Issuer Limit Rules: Explained

What are the Issuer Limit Rules?

Our Issuer Limit Rules cover the major shareholding limits for issuers in jurisdictions where issuers are able to impose lower bespoke disclosure thresholds in their articles of association. These limits are set by issuers, and not the regulator.
Issuer limits for Belgian issuers are covered within the Major: Belgium rules - if an issuer triggers under both the Major: Belgium rules and the Issuer Limits rules, only the Major: Belgium disclosure should be considered. 
For French issuers, the Rules currently look up the ISIN, but will in the future also use the name from the information page of the relevant market - so make sure your IssuerID matches this as well.
Please note that our coverage of Issuer Limits relates specifically to those mentioned in the 'Substantial Shareholdings' section of the Aosphere memos. Issuer Requests are not in scope at this point.
The rules are as follows: 

a) Legal Structure

i) Aggregation level: AllEntities

      1. Issuer Limits - Shares: Legal Aggregation
      2. Issuer Limits - Voting: Legal Aggregation

ii) Aggregation level: AllEntitiesAndPortfolio

      1. Issuer Limits - Shares - Portfolio: Legal Aggregation
      2. Issuer Limits - Voting - Portfolio: Legal Aggregation

b) Voting Structure

i) Aggregation level: AllEntities

      1. Issuer Limits - Shares: Voting Aggregation
      2. Issuer Limits - Voting: Voting Aggregation

ii) Aggregation level: AllEntitiesAndPortfolio

      1. Issuer Limits - Shares - Portfolio: Voting Aggregation
      2. Issuer Limits - Voting - Portfolio: Voting Aggregation
 

Which ones apply/ which ones do we pick?

Firstly, you must accept any new updated versions and then deactivate them as required.
Rules must be selected on the following basis and depending on your needs:

  1. In total, only four rules should be activated within your environment at any given time on the following basis: two sets of rules selected from each set (a) legal structure and (b) voting structure as set out above.
  2. The subset of rules that you select within each structure depends on what level of aggregation you require:
    1. AllEntities: this means that the rules will aggregate all portfolios up to a specific sub-entity and trigger a disclosure based on all the assets of the sub-entity child portfolios. Further, should there be a Top Level Company as the ultimate parent, the rule will also trigger a disclosure based on the aggregate holdings across all portfolios.
    2. AllEntitiesAndPortfolio: this means that the rules will trigger disclosures on both sub-entities and a Top Level Company, but in contrast to the "All Entities" level, a disclosure on each individual portfolio is possible here as well. So, this is a combination of "Portfolio" and "All Entities".

For further information regarding aggregation within Rapptr please see our articles on Aggregation in our Help Centre.

How can we change an issuer to be included to run on the voting structure rules?


French issuers: 

In regard to whether issuer imposed thresholds in France should apply to aggregated calculations of where one holds a) either management or voting power, or b) just voting power alone, it depends on references in the issuer's articles of association. If a specific issuer's articles of association include a note that the rules applicable for the calculation of the additional thresholds are the same as those set out in Article L.233-7 et seq. of the French Commercial Code (or similar reference to this law), then FundApps will ensure that the calculations apply where only voting rights are held, since this is the standard under the code as referenced earlier. In the absence of such a reference, we have no specific legal guidance and conservatively calculate in the "legal" tree (representing where either management or voting power is held).
If you know of an issuer that is not set to run solely on the voting tree, contact Support with evidence from the issuer's articles of association containing the references as noted in the above standard. We will review such information and assess whether the change can be made. Since articles of association are not likely to change for an issuer, we would consider that any decision they make about how they want their assets aggregated would apply equally across the board.

Belgian issuers:

For Belgium, if companies add additional thresholds in their articles of association, they are assessed against the same aggregation criteria as the statutory rules (implemented Amended Transparency Directive) which is where one has power over the voting rights.

Other countries:

Without specific regulatory guidance, any other issuer imposed thresholds will apply to where either management or voting power is held.

How can we tell which issuers are included?

Our lists of issuers with limits and the lists which define how the rules operate are maintained in our Value Sets page. We store these lists in the Value Sets page (Main Menu > Value Sets) and the relevant value sets are as follows:

    1. IssuerLimits: contains the companies' names with their associated threshold values that trigger a disclosure requirement.
    2. IssuersWithLimits: contains the companies' names and matches to the ISIN of their instruments.
    3. IssuerLimitsAggregation: contains the name of the issuer and defines whether it should run on the voting structure set of issuer limit rules (IssuerLimitsVotingTree), or on the legal structure set of issuer limit rules (IssuerLimitsLegalTree).

For information on the source (website) for each issuer limit, this can be found in the Global Company Database (GCD) in Rapptr under the Company detail page > Limits > Data Source.

How do companies with issuer limits get added to the list in Rapptr?

We add companies with issuer limits for French and Belgian issuers any time we are informed of them by clients so they are primarily crowd-sourced. If you have any updates or amendments you would like to suggest, please find the company you wish to make the change to in the Global Company Database and then request to add of edit the record via the Limits tab.

You will be asked to provide

  1) The threshold (please provide this in in the syntax you are familiar with Rapptr using)

  2) The aggregation (Legal, Voting or Legal, Voting)

  3) The disclosure deadline

  4) The source where the thresholds are stated (this will usually be the articles of association)

  5) The source date and the date on which you checked the source

  6) All ISINs you are aware of that are linked to the company - note that these would be added to ISINs that may already exist from GCD.

GCDLimits.gif

Once the form has been submitted, the Content Team will be notified and will review the proposed change. They will either approve the change or respond to you with any questions if necessary. Once approved the change will be reflected in GCD and the content team will also add the data into the valuesets, which the Issuer Limits rules currently use to source the thresholds for the Issuer Limit rules.

How often is the list reviewed and updated?
We do periodic thorough reviews of the list to continue improving the service. We also review the issuer list at least once every 12 months on the best efforts basis to maintain the most updated information. We encourage our clients to notify us in the manner described above if they are aware of any changes to an issuer's information. For example, any ISIN changes as a result of a merger.

Only French and Belgian companies seem to be included, is there a reason for this?
We haven't included issuers from other jurisdictions for the reason that few of our clients have informed us of any (with supporting documentation).
If you would like to see issuers added from other countries then please contact our support team who will let you know the latest progress on supporting them.

What is the process for updating and monitoring individual issuer disclosure limits in Rapptr?
For any issuers where you disagree with the limits that appear on Rapptr, please contact Support with evidence (screenshot or email) from the regulator or the issuer themselves which states what rules apply. We will double-check this view, create an internal ticket for this to be adjusted and update it.

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