The New Transparency Requirements Law

The Transparency Requirements Law, Law 190(I)/2007 took

effect on 1 January 2008. It transposes into domestic

legislation the European Parliament and Council Directive

2004/109/EC on transparency requirements of listed transferable

securities, and in part the European Commission Directive

2007/14/EC, which sets out detailed rules for the

implementation of certain provisions of Directive

2004/109/EC.

The Law applies to issuers of transferable securities listed

for trading on a regulated market having Cyprus as their Home

Member State. It designates the Cyprus Securities and Exchange

Commission ("CySEC") as the competent authority with

responsibility for supervision and enforcement.

The Law applies to transferable securities that are traded

in the stock exchange apart from instruments of payment and

money market instruments. It does not apply to units issued by

and traded in Undertakings of Collective Investments in

Transferable Securities ("UCITS"), unless they are

close-ended funds.

Issuers are required to publish accurate and concise

information in relation to their business performance and their

assets, including annual and half-year financial statements as

well as quarterly financial reports. Issuers are also obliged

to report on transactions in their securities on an ongoing

basis. An issuer is obliged to report the total amounts of

shareholdings in it as well as any notifications it receives

from its significant shareholders (those holding more than 5%

of the issued capital) in relation to their transactions. These

must be reported as soon as possible and in any event no later

than the end of the day after notification. Issuers are

required to notify CySEC at the end of each calendar month of

any changes in their capital or the total amount of the voting

rights attached to their shares. They must also immediately

inform CySEC of any change in the rights attaching to their

shares and derivatives or any loan agreement they enter into.

Finally, issuers are obliged to give CySEC prior notice of any

proposed changes to their constitution.

The Law also imposes obligations on shareholders. A

shareholder who acquires or disposes relevant securities to

which voting rights are attached, must notify the issuer of the

proportion of voting rights held by him or her as a result of

the acquisition or disposal in the event that proportion

reaches or exceeds 5% (being the minimum threshold). This

notification requirement does not apply:

where shares...