Listing

Term and Legal Definition of Listing

The term Listing refers in a legal context primarily to the admission of financial instruments, particularly securities such as shares or bonds, to trading on a stock exchange (stock exchange admission). The listing makes securities publicly tradable and is subject to strict legal regulations in Germany and internationally. The process and consequences of listing are comprehensively regulated in capital market law, in the Stock Exchange Act (BörsG), as well as in the stock exchange rules and other regulations.

Requirements and Procedures for Listing

Admission Requirements

Certain admission requirements must be met for the listing of securities on a stock exchange. These conditions vary depending on the market segment (for example, Regulated Market or Open Market) and the fulfillment of transparency and disclosure requirements. General admission requirements include, among others:

• Existence of an issuer, who issues the securities
• Existing and valid securities prospectus, which complies with the requirements of the EU Prospectus Regulation as well as national provisions
• Adequate free float volume of the securities (e.g., minimum number of shareholders or minimum issuance volume)
• Legal form and registered office of the company, often in an EU/EEA state
• Financial and economic status of the issuer (e.g., continuous business activity over a certain period)

Admission Procedure

The listing is done by submitting an application to the admissions committee (for German stock exchanges usually the admissions office of the respective exchange). The procedure essentially comprises:

1. Review of application documents: The stock exchange or the admissions office examines whether all requirements are fulfilled.
2. Disclosure obligations: Within the scope of admission, the issuer must make various mandatory publications, in particular regarding an approved securities prospectus.
3. Admission notice and commencement of trading: Following a successful review and admission, the security is included in stock exchange trading.

Legal Significance of Listing

The listing of a security results in numerous legal effects and obligations:

Transparency and Disclosure Requirements

Listed companies are subject to increased transparency rules, including:

• Ad hoc disclosure (obligation to immediately publish price-sensitive facts in accordance with the EU Market Abuse Regulation)
• Regular reports: Publication of quarterly, half-yearly, and annual financial statements
• Directors’ dealings (notification obligations for transactions by executives with company securities)
• Notification obligations regarding voting rights (e.g., according to § 33 WpHG)

Market Abuse Law

Compliance with the rules on insider trading and market manipulation from the EU Market Abuse Regulation (MAR) is mandatory upon listing. Violations of these rules may result in significant penalties and fines.

Corporate Governance

Issuers in the Regulated Market are bound by specific corporate governance regulations, such as the obligation to comply with the German Corporate Governance Code, which imposes special duties on company management.

Liability Rules

In case of violations of mandatory publications or misleading information in prospectuses, the management board and the company are liable under civil law and, in certain cases, criminal law to injured investors.

Stock Exchange Rules and Delisting

The inclusion as well as the removal of a security from trading (delisting) are regulated in the respective exchange rules and in the Stock Exchange Act (BörsG). In the case of delisting, particular protection rights for shareholders must be observed, such as the mandatory offer to acquire their shares (so-called mandatory offer).

Types of Listing and Legal Consequences

Depending on the market segment and type of admission, there are specific legal consequences:

Listing in the Regulated Market

Listing in the Regulated Market (formerly Official Market) is subject to the most comprehensive regime of BörsG, WpHG, MAR, and civil law. Particularly strict admission and post-admission obligations apply.

Listing in the Open Market

In the Open Market, relaxed requirements apply. The prospectus requirement is partially waived, but publicity and market conduct obligations must also be observed here.

International Listing

Secondary listing on foreign exchanges (e.g., ADRs in the USA) results in the additional application of international legal systems, such as US securities laws. This leads to additional reporting and disclosure obligations.

Special Legal Aspects of Listing

Listing and Investor Protection

Listing increases legal certainty for investors through standardized trading and information processes. At the same time, it offers options for asserting claims for damages in the event of breaches of duty, for example within the scope of prospectus liability or in the case of inadequate ad hoc reporting.

Listing and Corporate Actions

Changes to the status of a listed security (for example, capital increases, splits, mergers) are regularly published and subject to strict disclosure obligations, thereby protecting investors and ensuring market fairness.

Delisting and Minority Protection

Extensive protection mechanisms exist for minority shareholders in the context of delisting, in particular a mandatory offer to acquire their shares in accordance with § 39 BörsG, as well as further information and fairness obligations on the part of the issuer.

Conclusion

Listing is a central concept in capital market law and is associated with far-reaching legal consequences for companies, investors, and the market. The process is characterized by strict legal requirements and ensures transparency, integrity, and protection of market participants. Violations of listing requirements entail significant liability and regulatory consequences, underlining the importance of clear regulatory standards in the financial market.

Further articles:

• Stock Exchange Admission
• Securities Prospectus
• Delisting
• Capital Market Disclosure Requirements
• MAR (EU Market Abuse Regulation)
• Corporate Governance and Company Law

Frequently Asked Questions

What legal requirements must be observed for listing in online trade?

When listing products in online trade, extensive legal requirements must be observed, stemming from both national and European law. Firstly, it must be ensured that all essential product information, such as prices, is stated clearly and truthfully (§ 5 UWG, Price Indication Regulation). In addition, special information obligations exist under the German Civil Code (§ 312d BGB, Art. 246a EGBGB), especially in distance selling to consumers. Furthermore, product-specific labeling obligations must be met, for example with food, textiles, or electronic devices. If applicable, safety instructions and CE markings must be present. Compliance with trademark rights, copyright, and, if applicable, patent protection must also be checked to avoid cease-and-desist orders or claims for damages. In addition, the platform where the product is listed is often subject to its own rules, compliance with which is binding upon conclusion of the contract with the platform operator.

How is the liability of the entrepreneur regulated in the event of incorrect listing?

If incorrect or incomplete information is provided in the course of listing, the entrepreneur is in principle liable for any resulting damages. This liability may extend to civil claims such as damages or injunctive relief. For example, claims under § 823 BGB (tort) as well as under the UWG (Act against Unfair Competition) may be considered. In the case of anti-competitive behavior, warnings by competitors or associations may also result. In cases of intentionally misleading or missing information, fines may be imposed by supervisory authorities, for example in relation to consumer protection rights. Even in cases of non-intentional misconduct, liability may arise due to negligence.

What role do copyright aspects play in product listing?

When listing products, copyright requirements are of particular importance when using photos, graphics, product descriptions, and logos. Product images and descriptive texts are regularly protected by copyright (§§ 2, 72 UrhG). Use is therefore only permitted if own or licensed content is used. The use of third-party images or texts without the consent of the rights holder regularly constitutes a copyright infringement, which may lead to cease-and-desist orders, removal claims, and claims for damages. Trademark law (§ 14 MarkenG) and design law (§ 38 DesignG) must also be observed, especially where trademarks or design elements are visible in the images.

What statutory information obligations exist for listing products to consumers?

When listing products to consumers, numerous information obligations must be fulfilled, especially in the field of distance selling. These include, according to Art. 246a EGBGB, information about the essential characteristics of the goods, the total price including all taxes and shipping costs, terms of payment, delivery and performance, and the right of withdrawal. For certain products such as electronic devices, food, and cosmetics, there are additional specific information and labeling requirements. Failure to comply with these information obligations can result in invalidity of contract clauses, extension of the withdrawal period, and warning letters.

What sanctions can be imposed for violations of legal requirements for listing?

Violations of statutory requirements for listing can lead to civil, administrative, and, where applicable, criminal consequences. In civil law, in particular, warnings from competitors, consumer protection associations, or competition centers are possible. These may result in claims for injunctive relief, removal, and damages. Contractual penalties under competition law are also possible. Administratively, supervisory authorities can impose fines, for example for violations of price indication obligations or consumer protection requirements. Under certain circumstances, such as systematic fraud, criminal prosecution may also occur.

What regulations apply to listings on platforms targeting international markets?

When listing on cross-border platforms such as Amazon, eBay, or others, the legal requirements of the country of origin as well as the rules of the target countries must be observed. In particular, in the area of product safety (e.g., CE marking under EU law), labeling obligations, and consumer rights (e.g., return rights, information obligations), requirements vary from country to country. The GDPR and national data protection laws must be observed when processing personal data. Violation of national regulations may lead to liability risks and sales bans in the target country.

To what extent must data protection regulations be taken into account in listing?

Even if primarily product information is processed in the context of listing, data protection is especially relevant when personal data — for example, customer reviews, providers, or specific offers — are displayed in the listing or processed in the background. The GDPR stipulates that only such data may be processed for which there is a legal basis (e.g., legitimate interest, contract performance, consent). Data subjects must also be informed about data processing (transparency obligation). Violations can result in severe fines.

What is the legal significance of platform T&Cs and guidelines in the context of listing?

The general terms and conditions and guidelines of the respective platform supplement statutory requirements and may contain special duties, restrictions, or prohibitions regarding product listings. Platforms may, for example, specify permissible product types, required supporting documents (e.g., CE certificates), display formats, or trademark protection agreements. In the event of violations, consequences may include removal of listings, permanent account suspension, and possibly contractual damage claims by the platform. Acceptance of these conditions is a prerequisite for using the platform and can be enforced in court in the event of a dispute.