Page 14 - מיזוגים ורכישות - פרופ' אהוד קמר תשפב

companies. The Panel is perceived to operate an efficient and effective system and it was
felt that the Directive would not necessarily lead to any significant improvements. The
Panel’s rulings are subject to judicial review, but in the past, the English courts have
generally been unwilling to intervene in takeover bids.

Implementation of the Directive in the U.K. will require the Panel and the City
Code on Takeovers and Mergers4 to be put on a statutory footing. This could potentially
provide more opportunities for legal challenge, and therefore litigation (whether tactical
or not) could increase. This led to the concern that, because the Directive will have
legislative effect in each country when implemented, the Panel would be by-passed by
participants going direct to court.

The provision that has been inserted into the Directive acknowledges that
Member States may regulate whether and in what circumstances parties are entitled to
bring court proceedings in a bid context. This includes discretion to decide whether a
breach of takeover rules would entitle parties to a bid to litigate directly against each
other. Accordingly, in the U.K. at least, implementation of the Directive should not lead
to a flood of U.S.-style securities litigation.

Split Jurisdiction

It is not clear from the Directive how authority will be shared if one Member State
has implemented the Directive and another has not. Given that there is a two-year
window for implementation, there are likely to be occasions during that period when a
transaction involves a Member State that has implemented the Directive and one that
has not yet done so.

Also, the definitions afforded to certain terms in the Directive mean that the
procedure for sharing jurisdiction is not clear, and there does not seem to be any
mechanism to resolve jurisdictional disputes between the supervisory authorities.5 This
uncertainty could lead to delay and challenges.

4 The City Code on Takeovers and Mergers (available at www.thetakoverpanel.org.uk) sets out the
principles and rules governing offers for public companies in the United Kingdom.

5 Mr. Philip Remnant, Director General, Takeover Panel, speaking at the Select Committee on the
EU session 2002-3 in the House of Lords.

10