Page 16 - מיזוגים ורכישות - פרופ' אהוד קמר תשפב

The Effect of the Recent EU Enlargement on the Directive
On May 1, 2004, ten countries joined the EU, increasing the number of EU
Member States from 15 to 25.6 This was by far the biggest increase in the size of the EU
since its conception.
The enlargement will increase the EU population by around 20% to a market of
about 450 million people, which is likely to affect the M&A market. Although various
provisional arrangements apply for these ten new countries relating to the integration of
their laws to EU standards, they will eventually be obligated to implement the Takeover
Directive. This will regulate the bidding process in a greater number of European
countries, and will assist in the harmonization of takeovers on this side of the Atlantic.

Conclusion
The final form of the Directive is significantly watered down from earlier versions
due to the series of political compromises. When implemented, it will be helpful in
particular in facilitating bids for companies in those jurisdictions that have little or no
existing body of takeover law or practice. However, it is likely that some countries, but
not others, will invoke their opt-out rights, with the result that true harmonisation will
not be achieved.
The Directive provides for the European Commission to review the Directive in
2011 and put forward any necessary changes. If the M&A climate changes as much in
that time as it has over the period the Directive took to negotiate, there will certainly be
many alterations to be made.

6 The new members are Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta,
Poland, the Slovak Republic, and Slovenia.

12