Swiss revisions ramp up takeover rules, insider trading enforcement

The rules regarding tender offers for Swiss-listed companies have been revised as part of the revision of the Swiss Stock Exchange Act. With this revision the offence of insider trading has been extensively revised and adapted to international standards. The revised provisions have come into force on 1 May 2013. This column briefly summarises them.

Revised Swiss takeover rules

Scope of application. In future, the Swiss takeover rules will also apply in the case of tender offers for foreign companies with equity securities that are, at least in part, primarily listed on a Swiss stock exchange. Prior to the revision, the scope of application of the Swiss takeover rules required both that the target’s corporate domicile is in Switzerland and that its equity securities are, at least in part, listed on a Swiss stock exchange.

Control premium. In future, the offer price in mandatory bids and voluntary bids affecting the control of the target will have to be at least as high as the highest price paid by the bidder for equity securities of the target in the preceding 12 months. Thus, it will no longer be possible to pay a control premium to a controlling shareholder, or to significant shareholders.

Felix Egli is a senior partner and Robert Bernet is a partner at the Swiss law firm VISCHER in Zurich. Wu Fan, a counsel of the firm, co-authored this article