Takeovers Code Introduction
The Takeovers Code was introduced in 2000. The government's two main objectives for the introduction of the Code were firstly, to align our takeovers regime with international best practice - giving international and domestic investors greater confidence in our market. And secondly, to give greater confidence to small and minority investors by providing them with fair and equal treatment and participation in takeover situations.
The Takeovers Code came into force on 1 July 2001. As could be expected with any new and comprehensive market regulation, the practical application of the Takeovers Code in its first years has brought to light a number of minor inconsistencies and anomalies in its wording or construction. These have resulted in instances where the Code's requirements have proved problematic or where its policy is not in fact being met.
In December 2003 and April 2005, following a period of public consultation, the Takeovers Panel (the Panel) recommended that the government make amendments to the Code relating to a number of technical issues.
Compliance
All prospective takeover offers must now comply with the Code and adhere to its core concepts of fair equal treatment and participation of all shareholders. By requiring an offer to remain open for a specified period and to all shareholders equally, the Code has removed some of the urgency seen in takeovers of old, where shareholders were coerced by brokers into selling out at a lightning pace for fear of missing out on the deal. The Code is enforced by the Takeovers Panel .
In December 2003, pursuant to its function to keep under review the law relating to takeovers of "specified companies", as defined in the Takeovers Act, the Panel made recommendations to the Minister of Commerce for a number of technical changes to the Code. In April 2005, the Panel made two further recommendations for change. Copies of the Panel's April 2003 and December 2004 discussion documents and its December 2003 and April 2005 recommendations are available from the Takeovers Panel .
The government is currently working through the recommendations with changes to the Code expected by late 2005 or early 2006.
Documents
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Technical Amendments to the Takeovers Code - Cabinet Paper
Cabinet Paper which discusses a number of technical amendments to the Takeovers Code, as recommended by the Takeovers Panel, in order to resolve practical difficulties that have become apparent in the years since the Code came into force on 1 July 2001.
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