UK Takeover Panel Chief Slams Directive

by Robin Pilgrim, LawAndTax-News.com, London

03 June 2004

Speaking at the International Bar Association's Financial Law Conference late last month, director-general of the UK's Takeover Panel, Richard Murley expressed disappointment at the eventual form that the EU's Takeover Directive has assumed.

Under the terms of the EU law, which was approved by the European Parliament in December 2003, EU members will be able to opt out of Articles 9 and 11 of the Takeover Directive, which prohibit the use of tactics such as poison pills and multiple votes to frustrate hostile takeovers.

The provision making Article 9 optional was reportedly added as a result of pressure from member states such as Germany, which is determined to prevent foreign takeovers of key companies, including Volkswagen.

According to an LMG report, speaking to the audience of 250 lawyers on May 28, Mr Murley questioned whether the final shape of the Directive merited the effort put into passing it, arguing that by allowing countries to opt out of Articles 9 and 11, the EU had "effectively grandfathered the existing regime".

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