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Providers of Investments Required to Publish Prospectuses in Germany

In 2017, the Act Amending Financial Market Regulations came into effect in Germany. The expansion of the obligation to draw up a prospectus has a particularly strong effect for providers of investments such as wood, container or other material investments. Previously, those providers only had to publish an investment prospectus either when they offered the investor an interest rate and refund or when they granted the investor a valuable cash settlement on the temporary transfer of money. According to the new regulations, it is now sufficient to only promise a valuable cash settlement.

Legislator fills last regulatory gaps

Having negative experiences with prospectus-free offers on the capital market, the German legislator intends to fill the last gaps for providers of investments. Furthermore, along with the financial investment, every investor shall receive a prospectus that contains comprehensive information about the investment, the provider, chances and risks. Thus, businesses that are refinanced with investors’ money will now usually have to draw up prospectuses for their investment offers and get them approved by the Federal Financial Supervisory Authority (BaFin) before publishing. This applies to both, German and foreign businesses that intend to benefit from the investment capacity of German investors.

WINHELLER advises providers of investments

The issuance of prospectuses should always be accompanied by competent consultants. WINHELLER has the necessary expertise and experience in this field. We would be happy to assist you with planning and implementing public offers for investments in Germany. We are looking forward to hearing from you!

Continue reading:
Reducing liability risks by investment prospectuses
Legal requirements for the issuance of securities on the German market

Dr. Annette Wagemann

Dr. Annette Wagemann comprehensively advises companies and their managers on questions regarding business law and banking regulations. She is specialized in the legal structuring of business models, corporate governance and compliance, and especially in business models that require a BaFin license.

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