The legal status of the shares traded on Rasdaq market

Author:Cristian Gheorghe
Position:Associate Professor, PhD, Faculty of Law, 'Nicolae Titulescu' University of Bucharest (e-mail: profesordrept@gmail.com).
Pages:108-115
SUMMARY

RASDAQ Market was launched in Romania in 1996, appeared as a mirroring of the well-established American market NASDAQ (which stood for National Association of Securities Dealers Automated Quotations). The role designated for RASDAQ was as platform for valuing papers issued in the privatization program in Romania (mass privatization process - MPP). In fact the participating companies to MPP had... (see full summary)

 
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LESIJ NO. XXII, VOL. 1/2015
THE LEGAL STATUS OF THE SHARES TRADED ON
RASDAQ MARKET
Cristian GHEORGHE*
Abstract
RASDAQ Market was launched in Romania in 1996, appeared as a mirroring of the well-
established American market NASDAQ (which stood for National Association of Securities Dealers
Automated Quotations). The role designated for RASDAQ was as platform for valuing papers issued
in the privatization program in Romania (mass privatization process - MPP). In fact the participating
companies to MPP had the legal obligation, under first Romanian Capital Market Law, No 52/1194,
to be listed on a stock exchange.
Although it attended a US regulatory model, RASDAQ had to adapt to European rules with the
accession of Ro mania to the European Union. The relevant EU rules (i.e., Directive 2004 /39/EC on
markets in financial instruments MiFID, about to be replaced by Directive 2014/65/EU MiFID II)
provide for only two types of trading systems, i.e. regulated markets and multilateral trading facilities
(MTF), while the RASDAQ Market securities fall under none of these two trading systems regulated by
MiFID1.
After an entire decade of uncertainty concerning the status of the RASDAQ, Romanian legislator
settled the situation of shares traded on this market. This regulation means the end for RASDAQ. Law
No. 151/2014 provides that the RASDAQ Market is to be closed within twelve months as of the effective
date of such law (October 27, 2014). To this end companies listed on the RASDAQ Market will have to
opt for listing on a regulated market or on a MTF or for becoming private companies. Such option
rests on the hands of shareholders. Going private asks for shareholders’ rights protection so Romanian
Financial Supervisory Authority (FSA) provides a procedure implementing the right to withdraw from
the company of the dissenting shareholders and for computing compensation for their shares (FSA
Regulation No. 17/2014).
Keywords: capital market, investments, RASDAQ, multilateral trading facility (MTF),
regulated market, shareholders protection.
1. Introduction
RASDAQ Market was launched in
Romania in 199 6, with the support of the
well-established American market
NASDAQ. The role designated for
RASDAQ was as platform for valuing
papers issued in the privatization program in
Romania (mass privatization process -
Associate Professor, Ph D, Faculty of Law, “Nicolae Titulescu” University of Bucharest (e-mail:
profesordrept@gmail.com).
MPP). In fact the participating companies to
MPP had the legal obligation, under first
Romanian Capital Market Law, No 52/1194,
to be listed on a stock exchange, so that most
of them got listed o n the RASDAQ Market.
Subsequently, in 1999, there were about
5,500 Romanian companies listed on
RASDAQ making it the European market
with the most issuers.
As the mother p latform, NASDAQ,
evolved from an OTC legal status (over-the-

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