listed.
4.8
Trading by the borrower in its own bonds
4.8.1
Introduction
Requirement –
Oslo Børs and
Nordic ABM
Persons possessing inside information may neither directly nor indirectly, for own or
third party account, subscribe, purchase, sell or exchange bonds or incite others to
80
carry out such transactions.
The borrower must not engage in market manipulation in connection with trading in
81
its own bonds.
The borrower must issue an announcement to the market if trades by the borrower in
82
its own bonds represent inside information.
The borrower must issue an announcement to the market if trades by the borrower in
its own bonds cause a material change in the borrower’s own holdings in a bond
83
loan.
The borrower must issue an announcement to the market if trades by the borrower in
84
its own bonds cause a material change in the outstanding amount of a bond loan.
If the borrower trades in its own bonds, it must ensure that all holders of bonds in the
bond loan are treated equally. Moreover, the borrower’s corporate bodies, officers or
senior employees must not adopt measures which are likely to confer on themselves,
individual owners of bonds or third parties an unfair advantage at the expense of
other holders or the borrower. The same applies in respect of the trading or issuance
85
of bonds or rights to such bonds in the group to which the company belongs.
If the bond loan in which the borrower trades is a convertible loan, the company must
immediately notify the Norwegian regulated market on which the loan is listed of any
purchase, sale, exchange or subscription of convertible bonds issued by the borrower
or by companies in the same group. Notification shall be sent no later than the start of
trading on the regulated market on the day following the purchase, sale, exchange or
86
subscription.
80
Cf. Securities Trading Act, Section 3-3 and ABM Rules, Section 3.3.1
Cf. Securities Trading Act § 3-8 and ABM Rules, Section 3.3.3
82
Cf. Bond Rules, Section 3.2.1.1 first paragraph and ABM Rules, Section 3.2.1.1 first paragraph
83
Cf. Bond Rules, Section 3.3 first paragraph item 6 and ABM Rules, Section 3.2.2 first paragraph item 5
84
Cf. Bond Rules, Section 3.3 first paragraph item 6 and ABM Rules, Section 3.2.2 first paragraph item 5
85
Cf. Bond Rules, Section 3.1.1 and ABM Rules, Section 3.1.1
86
Cf. Securities Trading Act, Section 4-2 first and second paragraph
81
01.10.2014
Page 46 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
There may be a number of reasons for a borrower that has issued a bond loan to
carry out trades in its own bonds during the course of the life of the bond loan, for
example:
• Refinancing an existing bond loan
• A wish to change the average remaining maturity of its funding
• To reduce outstanding borrowings
• Market making
The borrower may participate in trading in its own bonds so long as it complies with
the relevant provisions and regulations. The borrower must not carry out any trades
that do not comply with the requirements mentioned above, regardless of whether
the loan agreement includes provisions that allow the borrower to trade in its own
bonds.
The rules on duty of disclosure, prohibition of market abuse, and equal treatment
set out in the Securities Trading Act, the Bond Rules and the ABM Rules provide the
overall framework of provisions with which the borrower must comply when trading
in its own bonds. The sections below provide some specific examples of matters
which the borrower must take into account when considering transactions in its own
bonds.
4.8.1.1 Trading represents inside information
The fact that the borrower carries out trades in its own bonds will in some cases
represent inside information in itself. For this reason, the borrower must consider
whether it may be in a situation where the trades it carries out are in themselves
price sensitive information that must be made public..
The question of whether information is inside information depends on a case-bycase evaluation of the circumstances of the particular situation. It is often not the
borrower’s trading in itself that is price sensitive information, but the reason behind
the trades and the factors that that have influenced the decision. If the borrower’s
decision to enter into trades is based on factual matters that are material to the
bond price and are not generally known in the market, the borrower must publicly
disclose these matters before it carries out the trades.
Recommendation–
Oslo Børs and
Nordic ABM
While in many cases the borrower does not have a duty to publicly disclose the trades
it carries out in its own bonds, it will often be desirable that this information is made
available to the market. Taking into account the need for market transparency, Oslo
Børs/Nordic ABM recommends that borrowers should publicly disclose information
about large and/or unusual trades that fall outside the normal trading pattern for the
borrower in question.
4.8.1.2 Borrower is in possession of inside information
It is important that the borrower considers whether it is in possession of inside
information at the time of the intended trade. If it is in possession of inside
information, it must not trade in its own bonds. Chapter 3 of this guide provides the
definition of inside information.
This means that when the borrower considers trading in its own shares, it must on a
case-by-case basis consider what factual information forms the basis for its decision.
01.10.2014
Page 47 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
If the factual information is not commonly known in the market, and is information
that a reasonable investor would be likely to take into account for investment
decisions, then the borrower it is in an insider position. The borrower has a duty to
inform the market of all information that is inside information. Once the borrower
has taken the necessary steps to eliminate the differential in information by public
disclosure to the market, it is then in general able to trade its own bonds so long as
it complies with the duty to treat bondholders equally and the duty of disclosure in
respect of large trades.
Recommendation –
Oslo Børs and
Nordic ABM
If the borrower is in any doubt as to whether information in its possession is
material to the price of its bonds, it should abstain from trading until the
information has been announced to the market. It is the borrower’s duty to
evaluate whether it is in an inside position at the relevant point in time.
4.8.1.3 Equal treatment
The Bond Rules and the ABM Rules stipulate that the borrower must not expose
holders of its bonds to differential treatment that lacks a factual basis in the
common interest of the company and the bondholders. As a result, if the borrower
trades or enters into agreements on transactions with particular investors at
different spreads within a restricted period, this may be in breach of the provisions
on equal treatment.
Similarly, if the borrower is active in the market and initiates trades in its own bonds
without making an equivalent offer to all bondholders in the bond loan in question,
this may be in breach of the provisions on equal treatment.
4.8.2
Specific situations
As mentioned above, the borrower may trade in its own bonds for a number of
reasons, each of which must be taken into account when deciding the correct
procedure in a particular case. The following paragraphs suggest some particular
factors and some of the considerations that they give rise to. The borrower must
always comply with the duty of disclosure, the duty to treat its bondholders equally
and the rules on market abuse, including the prohibitions against illegal insider
trading and market manipulation. It should be noted that every situation must be
evaluated on its own merits, and the following examples do not provide an
exhaustive list of possibilities. The correct behaviour in each case will depend on the
result of a comprehensive evaluation of the situation.
4.8.2.1 The significance of whether the borrower’s level of activity is commonly known in the market
The type of borrower in question may play a determining role in when the duty of
disclosure is triggered. Banks and credit institutions often trade actively in their own
bond loans as part of their business activities. An industrial company will normally
trade less often, and this may lead to a different conclusion being drawn for an
otherwise similar situation.
The borrower must take into account its position in the market and the market's
expectations. These factors may play a crucial role in determining when the duty of
disclosure is triggered. Where a borrower is not known in the market for trading in
its own bonds, the circumstances and/or rationale for an increased level of trading
in its own bonds may represent notifiable information. If this is the case, the
01.10.2014
Page 48 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
borrower must issue an announcement to the market explaining the circumstances
that have caused the change in its pattern of trading.
4.8.2.2 Guidelines in the loan agreement
The loan agreement will normally include provisions on whether the borrower is
entitled to acquire and own its own bonds without writing down the outstanding
amount of the loan. However, this does not mean that the borrower is free to carry
out trades in its own bonds if this will conflict with the rules in relation to equal
treatment and market abuse.
4.8.2.3 Buy-back offers
Issuing a buyback offer
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately publicly disclose a buyback offer sent to
87
bondholders and the result of the offer.
A buyback offer sent to bondholders must be publicly disclosed at the time it is sent.
If the buyback offer is sent to the securities register for distribution, it must be
publicly disclosed no later than the time at which it is sent to the securities register
for distribution.
A buyback offer made to bondholders must satisfy the requirements for equal
treatment. The offer must specify the terms and conditions of the buyback offer,
such as the price and any allotment criteria, as well as the time limit for acceptance.
Normally, an investment firm will assist the borrower with drafting and sending the
offer. If the borrower wishes to buy back the entire bond loan or a large part of the
bond loan, this can be done by sending the buyback offer to bondholders through
the securities register or by publishing an announcement of the terms and
conditions of the offer.
If the buyback offer is only distributed as an announcement to the market using the
channels normally used for publishing inside information, bondholders will be
deemed to have been informed by this channel.
The borrower must publicly disclose the result of the offer immediately after the
expiry of the offer period. If the offer price is determined after the expiry of the
offer period (for example where the offer price is expressed as a spread over a
reference interest rate), the announcement must also provide information on the
offer price so determined.
Requirement for a prospectus as a result of a buyback offer
Requirement –
Oslo Børs and
Nordic ABM
87
88
Where an offer to subscribe for or purchase transferable securities is addressed to
150 or more persons in the Norwegian securities market, and involves an amount of
at least EUR 1,000,000 calculated over a 12-month period, a prospectus shall be
88
prepared unless the provisions on exceptions apply.
Cf. Bond Rules, Section 3.3 first paragraph item 13 and ABM Rules, Section 3.2.2 first paragraph item 12
Cf. Securities Trading Act, Section 7-2, cf. Section 7-4
01.10.2014
Page 49 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
In some cases, a buyback offer is combined with an offer to subscribe for a new
bond loan. If such a public offer is addressed to 150 or more persons and involves an
amount of at least EUR 1,000,000, the borrower will in general have a duty to
prepare a prospectus before the offer is made, and this means that the prospectus
must be checked by either Finanstilsynet or Foretaksregisteret (the Register of
Business Enterprises) before the offer to subscribe can be made to bondholders.
Once approved, the prospectus can be enclosed with the buyback offer.
If only professional investors hold the bond loan that is to be replaced by the new
loan, and the buyback offer can accordingly be made only to this category, there will
be no duty to prepare a prospectus unless the borrower intends to apply for the
new loan to be admitted to stock exchange listing.
If the denomination per bond in the new loan is at least EUR 100,000 or if the
minimum subscription amount is at least EUR 100,000, there will be no duty to
prepare a prospectus unless the borrower intends to apply for the new loan to be
admitted to stock exchange listing. In order to satisfy the rules on equal treatment
of bondholders, it must be the case in such a situation that all bondholders who
receive the offer to exchange the existing loan with a new loan must have an
existing holding that at least satisfies the requirement for them to apply for at least
the minimum subscription to the new loan. If the duty to prepare a prospectus does
arise because the borrower intends to apply for the new loan to be admitted to
stock exchange listing, the inspection and approval of the prospectus by the
prospectus authority will normally take place at a later date in connection with the
consideration of the application for listing.
4.8.2.4 Large trades
Trades that represent a certain size may, among other reasons, be carried out
because the borrower is making strategic acquisitions of its own bonds. This includes
cases where the borrower is seeking to change its funding structure or to sell a large
part of its holding of its own bonds. Trades carried out for more normal commercial
reasons, such as a wish to create liquidity in the bonds in question, can also be the
reason for purchases.
Strategic trades relates to cases where the borrower is seeking to change its funding
structure or to sell a large part of its holding of its own bonds. Trades for normal
commercial reasons refer here to cases where the borrower is trading in its own
bonds with the objective of creating liquidity in the loan in question.
The reason behind large trades will normally play a role in how the borrower should
handle this kind of situation. The question of whether the borrower is subject to the
duty of disclosure before carrying out such a trade will depend on a judgement of
the actual situation that lies behind the borrower’s wish to carry out the transaction.
If the borrower’s trades in its own bonds cause a material change in the outstanding
volume of the loan or the borrower’s holdings of its own bonds in the loan, it must
always make an announcement to the market in this respect. Subject to the
reservations mentioned, it is however the case that a large trade by the borrower in
its own bonds does not automatically trigger a duty of disclosure for the borrower.
The deciding factor will be the underlying reason or rationale for the borrower’s
trades in its own bonds. Where the borrower’s trades in its own bond reflect specific
matters, for example strategic considerations, and information on these matters is
01.10.2014
Page 50 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
likely to have a marked effect on the price of the bonds, the borrower does have a
duty to disclose information. This means that before the borrower can carry out the
transactions in its own bonds, the notifiable information that represents the reason
for the borrower’s intention to trade must be disclosed to the market in order to
eliminate the difference in information between the borrower and the market.
In terms of the size of the borrower’s buybacks of its own bonds, in some situations
a number of transactions carried out over a shorter period may be assumed to
represent a single trade. The evaluation is therefore not restricted to considering
the events of a single day or specific individual transactions. The borrower’s actions
must be evaluated on an overall perspective, taking into account the reality that the
transactions must be assumed to represent.
Announcements by the borrower of transactions in its own bonds should at a
minimum include the following information:
• ISIN and name of the bond loan in question
• Volume
• Time when the transaction was agreed
• Price (in cases where the price must be assumed to be price sensitive
information), or the spread over a specified reference yield
• The borrower’s total holding of its own bonds in the loan (if any) after the
trade
Recommendation–
Oslo Børs and
Nordic ABM
If the borrower is uncertain as to whether one or more transactions are subject to the
provisions on the duty of disclosure, it is recommended that the borrower should
make the transaction(s) public by issuing an announcement.
If the borrower intends to carry out strategic buybacks of its own bonds, it should
issue an announcement to this effect in advance.
4.8.2.5 Switching between different maturity periods
When a bond loan is approaching maturity, it may be desirable for both investors
and the borrower for the borrower to rollover the loan by inviting investors to
subscribe for a new loan.
Recommendation–
Oslo Børs and
Nordic ABM
When switching between bond loans with different maturity periods, it is
recommended that the borrower should communicate information about this to the
market if its actions differ from its normal procedure. This also applies in cases where
89
the procedure to be adopted is not subject to the provisions on duty of disclosure.
Three situations can be suggested where a switch between maturity periods may be
relevant. These are described in more detail below.
Investor(s) wish to switch maturity periods
The wish to switch maturity periods may be initiated by an investor or investors,
possibly because they wish to have a specific maturity in their portfolio. Where the
borrower wishes to satisfy such requests, it must ensure that it acts in accordance
with the rules on equal treatment of bondholders if a number of such requests are
received within a limited period of time. The requirement for equal treatment
89
Cf. Bond Rules, Section 3.2.1.1 and Section, 3.3, and ABM Rules, Section 3.2.1.1 and Section 3.2.2
01.10.2014
Page 51 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
applies regardless of whether the transaction involves issuing a new bond loan or
whether the borrower sells bonds in another outstanding bond loan, or whether the
transaction only involves trading with the investor(s) in question.
The borrower wishes to extend the maturity of its funding portfolio and/or reduce
the volume of funding falling due for repayment in the near future
When the borrower wishes to change the maturity of its bond funding and makes an
offer to investors in this respect, the borrower must comply with the rules on equal
treatment of bondholders and on the duty of disclosure in general. The borrower
must ensure either that all investors receive the same offer, or that an offer made to
investors that the borrower believes might be interested does not give such
investors an unreasonable advantage at the expense of investors not receiving the
offer. The borrower must also consider whether the offer in itself represents
notifiable information.
An announcement must state both the terms and conditions for the switch and the
terms and conditions for the new bond loan to be issued.
The borrower makes a public approach to investors in case they wish to redeem
bonds that are close to maturity
Some borrowers offer investors the opportunity to switch between maturity periods
when bonds they hold approach their maturity. This will involve an official offer to
investors by issuing an announcement and possibly via the securities register,
whereby investors are given the opportunity to switch their bonds by subscribing for
a new bond loan that is issued. The borrower agrees to buy back the bonds in the
old bond loan in return for the investor committing to subscribe for the new bond
loan.
4.8.2.6 Borrower’s consideration of specific bond lots
Investors may need to dispose of bonds for which at a specific time there is no
demand in the market at the current price. A number of borrowers have an
established practice of considering the purchase of such bonds for their own
account in order to create liquidity in the market for their bonds.
Borrowers may also wish from time to time to buy specific bonds on their own
initiative. The question of whether such transactions will trigger the duty of
disclosure will depend on a specific case-by-case evaluation.
Where the borrower has the opportunity to buy bonds from an investor in response
to a request from the investor, it must evaluate whether this will trigger a duty of
disclosure for the borrower. If the duty is triggered, information on the trade must
be made public as an announcement to the market, see section 4.8.1.
The borrower must also evaluate any offers it makes to investors in terms of the
rules on equal treatment.
If there is a lot of demand in the market to sell bonds in the same bond loan, the
borrower should consider making a general buyback offer to the market rather than
buying individual lots in the market, see also section 4.8.2.3.
01.10.2014
Page 52 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
In addition, the prohibition against trading on the basis of inside information also
applies to such situations.
4.8.2.7 Trades in subordinated bonds and perpetual tier 1 bonds
Where a borrower trades in its own subordinated bonds and perpetual tier 1 bonds,
this will almost always represent information that is subject to the duty of
disclosure. If the borrower wishes to increase or reduce holdings of its own primary
capital instruments, this signals a change in underlying capital that must be made
public. If the borrower is a financial institution, it must also have prior approval from
Finanstilsynet to buy back bonds in a subordinated or perpetual tier 1 bond issue.
4.9
Substantial changes in the outstanding amount of a bond loan
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately publicly disclose any substantial changes in the
outstanding amount of the bond loan.
The announcement must include a new repayment plan if the change is of significance
90
in this respect.
Changes in outstanding volume may, for example, result from an increase in an open
(‘tap’) loan, the borrower writing off holdings of its own bonds or the exercise in full
or part of a call option.
If the borrower carries out transactions that cause a substantial change in the
outstanding volume of a bond loan listed on Oslo Børs/Nordic ABM, the borrower
must immediately issue an announcement to this effect. The question of what
constitutes a substantial change must be evaluated on a case-by-case basis.
The announcement must, at a minimum, provide information on which bond loan
the change relates to, what has caused the change, the date on which the change
will take place and the new outstanding volume after the change. The
announcement must also include a new repayment plan if the change is of
significance in this respect.
4.10
New loans
91
Requirement –
Oslo Børs
The borrower must immediately publicly disclose the issue of new loans, including any
guarantees or collateral provided in that connection. The priority of any new loan
92
must be stated.
Commentary on increases in existing listed loans can be found in section 4.9.
This requirement reflects the provisions of Section 5-8, fourth paragraph, of the
Securities Trading Act that implements the requirement of the Transparency
Directive on the duty to disclose “new loan issues”. The wording of the provision is
such that the requirement for public disclosure is general, regardless of whether the
loan/loans in question is/are listed on a regulated market. Taking up a new loan is
considered to be price sensitive information that is subject to the duty of disclosure
pursuant to the general rule on making public inside information. The wording may
90
Cf. Bond Rules, Section 3.3 first paragraph item 6 and ABM Rules, Section 3.2.2 first paragraph item 5
Does not apply to borrowers with securities listed on Nordic ABM
92
Cf. Bond Rules, Section 3.3 first paragraph item 2
91
01.10.2014
Page 53 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
also suggest that it only applies to a loan that is issued as negotiable securities
(interest-bearing instruments), cf. the use of the word “issue”. Oslo Børs/Nordic
ABM will apply this interpretation until such time as any relevant statements on the
interpretation of the wording are issued.
Recommendation –
Oslo Børs and
Nordic ABM
It will be in the market’s interests for the borrower to maintain open communications
in respect of its plans for future financing-related activities. Borrowers are therefore
recommended to maintain open communications with the market. When a borrower
wishes to indicate that a bond loan is to be issued, it may find that the market reacts
positively to being notified of this in advance of the loan being issued.
Refinancing of bond loans or other types of financing should be made public, even in
cases where the refinancing is not deemed to be a substantial transaction. This will
ensure inter alia that investors have an overview of the maturity structure of the
borrower’s borrowings to supplement that reported in the annual and interim
reports.
Commentary on increases in existing listed loans can be found in section 4.9.
4.11
Change to the overall limit of an open loan
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately publicly disclose any change to the overall limit of a
93
loan.
When issuing an open (‘tap’) loan, the borrower agrees a limit for the overall total
limit of the loan. In some cases, this limit may be increased at a later date. If the
borrower decides to increase the overall limit of a loan listed on Oslo Børs or Nordic
ABM, the borrower must immediately make this public by an announcement to the
market.
4.12
Changes in the borrower’s holdings of its own bonds
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately publicly disclose any substantial change in the
94
borrower’s own holding of bonds in a loan.
In the event of a substantial change in the borrower’s holdings of its own bonds in a
bond loan listed on Oslo Børs or Nordic ABM, the borrower must make this public
immediately. This requirement is subject to the threshold of an announcement only
being required for a substantial change. The question of whether a change is
substantial must be evaluated on a case-by-case basis.
If the borrower carries out small write-offs of its own holdings over a period of time,
it must take into account the size of the total change as it takes place. If such writeoffs amount over a period to a substantial change, this must be made public. If the
loan agreement permits, the borrower may be permitted to own holdings in its own
bonds. A holding of own bonds may result from the borrower purchasing bonds in
its own loan, or not writing off bonds following the exercise of a put option.
93
94
Cf. Bond Rules, Section 3.3 first paragraph item 7 and ABM Rules, Section 3.2.2 first paragraph item 6
Cf. Bond Rules, Section 3.3 first paragraph item 6 and ABM Rules, Section 3.2.2 first paragraph item 5
01.10.2014
Page 54 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
It is important that Oslo Børs/Nordic ABM and investors have up-to-date
information at all times on the outstanding amount of listed bond loans and
commercial paper loans to ensure that correct information is distributed in the
market.
4.13
Interest rate fixings
Requirement –
Oslo Børs and
Nordic ABM
If the coupon rate for a loan is changed, the borrower must immediately issue an
announcement on the new interest rate and the period for which the new interest
95
rate applies.
In the case of floating rate loans, a new interest rate will be fixed at regular
intervals. The prospectus will include provisions on when and how the interest rate
is fixed.
The borrower is responsible for making interest rate fixings public by issuing an
announcement on the new rate and the period to which it applies. However, it is not
unusual for the trustee for a loan issue to be responsible for fixing the interest rate
and issuing the announcement. This is subject to there being an agreement in this
respect between the borrower and the trustee. If there is no such agreement
between the trustee and the borrower, the borrower is responsible for issuing the
announcement as soon as a new interest rate is fixed.
4.14
Exercise by the borrower of its right to redeem bonds (call)
Requirement –
Oslo Børs and
Nordic ABM
An announcement that the borrower intends to exercise its right to redeem bonds (in
whole or part) must be published immediately the borrower has decided to exercise
96
this right.
A bond loan where the borrower has the right to redeem bonds refers to a situation
where the borrower has the right to redeem the loan in whole or part at specified
times. The prospectus will include the necessary provisions for the borrower’s call
option, specifying the redemption price, notice period to be given and arrangements
for partial redemption. The prospectus prepared in connection with the loan will
state the notice period the borrower must give when it intends to exercise its right
to redeem the loan. When preparing the prospectus and determining the provisions
for redemption, the borrower must ensure that the redemption arrangements
satisfy the requirements for equal treatment of bondholders.
If the borrower decides to exercise its right of redemption during the life of a loan,
the borrower must issue an announcement to this effect immediately the decision is
made. This implies that the borrower must not delay announcing its decision until
the start of the notice period defined in the prospectus if it actually makes the
decision at an earlier date. The announcement must provide information on
whether the loan is to be redeemed in whole or part, the terms for the redemption
and when it will take place.
In the event of partial redemption of a loan with a repayment plan, a new
repayment plan must be produced and made public.
95
96
Cf. Bond Rules, Section 3.3 first paragraph item 1 and ABM Rules, Section 3.2.2 first paragraph item 1
Cf. Bond Rules, Section 3.3 first paragraph item 1 and ABM Rules, Section 3.2.2 first paragraph item 1
01.10.2014
Page 55 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
If the borrower is a financial institution, any decision to exercise the right of
redemption in respect of a subordinated loan requires approval from Finanstilsynet.
Such a borrower can accordingly not make any change to the size of its primary
capital without prior approval from Finanstilsynet.
4.15
Exercise by investors of their right to sell back bonds (put)
Requirement –
Oslo Børs and
Nordic ABM
If the exercise by investors of their right to sell back bonds (put) causes a substantial
change in the outstanding volume of the loan or in the borrower’s own holdings, the
borrower must make this public immediately. The announcement must include a new
97
repayment plan if the change is of significance in this respect.
In the case of a bond loan where investors have the right to sell back bonds, the
provisions for this will be set out in the prospectus. The prospectus will include the
necessary terms and conditions and notice periods for investors to exercise their put
options.
If investors exercise their right to sell back bonds and this causes, in total, a
substantial change in the borrower’s own holdings in the loan, the borrower must
make this public immediately. Similarly, the borrower must publicly disclose if it
decides to write off the bonds put back to reduce the outstanding value of the loan
and this reduction represents a substantial change. This requirement also applies
where the accumulated value of bonds written off over a certain period represents a
substantial amount.
If bonds put back by investors and subsequent write-offs by the borrower of its
holdings of own bonds make it necessary to revise the repayment plan, a revised
repayment plan must be prepared and made public.
4.16
Changes to the loan agreement
4.16.1 Changes to the loan agreement that must be made public by an announcement
Requirement –
Oslo Børs and
Nordic ABM
Changes to the loan agreement that may be relevant to the pricing of the loan must
98
be made public by means of an announcement.
The borrower may need to make changes to the loan agreement after it has been
entered into. This may be due to a change in the borrower’s circumstances, or
because there were errors or inaccuracies in the original agreement. If such changes
may be relevant to the pricing of the loan, the borrower must publicly announce the
changes. This requirement applies regardless of whether the changes are to be
approved by a bondholders’ meeting or whether the trustee for the loan can
approve the changes without consulting the bondholders. The loan agreement will
set out the framework for which changes can be made and by whom, and the
related procedures. Examples of matters that will be subject to the requirement for
publication of an announcement are described in other sections of this guide.
97
Cf. Bond Rules, Section 3.3 first paragraph item 6 and ABM Rules, Section 3.2.2 first paragraph item 5
Cf. Bond Rules, Section 3.2.1.1 first paragraph, Section 3.3 first paragraph item 1 and 7 and Section 3.4 and ABM Rules, Section 3.2.1.1
first paragraph, Section 3.2.2 first paragraph item 1 and 6 and Section 3.2.3
98
01.10.2014
Page 56 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
In addition to issuing an announcement of the changes to the market, the borrower
must send the amended loan agreement to Oslo Børs/Nordic ABM for information.
4.16.2 Changes to the loan agreement that must be sent to Oslo Børs/Nordic ABM for information
Requirement –
Oslo Børs and
Nordic ABM
Changes to the loan agreement that are not subject to the requirement to publish an
announcement of the changes must be sent immediately to Oslo Børs/Nordic ABM for
99
information.
The purpose of this requirement is partly to ensure that Oslo Børs has updated loan
documentation at all times, and partly to ensure that the changes made do not
affect the suitability of the loan for listing.
4.17
Change to the collateral for a loan
4.17.1 Change to the collateral for a listed loan
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately make public any changes to the collateral for a listed
100
loan as well as any matters of material significance in respect of the collateral.
Certain loans involve the borrower pledging collateral or arranging for a guarantee
in favour of bondholders so that investors have security for their claim on the
borrower.
Once the loan has been established, the borrower may need to change the security
arranged in favour of bondholders. This may, for example, apply if the borrower
wishes to remove a municipality guarantee for the loan, or to sell a property
pledged as collateral for the loan, or if the borrower wishes to cancel a dividend
restriction clause in return for arranging other security for the bondholders. The
procedure for making such changes will be regulated in the loan agreement or in the
terms and conditions agreed between the borrower and bondholders when the loan
was first drawn down.
If the borrower decides to propose changes to the security for a loan, it must
publicly disclose this immediately. If the changes require approval by a bondholders’
meeting, public disclosure will be subject to the requirements for disclosure of a
notice calling a meeting of bondholders and the results of the meeting, see section
4.19.
The borrower must in addition publicly disclose any other matters that are of
material significance in respect of collateral pledged, a guarantee or other security
in favour of bondholders, and other matters of material significance to such security,
even if no changes to the security are proposed. For example, the borrower must
publicly disclose any new valuation obtained for assets pledged in favour of
bondholders. If the collateral pledged is newly constructed (building, rig, vessel etc.)
it will be natural for the borrower to keep the market informed of the progress of
the construction process. Similarly, the borrower must publicly disclose any material
damage to assets pledged as collateral.
99
Cf. Bond Rules, Section 3.1.5 first paragraph item e) and ABM Rules, Section 3.1.5 first paragraph item 6
Cf. Bond Rules, Section 3.3 first paragraph item 1 and 8, ABM Rules, Section 3.2.2 first paragraph items 1 and 7
100
01.10.2014
Page 57 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
4.18
Information to bondholders
Requirement –
Oslo Børs and
Nordic ABM
Any notice sent to bondholders must be published no later than the time at which
101
such notice is distributed.
Situations may arise in which the borrower or the trustee for a loan will wish to
communicate information about specific matters to bondholders. This may, for
example, relate to a notice calling a meeting of bondholders and the result of the
meeting (see section 4.19), information on minor changes to the loan agreement
that do not require approval by a bondholders’ meeting, or information on changes
at the borrower. Such information must be published no later than the time at
which the notice is sent out to bondholders. This means that the borrower cannot
delay publishing information until the time at which it assumes that bondholders
will have received the notice sent out.
4.19
Bondholders’ meeting
4.19.1 Notice calling a bondholders’ meeting
Requirement –
Oslo Børs and
Nordic ABM
The notice calling the meeting, the agenda and any other documents sent to
bondholders in connection with the meeting must be published no later than at the
102
same time as the notice calling the meeting is distributed.
The loan agreement and prospectus will define the powers of the bondholders’
meeting and specify which matters require consideration by a bondholders’
meeting.
The borrower shall include information in the notice calling a bondholders’ meeting
on the venue, time, agenda, the bondholders’ right to participate in the meeting,
payment of interest, exercise of any conversion, exchange or cancellation rights, and
on repayment of the loan.
The borrower shall append a proxy voting form to the notice of the meeting.
The bondholders’ meeting may be held in an EEA state other than Norway provided
the denomination per bond is at least EUR 50,000 or the equivalent amount in
another currency at the time of the issue, and all facilities and all information
necessary to enable the bondholders to exercise their rights are made available in
the EEA state concerned. The requirement to publish the notice calling a meeting of
bondholders applies regardless of the country in which the meeting is to be held.
4.19.2 Resolutions passed by a bondholders’ meeting
Requirement –
Oslo Børs and
Nordic ABM
The borrower must publish immediately any resolution passed by a bondholders’
103
meeting.
101
Cf. Bond Rules, Section 3.4 and ABM Rules, Section 3.2.3
Cf. Bond Rules, Section 3.9.3 and 3.4 and ABM Rules, Section 3.6.3 and 3.2.3
103
Cf. Bond Rules, Section 3.3 first paragraph item 10 and ABM Rules, Section 3.2.2 first paragraph item 9
102
01.10.2014
Page 58 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
The borrower must issue an announcement immediately after a bondholders’
meeting to make public the resolutions passed by the meeting. It is normal practice
for the trustee for the loan to issue this announcement, but the borrower is formally
responsible for disclosing the information. The borrower must therefore ensure that
the announcement is issued.
4.19.3 Minutes of a bondholders’ meeting
The minutes of a bondholders’ meeting represent information that must be sent to
Oslo Børs/Nordic ABM, see section 5.1.
4.19.4 Particular requirements for convertible loans and loans where the yield is linked to the performance
104
of an underlying instrument
Requirement - Oslo
Børs
A borrower that has issued a convertible loan or a loan with a yield linked to the
performance of an underlying share, share index, share fund or similar, must provide
sufficient information for the bondholders to be able to judge the value of the
105
instruments to which the bonds are linked.
Bonds that confer a right on the bondholder to acquire shares can only be admitted
to listing if shares of the same class are either already stock exchange listed or are
admitted at the same time to listing on Oslo Børs or to listing on another regulated,
recognised and open market that functions routinely. If this requirement is not
satisfied, Oslo Børs may nonetheless allow such bonds to be admitted to listing if it
considers it to be apparent that bondholders and the public in general have access
to all the information needed to assess the value of the shares to which the bonds
are linked. This applies similarly to the listing of bonds that generate a yield
determined by the performance of an underlying share, share index, share fund or
similar.
In the case of a convertible loan where the underlying share is listed on Oslo Børs or
Oslo Axess, the borrower will be subject both to the provisions on duty of disclosure
that apply to shares and the provisions that apply to bonds. If the underlying share is
listed on some other regulated market, the borrower will be subject to the
provisions on duty of disclosure that apply on this market. In addition, the borrower
will be subject to the Bond Rules.
4.19.5 Conversion – requirements
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately make public information on any conversion that
106
causes a substantial change in the outstanding volume of the bond loan.
The borrower must immediately make public any decision to increase its share capital
107
as the result of conversion.
The borrower must, no later than at the end of any month in which changes are made
to its share capital, publish an overview of its share capital and the number of votes in
108
the company.
104
It is not possible to list index-linked loans on Nordic ABM. In addition, convertible bonds can only be listed on Nordic ABM if the
underlying share is listed on Oslo Børs or on another regulated market. Cf. ABM Rules, Section 2.3.4.
105
Cf. Bond Rules, 2.3.4 first to third paragraphs
106
Cf. Bond Rules, Section 3.3 first paragraph item 6 and ABM Rules, Section 3.2.2 (1) item 5
107
Cf. Continuing obligations of stock exchange listed companies, Section 4.2 first paragraph item 3
01.10.2014
Page 59 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
When the borrower receives notice of conversion in respect of a stock exchange
listed convertible loan where the conversion represents a substantial change in the
outstanding volume of the loan, it must publicly disclose this immediately. The
announcement must include information on the nominal volume of the bond loan
that is subject to conversion, the date conversion took place, the number of new
shares and the new amount of the borrower’s share capital. If the new shares do not
carry full dividend rights until a later date, this must also be stated in the
announcement.
If the conversion does not cause a substantial change in the outstanding volume of
the listed loan, the company must, no later than at the end of any month in which
changes are made to its share capital or voting capital, publish an overview of its
share capital and the number of votes in the company. In the event of conversions
of convertible bonds where the underlying instrument is listed on Oslo Børs or Oslo
Axess in the period, the redemption shall be taken into account in the overview
published at the end of each month. If the borrower wishes to replace the monthly
overview with regular announcements of conversions, such announcements must
include all the information required by the duty to issue monthly reports.
The company must also immediately make public decisions by its board of directors
to increase the company’s share capital. This will also apply to decisions by the
board on increases in share capital caused by conversions of convertible bonds. The
company must also immediately make public the registration of the increase in
share capital with the Registrar of Business Enterprises (Foretaksregisteret),
including the amount of the new share capital.
The deadline for registering conversions with the Foretaksregisteret is laid down in
Section 11-7, first paragraph, of the Public Limited Liability Companies Act.
4.19.6 Changes in the conversion terms and conditions for convertible loans
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately make public any changes to the conversion terms
109
and conditions for a convertible loan.
The announcement must clearly state the new terms and conditions. Such changes
may, for example, relate to changes in the conversion period or changes to the
conversion price caused by payments of dividend, share issues or other changes.
If the changes can be made without prior approval from a bondholders’ meeting,
the changes shall be made public immediately after they have been decided.
If the changes require approval by a bondholders’ meeting, the borrower must issue
an announcement immediately it decides to submit a proposal to the bondholders.
Similarly, the notice calling the bondholders’ meeting and the result of the meeting
must be published in accordance with the rules in this respect, see section 4.20.
108
Cf. Securities Trading Act, Section 5-8 second paragraph and Continuing obligations of stock exchange listed companies, Section 3.2
fourth paragraph
109
Cf. Bond Rules, Section 3.3 first paragraph item 1 and ABM Rules, Section 3.2.2 (1) item 1
01.10.2014
Page 60 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
4.20
Changes in the choice of law and venue of jurisdiction for the borrower
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately make public any changes to the choice of law or
110
venue of jurisdiction for the borrower.
When a bond loan is admitted to listing, the borrower is required to state in the
prospectus/listing document which country’s laws will apply to the borrower and
which court will be the venue of jurisdiction. It is assumed that the procedure for
making any subsequent changes in this respect will be specified in the loan
agreement, and bondholders will be informed of any such change. The information
sent to bondholders must be made public at the same time by an announcement to
the market, cf. section 4.18.
In the event that there is no separate loan agreement for the loan in question, the
borrower must follow the procedure described in the prospectus/listing document
in order to change the choice of law or venue of jurisdiction. Regardless of the
procedure described in the prospectus/listing document, the borrower must always
immediately make public such changes.
5.
Information to be provided to Oslo Børs and/or Nordic ABM
This chapter deals with information that the borrower is required to send to Oslo Børs to keep its records up to
date, but that is not information which must be publicly disclosed by an announcement to the market.
Information that is to be sent to Oslo Børs for information but not for publication must be sent to the Listing
Department of Oslo Børs by e-mail to notering@oslobors.no. The Listing Department can also be contacted by
telephone on +47 22 47 64 30.
5.1
Minutes of a bondholders’ meeting
Requirement –
Oslo Børs and
Nordic ABM
Oslo Børs/Nordic ABM are entitled to require that the minutes of a bondholders’
111
meeting must be sent to Oslo Børs as soon as they are signed.
The borrower must issue an announcement of the resolutions passed at a
bondholders’ meeting, as soon as the meeting finishes, see section 4.19.2.
In addition, written minutes of the bondholders’ meeting must be produced which
state the resolutions approved and the number of votes in favour of each resolution.
Oslo Børs/Nordic ABM are entitled to require that the minutes of a bondholders’
meeting must be sent to Oslo Børs as soon as they are signed. However, Oslo
Børs/Nordic ABM will not publish the minutes for two reasons: Firstly, the minutes
will include an overview of which bondholders were represented at the meeting,
and since the bondholders’ register is not open to public inspection, the minutes
therefore cannot be published. Secondly, all the material information contained in
the minutes will already have been published pursuant to the borrower’s duty to
announce the resolutions approved at a bondholders’ meeting, see section 4.20.2.
110
111
Cf. Bond Rules, Section 3.3 first paragraph item 14 and ABM Rules, Section 3.2.2 first paragraph item 13
Cf. Bond Rules, Section 3.9.5 and ABM Rules, Section 3.6.5 second paragraph
01.10.2014
Page 61 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
5.2
Change to the ISIN
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately inform Oslo Børs/Nordic ABM of any changes to the
International Securities Identification Number (ISIN) of the bonds in the securities
112
register.
The purpose for this requirement is to ensure that Oslo Børs/Nordic ABM uses the
correct information in the trading system. In order that Oslo Børs/Nordic ABM will
be able to coordinate the time for the change of ISIN with the account operator for
the loan, the information on the new ISIN must be submitted in advance of the
change.
5.3
Change of the securities account operator and paying agent for the borrower
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately inform Oslo Børs/Nordic ABM of any changes to the
113
identity of the securities account operator or the paying agent for the borrower.
The purpose for this requirement is to ensure that Oslo Børs will be able to contact
the right securities account operator or paying agent in the event of any questions
on the registration of the loan in the securities register.
5.4
New repayment plan in the event of a change in outstanding volume
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately inform Oslo Børs/Nordic ABM of any new or
amended repayment plan in the event of a change in the outstanding volume of a
114
bond loan.
In the case of a loan with repayments, the repayment plan may need to be amended
if the outstanding volume is changed as a result of an increase in the loan, a partial
repayment of the loan or as a result of the borrower writing off holdings of its own
bonds. In the event of a substantial change in the outstanding volume, the borrower
must send an announcement to the market, cf. section 4.10 and section 4.12.
However, in certain cases the borrower may need to make minor adjustments to the
outstanding volume that will not trigger the duty to issue an announcement. In such
cases, the borrower must send information on the new repayment plan to Oslo
Børs/Nordic ABM so that Oslo Børs/Nordic ABM will have correct fixed data on the
loan in its database for distribution to market participants. The information provided
to Oslo Børs/Nordic ABM must include the outstanding volume of the bond loan in
question.
5.5
Listing or application for listing of bonds on another regulated market
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately notify Oslo Børs/Nordic ABM of any application
115
for its bonds to be listed on another regulated market.
112
Cf. Bond Rules, Section 3.1.5 first paragraph item a) and ABM Rules, Section 3.1.5 first paragraph item 2
Cf. Bond Rules, Section 3.1.5 first paragraph item a) and ABM Rules, Section 3.1.5 first paragraph item 2
Cf. Bond Rules, Section 3.1.5 first paragraph item b) and ABM Rules, Section 3.1.5 first paragraph item 3
115
Cf. Bond Rules, Section 3.1.5 first paragraph item c) and ABM Rules, Section 3.1.5 first paragraph item 4
113
114
01.10.2014
Page 62 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
The purpose of this requirement is to enable Oslo Børs/Nordic ABM to provide the
other marketplace with information on any suspension (trading halt) of the bond
loan. This would be done in order to give the other regulated market the
opportunity to consider implementing a similar trading halt to avoid a situation in
which investors can trade in the loan on another marketplace while such trading is
prohibited on Oslo Børs/Nordic ABM.
The borrower must ensure that information is not made available in the foreign
market in a manner that conflicts with the requirements of the Bond Rules or the
ABM Rules.
5.6
Suspension or removal from listing of bonds on another regulated market
Requirement –
Oslo Børs and
Nordic ABM
The borrower must immediately notify Oslo Børs/Nordic ABM if its bonds are
116
suspended or removed from listing on another regulated market.
The purpose of this requirement is to give Oslo Børs/Nordic ABM the opportunity to
consider whether the bond loan in question should be subject to suspension
(trading halt) on Oslo Børs/Nordic ABM. The purpose for such a decision would be to
avoid a situation in which investors can trade in the loan on Oslo Børs/Nordic ABM
while such trading is prohibited on the other regulated market.
Similarly, the borrower must immediately inform Oslo Børs/Nordic ABM if a bond
loan is removed from listing on another regulated market. This is necessary because
Oslo Børs/Nordic ABM would then no longer need to co-ordinate any decision on a
trading halt with the other marketplace.
5.7
Changes to the articles of association
The rules on public disclosure of changes to the borrower’s articles of association
differ between Oslo Børs and Nordic ABM.
5.7.1
Changes to the articles of association for borrowers with stock exchange listed bond loans
Requirement - Oslo
Børs
If the borrower intends to amend its articles of association, it must submit the
changes proposed to Finanstilsynet and Oslo Børs. The submission shall take place
electronically, and at the latest on the same day that the notice calling the general
meeting at which the proposed change shall be considered is distributed. The duty to
submit the changes proposed to Finanstilsynet is deemed to be satisfied by submitting
the changes proposed to Oslo Børs. The deadline in the second sentence applies
equally to submission of the changes to the board of representatives, corporate
assembly or similar body. The duty applies to the extent that the borrower is not
117
already under a duty to publish such information.
It is assumed in this respect that the changes do not represent inside information, or
information that is in some other way subject to the duty of disclosure, and must
therefore be made public for these reasons.
116
117
Cf. Bond Rules, Section 3.1.5 first paragraph item d) and ABM Rules, Section 3.1.5 first paragraph item 5
Cf. Bond Rules, Section 3.1.5 fourth paragraph
01.10.2014
Page 63 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
The rules state that the proposed changes must be sent to both Finanstilsynet and
Oslo Børs, but clarify that the duty to submit the proposal to Finanstilsynet is
deemed to be satisfied by submitting it to Oslo Børs. In the case of borrowers where
changes to the articles of association require prior approval by Finanstilsynet, the
provisions of the Bond Rules do not imply any change to the need for the borrow to
submit the proposed changes to Finanstilsynet in accordance with the guidelines
laid down by Finanstilsynet.
In cases where changes to the articles of association do require approval by
Finanstilsynet, it will be appropriate to make this clear when submitting the
proposed changes to Oslo Børs. Similarly, it will be appropriate to notify Oslo Børs in
writing when such approval has been received.
5.7.2
Changes to the articles of association for borrowers with bond loans listed on Nordic ABM
Requirement Nordic ABM
The borrower must immediately notify Nordic ABM of any changes in the borrower’s
118
articles of association or equivalent constitutional rules.
If the changes to the articles of association are the result of a matter that represents
inside information or are otherwise subject to provisions that trigger the duty of
disclosure, the borrower must immediately make the matter public in accordance
with the duty of disclosure provisions as they apply to the matter in question. The
updated articles of association should then be sent to Nordic ABM. It is sufficient to
send the new articles of association once they have been approved by the
competent corporate body. If the change requires prior approval by Finanstilsynet,
the borrower may wait until it has received such approval before submitting the
new articles of association to Nordic ABM.
If the changes to the articles of association are the result of a matter that does not
in itself trigger the duty of disclosure, the borrower must nonetheless send the
updated articles of association to Nordic ABM. It will also be sufficient in such
circumstances to send the new articles of association once they have been approved
by the competent corporate body. If the change requires prior approval by
Finanstilsynet, the borrower may wait until it has received such approval before
submitting the new articles of association to Nordic ABM.
5.8
Status reports for open bond loans
Requirement –
Oslo Børs and
Nordic ABM
A borrower with listed bonds that are not registered with VPS must, no later than
seven calendar days after the expiry of each calendar month, provide Oslo
Børs/Nordic ABM with a status report for each open bond loan save to the extent that
any changes have been disclosed by publishing an announcement. The status report
shall detail changes in outstanding volume and in the borrower’s own holdings of the
119
bonds in question.
Oslo Børs/Nordic ABM need to have correct information in their databases about
listed loans, including the outstanding volume. Open loans relate to bond loans and
commercial paper issues where the amount of the issue can be increased within a
pre-determined limit. By reporting the outstanding amount of its loans to Oslo
118
119
Cf. ABM Rules, Section 3.1.5 first paragraph item 1
Cf. Bond Rules, Section 3.1.5 second paragraph and ABM Rules, Section 3.1.5 second paragraph
01.10.2014
Page 64 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
Børs/Nordic ABM, the borrower ensures that Oslo Børs/Nordic ABM has the correct
information about its listed loans at all times.
If the borrower makes a minor adjustment to the outstanding volume, or makes a
minor change to holdings of its own bonds, this will not necessarily give rise to a
duty to make the information public, cf. section 12.
Oslo Børs/Nordic ABM receives information at the end of each month on the
outstanding volume and borrowers’ holdings of bonds for all listed loans that are
registered with VPS. This means that the borrower does not need to send updated
information for loans registered with VPS other than information already required
by the duty of disclosure, cf. section 12.
However, in the case of loans not registered with VPS, Oslo Børs/Nordic ABM will
not have the equivalent opportunity to automatically update its information. The
borrower is therefore responsible for providing this information to Oslo Børs/Nordic
ABM. The report must be submitted no later than seven calendar days after the end
of the calendar month.
For the sake of good order, it should be noted that the arrangements mentioned
above do not have any bearing on the arrangements for reporting the status of open
loans to Norges Bank.
5.9
Failure to satisfy the conditions for listing
Requirement –
Oslo Børs and
Nordic ABM
If it can no longer be assumed that the bonds satisfy the conditions for admission to
120
listing, this must be notified to Oslo Børs/Nordic ABM immediately.
When a bond loan is admitted to listing, it must satisfy certain minimum
requirements such as the loan being freely negotiable and suitable for listing. A full
account of the conditions for admission to listing can be found in Chapter 2 of the
Bond Rules and Chapter 2 of the ABM Rules.
If circumstances arise during the life of a bond loan which mean that the bonds can
no longer be assumed to satisfy the conditions for admission to listing, the borrower
must immediately notify this to Oslo Børs/Nordic ABM. The reason for this is to
allow Oslo Børs/Nordic ABM to evaluate whether listing can continue, and what
measures might prove necessary for this to happen.
5.10
Registering changes in company information
Requirement– Oslo
Børs and Nordic
ABM
The borrower has a duty to immediately register any changes in the information about
the company that Oslo Børs/Nordic ABM requires to be registered in the NewsPoint
121
electronic portal for issuers.
Borrowers with bonds listed on Oslo Børs/Nordic ABM are responsible for the
company information registered in the Oslo Børs electronic portal for issuers, known
as NewsPoint, and this includes responsibility for registering changes in:
120
121
Cf. Bond Rules, Section 3.1.5 third paragraph and ABM Rules, Section 3.1.5 third paragraph
Cf. Bond Rules, Section 3.1.5 fifth paragraph and ABM Rules, Section 3.1.5 fourth paragraph
01.10.2014
Page 65 of 68
Duty of disclosure for issuers of bonds listed on the Oslo Børs and Nordic ABM marketplaces
a.
b.
c.
The borrower's contact details (postal address, street address, e-mail address,
website address and telephone number;
the borrower's nominated contact person, together with the contact person's email address and telephone number;
122
The borrower's audit committee
Any questions in relation to using NewsPoint should be addressed to the Market
Administration department at Oslo Børs: e-mail address ma@oslobors.no.
122
Only applies to borrowers with bonds listed on Oslo Børs
01.10.2014
Page 66 of 68
OSLO BØRS ASA
Box 460 Sentrum
NO-0105 Oslo, Norway
Visiting address: Tollbugata 2, Oslo
Questions may be directed to Listing
E-mail: listing@oslobors.no
Telephone: +47 22 34 17 00
www.oslobors.no | www.nordicabm.no