Recent decisions of the Supreme Court, which concern the Cyprus Securities and Exchange Commission:
1. 1005/2009, Aspis Holdings Public Company Ltd vs. SEC
The appeal concerned a fine of €30,000, which was imposed to Aspis Holdings Public Company Ltd for violating article 19, as specialized by article 20(1)(c) of the Law on the Market Abuse due to the fact they made a misleading statement to the investing public.
The reasons for the appeal were mostly that there was a delusion on the things because not all the announcement of the Company was taken into account, no right for hearing was given, the view of the investigators were not registered and the composition suffered due to an illegal writ of summon by a member of the Commission.
On 20/12/2010 the Supreme Court rejected the Company’s appeal.
With reference to the allegation of the illegal writ of summon by a member of the Commission, the Court decided that what is important is that the member was called to attend the meeting, irrespective of whether the member sent its answer to the invitation at a later stage.
With reference to the allegation that the right of hearing for the penalty was not given, the Court reiterated the grounds of the decision of SEC vs. Exelixis Investment Ltd case, that the cutting up of the procedure and its conduct in many stages could not serve any purpose.
With reference to the allegation that not all the announcement of the Company was taken into account, the Court decided that the content of the entire announcement must be taken into account. But it is enough, when a part of it contains information, which aims to give false or misleading indication on the financial means. The violation is committed by the spread of information by person who is aware of the fact the information is false or misleading.
With reference to the non registration of the opinion of the two investigators, the Court decided that the Commission was not obliged to write down the views of its investigators, since they roles was purely informative. Article 24 of N.158(I)/1999 requires the registration of decisions (facts and legal basis) so that the Court is able to check their legality.
2.1007/2009 Aspis Holdings Public Company Ltd vs. SEC
The appeal concerned a fine of €20,000, which was imposed to Aspis Holdings Public Company Ltd for violating articles 5(f), 6 and 17(1) of the Takeover Bid Law (they submitted a public offer to another company without submitting the legal certification for the sum of the consideration and its availability).
The reasons for the appeal were mostly that it was taken into account the previous behaviour of the Company in a similar case, no hearing right was granted and the decision was a product of wrong interpretation of the Law.
On 22.3.2011, the Supreme Court rejected the Company’s appeal.
With reference to the allegation that the previous behavior of the Company in a similar case was taken into account, the Court decided that this behaviour was taken into account during the determination of the fine and not for the commission of the violation, which is absolutely allowed.
With reference to the allegation that no hearing right was given for the fine, the Court decided that from the time that the procedure followed has been determined as administrative, there is no obligation to hear the applicants before the imposition of the fine.
With reference to the allegation that the decision was a product of wrong interpretation of the Law, the applicants claimed that the document submitted was a “draft” and not the official offer, therefore, the inclusion of the bank certification was not obligatory. The Court decided that the Law does not refer to the ability to submit a draft of the public offer. Therefore, the characterization of the document as “draft” does not change its legal entity.
1. 1005/2009, Aspis Holdings Public Company Ltd vs. SEC
The appeal concerned a fine of €30,000, which was imposed to Aspis Holdings Public Company Ltd for violating article 19, as specialized by article 20(1)(c) of the Law on the Market Abuse due to the fact they made a misleading statement to the investing public.
The reasons for the appeal were mostly that there was a delusion on the things because not all the announcement of the Company was taken into account, no right for hearing was given, the view of the investigators were not registered and the composition suffered due to an illegal writ of summon by a member of the Commission.
On 20/12/2010 the Supreme Court rejected the Company’s appeal.
With reference to the allegation of the illegal writ of summon by a member of the Commission, the Court decided that what is important is that the member was called to attend the meeting, irrespective of whether the member sent its answer to the invitation at a later stage.
With reference to the allegation that the right of hearing for the penalty was not given, the Court reiterated the grounds of the decision of SEC vs. Exelixis Investment Ltd case, that the cutting up of the procedure and its conduct in many stages could not serve any purpose.
With reference to the allegation that not all the announcement of the Company was taken into account, the Court decided that the content of the entire announcement must be taken into account. But it is enough, when a part of it contains information, which aims to give false or misleading indication on the financial means. The violation is committed by the spread of information by person who is aware of the fact the information is false or misleading.
With reference to the non registration of the opinion of the two investigators, the Court decided that the Commission was not obliged to write down the views of its investigators, since they roles was purely informative. Article 24 of N.158(I)/1999 requires the registration of decisions (facts and legal basis) so that the Court is able to check their legality.
2.1007/2009 Aspis Holdings Public Company Ltd vs. SEC
The appeal concerned a fine of €20,000, which was imposed to Aspis Holdings Public Company Ltd for violating articles 5(f), 6 and 17(1) of the Takeover Bid Law (they submitted a public offer to another company without submitting the legal certification for the sum of the consideration and its availability).
The reasons for the appeal were mostly that it was taken into account the previous behaviour of the Company in a similar case, no hearing right was granted and the decision was a product of wrong interpretation of the Law.
On 22.3.2011, the Supreme Court rejected the Company’s appeal.
With reference to the allegation that the previous behavior of the Company in a similar case was taken into account, the Court decided that this behaviour was taken into account during the determination of the fine and not for the commission of the violation, which is absolutely allowed.
With reference to the allegation that no hearing right was given for the fine, the Court decided that from the time that the procedure followed has been determined as administrative, there is no obligation to hear the applicants before the imposition of the fine.
With reference to the allegation that the decision was a product of wrong interpretation of the Law, the applicants claimed that the document submitted was a “draft” and not the official offer, therefore, the inclusion of the bank certification was not obligatory. The Court decided that the Law does not refer to the ability to submit a draft of the public offer. Therefore, the characterization of the document as “draft” does not change its legal entity.
Friday, 20 May, 2011 - 11:58