UK's HM Treasury has adopted the Prospectus Regulations 2012 which amends the Financial Services and Markets Act 2000 (FSMA) and completes UK's implementation of changes to the prospectus directive which has been in force since 1 July.

The main changes to the FSMA Act of 2000 are in relation to the definition of a qualified investor, the summary and final terms and the supplementary prospectus.

The new regulation includes amendments to the exemptions to the obligation to produce a prospectus as well as a substitute definition of a qualified investor based on concepts derived from Mifid.

The regulations also amend the purpose of prospectus summaries and the obligation to notify competent authorities of final terms of an offer of securities, and make these available to investors as well as the last date before which a supplementary prospectus must be prepared if a significant new factor, material mistake or inaccuracy arises.

The Prospectus regulations also adopt the Key Information Document (KID) which should contain the final offer price or the amount of transferable securities to be offered to the public.

According to the Treasury document the KID can only contain information that relates to the securities note and must not be used to supplement the prospectus.

Investments products marketed in the UK will have to be accompanied by the KID which, according to the Treasury, will be essential to enable investors to understand the transferable securities to which the prospectus relates and to decide whether to consider the offer further.

The KID will also include the essential characteristics of the issuer and any guarantor, including their assets, liabilities and financial positions as well as and the risks associated with investing in the transferable securities, including any rights attaching to the securities.

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