Fewer guidelines, more management report: ESMA’s prospectus package after the Listing Act

On Wednesday, 9 September 2026, the European Securities and Markets Authority (ESMA) published a package on the Prospectus Regulation that turns the changes made by the Listing Act, Regulation (EU) 2024/2809, into supervisory practice. It has four parts: a consultation paper on the guidelines on disclosure requirements, a final report on guidelines for supplements that introduce new securities to a base prospectus, a final report on regulatory technical standards (RTS) for the financial information in the prospectus summary, and revised questions and answers (Q&As). Only the first part is open for comment, until Monday, 9 November 2026. ESMA’s press release places the package within its own agenda for simplification and burden reduction, and the consultation paper supplies the figure that seems to prove the point: 57 guidelines are to become 49.

Anyone reading the package as relief can point to the list of deletions. The guidelines on the operating and financial review (OFR), capital resources, capitalisation and indebtedness, the history of share capital and information on holdings all go, and each deletion saves a legal team some reading. Yet they go because the legislator had already removed the obligations they explained. The consultation paper says so itself: there is “no legal basis to maintain them”. Where ESMA does write new rules, the burden changes shape rather than disappearing. The entire management report takes the place of the OFR, and with it comes a duty to reconcile that report with the financial information and the rest of the prospectus. The rest of this article takes the four parts in turn and applies that distinction. It is a reading of the published documents and makes no prediction about how the guidelines will look once the consultation closes.

Three of the four parts are settled before the consultation window opens

The four parts stand at different stages of the process, which is easy to miss because the press release presents them under one heading. According to consultation paper ESMA32-753890202-3085, only the guidelines on disclosure requirements are being consulted on, through eleven questions. ESMA consulted on the supplements guidelines between 18 February and 19 May 2025, reviewed 39 responses and has now published them in final form. Under the final report they apply “two months after their publication on ESMA's website in all the official languages”. ESMA says it did not run a public consultation on the RTS for the financial information in the summary, because the change merely reflects the shorter periods introduced by the Listing Act, and it has sent them to the European Commission for adoption. The Q&As, finally, were revised without a procedure of their own.

For capital markets lawyers the distinction matters in practice. Objections to final guidelines can still be raised, in conversations with supervisors or in a later review. The only lever that can still be moved before 9 November, however, is disclosure in the prospectus itself: the management report, profit forecasts, historical financial information, related party transactions and the question of whether the risk factor guidelines should move into the same document. For issuers of structured products, the part that matters more is the one already decided, and the consultation deadline no longer gives them a say there.

The deletions follow what the legislator had already removed

The figures in the consultation paper are clear. The current guidelines, ESMA32-382-1138, applied since March 2021, contain 57 guidelines in 18 sections. According to the summary table in Annex II, the draft comes to 49 guidelines in 14 sections, and both figures appear in square brackets in the original, which marks them as provisional. Counting through the full text of the old version, 14 guidelines disappear: 13 from the five deleted sections, plus Guideline 15 on the so-called bridge approach, which dealt with a change of accounting framework across three financial years. Six are added, two on the management report and four on profit forecasts that until now sat in the Q&As. The numbers add up: 57 minus 14 plus 6 makes 49.

Reading this as deregulation by the supervisor overlooks the reasoning. Paragraph 5 of the consultation paper explains that ESMA is deleting the guidelines because the Prospectus Regulation’s annexes no longer require the disclosures concerned, and a footnote makes clear that this means the annexes to the Regulation itself rather than those to the Delegated Regulation. Guideline 15 goes because the Listing Act cut historical financial information from three financial years to two, and to one for non-equity securities. In other words, the supervisor is clearing up what the legislator left behind. That saves reading time, but it is relief from the supervisor only indirectly.

One exception deserves attention because it points the other way. Guideline 41 on related party transactions required issuers that do not apply International Accounting Standard (IAS) 24 to state the share of such transactions in turnover and, in addition, in assets and liabilities. In ESMA’s own words, that went “beyond the requirements of Item 7.4 of Annex 1”, which mentions turnover only. The new Guideline [35] simply refers to the definition in IAS 24. Here an obligation that went further than the law is dropped, and it is the clearest case in the package where the supervisor grants genuine relief. The Q&As follow the same pattern: according to ESMA’s own overview, 21 of the 61 numbered answers are deleted, eight of them with the comment “The answer is clear based on the law.” The 17 answers drafted by the Commission, by contrast, were left untouched.

The management report replaces the OFR and brings a consistency duty with it

Anyone who has taken an equity prospectus through approval knows the OFR as the chapter in which the issuer explains, in its own words, how its financial figures developed. Under the old Guideline 4 this requirement could be met by including the entire management report, in which case the persons responsible for the prospectus had to make sure it was comprehensible and consistent with the prospectus. Since the Listing Act, the option has become the rule. According to the consultation paper, item 4.1 of Annex I now requires the entire management report to be incorporated by reference or all of its information to be included, together with the sustainability reporting and the related assurance opinion where these apply. ESMA therefore considers the old guideline “no longer fully fit for purpose”.

The new Guideline [1] spells out the consequence. The persons responsible for the prospectus are to ensure that material information is consistent across three layers: the historical financial information, the management report incorporated by reference and the other sections of the prospectus. Where that cannot be achieved, they are to disclose the fact and identify the passages of the management report concerned. To define when reconciliation is impracticable, ESMA borrows from IAS 8.5: those responsible must have made every reasonable effort. The examples in the paper come straight from approval practice, such as a management report that still explains key figures under the old accounting framework while the financial statements have been restated under International Financial Reporting Standards (IFRS), or one that names major shareholders who have since sold.

ESMA is careful in how it frames the obligation. Only material inconsistencies need to be addressed, out-of-date information only has to be updated as far as the prospectus needs it to remain comprehensible, and nobody has to write a new management report. The cost-benefit analysis in Annex II singles out exactly these points as proportionate. The reconciliation itself, however, is work that previously fell only on issuers who had chosen to use the management report. It lands in the weeks before approval and concerns a text that the finance function and the sustainability reporting team wrote for a different purpose. When in doubt, it ends in a disclosure that nobody enjoys drafting in a prospectus. Question 3 of the consultation asks explicitly for situations in which reconciliation would be impracticable. That is where practitioners can bring their experience to bear before the guideline is fixed.

The second new guideline covers issuers that are not required to prepare a management report under the Accounting Directive, which in practice mostly means issuers from third countries. They are to include in the prospectus the material information that would otherwise appear in a management report, using Article 13 of Directive 2007/14/EC as a benchmark. In paragraph 14 ESMA justifies this by pointing to a level playing field between European and foreign issuers and with the aim of sparing those issuers from drawing up a management report under European accounting law. Question 5 puts that claim up for discussion. For a syndicate bringing issuers from the United States or Switzerland to a European market, the answer determines how much new text such an issuer has to write for its prospectus.

For base prospectuses, the annex now decides whether a supplement will do

The supplements guidelines concern the part of the market with the largest number of documents. According to the 2025 annual report of Germany’s Federal Financial Supervisory Authority (BaFin), 170 of the 197 prospectuses it approved in 2025 were base prospectuses, around 86 per cent, among them the offering programmes of certificate issuers. Since the Listing Act, Article 23(4a) of the Prospectus Regulation has prohibited using a supplement to introduce a new type of security for which the base prospectus does not contain the necessary information. What counts as a new type was left open, and according to the final report national authorities answered differently: one required a new base prospectus, another approved a supplement with similar content.

ESMA’s first draft from February 2025 answered the question by looking at the features of securities, and it met with almost unanimous rejection. According to the final report, four of the 38 responses on the first guideline agreed with it, and 24 responses came from a single Member State. The International Capital Market Association (ICMA) called it “confusing and misguided to equate an instrument 'type' with a mere 'feature' of an instrument”, the Association for Financial Markets in Europe (AFME) concluded that “ESMA has gone too far in their approach”, and Germany’s structured securities association, the Bundesverband für strukturierte Wertpapiere (BSW), found the draft “too narrow and too vague”. 25 respondents put the cost of a new base prospectus at five to ten times that of a supplement. The dissenting voice came from BETTER FINANCE, the European federation of investor and financial services user organisations, which explicitly backed the restrictive approach on investor protection grounds.

The final version replaces the feature test with a test based on the annexes to Delegated Regulation 2019/980. A supplement introduces a new type of security if it needs disclosure from Annex 17 on payment or delivery obligations linked to an underlying asset, Annex 18 on the underlying share, Annex 19 on asset-backed securities or Annex 21 on guarantees that the base prospectus did not previously include. For structured products, Guideline 2 narrows the test down to the type of underlying. If the base prospectus provides for “index” as a type of underlying, a supplement may add a new proprietary index. It may not add a commodity if commodities are missing as a type. ESMA credits the new approach to proposals from large issuer associations, so the industry has won part of its argument.

The annex test is more predictable than the draft, and in a client briefing dated 11 September 2026 the law firm Hogan Lovells Cadwalader describes the supplements guidelines as likely to be the most significant part of the package for structured products programmes. Predictable also means rigid, though. Whatever type is missing at the annual programme update can only be added during the year by way of a new base prospectus. The authors, Jochen Seitz, Jennifer O'Connell and Isobel Wright, therefore advise building in the necessary optionality for products, underlyings, guarantees and environmental, social and governance (ESG) features at the update stage, “rather than assuming that those features can be added later by way of a supplement”. Here too the burden moves, from the individual supplement to the planning of the whole programme. The statutory deadline for these guidelines, incidentally, was 5 June 2026.

Compared with 2017, the prospectus has shrunk more than the rulebook behind it

The yardstick for this assessment is the regime under Prospectus Regulation (EU) 2017/1129, with Delegated Regulations 2019/980 and 2019/979. Under that regime, the median length of an IPO prospectus was 400 pages, ranging from 250 pages in the Netherlands to more than 800 in Italy, according to an analysis by the Italian issuers’ association Assonime that a Commission expert group on small and medium-sized enterprises cited in May 2021. Issuers with a market capitalisation between 150 million and one billion euros even wrote longer prospectuses on average than larger ones. The Commission’s impact assessment of December 2022 put the cost of a standard equity prospectus at up to 300,000 euros for large issuers.

The Listing Act targets the source of that length. Under Article 6(4) an equity prospectus may run to no more than 300 pages, the new EU Follow-on Prospectus under Article 14a to no more than 50 and the EU Growth Issuance Prospectus under Article 15a to no more than 75. An issuer admitting additional fungible securities amounting to less than 30 per cent within twelve months can use a document under Annex IX of no more than eleven pages. BaFin counted twelve such cases in 2025. Historical financial information shrinks from three years to two, and the right of withdrawal after a supplement grows from two working days to three. That is the relief the legislator decided on, and it can be measured in pages and years.

The supervisory rulebook behind it is shrinking far more slowly. 57 guidelines become 49. If ESMA merges the seven 2019 guidelines on risk factors into the same document, as it proposes, the combined text would run to 56 guidelines. That is the author’s own calculation and assumes the seven are carried over unchanged, since the draft does not yet contain their text. Measured against 2017, the reform has mainly shortened the prospectus and shifted where it creates work. The interpretive guidance is hardly any thinner. It simply deals with different things: the management report instead of the OFR, and annexes instead of features.

Interpretation trails the law by roughly a year

The order in which the legal acts arrived explains why the package is coming only now. The Listing Act appeared in the Official Journal on 14 November 2024, and under its Article 4 the prospectus amendments have applied in full since 5 June 2026. Delegated Regulation (EU) 2026/1061, which recasts the format, sequence and content of the standard prospectus, was adopted by the Commission on 7 May 2026 but did not appear in the Official Journal until 13 August 2026. For the 69 days between application and publication, ESMA advised in a public statement on 7 May to follow the adopted but unpublished text. ESMA attributes the delay in the supplements guidelines to the same chain of events: the new approach depends on the annexes to the Delegated Regulation, “which were only recently amended”.

For the disclosure guidelines the same gap opens again, only wider. The consultation paper itself states that the current guidelines are based “on the earlier version of Commission Delegated Regulation 2019/980”. It sets out no transitional arrangement for the period until the new version is final. ESMA is also inconsistent about when that will be: the consultation paper says the first quarter of 2027, the press release published the same day says the second. There is therefore roughly a year between the law taking effect and the finished interpretive guidance. The RTS on the summary have not been adopted either, and in its final report ESMA encourages national authorities to anticipate their entry into application and to act in line with the amended Regulation.

Level 3 guidelines inevitably follow the law, because they interpret what the two levels above have laid down, and the deletions in the package only describe what is no longer required anyway. That does little to reassure those responsible for a prospectus, however. The new duty to include the entire management report also applies today, while the guideline meant to explain the reconciliation is still out for consultation. An issuer submitting a prospectus for approval this autumn is writing under a law from 2024, a delegated regulation from August and an interpretation that will only exist in 2027.

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