Certain Limitations on Privately Issued Shares

Under the controversial Decree 1/2010,  a private placement of shares in a private shareholding company was subject to various restrictions under Decree 1/2010, including:
  • shares privately issued were subject to a lock-up period of 1 year;
  • there had to be a six-month gap between two tranches of a private placement; and
  • the proceeds resulting from the sale of shares had to be kept in an escrow account.

Decree 58/2012 of the Government dated 20 July 2012 implementing the Securities Law has repealed Decree 1/2010 and therefore has removed these restrictions. However, except in certain limited circumstances, private placement of shares by a public shareholding company is still subject to the first two restrictions, which are provided in the amended Securities Law rather than in Decree 1/2010.