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Opting Up / Opting Out

Obligation to make an offer under the Stock Exchange Act (Art. 32 SESTA)

Since 1998, new provisions governing public takeover offers (Stock Exchange Act SESTA[pdf], Chapter 5) apply to all Swiss companies whose equity securities are, in whole or in part, listed on an exchange in Switzerland (Art. 22 SESTA).

Accordingly, anyone acquiring more than 33 1/3 %of the voting rights of a listed company is obliged to make an offer to acquire all listed equity securities of said company (offeree company) that are listed for trading on the Exchange (Art. 32 SESTA).

However, the Stock Exchange Act does leave companies some room for manoeuvre in respect of the obligation to make an offer: The threshold of 33 1/3 % of the voting rights that triggers the obligation to make an offer can be increased by corresponding provisions in the articles of association up to a maximum of 49% ("opting up") or can be entirely abolished ("opting out").

The obligation to make an offer no longer applies to a company (offeree company) that has opted out. Companies may adopt an opting out provision in their articles of association at any time, provided that this is not to the detriment of shareholders as defined in Art. 706 of the Swiss Code of Obligations (Art. 53 SESTA in conjunction with Art. 22 para. 3 SESTA).

You can use the issuers search request to find out which Swiss companies listed on the SIX Swiss Exchange have already made use of the opportunity to incorporate an opting up or opting out clause in their articles of association.