Cross border merger regulations
Cross border merger regulations

The following Corporate guidance note provides comprehensive and up to date legal information covering:

  • Cross border merger regulations
  • Brexit impact
  • Background
  • Application of the Regulations
  • Reasons for using the procedure to effect a takeover
  • Types of merger
  • The Takeover Code
  • Key documentation
  • Procedure
  • Employee participation
  • more

Brexit impact

The ability of UK companies to participate in mergers under the EU cross-border merger regime may be affected by Brexit. In particular, the Companies (Cross–Border Mergers) Regulations 2007 (Regulations) are being revoked by the Companies, Limited Liability Partnerships and Partnerships (Amendment etc.) (EU Exit) Regulations 2019, SI 2019/348 as after the end of the Brexit implementation period (which is due to end at 11pm UK time on 31 December 2020) the UK will no longer have access to the regime designed for mergers to occur between EEA States (subject to the terms of any ratified Future Relationship Agreement that may be entered into between the UK and the EU. For further details, see Proposed revocation of the Regulations following Brexit below.

For further details of the impact of Brexit on the UK takeover regime generally, see Practice Note: Brexit—UK takeover regime.

Background

The European regime governing mergers between companies in different member states of the EEA derives from Directive 2005/56/EC, the Directive on Cross-Border Mergers of Limited Liability Companies (Directive), which was consolidated with five other EU directives in the area of company law in 2017 by Directive (EU) 2017/1132 relating to certain aspects of company law (the Codifying Directive).

The Directive was enacted to:

  1. enhance co-operation and consolidation between companies in the member states of the European Economic Area