5.9 Listing and the Information Management Regime 221One of the special circumstances that preclude normal regular dealings is own-
ership concentration. A shareholder can reduce the number of outstanding shares
and increase the prospects of a delisting through a public offer.
For example, the FSA may cancel the listing of shares “if the percentage of shares in public
hands falls below 25% or such lower percentage as the FSA may permit”.^428
The exact modalities of a regular delisting depend not only on the governing law
but also on the rules of the market. There are disclosure obligations which can re-
semble the disclosure obligations applicable to public offers.^429 The exact re-
quirements can vary depending on the market.
For example, the Düsseldorf Stock Exchange applies stricter rules than the Frankfurt Stock
Exchange although both are governed by German law. The requirements of the Frankfurt
Stock Exchange can be fulfilled by disclosing the delisting six months in advance so that
“investors have sufficient time to sell”.^430 The Düsseldorf Stock Exchange requires the
making of a mandatory bid to holders of outstanding shares.^431 The Federal Supreme Court
(BGH) held in the Macrotron case^432 that the majority shareholder must make a mandatory
offer for outstanding shares.
Issuer ceases to exist. Securities must be delisted where the legal entity that issued
them ceases to exist. For example, shares can disappear as a result of a merger.
Non-compliance with the rules of the market. The MiFID makes it easier to de-
list securities that do not fulfil the minimum requirements of listing.
Either the operator of the regulated market or the competent authority may de-
cide to “suspend or remove from trading a financial instrument which no longer
complies with the rules of the regulated market unless such a step would be likely
to cause significant damage to the investors’ interests or the orderly functioning of
the market”.^433
SEC. In 2007, the SEC issued a release adopting new rules on “deregistra-
tion”.^434 The SEC established two alternative quantitative benchmarks for the de-
registration of the equity securities of foreign private issuers: (i) a new trading
(^428) LR 5.2.2 G. See also SEC Rule 13e-3, Going Private Transactions by Certain Issuers or
Their Affiliates.
(^429) Such rules can have been inspired by SEC Rule 13e-3, Going Private Transactions by
Certain Issuers or Their Affiliates.
(^430) § 58(1)(2) and § 58(2) of Börsenordnung der Frankfurter Wertpapierbörse (Exchange
Rules for the Frankfurt Stock Exchange).
(^431) § 74(4) of Börsenordnung der Börse Düsseldorf. The bid must fulfil the requirements of
§ 31 WpÜG.
(^432) BGH, judgment of 25.11.2002 – II ZR 133/01 (Ingram/Macrotron).
(^433) Article 41 of Directive 2004/39/EC (MiFID). See also Articles 17, 18 and 19 of Direc-
tive 2001/34/EC (Listing Directive). For German law, see § 38 BörsG. For English law,
see LR 5.2.2 G.
(^434) SEC Release No. 34–55540, “Termination of a Foreign Private Issuer’s Registration of a
Class of Securities Under Section 12(g) and Duty to File Reports Under Section 13(a) or
15(d) of the Securities Exchange Act of 1934” (March 27, 2007).