Deutsche Börse AG Suspends New Listings on the Open

On December 20, 2011, Deutsche Börse AG suspended new listings for the First Quotation Board due to fraud and new cases of suspected market manipulation among several shares listed in the First Quotation Board. Deutsche Börse AG stated, “prosecution according to criminal law and supervisory legislation only seems to have a limited deterrent effect. By Brenda Lee Hamilton

Against this background and for the purpose of protecting the capital market and particularly the investors, Deutsche Börse AG has decided not to list any shares and certificates representing shares in First Quotation Board any more until further notice”. Open Market Circular No. 05/11 announcing the suspension of new listing applications, Deutsche Börse AG also reminded all market participants of their obligation according to § 10 of the German Securities Trading Act to report any suspension of market manipulation immediately to the German Federal Financial Supervisory Authority.

Deutsche Börse AG indicated that is currently examining together with the Hessian Exchange Supervisory Authority and the German Federal Financial Supervisory Authority further measures in order to guarantee orderly exchange trading for the capital market and particularly for the investors and maintain quality of the segments also in the future. Issuer’s wanting to list its shares on the First Quotation Board must now locate a Frankfurt listed shell company to list on the First Quotation Board. Issuers who qualify can continue to list on the Open Market which requires among other things that the issuer fulfill ongoing transparency requirements including the following which must be published on the Listed Company’s website:

i. Audited consolidated financial statements and management report (in accordance with provisions of the national accounting standards like the German Commercial Code, HGB or International Financial Reporting Standards, IFRS) no later than six months after the end of the reporting period;
ii. Publication of a brief, up-to-date company profile and a calendar of company events; iii. Publication of the interim report no later than three months after the end of the first half of the fiscal year- There is no minimum content requirement of the interim report. Simply put using figures and explanatory notes, the interim report should give a true and fair view of the issuer’s financial position and general business trend during the first six months of the financial year (reporting period); and
iv. Immediate publication of information that could have a significant impact on the price of the listed shares.

This memorandum is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed in the material do not guarantee similar outcomes.

ABOUT THE AUTHOR: Brenda Lee Hamilton, Attorney
Brenda Hamilton our law firm’s founder has counseled clients in securities law transactions advising issuers in going public transactions, equity and debt offerings, corporate law matters and restructurings, securities transactions and disclosures, corporate identity theft and hostile takeovers. Ms. Hamilton assists clients in all of the going public process including filing of Form S-1 Registration Statements and Form 211 and symbol assignment from the Financial Industry Regulatory Authority (“FINRA”).

Copyright Hamilton & Associates, P.A.
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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.

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