[Last updated: 1 January 2025, unless otherwise noted]

3.1 Disclosure of shareholdings

Shareholding disclosure rules apply before, during and after a public takeover bid.

According to these rules, a bidder must announce a change in shareholding in the target company if it exceeds the applicable disclosure thresholds. The relevant disclosure thresholds are 5% and each increase or decrease of 1% of its stake.

When calculating its shareholding stake, the bidder must include shares held by the parties with whom it acts in concert or may be deemed to act in concert (see 3.4 below).

3.2 Target company disclosures

The target company must continue to comply with the general rules on disclosures. For example, before a shareholder announces the change of its stake, the relevant information is disseminated in certain media or if the transaction in the shares of the company is seen as abnormal, the target company must make an announcement in a timely manner.

3.3 Due diligence

When the bidder intends to acquire the target company shares via a tender offer, the bidder must engage a financial adviser, sponsor or law firm (hereinafter collectively referred to as 'intermediary agencies') to act as advisors and have them conduct due diligence and issue reports based on Acquisition Measures and Strategic Investment Measures. Meanwhile, the target company's board of directors shall conduct an investigation into the bidder and engage an independent financial adviser to issue professional opinions.

3.4 Acting in concert

Persons “act in concert” when:

• there is an equity control relationship between the investors;
• the investors are controlled by the same subject;
• an investor’s directors, supervisors, or senior management personnel take the posts of directors, supervisors, or senior management personnel of another investor;
• an investor is an equity participant of another investor, which may have a major impact on the major strategy of the equity participating company;
• a legal person or any other organization other than the bank or a natural person provides the capital financing for the investor to obtain relevant shares;
• there is a partnership, cooperation, joint operation, or other economic interest relationship between the investors;
• a natural person holding more than 30% stake in an investor holds shares in a listed company also held by the investor;
• any person who assumes the post of a director, supervisor, or senior manager in an investor holds shares in a listed company also held by the investor;
• a natural person holding more than 30% stake in an investor, or a director, supervisor, or senior manager in an investor, and their parents, spouses, children, children’s spouses, spouses’ parents, siblings, sibling’s spouses, spouses’ siblings and their spouses hold shares of the same listed company with the investor;
• a director, supervisor, or senior manager in a listed company holds shares of the company concerned concurrently with the aforementioned relatives, or holds shares of the company concerned concurrently with an enterprise directly or indirectly controlled thereby or by the aforementioned relatives;
• a director, supervisor, or senior manager, and staff members of a listed company and the legal person or other organization under its control holds the shares of the company concerned; or
• there are other affiliations between the investors.

The concept of persons acting in concert is especially relevant in relation to disclosure duties and mandatory takeover bids. A group of persons acting in concert will be required to carry out a mandatory takeover bid if that group acquires 30% of the shares in the target company and continues acquiring more of the target company’s shares even though no individual group member holds more than 30%, unless it meets the conditions for “exemption from adopting a tender offer” as prescribed in Chapter VI of the Acquisition Measure.