Due to relatively recent changes in legislation a prospectus may be required if a company offers shares (or other securities) to its employees within the European Economic Area (EEA).
On 1 July 2005 the Prospectus Directive was incorporated into UK law. Before then, there was a clear exemption from the need to produce a prospectus for offers of shares and other securities
under employee share schemes. This is no longer the case.
The Directive applies not only to EU companies, but also to non-EU companies, such as US issuers, who offer securities to their employees working in the EEA.
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