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Weekly newsletter - year XXII - No. 48 - 19 December 2016

Commission decisions:

N.B. measures adopted by Consob are published in the Bollettino and, where envisaged, also in the Gazzetta Ufficiale. This newsletter summarises the more important or general measures and their disclosure here is therefore merely to update readers on Commission activities.


- NEWS OF THE WEEK -

CONSOB COMMUNICATION FOR INVESTOR PROTECTION

The National Commission for Companies and the Stock Exchange (Commissione Nazionale per le Società e la Borsa - CONSOB) has:

- suspended for a period of 90 days, under the terms of art. 99, paragraph 1, letter b), of the Consolidated Law on Finance - CLF, Service Merchant Corp. from its activities offered to the public resident in Italy for the purpose of investments of a financial nature, also carried on through the website www.merchantshares.com (resolution no. 19807 of 13 December 2016);

- suspended for a period of 90 days, under the terms of art. 101, paragraph 4, letter a), of Italian Legislative Decree no 58/1998, advertising in relation to the offer to the public resident in Italy concerning investments of a financial nature promoted by Service Merchant Corp. carried out through the website www.euroinrete.blogspot.it/2016/11/merchantshare.html (resolution no. 19806 of 13 December 2016).

* * *

The National Commission for Companies and the Stock Exchange, CONSOB also reports that:

- the website www.profitmaximizer.com cannot be traced to subjects authorised to provide investment services and facilities in Italy.

the companies Dsmg Ltd and Europe Ridge Eood are not authorised to carry out investment services and business in Italy in any way, including through the website www.binarybrokerz.com;

- the companies Evolution Trade Lp and Revolution Markets Lp are not authorised to carry out investment services and business in Italy in any way, including through the website www.exxonfx.com;

- the company International Partners is not authorised to provide investment services and business in Italy in any way.

the company Gmi Bq Ltd is not authorised to provide investment services and business in Italy in any way, including through the website www.gmibanque.com.


OTHER COMMUNICATION FOR INVESTOR PROTECTION

The supervisory authorities of the United Kingdom (Financial Conduct Authority – FCA), Spain (Comisión Nacional del Mercado de Valores - CNMV), the Netherlands (Netherlands Authority for the Financial Markets - AFM), Switzerland (Swiss Financial Market Supervisory Authority – FINMA), Austria (Financial Market Authority - Ma), Hong Kong (Securities and Futures Commission – SC) and Poland (Polish Financial Supervision Authority - KN) report companies and websites that are offering investment, financial and insurance services without the required authorisations.

Reported by the FCA:

  • Ernst Jet-setter Asset Management (www.ernsthofsetter.com), with registered head office in Austria, clone of an authorised company;

  • Westburn Finance, clone of the authorised company Westburn Finance Limited (www.westburnfinance.co.uk), reference no. 631762;

  • Reinhardt Hoer International/Reinhardt Hoer Venture Partners (www.reinhardhofer.com), with registered head offices in Austria and in China, clone of an authorised company;

  • Novostar Finance Co Ltd (www.novostarfin.n.nu), with registered head office in London;

  • Totally Money, clone of the authorised company Media Ingenuity Trading (www.totallymoney.com), reference no. 483456;

Reported by the CNMV:

  • www.stockscall.com;

  • Solidary Markets X (http://solidarymarkets.com);

  • www.fb-one.com;

  • www.clickbanca.es.

Reported by the AFM:

  • Orix Capital Trading (www.orixtrading.com), with registered head office in Tokyo.

Reported by the FINMA:

  • Kyburg Financial Gmbh (www.kyburgfinancial.com), with registered head office in Zurich;

  • Blue Print Investment;

  • Godhand Fund Management (www.godhandfund.com), with registered head office in Geneva.

Reported by the FMA:

  • Atlantic Global Asset Management SA, with registered head office in Cape Verde;

  • Drukenmiller Investment Services (www.drukenmiller-investment.com), with registered head office in Hong Kong.

Reported by the SFC:

  • Tharapatong Limited;

     
  • Softbank Cibc International;

     
  • Thornwood Financial;

     
  • Lexus Group;

     
  • Hc Capital Asia;

     
  • Global Future City Holdings (Hong Kong) Company Limited;

     
  • Global Future City Holding Inc;

     
  • Kings View Capital Advisors;

     
  • Kaufman Capital Management;

     
  • Somerset Capital Limited;

     
  • Mitsui Credit Global;

     
  • Resona Corporate Partners;

     
  • Franklin Transfer Services.

Reported by the KNF:

  • Dom Maklerski Pekao;

     
  • Aforti Securities Sa;

     
  • Nuntius Chrimatistiriaki Anonimos Eteria Parochis Ependitikon Ipiresion Sa Oddział w Polsce.

EXTRACURRICULAR INTERNSHIPS IN CONSOB - 2017 EDITION

The Commission has announced a selection procedure for training and orientation internships of an extracurricular nature to be carried out in the CONSOB offices in Rome and Milan.

The idea is aimed at broadening and rounding off courses of study already completed, as well as directing the professional choices of the interns by means of a training experience in direct contact with the world of employment.

The year 2017 will see the launch of 26 internships, each distinguished by an individual code.

The internships involve daily attendance of 6 hours and 30 minutes, from Monday to Friday, for an average commitment of 32 hours and 30 minutes weekly, unless particular needs should arise during the period of the training project. The internships will last a maximum of 6 months (except for the internship indicated with the code Dst-3, which will last for a maximum of 3 months) including any extensions, but excluding any periods of suspension for maternity or sickness leave.

Applications for participation require possession of one of the following qualifications, obtained during the 12 months prior to the deadline for presentation of applications:

- second level degree, either specialised, master's or single cycle, in the subjects concerned in the training course for which application is being submitted, obtained with a grade of no less than 105/110;

- research doctorate;

- 2nd level master's degree of minimum one year at university;

university specialisation course of at least one year, following attainment of a second level degree, either specialised, master's or single cycle.

The interns will receive an allowance for participation of € 800 gross monthly. Applications for participation must be submitted – no later than 31 January 2017 – to the e-mail address: tirocini@pec.consob.it.

Further information regarding requirements, procedures and terms for participation can be found in:

- the resolution and public announcement of the internships;

- the list of projects of the internships;

- the application form;

published on the CONSOB website in the section "Consob e le sue attività/La Consob/Lavorare in Consob/tirocini" ("CONSOB and its activities/CONSOB/work at CONSOB/internships").


MARKET ABUSE: TRANSPOSITION OF THE ESMA GUIDELINES ON DELAY IN THE DISCLOSURE OF INSIDER INFORMATION AND ON MARKET SOUNDINGS

CONSOB (pursuant to article 16, paragraph 3, of EU regulation no. 1095/2010) has informed the European Securities and Markets Authority (ESMA) of its decision to comply with the Authority's published Guidelines regarding market abuse ("MAR Guidelines- Delay in the disclosure of inside information" and "MAR Guidelines – Persons receiving market soundings") and has published on its own website two communications (no. 0110351 and no. 0110353 of 14 December 2016) to announce publicly that they are now in force. The Guidelines were published on the European Authority website in the various official Union languages on 20 October and 10 November 2016 and come into force, respectively, on 20 December 2016 and 10 January 2017. The Guidelines have also been published, in the official Italian translation, on the CONSOB website.

Guidelines on delay in the disclosure of inside information

Article 17, paragraph 1, of EU regulation no. 596/2014 (MAR – Market Abuse Regulation) lays down that the issuer of financial instruments shall make public, as soon as possible, insider information directly concerning the issuer itself. The issuer may, however, decide to delay the disclosure of the insider information where the three conditions are met, as indicated in article 17, paragraph 4: "a) immediate disclosure would probably prejudice the issuer's legitimate interests (...); b) the delay in disclosure probably would not have the effect of misleading the public; c) the issuer (…) is able to guarantee the confidentiality of any such information".

With reference to the first two conditions, article 17, paragraph 11, MAR, lays down that "ESMA

shall provide guidelines to set out an indicative, but not exhaustive, list of legitimate interests (…), and situations in which delay in disclosure of insider information could lead the public into error (…)".

These Guidelines provide suggestions to help issuers in making decisions to delay disclosure of insider information under the above-mentioned article 17, paragraph 4, MAR, by means of an indicative, but not exhaustive, list of issuers' legitimate interests which might be prejudiced by immediate disclosure of insider information and of situations in which delay in disclosure could lead the public into error.

Guidelines on market soundings

Article 10 of the MAR regulation defines abuse regarding illicit communication of insider information. The subsequent article 11 MAR proposes specific protection for subjects engaged in carrying out market soundings (known as Disclosing market participant, DMP for short), typically on behalf of someone with a considerable share holding, for the purpose of sounding out willingness of potential investors (known as Market sounding recipient, MSR for short) to take part in a purchase transaction.

Article 11 MAR and its relative enacting measures effected by the delegated regulation (EU) 2016/960 and by the implementing regulation (EU) 2016/959 set out precise procedural rules for DMPs.

The Guidelines under consideration are issued pursuant to article 11, paragraph 11, MAR, which requires ESMA to draft Guidelines under article 16 of the ESMA regulation, applicable to MSRs and concerning: "a) the factors to be taken into consideration by such persons when information is passed to them as part of a market sounding for the purpose of assessing whether the information is to be considered as insider information; b) the measures to be adopted by such persons if insider information is passed to them for the purpose of complying with articles 8 [misuse of insider information] and 10 [illicit communication of insider information] of this regulation; as well as c) the records that such persons must keep, to demonstrate that they have complied with articles 8 and 10 of this regulation".


BMPS BONDS TAKEOVER AND SHARE CAPITAL INCREASE: CONSOB HAS APPROVED THE SUPPLEMENT TO THE TAKEOVER DOCUMENT AND TO THE PROSPECTUS

CONSOB has approved the supplements: i) to the offer document for the voluntary takeover bid (Liability Management Exercise), launched, in pursuance with Articles. 102 et seq. of Italian Legislative Decree No. 58/1998 (the Consolidated Law on Finance), by Banca Monte dei Paschi di Siena (BMPS) SpA. for subordinated bonds issued by themselves or guaranteed with obligation to reinvest the cost in ordinary shares in the same bank; (ii) the base prospectus in tripartite format (registration document, securities note and summary note) for the takeover and admission to trading of shares issued in connection with the LME bid. The dates for subscribing to the offer, initially set from 28 November 2016 to 02 December 2016 have been extended for the 16 to 21 December 2016, unless extended further.

Referring to the provisions laid down for the previous offer period, it should be specified that, in terms of obligations on conduct applicable to BMPS as depositary intermediary under the so-calledMarkets in Financial Instruments Directive (MIFID), the assessment of shareholder suitability for those who intend to accept the offer will not be a bar, notwithstanding the non-proactive behaviour of the offerer toward those who do not have an adequate profile for an investment in shares. Other basic elements of the offer and, especially, the list of shares on offer, the conditions precedent to the effect of the offer and the price remain unchanged from those announced by the bank on 28 November 2016.

The BMPS takeover was approved by CONSOB on 28 November 2016 (see "CONSOB Informs" no. 45/2016) and involves subordinated bonds "Tier I Bonds" and "Tier II Bonds" issued or guaranteed by the bank itself and lies within the context of a wider and more complex operation aimed at finding a structural solution to the portfolio of non performing loans (NPL) and strengthening the assets of the BMPS group. The BMPS share capital increase, by payment in cash, including divisible form, in one or more occasions and for single tranches, with the exclusion or limitation of stock options, was deliberated by the bank's Shareholders' Meeting on 24 November, for a maximum amount of € 5 billion , including any premium.

On 02 December 2016 the LME bid closed. On 11 December the board of the bank decided, inter alia, to extend the LME bid and put forward an offer, addressed exclusively to qualified investors, under article 34-ter, paragraph 1, letter b) of the issuer regulation, for fresh 2008 shares. Also, on 13 December 2016 the ECB informed the bank of a draft decision with which it announced the rejection of a request for extension made by the issuer and confirmed 31 December as the final date for completion of the whole financing operation.

The supplement to the prospectus includes the above-mentioned items of information, as well as making it known that it is not certain whether there will be any state intervention in the recapitalisation of the bank, nor, in the event of any such intervention, how it would be effected and, where applicable, sharing of costs with holders of the bank's subordinated loans (including any who decided against accepting the offer). The following items of information are also included:

1. the pro-rata effects of the whole operation on the balance sheet of the BMPS group on 31.12.2015 and on 30.9.2016;

2. the effects of further deterioration of BMPS group liquidity, as a result of the constitutional referendum on 04 December 2016, on the short-term financial situation of the BMPS group (impact on the declaration of the group's working capital);

3. a revised estimate of the overall costs of the operation;

4. details of the fact that, on the date of the supplement, the bank is negotiating with joint bookrunners an agreement by which "the latter would undertake to act, on a best effort basis, as placement agents and to negotiate, in good faith, the terms and conditions of a placement agreement, which will not involve the joint bookrunners in any undertaking to guarantee, but only accept the settlement risk, that is an undertaking of the joint bookrunners to subscribe to the new shares already allocated, but which subsequently prove not to be subscribed to on the payment date (…)";

5. description of detailed elements regarding some of the contracts and agreements foreseen as part of the operation.

Under art. 95-bis of Italian Legislative Decree no. 58/1998, investors who have already agreed to subscribe for the offer during the period from 28 November to 02 December 2016 may exercise the right to withdraw their subscription within two days subsequent to publication of the supplement. The same right to withdraw acceptance also remains applicable to all subscribers in the event of further supplements up to the payment date.

The bank will adopt rigorous safeguards to ensure full compliance with obligations on disclosure and conduct as laid down by the MIFID regulations. As far as obligations on conduct are concerned: a special disclosure is provided regarding the bank's conflict of interest;

assessment of suitability for subscription is always carried out;

for clients whose subscription is suitable, the bank will provide an advisory service;

for clients whose subscription is unsuitable, the bank will not provide an advisory service; Any client intending to subscribe for the offer on his or her own initiative will be informed of the unsuitability and will be able to: (i) withdraw from the operation; (ii) apply to proceed in any case with subscription to the offer;

in order to prevent intentional re-profiling of investors to ensure a positive outcome to suitability assessment, such assessment will be done using MIFID questionnaires in existence on 30 September 2016, or, in any case, the more cautious (lower) parameters from questionnaires in existence during the period from the end of September 2016 to the date of subscription.

As far as the obligations on disclosure are concerned, the bank has made these provisions, amongst others:

- sending its own depositary clients who hold shares affected by the bid special notice to inform them of the operation, highlighting the conflict of interest and a reminder of the contents included in the offer document;

- sending its clients an appropriate data sheet, the summary note and the related alterations to the supplement, the advice in the prospectus, the advice in the offer document and the related alterations to the particular supplement, on receipt of which the clients will have to go to their bank branch to obtain further information about the offer. The bank will obtain from subscribers a written statement that they have received the above-mentioned informative material, that they are aware of the bank's conflict of interest in the operation and of the change in their status, from bondholder to shareholder, including for the effects of the regulation of banking resolutions. In the event of a client deciding to subscribe to the offer in spite of an assessment of unsuitability made by the bank, then the bank shall also obtain from the subscriber a written statement that he or she has subscribed on his or her own initiative, without any soliciting or provision of any advice by any intermediary, as well as being informed of unsuitability for the operation and that he or she wishes, in spite of this, to proceed with subscription. 


BANK OF MONTE PASCHI DI SIENA SPA: CONSOB HAS APPROVED THE SECURITIES NOTE AND SUMMARY NOTE TO THE OFFER AND ADMISSION TO LISTING OF SHARES TO COVER THE SHARE CAPITAL INCREASE OF BMPS

CONSOB has approved the securities note and summary note to the offer and admission to trading on the MTA of ordinary shares in Banca Monte dei Paschi di Siena Spa to cover the share capital increase of BMPS (see "CONSOB Informs" no. 45/2916).

The extraordinary meeting of the bank on 24 November granted the board the right to increase the share capital by payment in cash, in one or more occasions and for single tranches, including in divisible form, for a maximum amount of € 5 billion, including any premium. Subsequently, the board of Banca Monte dei Paschi di Siena, exercised its right on 14 December and decided, amongst other things, on an indivisible share capital increase ("increase in BMPS share capital) divided into: 35% as an offer to the general public in Italy, at least 30% of which is to be offered with right of first refusal to shareholders of the Bank ("public offer"); 65% for institutional placing reserved for qualified investors in Italy and for institutional investors abroad ("institutional placing").

The public offer and the institutional placing, together make up the global offer, the total of which is equal to the difference between € 5 billion and the total of the subscriptions under the LME share capital increase.

On 14 December 2016 the board confirmed the maximum offer price of the LME, corresponding to the maximum offer price of the BMPS share capital increase, equal to € 24.9 per share.

The counter-value of the global offer cannot be determined, since the LME offer has been extended, so that the subscription period is still open, apart from the maximum counter-value of the capital increase equal to € 5 billion and its minimum total, which is the difference between 5 billion and the maximum total of the LME capital increase (€ 4,511,181,573.81).

Once the counter-value of the global offer has been finally determined, the number of new BMPS shares will be established, following the closure of the global offer, on the basis of the subscriptions to the LME capital increase and the offer price.

The overall number of new BMPS shares to be issued as part of the global offer will be announced, together with the offer price, the final total of LME subscriptions and the total number of new shares to be issued to effect the capital increase, at the end of the offer period.

The public offer commences on 19 December and terminates on 21 December 2016; the institutional placing commences on 19 December and terminates on 22 December 2016.

The capital increase is not backed by a contract of guarantee and there is no obligation to subscribe.


SHARE CAPITAL INCREASE DMAIL GROUP SPA: CONSOB HAS APPROVED THE LISTING PROSPECTUS OF THE NEW SHARES

CONSOB has approved the prospectus for admission to trading on the MTA of ordinary shares deriving from the share capital increase reserved for the shareholder D. Holding Srl and certain creditors of Dmail Group Spa.

Dmail is the holding company of the group of the same name, operating in the sector of local publishing and, in particular, through the company Dmedia Group, in the area of local media, through its own circuit called iNetweek, which is mainly involved in managing local newspapers with weekly circulation, both privately owned (45 newspapers) and owned by third parties (12 newspapers). As at the date of the prospectus, no single entity exercises control over the issuer pursuant to Art. 93 of the Consolidated Law on Finance.

The company has been subject to periodic information disclosures, in accordance with Art. 114, paragraph 5 of the Consolidated Law on Finance (CLF), since June 2012.

The capital increase, decided by the board of Dmail Group on 24 March 2016, by payment in cash and in non-divisible form, for a total, including premium, equal to € 16,197,400, excluding stock options, since it is reserved for D.Holding and other creditors of the company, is placed in the context of the issuer's bankruptcy proposals aimed at overcoming the situation of asset deficit and serious economic, financial and asset crisis the group is undergoing.

The capital increase requires that (i) D. Holding will subscribe a part in cash for € 4.4 million and a part from conversion of credits and capital transfer from future capital increase, to the amount of € 11.5 million; (ii) other creditors subscribe a part of the capital increase through conversion of credits to the amount of € 0.3 million.

The issue price of shares deriving from the capital increase is € 0.15, leading to the issue of 107,982,667 new shares.

As a result of carrying out the capital increase, participation in the share capital of the various shareholders of D. Holding will undergo a dilution of 98.6%. D. Holding will keep, as a result of the increase, a share of 97.3% of the share capital of Dmail, therefore leading to a reduction of the float (sufficiently to ensure regular trading trends) from 74.8% to 2.7%. D. Holding has shown that it is willing to restore the float within the terms of the law.

In the "warnings to investors" provided at the beginning of the listing prospectus, some risks.

associated with the issuer are summarised. In particular, the situation of serious economic, financial and asset crisis which Dmail Group is undergoing is mentioned. In the "Risk Factors" section, the prospectus provides information for the investor with regard to the issuer, the group to which the same belongs, the sector in which they operate, as well as the financial instruments being listed.


CONSOB: APPOINTMENT OF THE MANAGER FOR CORRUPTION PREVENTION AND TRANSPARENCY

The Commission has appointed Guido Stazi, General Secretary of CONSOB and previously Manager for Corruption Prevention, as Manager for Corruption Prevention and Transparency in CONSOB, with effect from 13 December 2016 (resolution no. 19816 del 13 December 2016).

The appointment has been made under art. 1, paragraph 7, of Law no. 190 of 06 November 2012, governing "Provisions for the prevention and suppression of corruption and illegality in public administration" taking into consideration the fact that, as a result of amendments to Italian Legislative Decree no. 33/2013 brought in by Italian Legislative Decree no. 97/2016, the National Anti-corruption Plan 2016, approved by the National Anti-corruption Authority (NAA), with its resolution no. 831 of 03 August 2016, entrusts the directing bodies with formalising, with a suitable act, the incorporation of duties in matters of transparency into the Manager for Corruption Prevention.

As from the date of Mr. Stazi's appointment, Gianpaolo Barbuzzi, recently appointed Chairperson of the Arbitrator for Financial Disputes

(ACF), ceases to carry out the role of Manager of Transparency, under resolution no. 18887 of 23 April 2014.

The Manager for Corruption Prevention and Transparency is responsible for carrying out completely independently and effectively all the activities assigned by the law and, in particular: a) drafting the proposal of the three-yearly Plan for prevention of corruption, for submission to the Commission for approval; b) the exercise, in complete independence, of the powers laid down by the law for carrying out tasks of prevention of corruption, including those concerning the enforcement of obligations regarding transparency under Italian Legislative Decree no. 33/2013.


 APPOINTMENTS AT CONSOB

The Commission has appointed, with effect from 19 December 2016, Serenella Maria Pizzoferrato as Manager of the Administrative Division and Ciro Maiello as Manager of the Commission Secretarial Office.

Also, with effect from the same date, Luca Menicucci has been assigned the role of temporary manager of the Workplace Health and Safety Office, coordinated within the Administration Division (resolution no. 19819 of 16 December 2016).


- COMMISSION DECISIONS -

taken or made public during the week
(the documents with a link or underlined in the printed edition are immediately available in the respective sections of the website www.consob.it; the other measures will be available in the next few days) 

Consob

  • Market abuse: transposition of the ESMA Guidelines on delay in the disclosure of insider information  and on market soundings (communications no. 0110351 and no. 0110353 of 14 December 2016).

  • Appointment of the Manager for Corruption Prevention and Transparency in CONSOB (resolution no. 19816 of 13 December 2016).

Takeover and exchange bids

  • CONSOB has approved the supplements: i) to the offer document for the voluntary takeover bid (Liability Management Exercise), launched, in pursuance with Articles. 102 et seq. of Italian Legislative Decree No. 58/1998 (the Consolidated Law on Finance), by Banca Monte dei Paschi di Siena (BMPS) SpA. for subordinated bonds issued by themselves or guaranteed with obligation to reinvest the cost in ordinary shares in the same bank; (ii) the base prospectus in tripartite format (registration document, securities note and summary note) for the takeover and admission to trading of shares issued in connection with the LME bid (decisions of 15 December 2016).

Prospectuses

  • CONSOB has approved the securities note and summary note to the offer and admission to trading on the MTA of ordinary shares in Banca Monte dei Paschi di Siena Spa to cover the share capital increase of BMPS (decision of 16 December 2016).

  • CONSOB has approved the prospectus for admission to trading on the MTA of ordinary shares deriving from the share capital increase reserved for the shareholder D. Holding Srl and certain creditors of Dmail Group Spa(decision of 15 December 2016).

  • Approval has been given for the registration document and base prospectus concerning the public offering and/or listing programme of bonds issued by Cassa Depositi e Prestiti Spa (decision of 13 December 2016).

Registers and lists

Simone Morini has been removed from the single register of financial consultants (resolution no. 19733 of 22 September 2016).

As a disciplinary measure Silvana Massa has been suspended from the single register of financial consultants for one month (resolution no. 19791 of 23 November 2016).

As a disciplinary measure Mario Roni has been suspended from the single register of financial consultants for two months (resolution no. 19790 of 23 November 2016)


CONSOB INFORMS (Rome Tribunal Registration no. 250 of 30/10/2013) Chief Editor: Manlio Pisu - Editorial board: Antonella Nibaldi (coordinator), Claudia Amadio, Riccardo Carriero, Luca Cecchini, Laura Ferrri, Alfredo Gloria - Address: CONSOB Via G. B. Martini, 3 - 00198 Rome - telephone: (06) 84771 - fax: (06) 8417707. Documents or reports can be submitted via the interactive section of the web site www.consob.it, where CONSOB INFORMA can also be consulted via the "newsletter" link.

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