European Notebook

OXFORD - Cross-border takeovers within the European Union would become more transparent under a proposed directive adopted by European Union ministers last week. The proposed law is part of the EU's Financial Services Action Plan and, according to Frits Bolkestein, internal market commissioner, is an important element in achieving a single European market in financial services by 2005.

Under the proposed directive, all investors holding the same class of shares must be treated equally, particularly when there is a change of control within the company requiring a full bid. Currently, some member states require a party buying over a specified percentage of stock to make a bid for the entire company. In the U.K., for example, shareholders owning more than 29.9 percent of a company are obliged to make an offer for all remaining shares. Under the proposed directive, such events would have to be publicized to all the other shareholders, giving them an opportunity to vote on whether the company should accept the offer...