Judges N Piçarra (Rapporteur), D Šváby, S Rodin, K Jürimäe
Advocate General J Richard de la Tour
The defendant, a Spanish bank, issued an offer of shares to the public for listing on the stock exchange, divided into two tranches: one addressed to non-qualified “retail investors” and employees and directors of the bank, the other addressed to “qualified investors” as defined by article 2(1)(e) of Parliament and Council Directive 2003/71/EC. A prospectus was published prior to the offer, but was addressed only to the retail investors. The requirements for protection of investors varied according to the category of investor and their level of expertise, as recognised in recital (16) and article 3(2) of the Directive which provided that a prospectus was not required for offers limited to qualified investors. The claimant, a Spanish insurance company which was regarded as a “qualified investor”, purchased a large number of shares. Following a revision of the bank’s annual financial statements, the shares lost almost all their value on the secondary market and were suspended from trading. In previous proceedings brought by some of the retail investors, the Spanish Supreme Court found that the prospectus contained serious inaccuracies regarding the issuer’s true financial situation. The claimant company’s claim for damages against the bank pursuant to article 6 of the Directive, on the grounds that the prospectus was misleading, was allowed. On the bank’s appeal, the Supreme Court noted that the offer addressed to the retail investors made the publication of a prospectus mandatory, and that the prospectus could have influenced the investment decisions of the qualified investors even though it was not addressed to them. In those circumstances, the Supreme Court stayed the proceedings and referred to the Court of Justice of the European Union for a preliminary ruling, the questions whether, on the correct interpretation of articles 3(2) and 6 of Directive 2003/71: (i) the qualified investors were able to bring an action for damages based on the prospectus; and (ii) if so, was it possible to assess the extent to which the qualified investors were aware of the economic situation of the issuer of the offer of shares otherwise than through the prospectus, on the basis of their legal and commercial relations with that issuer.
On the reference—
Held (1) an investor who had participated in an offer of securities in the context of which a prospectus had been published could legitimately rely on the information given in that prospectus and was, therefore, entitled to bring an action for damages, pursuant to article 6 of Parliament and Council Directive 2003/71/EC, on the grounds of the inaccuracy of that information, whether or not the prospectus was issued for that investor. The distinction between retail investors and qualified investors, which was apparent from recital (16) and article 3 of the Directive, did not cast doubt on that conclusion. The exemptions from the general obligation to publish a prospectus in article 3(2), which had to be strictly interpreted, did not prohibit the voluntary publication of such a document for all investors. As in the present case, where there was a combined offer addressed both to qualified and retail investors, all investors, regardless of their status, could rely on the information in any prospectus that was published, and could bring an action for damages on the basis of the inaccuracy of that prospectus under article 6 of the Directive (judgment, paras 33, 34, 36–39, operative part, para 1).
(2) Article 6(2) of Directive 2003/71 granted a broad discretion to the member states to lay down the rules for bringing an action for damages on the grounds of the information given in a prospectus and did not preclude provisions under national law which allowed, or even required, a court hearing such an action to take account of the knowledge which the qualified investor had or should have had of the issuer’s economic situation, on the basis of its relations with that issuer, and otherwise than through the prospectus. However, the national court had to verify that those provisions were no less favourable than those governing similar actions under national law and that they did not make it excessively difficult to bring such an action (judgment, paras 42, 47, 48, operative part, para 2).
JM Fatás Monforte, J Salinas Aguirre and D Sarmiento Ramírez-Escudero for the defendant bank.
L Lozano García for the claimant company.
L Aguilera Ruiz and J Rodríguez de la Rúa Puig, agents, for the Spanish Government.
M Smolek, J Vláčil and J Očková, agents, for the Czech Government.
T Scharf and J Rius Riu, agents, for the European Commission.