Thomas Papadopoulos

Bio: Thomas Papadopoulos is an academic researcher from University of Cyprus. The author has contributed to research in topics: Corporate law & Directive. The author has an hindex of 7, co-authored 43 publications receiving 198 citations. Previous affiliations of Thomas Papadopoulos include International Hellenic University & University of Oxford.

International Organization of Securities Commissions (IOSCO)

Abstract: The International Organization of Securities Commissions (‘IOSCO’) was founded in 1983 and comprises the majority of the national competent authorities on securities regulation around the globe. It operates as a global standard setter for the securities sector. IOSCO develops, implements, and promotes adherence to internationally recognized standards for securities regulation. IOSCO cooperates with the G20 and the Financial Stability Board (‘FSB’) on the global regulatory reform agenda. It is based in Madrid, Spain. Its members cover more than 95% of the world’s securities markets in over 110 jurisdictions. Almost all the major emerging markets jurisdictions are members of IOSCO; this is a unique characteristic of this international financial organization. IOSCO currently has 203 registered members (IOSCO Fact Sheet [July 2013] 2; this and other IOSCO documents can be found at IOSCO website [22 April 2014]). IOSCO is a peculiar international organization because it does not have a founding treaty. It has been characterized as a ‘multilateral regulatory network of supervisors’ because IOSCO is a private organization made up of mostly public authorities (Marcacci ‘IOSCO: The World Standard Setter for Globalized Financial Markets’ 23, 25).

The Mandatory Provisions of the EU Takeover Bid Directive and Their Deficiencies

Abstract: The two key provisions of the EU Directive on Takeover bids, the Board Neutrality (Art.9) and the Breakthrough Rule (Art.11) are optional at Member State and individual Company level. According to the Directive's Reciprocity Rule, a target company, which applies the Board Neutrality and/or Breakthrough Rule, is able to opt-out, if the offeror company does not apply the same Board Neutrality and Breakthrough provisions. Some of the few obligatory substantial provisions of the EU Directive on Takeover Bids are the Mandatory Bid Rule (art.5), the squeeze-out right (Art. 15) and the sell-out right (Art.16). The purpose of these provisions is to protect the minority shareholders according to the legal basis of the Directive (Art.44 par.2g Treaty of the EC). However, the Directive itself provides again the possibility to evade the enforcement of these provisions: a) at the transposition of the Directive into the national law and, b) after the implementation stage, when the parties to a bid are obliged to launch a mandatory bid. Additionally, the provisions themselves are characterized by many drawbacks and problems of interpretation, which reveal their weakness to contribute to the protection of the shareholders and subsequently to the freedom of establishment through takeover bids. Furthermore, the most important mandatory provisions of the Directive are easily avoidable and become de facto optional. If this conclusion is combined with the optionality of the two key provisions and the Reciprocity Rule, the EU Directive will not have any significant effect on the integration of the European Market for Corporate Control, the promotion of cross-border corporate mobility, the protection of shareholders and the protection of freedom of establishment in general. The Directive does not really 'exist'. This Article will analyze the most important mandatory provisions of the Directive, namely the Mandatory Bid Rule (art.5), the squeeze-out right (Art. 15) and the sell-out right (Art. 16).

The European Union Directive on Takeover Bids: Directive 2004/25/EC

Abstract: This article examines the extent to which the Takeover Bid Directive facilitates cross border takeover bids. The Directive should in principle contribute to cross frontier corporate mobility through takeover bids because it is based on the EC Treaty chapter on freedom of establishment. However, the Takeover Bid Directive is a compromise and watered down version of a proposal which the Commission envisaged would lead to a more effective pan-European takeover regime than that which actually proved possible. The need for compromise was the result of the very different legal and policy approaches of the Member States in the field of takeover regulation. Some provisions of the Directive are obligatory for all Member States. These provisions include the mandatory bid rule, the squeeze-out right, and the sell-out right. The mandatory bid rule requires a bidder who has acquired control of a listed company to make a bid at an equitable price for shares which remain in the hands of other shareholders. The squeeze-out right enables a successful bidder to require the holders of the remaining shares to sell them to him at a fair price. The sell-out right entitles a holder of remaining shares to require the bidder to buy these securities at a fair price. All these obligatory provisions of the Directive are in their present form open to criticism. The two key provisions of the Directive have been made optional for Member States. These are the non-frustration rule, requiring the board to obtain the prior authorization of the general meeting of shareholders before taking any action which could result in the frustration of the bid; and the breakthrough rule, requiring that any restrictions on the transfer of securities or voting rights provided for in the articles of association of the offeree company or in contractual agreements between the offeree company and the holders of its securities or in contractual agreements between holders of the offeree company's securities shall not apply vis-a-vis the offeror during the time allowed for acceptance of the bid. Nevertheless, Member States, which opt out, are obliged to allow individual companies to opt in. Moreover, a reciprocity rule was also adopted, which allows Member States to permit those companies, which apply these provisions, to opt out again if they are the target of a bidder, which does not itself apply the same takeover provisions. Additionally, the non-frustration and the breakthrough rule are not fully comprehensive and even when a company applies them, it might still be able to evade their application since some corporate and financial structures remain outside the Directive's scope. The disclosure of information required by the Directive plays an important role in the market for corporate control both for bidders and target companies, but the relevant provisions of the Directive are open to criticism.

The mandatory provisions of the EU Takeover Bid Directive and their deficiencies

Abstract: The two key provisions of the EU Directive on Takeover bids, the Board Neutrality (Article 9) and the Breakthrough Rule (Article 11), are optional at Member State and individual company level. According to the Directive's Reciprocity Rule, a target company that applies the Board Neutrality and/or Breakthrough Rule is able to opt out, if the offeror company does not apply the same Board Neutrality and Breakthrough provisions. Some of the few obligatory substantial provisions of the EU Directive on Takeover Bids are the Mandatory Bid Rule (Article 5), the squeeze-out right (Article 15) and the sell-out right (Article 16). The purpose of these provisions is to protect minority shareholders according to the legal basis of the Directive (Article 44, paragraph 2g EC Treaty). However, the Directive itself provides the possibility to evade the enforcement of these provisions: (i) at the transposition of the Directive into the national law, and (ii) after the implementation stage, when the parties to a bid are obl...

EU Company Law

Abstract: The aim of this volume is to provide a comprehensive analysis of the European Union’s legal framework in the area of company law. Company law has been at the centre of interest in EU law since the early stages of European integration. The internal market requires among other things the harmonization of the rules relating to company law, as well as to accounting, auditing and securities regulation. It is a real strength of this volume that it analyses the whole area of EU company law. Chapter 1 provides an introduction to history and structure of EU company law. Chapter 2 is dedicated to the first company law directive. Chapter 3 discusses the second company law directive. Chapter 4 concerns restructuring and analyses the third and sixth company law directives. Corporate disclosure is discussed in chapter 5. More specifically, the fourth company law directive on annual accounting disclosure and the seventh company law directive on consolidated accounts are discussed. In this chapter, there is also an examination of the International Accounting Standards (IAS) Regulation. Chapter 6 is devoted to single member private limited liability companies. The contribution of EU to corporate governance and all recent developments are discussed extensively in chapter 7. The important issue of statutory audit, at EU level, is analyzed in chapter 8. Chapter 9 is devoted to the takeover bids directive (thirteenth company law directive). Chapter 10 is dedicated to cross-border corporate restructurings with reference to the tenth company law directive on cross-border mergers and to the proposed fourteenth company law directive on the cross-border transfer of the registered Office. EU corporate forms, with an emphasis on the European Company Statute are analyzed in chapter 11. An extensive analysis of the Treaty articles and of the relevant case law on freedom of establishment and free movement of capital is included in chapter 12. Securities regulation and some aspects of capital markets law related with company law are discussed in chapter 13 (prospectus directive, transparency directive, and market abuse directive). The relevant case law of the Court of Justice of the EU is analysed thoroughly, throughout these chapters. When it is necessary, some parts refer to national company law paradigms.

Why higher takeover premia protect minority shareholders

Abstract: Posttakeover moral hazard by the acquirer and free‐riding by the target shareholders lead the former to acquire as few sharcs as necessary to gain control. As moral hazard is most severe under such low ownership concentration, inefficiencies arise in successful takeovers. Moreover, share supply is shown to be upward‐sloping. Rules promoting ownership concentration limit both agency costs and the occurrence of takeovers. Furthermore, higher takeover premia induced by competition translate into higher ownership concen‐tration and are thus beneficial. Finally, one share‐one vote and simple majority are generally not optimal, and socially optimal rules need not emerge through private contracting.

Climate Change and Financial Instability: Risk Disclosure and the Problematics of Neoliberal Governance

Abstract: In recent years, climate change has increasingly come to be seen as one of the principal threats to future global financial stability. This article identifies and critiques the emerging consensus among international financial regulators as to how this threat—the key perceived components of which are also delineated—can best be managed. It shows that the preferred approach mirrors hegemonic postfinancial crisis regulatory practice vis-a-vis financial stability risk more generically: prioritization of market discipline underpinned by risk disclosure. The article characterizes this approach as a quintessentially neoliberal modality of governance. It also argues that insofar as this approach relies on financial market workings and financial institutional behaviors explicitly belied by the financial crisis, it risks precisely the type of “climate Minsky moment” regulators aim to avoid.

The Effect of Mandatory IFRS Adoption on International Cross-Listings

Abstract: Using a comprehensive dataset of international cross-listings spanning 34 (50) home (target) countries, we examine whether mandatory IFRS adoption facilitates firms' cross-listing activities. Our results using difference-in-differences analyses show that firms that mandatorily adopt IFRS exhibit significantly higher cross-listing propensity and intensity following IFRS adoption. We also find that firms from mandatory IFRS adoption countries are more likely to cross-list their securities in countries also mandating IFRS and countries with larger and more liquid capital markets. We further find that IFRS adoption has a greater effect on mandatory IFRS adopters from countries with larger accounting differences from IFRS, lower disclosure requirements, and less access to external capital prior to IFRS adoption. Our findings are consistent with the notion that mandatory IFRS adoption facilitates firms' cross-listing activities and highlight the importance of considering the change in cross-listings w...

Mezzanine Financing : A Comparison between the Finnish and International Financial Market Regulation

Abstract: The purpose of the research is to give understanding what is the company law background concerning the use of mezzanine financing, how mezzanine instruments are handled from accounting and taxation perspective and how they are used in the market today. On top of that is reviewed the size of mezzanine market in relevant countries. The main focus is in Finland and comparison is done to Sweden, Estonia, USA, UK and Germany. The differences of legal frameworks and markets in relation to the discussed financing form are analysed. The research objective has been to conclude what are some of the main differences of company regulation, accounting and taxation rules and local market conditions related to the topic in question. Additionally, it is reviewed how mezzanine could be used in bank lending going forward in order to support functioning capital markets. In the review of legal background, the focus has been on company law solely. Reference to other legislation is made only if it is necessary to understand better the specific company law regulation in question. The analysis of applicable accounting rules has concentrated on the local GAAP and IFRS regulation. In the review of taxation rules is focused on thin capitalisation rules and deductibility of interest from the borrower ́s view. When reviewing the local market conditions, the attention has been given to the size of the market in terms of amount of venture capital actors, volumes of venture capital investments, number of banks and volumes of bank loans. The research is based on academic and professional literature in company law and finance. The outcome of the research is that there are significant differences in the company law, accounting rules and taxation regulation between the observed countries. There are also significant differences in mezzanine markets between the observed countries due to variation of actors and their capacity to provide financing. This influences on the availability of the mezzanine financing in general. Additionally, it can be concluded that mezzanine is a potential bank lending form. Mezzanine financing could be used especially in situations where customer does not have collateral to offer and bank would be prepared to grant financing even with traditional debt instruments. Mezzanine instruments give also additional possibilities for a bank to price the lending to reflect better the risk of the financing transactions. However, mezzanine cannot be a tool which would allow banks to step to transactions or projects which would be riskier than those transactions or projects which are financed by banks today with traditional senior debt loan instruments. It is rather a tool which would provide to banks additional alternatives to price more accurately the risks they would take anyhow.