City Code

English Legal System: City Code On Takeovers And Mergers

In the context of the English law, A Dictionary of Law provides the following legal concept of City Code On Takeovers And Mergers : A body of rules regulating those engaged in the conduct of *takeovers and *mergers of public companies. It is administered by a Panel representing the major City financial institutions, e.g. the *Stock Exchange and the Issuing Houses Association. The principal aim is to ensure that company members (rather than the directors) decide upon the merits of accepting a bid, that they are fully informed about what is going on, and that shareholders of the same class are treated equally in the event of a takeover or merger. The rules are not legally binding, but if they are contravened sanctions may be imposed on the company, including having the facilities of the securities markets withdrawn from them. Decisions of the Panel are subject to *judicial review.