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| Dear reader We are glad that “Deal with LMHB” has found many readers and received positive feedback. The June edition of the newsletter deals with the plans of the Parliament to increase the attractiveness of the private limited company as a type of enterprise, the efforts of the Financial Supervision Authority to regulate the roles of collateral agents and underwriters, and the Estonian Development Fund’s optimistic foresight report on financial services. In addition, we have reflected on a topic that has been a cause of headache for legal and financial advisors – how to arrange an issue of shares in a situation where a shareholder cannot subscribe for a whole number of shares. Wishing you a pleasant read and enjoyable summer Luiga Mody Hääl Borenius
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The first parliamentary reading of a draft resolution to amend the Commercial Code took place on 19 May. The draft aims to significantly amend requirements on private limited companies. Founding and managing private limited companies, making non-monetary contributions, transfer of shares, and other procedures will become far simpler.
The Financial Supervision Authority is going to provide an advisory guideline “Generally recognised professional requirements upon rendering investment services and non-core services”. The guideline mainly aims at specifying the principles applicable to the named services. Although the guidelines of the FSA are not statutory and are meant to be explanatory and guiding in nature, it would still be commendable to consider them in order to understand the market regulator’s position.
Our last newsletter overviewed amendments to financial sector related regulations, simplifying requirements set for companies doing business in the financial sector and allowing more freedom concerning cross-border activities. The Estonian Development Fund’s recent foresight report “Financial services 2018: Estonian export opportunities and political implications” is highly topical in this context. The report studies Estonian prospects for increasing exports of financial services.
When raising additional capital, allocation of the pre-emptive subscription right may become problematic when the number of shares owned by a shareholder does not allow subscription for a whole number of shares. What are the possible solutions to this problem?
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The content of "Deal with LMHB" is not to be interpreted as a recommendation, proposal, or any form of legal advice. The information is of a general character and cannot form the basis for any decision.