UK Offence Report

Offence of disclosure in contravention of regulation 7

regulation 8(1) of The Takeovers Directive (Interim Implementation) Regulations 2006

This offence was read from the text as made, and no revised version was available, so a later revocation could not be ruled out. Check the current text at legislation.gov.uk.

What the provision says

1 A person who discloses information in contravention of regulation

7 is guilty of an offence, unless—

a he did not know, and had no reason to suspect, that the information had been provided as mentioned in regulation 7(1); or

b he took all reasonable steps and exercised all due diligence to avoid the commission of the offence.

Text as made, from legislation.gov.uk. © Crown copyright, reused under the Open Government Licence v3.0. This is the text as originally made; later amendments are not shown here.

Who it binds, and what has to be proved

Binds
a person
Conduct
contravening a requirement of the instrument
Fault element
Strict liability
Burden of proof
Legal burden on the defendant

The prosecution must prove that the conduct happened. This is a strict liability offence as drafted: the provision uses no word of intention, knowledge, recklessness or negligence, so there is no need to show that a person meant to do it, knew about it, or was careless.

Intention, knowledge and carelessness are irrelevant to guilt. They may still matter a great deal to sentence.

The provision gives a defence the defendant must prove, on the balance of probabilities. A legal burden of that kind can be read down to a merely evidential one under section 3 of the Human Rights Act 1998 where placing it on the defendant would be disproportionate (R v Lambert [2001] UKHL 37; Sheldrake v DPP [2004] UKHL 43).

Classifier’s reasoning: no word of intention, knowledge, recklessness or negligence in the offence or its provision.

The defence, as drafted

had been provided as mentioned in regulation 7(1); or b he took all reasonable steps and exercised all due diligence to avoid the commission of the offence.

What would breach regulation 8(1)?

These are illustrations, not law. They are generated from the provision’s own words to show the shape of the offence. Whether any particular conduct is caught depends on the full text, on any amendment since, and on the facts.

  1. On these words an offence is committed where a person discloses information in contravention of regulation 7.
  2. Doing the thing the provision prohibits under the Takeovers Directive (Interim Implementation) Regulations 2006, whatever the reason for doing it.
  3. Where the requirement is a positive duty, letting the time for performing it pass without performing it.

Penalty

Mode of trial
Either way — magistrates’ court or Crown Court
Maximum fine
£5,000
Maximum prison (summary)
Not determined
Maximum prison (on indictment)
3 months

expressed as the statutory maximum (the prescribed sum): the same words mean £5,000 in England and Wales and £10,000 in Scotland.

Sentencing

Offences of this kind are usually sentenced under the guidelines below. This is a mapping by subject, not a finding about this provision, and the links go to a search of the Sentencing Council’s own site.

Prosecution figures

No published per-offence figure was found for this provision, and it could not be matched to a Ministry of Justice offence code. Offences created by statutory instrument very largely do not have one. Absence of a figure is not evidence that the offence is unused.

Status and lifecycle

Current status
Status not determined
Made
25 April 2006
In force from
20 May 2006
Extent
Not stated

How this was established: read from the text as made; no revised version available, so later revocation could not be ruled out.

What the instrument is for

(This note is not part of the Regulations) — the explanatory note published with the instrument, © Crown copyright.

These Regulations, which are made under section 2(2) of the European Communities Act 1972, implement Directive 2004/25/EC of the European Parliament and of the Council of 21 April 2004 on Takeover Bids (“the Directive”). Part 2 makes provision for the operation of regulatory activities of the Panel on Takeovers and Mergers, the body designated to supervise takeover bids. It gives effect to the rules in the City Code on Takeovers and Mergers and the Rules of Procedure of the Panel’s Hearings Committee that implement the Directive. It confers powers on the Panel including the power to require information (regulation 6) and to apply to the court to secure compliance with certain requirements (regulation 11). The provisions contain new offences at regulation 8 (the disclosure offence) and regulation 10 (failure to comply with rules about bid documentation). Part 3 provides for defensive devices that may be adopted by a company prior to a takeover bid, to be overridden in certain circumstances. Such provisions are optional and regulations 20 and 21 set out the basis on which companies can opt-in and opt-out should they choose to do so. Regulation 22 deals with consequences of opting in. Part 4 supplements section 234 of the Companies Act 1985 (“the 1985 Act”) (or in the case of Northern Ireland, Article 243 of the Companies (Northern Ireland) Order 1986 (“the 1986 Order”), by setting out the additional information that must be contained in the directors' report of certain companies (regulation 26). Regulation 27 amends section 251 of the 1985 Act (or Article 259 of the 1986 Order) on summary financial statements to provide for the explanatory material either to be included in any summary financial statement or to accompany it. Part 5 and Schedule 2 contain provisions designed to address the problem of and for residual minority shareholders following a successful takeover bid. Known as “squeeze out” and “sell out”, these provisions enable a successful bidder to compulsorily purchase the shares of remaining minority shareholders and for those shareholders to require the majority shareholder to purchase their shares. Regulation 30 disapplies the existing provisions for “squeeze out” and “sell out” in the 1985 Act and 1986 Order where a takeover offer is made for a company with securities admitted to trading on a regulated market and instead applies Schedule 2. This is a consolidation of the existing provisions and the amendments required to implement the Directive or arising out of or related to obligations in the Directive. Part 2 applies to takeover bids covered by the Directive for all companies with securities traded on a regulated market in the United Kingdom or for companies registered in the United Kingdom whose securities are traded on a regulated market in one or more member states of the European Economic Area (other than the United Kingdom). Parts 3 to 5 apply only to companies registered under the Companies Act 1985 (or in the case of Northern Ireland, the Companies (Northern Ireland) Order 1986) and to unregistered companies. Copies of the City Code on Takeovers and Mergers and the Rules of Procedure of the Panel’s Hearings Committee are available from The Panel on Takeovers and Mergers, 10 Paternoster Square, London, EC4M 7DY. A Transposition Note and a full Regulatory Impact Assessment of the effect that this instrument will have on the costs to business are available from the Company Law and Governance Directorate, Department of Trade and Industry, Bay V565, 1 Victoria Street, London, SW1H 0ET. Copies have also been placed in the libraries of both Houses of Parliament.

Read the full note and every offence in this instrument

Other offences in the same instrument

How this was identified as an offence

Everything above rests on the judgement that this provision creates a criminal offence, rather than mentioning one. That judgement is made by rule, from the words of the provision, and this is the rule that made it — with a confidence of 0.92.

Basis
the provision says a person is “guilty of an offence”
Confidence
0.92 of 1.00

A provision that states a penalty for an offence created elsewhere can read very like one that creates an offence, and the rules can mistake the one for the other. If the text quoted above sets a penalty for something made an offence by another provision, treat the classification on this page with that in mind, and read the instrument.

Check the source