No C 64/8 Official Journal of the European Communities 14. 3. 89 
II 
(Preparatory Acts) 
COMMISSION 
Proposal for a Thirteenth Council Directive on Company Law concerning takeover and other 
general bids 
COM(88) 823 final - SYN 186 
(Submitted by the Commission on 19 January 1989) 
(89/C 64/07) 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 54 
thereof, 
Having regard to the proposal from the Commission, 
In cooperation with the European Parliament, 
Having regard to the opinion of the Economic and 
Social Committee, 
Whereas it is necessary to coordinate certain safeguards 
which Member States require of companies and firms 
within the meaning of the second paragraph of Article 58 
of the Treaty for the protection of members and others, 
in order to make such safeguards equivalent throughout 
the Community; 
Whereas it is necessary to protect the interests of the 
shareholders of public companies limited by shares when 
these are the subject of a takeover or other general bid; 
Whereas shareholders who are in the same position 
should be treated equally; 
Whereas this equality of treatment requires that the obli­
gation to make a bid is imposed on persons wishing to 
attain a certain level of participation in a company and in 
order to ensure the protection of minority shareholders 
and to avoid purely speculative partial bids, it is 
necessary to require that these persons make a bid for all 
the shares of that company; 
Whereas each Member State should designate a super­
visory authority or authorities to ensure that parties to a 
takeover or other general bid fulfil their obligations; and 
whereas it is necessary to determine which authority has 
territorial jurisdiction in the case of cross-frontier bids 
and to provide for the mutual recognition of offer documents within the Community; whereas the different 
authorities must cooperate with one another and their 
present or former officers and servants should be bound 
to preserve confidentiality; 
Whereas to reduce the scope for insider dealing offerers 
should be required to announce their intention of 
launching a bid as soon as possible and to inform the 
supervisory authority and the offeree company's board 
of the precise terms of the bid before they are made 
public; 
Whereas to avoid operations which frustrate the bid it is 
necessary to limit the powers of the board of directors of 
the offeree company to engage in operations of an 
exceptional nature; 
Whereas to help ensure compliance with the obligations 
resulting from the Directive it should be compulsory for 
offerers to be represented by a person or credit 
institution licensed to deal on the financial markets; 
Whereas the addressees of a takeover or other general 
bid should be properly informed of the terms of the bid 
by means of an offer document and, where the 
consideration offered includes securities, should be 
provided with certain additional information about the 
company issuing those securities; 
Whereas the offerer should be required to bring the offer 
document to the attention of all addressees of the bid 
and where the offer document contains insufficient 
information to clarify the real intentions of the offerer, 
the supervisory authority should be able either to forbid 
the publication of the offer document or to make the 
offerer publish a revised document; 
Whereas it is necessary to set a time limit for takeover 
bids; 
Whereas, in the interests of the offeree company and the 
addressees of the bid, it should be provided that once an 
offer document has been made public the bid may not be 
withdrawn except in certain specified circumstances; 
14. 3. 89 Official Journal of the European Communities No C 64/9 
Whereas the board of the offeree company should be 
required to report in writing to its shareholders its view 
of the bid, and whereas where the consideration offered 
in the bid includes serurities for which at the time the bid 
is made no official stock exchange listing has been 
applied for it should also be required to obtain and make 
available to all addressees of the bid an additional report 
by an independent expert; 
Whereas offerers are entitled to revise their bids; 
whereas limits should be placed on that right in order to 
maintain an orderly market in the shares and it should be 
ensured that the addressees of the bid are informed in 
time; whereas it is necessary that the offerer draw up 
and make public a fresh document setting out the 
amendments to the original bid and whereas addressees 
who have already accepted the bid should be entitled to 
accept the revised bid; 
Whereas in order to ensure equal treatment of 
addressees of the bid, any acquisition by the offerer, or 
by certain persons associated with him, of shares which 
are the subject of the bid at a higher price than that laid 
down in the offer document or one of its revisions, must 
itself be considered as a revision; 
Whereas to be able to perform their functions satisfac­
torily, supervisory authorities need to be able to find out 
at any time how many acceptances have been received to 
date and whereas, from the time the intention to make a 
bid is announced by the offerer, any dealing in the 
securities concerned must be made public by any person 
already having a significant shareholding; 
Whereas the result of the bid must be made public and 
notified to the supervisory authority; 
Whereas taking into account the social policy of the 
Community, it is necessary that representatives of the 
employees of the offeree company be informed with 
regard to the bid and that they should receive all the 
documents concerning that bid; 
Whereas competing bids for the securities of a company 
are necessarily to the advantage of its shareholders; 
whereas all such bids should be subject to the same rules 
as the original bid and the original offerer should be 
entitled to withdraw his bid in such a case; 
Whereas this Directive does not until subsequent coordi­
nation affect the capacity of Member States to forbid a 
takeover or other general bid where the offerer is either 
a national or a company from a third country, in 
particular where Community nationals and companies do 
not benefit from reciprocal treatment as regards the 
acquisition of shares by means of such a bid in a 
company governed by the law of that third country, HAS ADOPTED THIS DIRECTIVE: 
Article 1 
Scope 
The coordination measures prescribed by this Directive 
shall apply to the laws, regulations and administrative 
provisions of the Member States relating to takeover and 
other general bids addressed, on the same terms, to all 
holders of the securities, or the securities of a particular 
class or classes, of any of the following types of 
company: 
— in Germany: 
die Aktiengesellschaft, die Kommanditgesellschaft auf 
Aktien, 
— in Belgium: 
la societe anonyme / de naamloze vennootschap, la 
societe en commandite par actions / de comraan-
ditaire vennootschap op aandelen, 
— in Denmark: 
aktieselskaber, kommanditaktieselskaber, 
— in Spain: 
la sociedad anonima, la sociedad en comandita por 
acciones, 
— in France: 
la societe anonyme, la societe en commandite par 
actions, 
— in Greece: 
T] avcbvuuri Exaipeia, n ETep6ppu$uT| Kaxd U£TOX&S 
exaipeia, 
— in Ireland: 
the public company, limited by shares, 
— in Italy: 
la societa per azioni, la societa in accomandita per 
azioni, 
— in Luxembourg: 
la societe anonyme, la societe en commandite par 
actions, 
— in the Netherlands: 
de naamloze vennootschap, 
— in Portugal: 
sociedade anonima, sociedade em comandita por 
accoes, 
— in the United Kingdom: 
the public company, limited by shares. 
No C 64/10 Official Journal of the European Communities 14. 3. 89 
Article 2 
Definitions 
1. For the purposes of this Directive, 'offeree 
company' shall mean a company whose securities are the 
subject of a takeover or other general bid (hereinafter 
referred to as 'a bid'). 
2. For the purposes of this Directive, 'offerer' shall 
mean any person or company including, where appro­
priate, the directors of the offeree company, who 
launches a bid in accordance with the obligation set out 
in Article 4 or on a voluntary basis. 
3. For the purposes of this Directive, 'securities' shall 
mean securities carrying voting rights in a company or 
which can be converted into securities carrying such 
rights. 
4. For the purposes of this Directive, 'parties to the 
bid' shall mean the offerer, the representative of the 
offerer within the meaning of Article 9, the directors of 
the offerer, if the latter is a company, the addressees of 
the bid and the directors of the offeree company. 
5. For the purposes of this Directive, 'persons acting 
in concert' shall mean persons who, pursuant to an 
agreement, cooperate with one another with the aim of 
acquiring the securities of a company. 
Article 3 
Equal treatment 
Shareholders who are in the same position shall be 
treated equally. 
Article 4 
Obligation to make a bid 
1. Any person aiming to acquire a number or 
percentage of securities, which, added to any existing 
holdings, gives him a percentage of the voting rights in a 
company which may not be fixed at more than 33 lh %, 
shall be obliged to make a bid to acquire all the securities 
of that company. 
2. To calculate the threshold referred to in paragraph 
1, the following must be added to the voting rights held 
by the offerer: 
(a) voting rights held by persons acting in their own 
name but on behalf of the offerer; 
(b) where appropriate, voting rights held by companies 
belonging with the offerer to the same group of undertakings within the meaning of Article 1 of 
Council Direcitve 83/349/EEC ('); 
(c) voting rights held by persons acting in concert with 
the offerer; 
(d) where appropriate, voting rights held by directors of 
the offerer company. 
3. The supervisory authority may grant exemptions to 
the rule laid down in paragraph 1, giving reasons for its 
decision and adopting all measures necessary to ensure 
equal treatment of all shareholders. 
Article 5 
Exemptions on the basis of size of the offeree company 
Article 4 shall not apply: 
(a) where the securities of the offeree company have not 
been admitted to official stock exchange listing or 
have not been the subject of a request for such 
admission at the moment when the bid is announced 
in accordance with Article 7, and 
(b) where the offeree company, or, where appropriate, 
the group of undertakings within the meaning of 
Article 1 of Directive 83/349/EEC to which the 
company belongs, do not exceed, at the 
balance-sheet date, the amounts of two of the three 
criteria laid down in Article 27 of Council Directive 
78/660/EEC (2). 
Article 6 
Supervisory authority 
1. Member States shall designate the authority or 
authorities which must discharge the functions specified 
in this Directive. The authorities thus designated may 
delegate all or part of their powers to other authorities 
or to associations or private bodies. Member States shall 
inform the Commission of these designations and of any 
delegation of powers and shall specify all divisions of 
functions that may be made. 
2. The authorities and, where appropriate, the associ­
ations or private bodies referred to in paragraph 1 must 
have all the necessary powers to ensure that this 
Directive is put into effect and, in any case, either the 
power to forbid the publication of an offer document 
which is incomplete by reference to the requirements of 
this Directive or the power to oblige the offerer to 
correct an inadequate offer document and to make it 
public by the means set out in Article 11 (1). 
(') OJ No L 193, 18. 7. 1983, p. 1. 
(2) OJ No L 222, 14. 8. 1978, p. 11. 
14. 3. 89 Official Journal of the European Communities No C 64/11 
3. The authority competent for supervising the 
drawing-up and publication of the offer document shall 
be that of the Member State in which the offeree 
company has its registered office. Where the bid is made 
in several Member States simultaneously, the offer 
document as prepared under the supervision of the 
national authority responsible shall be accepted in the 
other Member States, without their supervisory auth­
orities having the right to require the inclusion of any 
additional particulars in the document. 
4. After an offer document has been made public in 
accordance with Article 11 (1), the competent authorities 
of the Member States shall give each other any 
cooperation required for the performance of their duties 
and for this purpose shall supply each other with any 
information that may be necessary. 
5. All present or former officers or servants of super­
visory authorities shall be bound by the rules of 
professional secrecy. Information that has come to their 
knowledge in the course of performing their professional 
duties shall not be disclosed to any person or body not 
legally entitled to receive it. 
6. This Directive shall not affect the legislation of 
Member States concerning the liability of competent 
authorities. 
Article 7 
Procedure prior to publication of the offer document 
1. As soon as it decides to make a bid, the offerer 
shall make public its intention of doing so by one of the 
means provided for in Article 11 (1). It shall inform the 
competent supervisory authority accordingly. 
2. The offerer shall then immediately draw up an 
offer document in accordance with Article 10 and make 
it public in accordance with Article 11 (1). 
3. Before the offer document is made public, the 
offerer shall communicate it to the competent super­
visory authority and to the board of the offeree 
company. 
Article 8 
Restriction of the powers of the board of the offeree 
company 
After receiving the information referred to in Article 
7(1) and until the expiry of the period for accepting the 
bid, the board of the offeree company shall not, without 
the authorization of the general meeting of shareholders, 
decide: 
(a) to issue securities carrying voting rights or which 
may be converted into such securities; 
(b) to engage in transactions which do not have the 
character of current operations concluded under 
normal conditions unless the competent supervisory 
authority has authorized them, giving its reasons for 
such authorization. Article 9 
Representative of the offerer 
The offerer shall be represented either by a qualified 
person authorized to deal on the Community financial 
markets or by a credit institution authorized within the 
Community. 
Article 10 
Offer document 
1. The offerer shall draw up an offer document in 
respect of the bid stating at least: 
(a) the type, name and registered office of the offeree 
company; 
(b) the name and address of the offerer or, where the 
offerer is a company, the type, name and registered 
office of that company; 
(c) the name and address or, where appropriate, name 
and registered office of the representative of the 
offerer referred to in Article 9, 
(d) the securities or class or classes of securities for 
which the bid is made; 
(e) the securities, or the securities of the relevant class 
or classes, already held by: 
(aa) the offerer, 
(bb) other persons for the account of the offerer, 
(cc) companies belonging with the offerer to the 
same group of undertakings within the 
meaning of Article 1 of Directive 83/349/EEC, 
(dd) persons acting in concert with the offerer, 
(ee) where the offerer is a company, its directors, 
and the voting rights attached to those 
securities and the date and the price at which 
they were acquired; 
(f) where the offerer is a company, the securities, or the 
securities of a particular class or classes, of the 
offerer held by the offeree company, and the voting 
rights attached to them and the date and the price at 
which they were acquired; 
(g) the consideration offered for each security and the 
basis of the valuation used in determining it and, in 
the case of a cash consideration, the guarantees 
provided by the offerer regarding payment of that 
consideration, and, where appropriate, a statement 
concerning any future indebtedness of the offeree 
company to finance the bid; 
(h) where the consideration comprises securities, the 
date from which those securities will entitle their 
No C 64/12 Official Journal of the European Communities 14. 3. 89 
holders to a share in the profits and any special 
conditions affecting that entitlement; 
(i) any condition authorized by the competent super­
visory authority which the offerer places on the bid; 
(j) the latest date on which the bid may be accepted; 
(k) the steps to be taken by the addressees of the bid in 
order to signify their acceptance and to receive the 
consideration for the securities which they transfer 
to the offerer; 
(1) the intentions of the offerer, explicitly expressed, 
regarding the continuation of the business of the 
offeree company, including the use of its assets, the 
composition of its board and its employees; 
(m) any special advantages which the offerer intends to 
grant to the directors of the offeree company; 
(n) all agreements concerning the exercise of the voting 
rights attached to the securities of the offeree 
company. 
2. In addition, the offer document shall identify: 
(a) any person for whose account the offerer is acting; 
(b) any companies belonging with the offerer to the 
same group of undertakings within the meaning of 
Article 1 of Directive 83/349/EEC; 
(c) any person acting in concert with the offerer. 
3. Where the consideration offered includes newly-
issued securities for which at the time of the bid an 
official stock exchange listing has been applied for, the 
offer document shall be accompanied by the listing 
particulars required by Council Directive 
80/390/EEC ('). 
4. Where the consideration offered includes securities 
for which at the time of the bid no official stock 
exchange listing has been applied for, the offer document 
shall contain all the facts necessary to enable the 
addressees of the bid to form an informed judgment as 
to the assets and liabilities, financial position, record and 
prospects of the issuer. 
0) OJ No L 100, 17. 4. 1980, p. 1. Article 11 
Publication of the offer document 
1. The offer document and, where appropriate, the 
documents required by Article 10 (3) or (4) shall be 
either: 
(a) published in full in one or more national or mass-
circulation newspapers and in the national gazette 
designated under Article 3 (4) of Council Directive 
68/151/EEC O, or 
(b) made available to the addressees of the bid at 
addresses announced in notices in the newspapers 
and the gazette referred to at (a) or by equivalent 
means approved by the competent supervisory 
authority, or 
(c) where all the securities comprised in the bid are 
registered, circulated to all addressees of the bid. 
2. The offer document and, where appropriate, the 
documents referred to in Article 10 (3) and (4) shall also 
be filed with the competent supervisory authority. 
Article 12 
Period for acceptance 
1. The period for accepting the bid indicated in the 
offer document in accordance with Article 10 (1) (j) may 
not be less than four weeks or more than ten weeks from 
the date of publication of the document in accordance 
with Article 11 (1). 
2. The period may not be modified without the auth­
orization of the supervisory authority, giving its reasons, 
without prejudice to Article 20. 
Article 13 
Withdrawal of bids 
1. Once a bid has been made public by the means 
provided for in Article 11 (1), it may be withdrawn only 
in the following circumstances: 
(a) where there are competing bids and the offerer 
decides to withdraw his bid in accordance with 
Article 20 (4); 
(b) in a bid in which new securities are offered in 
exchange for the securities bid for, where the 
approval of the general meeting of the offerer 
company is not obtained for the issue of the new 
securities; 
(c) in a bid in which securities are offered in exchange 
for the securities bid for, where the securities fail to 
(2) OJ No L 65, 14. 3. 1968, p. 8. 
14. 3. 89 Official Journal of the European Communities No C 64/13 
obtain an official stock exchange listing as the offerer 
intended; 
(d) where the necessary judicial or administrative auth­
orization is not obtained for the acquisition of the 
securities for which the bid is made, and in particular 
in the event of lack of authorization of the 
acquisition by the merger control authorities; 
(e) where a condition of the bid announced in the offer 
document in accordance with Article 10 (1) (i) and 
approved by the competent supervisory authority is 
not fulfilled; 
(f) in exceptional circumstances and with the authori­
zation of the supervisory authority, giving reasons, 
where the bid cannot be put into effect for reasons 
beyond the control of the parties to the bid. 
2. The withdrawal of the bid shall be made public by 
the means provided for in Article 11 (1) and 
communicated to the competent supervisory authority. 
Article 14 
Report of board of offeree company 
1. The board of the offeree company shall draw up a 
detailed report giving its views on the bid and setting out 
the arguments for and against acceptance. The report 
shall state whether the board is in agreement with the 
offerer on the bid and specify any agreements on the 
exercise of the voting rights attached to the securities of 
the offeree company. 
2. Where the consideration offered comprises 
securities for which at the time of the bid no official 
stock exchange listing has been applied for, the board's 
report shall be accompanied by the report of an expert 
independent of the parties to the bid appointed or 
approved by the competent supervisory authority. This 
report shall in all cases state whether, in the expert's 
opinion, the consideration offered is fair and reasonable 
and shall give the expert's views on the basis of valuation 
used to determine the consideration. 
3. The reports shall, in good time before the expiry of 
the period for acceptance, be made public by the means 
provided for in Article 11 (1) and filed with the 
competent supervisory authority. 
4. Where the board of the offeree company is in 
agreement with the offerer, the board's report, accom­panied, where appropriate, by the expert's report as 
referred to in paragraph 2, may be attached to the offer 
document provided for in Article 10. 
5. The provisions of this Article shall also apply to 
revisions of the bid and to competing bids. 
Article 15 
Revision of bids 
1. At any time before the last week of the period for 
acceptance announced in accordance with Article 
10 (1) (j), the offerer may revise the terms of the bid. 
Article 7 (I) shall apply as regards the. public 
announcement of the offerer's intention to revise the bid. 
2. Where a bid is revised, the previous period for 
acceptance shall be automatically extended by one week. 
3. The offerer shall draw up a document setting out 
the amendments to the offer document and making it 
public by the means provided for in Article 11 (1). 
4. Member States shall ensure that persons who have 
already accepted the previous bid by the offerer may 
accept the revised bid. 
5. The periods provided for in paragraphs 1 and 2 
may be modified with the authorization of the competent 
supervisory authority, which must set out the reasons on 
which it is based. 
Article 16 
Automatic revision 
The acquisition by the offerer, by persons acting in 
concert with him or by persons acting in their own name 
but on behalf of the offerer, during the acceptance 
period, of securities in respect of which the bid is made 
at a price higher than that established in the offer 
document or one of its revisions, will itself be considered 
as a revision of the bid and have the effect of increasing 
the consideration offered to those who have accepted 
previously. 
Article 17 
Provision of information to the supervisory authority 
1. Throughout the period for acceptance of the bid 
the offerer shall provide the competent supervisory 
authority at any time on request with information as to 
the number of acceptances received to date. 
2. From the time a bid is publicly announced in 
accordance with Article 7(1), the offerer or any holder 
of 1 % or more of the voting rights of the offeree 
company, of the offerer company if the offerer is a 
No C 64/14 Official Journal of the European Communities 14. 3. 89 
company, or of any other company whose securities are 
offered by way of consideration, shall declare to the 
competent supervisory authority all acquisitions of 
securities of the said companies by the offerer or the 
holder, persons acting in concert with them or persons 
acting in their own name but for their account, and the 
purchase price of such securities. 
Article 18 
Publication of result of bid 
Once the period for acceptance has expired, the result of 
the bid shall be made public by the means provided for 
in Article 11 (1) and shall be communicated to the 
competent supervisory authority by the offerer. 
Article 19 
Information for representatives of employees of the 
target company 
The board of the offeree company shall communicate to 
its workers' representatives, as designated by national 
legislation or customary practice in Member States, the 
offer document and, where appropriate, the documents 
referred to in Article 10 (3) and (4), as well as its own 
report as referred to in Article 14 and, if appropriate, the 
expert's report as referred to in Article 14 (2). 
Article 20 
Competing bids 
1. Where competing bids are made for the securities 
of the offeree company, this Directive shall apply to each 
such bid. 
2. Competing bids shall be publicly announced in 
accordance with Article 7(1). The offerer shall draw up 
an offer document in accordance with Article 10 and 
shall make it public by the means provided for in Article 
11 (1) before the period for acceptance of the initial bid 
expires. 
3. Except with the authorization of the competent 
supervisory authority, which must set out the reasons on 
which it is based, persons acting in concert with the 
offerer or acting in their own name but for the account 
of the offerer may not make a bid competing with the 
initial bid. 
4. Where there are competing bids and the initial 
offerer does not withdraw its bid, the period for 
acceptance of the initial bid shall be extended auto­
matically to the date of expiry of the period for 
acceptance of the competing bid. The extension shall be made public by the means provided for in Article 11 (1) 
and communicated to the competent supervisory 
authority. 
Article 21 
Contact committee 
1. A contact committee shall be set up under the 
auspices of the Commission. Its function shall be: 
(a) without prejudice to the provisions of Articles 169 
and 170 of the Treaty, to facilitate the uniform 
application of this Directive through regular consul­
tations on, in particular, practical problems arising in 
its implementation; 
(b) to ensure concerted action upon the policies 
followed by the Member States in order to obtain 
reciprocal treatment for Community nationals and 
companies as regards the acquisition of securities of 
a company by means of a takeover bid; 
(c) to advise the Commission, if necessary, on additions 
or amendments to this Directive. 
2. The contact committee shall be composed of repre­
sentatives of the Member States and representatives of 
the Commission. The chairman shall be a representative 
of the Commission. Secretarial services shall be provided 
by the Commission. 
3. The committee shall be convened by the chairman 
either on his own initiative or at the request of one of its 
members. 
Article 22 
Transposition of the Directive 
1. Member States shall adopt before .... the laws, 
regulations and administrative provisions necessary to 
comply with this Directive. They shall forthwith inform 
the Commission thereof. 
2. Member States shall fix the date of entry into force 
of these provisions in any case at the latest by ... . 
3. Member States shall communicate to the 
Commission the texts of the main provisions of national 
law which they adopt in the field covered by this 
Directive. 
Article 23 
Addressees of the Directive 
This Directive is addressed to the Member States.