Capital Markets

Your Partner in Navigating European Capital Markets

At Acumum, we provide comprehensive legal guidance for businesses seeking to raise capital and navigate the complexities of European and Maltese financial markets. Whether you are planning an Initial Public Offering (IPO), issuing bonds, or exploring structured finance products, our experienced team ensures your transactions are compliant, efficient, and strategically sound. We partner with issuers, underwriters, and investors to unlock opportunities for growth and secure a competitive edge in the EU’s dynamic economic landscape.

Overview of Capital Markets Law in the EU

Capital markets law in the European Union (EU) is a comprehensive legal framework designed to regulate the issuance, trading, and supervision of securities and other financial instruments. Its main objectives are to ensure efficient, transparent, and resilient markets, protect investors, and foster cross-border investment and economic growth.

TYPES OF
TRANSACTIONS COVERED

Acumum has extensive experience in a number of capital markets – EU and USA, including work covering:

  • Initial Public Offerings (IPOs)
  • Secondary Offerings and Rights Issues
  • Bond and Note Issuances
  • Convertible and Equity-Linked Instruments
  • Securitizations and Structured Finance Products

BENEFITS OF EU CAPITAL MARKETS
FOR RAISING MONEY

Accessing capital markets offers companies:

  • Diverse funding options beyond bank loans, including shares, bonds, and crowdfunding.
  • Lower financing costs due to investor competition and market efficiencies.
  • Easier access for SMEs through simplified rules and alternative financing sources.
  • Cross-border fundraising with harmonized EU regulations and a larger investor pool.
  • Faster, more efficient processes thanks to digital platforms and streamlined procedures.
  • Support for growth and innovation by providing capital for expansion and R&D.
  • Greater resilience through risk diversification and multiple funding channels.
  • Enhanced visibility and credibility by increasing transparency and attracting institutional investors.

EUROPEAN LEGAL FRAMEWORK

KEY REGULATORY FRAMEWORKS

EU Capital Markets Law governs the issuance, trading, and regulation of financial instruments across the European Union. It ensures transparency, investor protection, and market integrity.

MIFID II

Investor protection, transparency and trading venue regulation

EMIR

Regulation of OTC derivatives and clearing obligations

MAR

Prevention of insider trading and market manipulation

UCITS & AIFMD

Regulation of retail and alternative investment funds

PROSPECTUS REGULATION

Disclosure requirements for securities offerings

MICAR

New framework for digital assets and tokens

STRATEGIC OBJECTIVES

INVESTOR CONFIDENCE

Market Integration

SUSTAINABLE FINANCE

Digital Transformation

WHO BENEFITS

INVESTORS

Greater transparency

STARTUPS & SMES

Alternative financing options

CAPITAL MARKETS UNION (CMU)

The CMU is the EU’s flagship initiative to create a single, integrated capital market across all 27 member states. It aims to broaden access to finance, diversify funding sources, improve economic resilience, and facilitate cross-border investments, particularly benefiting small and medium-sized enterprises (SMEs). The CMU was launched to address the fragmentation of European capital markets, which remain divided along national lines despite the EU’s single market.

Key EU Capital Markets Regulations Explained

Over recent years, the EU has shifted from directives (which require national implementation) to directly applicable regulations and numerous implementing acts to ensure a level playing field. Key regulations and directives include:

The EU has enacted a series of cornerstone regulations and directives. These rules are part of the Single Rulebook for EU financial markets, aiming to ensure a level playing field and facilitate cross-border activities:

LEGAL INSTRUMENT PURPOSE / SCOPE
MiFID II & MiFIR Harmonized rules for investment services, trading venues, and transparency
Prospectus Regulation Disclosure requirements for public offerings and admission to trading
Market Abuse Regulation (MAR) Prevents insider dealing and market manipulation
Securitisation Regulation Framework for simple, transparent, and standardised securitisation
Central Securities Depositories Rules for settlement and safekeeping of securities
Benchmarks Regulation Oversight of financial benchmarks used in financial contracts
Short Selling Regulation Rules on short selling and credit default swaps
European Crowdfunding Regulation Harmonized rules for crowdfunding platforms
Transparency Directive Ensures ongoing disclosure by listed companies

Navigating the Maltese Capital Market

Why Choose Malta for Capital Raising?

Malta offers a robust and attractive jurisdiction for raising capital within the European Union. As a reputable financial hub, it provides access to the EU single market while maintaining a flexible and pro-business regulatory environment. The Malta Financial Services Authority (MFSA) is an accessible and respected regulator, making the listing process transparent and efficient for both established companies and SMEs.

Our Services for the Malta Stock Exchange (MSE)

Acumum provides specialised legal support for companies looking to list on the Malta Stock Exchange. Our services include advising on listing rules, preparing the necessary documentation for admission, and ensuring ongoing compliance with MSE regulations. We guide clients through every step, from initial assessment to post-listing obligations, helping them leverage Malta’s strategic position to achieve their funding goals.

INVESTOR PROTECTION AND MARKET INTEGRITY

EU law imposes strict rules to protect investors, including requirements for transparent disclosures, prohibitions on insider trading and market manipulation, and compensation schemes for investors in case of firm failures. National and European supervisory authorities (such as ESMA) have powers to intervene in the distribution of risky financial products if investor protection or financial stability is threatened.

SUPERVISION AND ENFORCEMENT

The financial crisis accelerated the development of a European supervisory structure. The European Securities and Markets Authority (ESMA) plays a central role, with increasing calls to centralize supervision and harmonize enforcement across the EU to prevent regulatory arbitrage and ensure market integrity

RECENT AND UPCOMING INITIATIVES

The EU continues to update its legal framework, most recently with the “Listing Act” (provisionally agreed in 2024), which aims to make capital markets more attractive and accessible, especially for SMEs, by reducing administrative burdens and improving oversight.

Our Capital Markets Legal Services

DUE DILIGENCE

  • Investigate and verify the financial, legal, and business background of companies issuing securities.
  • Assess risks and ensure all material information is disclosed to investors.

DRAFTING AND
REVIEWING
DOCUMENTATION

  • Prepare prospectuses, offering memoranda, and disclosure documents for public and private offerings of equity (shares) and debt (bonds) securities.
  • Draft and negotiate transaction agreements between issuers, underwriters, and other parties.

REGULATORY
COMPLIANCE

  • Advise clients on compliance with EU and national securities laws, such as MiFID II, Prospectus Regulation, and Market Abuse Regulation.
  • Guide clients through the approval process for stock exchange listings and ensure ongoing compliance with disclosure and reporting requirements.

TRANSACTION
MANAGEMENT

  • Coordinate and manage the entire transaction process, often leading deal teams from initial discussions through to closing.
  • Liaise with regulators, stock exchanges, and other stakeholders to secure necessary approvals and resolve legal or regulatory issues.

ADVISORY WORK

  • Counsel issuers (companies raising capital), underwriters (investment banks), and investors on legal structuring, market trends, and risk management.
  • Advise on corporate governance, securities law developments, and the impact of new regulations.

CROSS-BORDER
TRANSACTIONS

  • Handle deals involving multiple jurisdictions, requiring knowledge of international securities regulations and coordination with foreign counsel.

CONTENTIOUS AND POST-
TRANSACTION WORK

  • Assist with amendments, restructurings, or disputes arising from completed transactions.
  • Support litigation or arbitration if transactions become contentious.

Clients
Represented

  • Public and private companies (issuers)
  • Investment banks and underwriters
  • Private equity firms and institutional investors
  • Corporate trustees and agents

Frequently Asked Questions

The Capital Markets Union (CMU) is an EU initiative designed to create a single, integrated capital market across all member states. Its goal is to make it easier for businesses, especially SMEs, to raise capital from diverse sources like shares and bonds, and for investors to find new opportunities across the EU, fostering economic growth and stability.

An Initial Public Offering (IPO) is the process by which a private company first sells its shares to the public, becoming a publicly-traded company. A law firm like Acumum is essential in this process. We manage the complex legal requirements, conduct due diligence, draft the prospectus and other legal documents, and liaise with regulators and stock exchanges to ensure a successful and compliant listing.

The Markets in Financial Instruments Directive II (MiFID II) is a cornerstone of EU financial regulation. It is important because it enhances transparency, strengthens investor protection, and establishes a more resilient market structure. For capital market transactions, it means stricter rules on reporting, disclosures, and how investment services are provided, ensuring a fairer and more efficient environment for all participants.

Yes, non-EU companies can raise capital in the EU, often by listing on a European stock exchange. However, they must comply with the relevant EU regulations, such as the Prospectus Regulation. This typically involves preparing a detailed prospectus approved by a national regulator within an EU member state, like Malta. Acumum can assist international companies in navigating this cross-border process.

If you would like to know more about how Acumum can assist your company in raising capital, please contact us.