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Derivative (Code definition) meaning
Published by a LexisNexis Corporate expert
What does Derivative (Code definition) mean?
In takeover practice, a derivative (Code definition) is a financial product whose value, in whole or in part, is determined—directly or indirectly—by the price of an underlying security. This is the definition used in the City Code on Takeovers and Mergers.
It covers, for example, options, futures, contracts for difference, total return swaps and other cash-settled or physically-settled instruments referenced to relevant securities.
Under the Takeover Code, holdings and dealings in such derivatives can create an interest in relevant securities for Code purposes and trigger disclosure obligations (for example under Rule 8), as well as restrictions on dealings during an offer period.
Usage is consistent across England & Wales, Scotland and Northern Ireland under the UK Takeover Code. In Ireland, the Irish Takeover Rules adopt a substantively similar approach to ‘derivative’ for disclosure and control purposes.
Practically, advisers should assess positions in cash-settled and physical-settlement derivatives referenced to target or offeror securities to determine interests, disclosure and dealing restrictions.
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View the related Practice Notes about Derivative (Code definition)
PRACTICE NOTES
UK Film and Television Law Glossary: Terms C–D—copyright, collecting societies, broadcasting, distribution
Film and TV glossary A–B Film and TV glossary E–H Film and TV glossary I–L Film and TV glossary M–P Film and TV glossary R–S Film and TV glossary T–W CAP Code for non-broadcast media The UK Code of Non-broadcast Advertising and Direct & Promotional Marketing (the CAP Code) serves as the principal framework governing non-broadcast adverts, promotional sales activity and direct marketing messages. It is drafted by the Committee on Advertising Practice (CAP), a self-regulatory body whose membership comprises organisations representing advertising, sales promotion, direct marketing and media industries. The Advertising Standards Authority (ASA) polices the CAP Code and may require the withdrawal or amendment of any advertisement that contravenes these standards. Refer to Practice Note: Advertising law and regulation. Channel 4 Channel 4 operates as a ‘publisher-broadcaster’: it produces no programmes internally, commissioning content from production companies across the UK. Cinematograph film Under the Copyright Act 1956 (CA 1956), films gained protection as...
22 May
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PRACTICE NOTES
Interests in Securities under the UK Takeover Code: practical guidance on definition, derivatives, voting control and Rule 8/9 disclosures
Interests in securities—Setting the scene This Resource Note addresses how the City Code on Takeovers and Mergers (the Code) defines “interests in securities”. It signposts core materials, commentary and guidance from the Panel on Takeovers and Mergers (the Panel), together with Lexis+® UK analysis and resources, to give practical assistance on interpreting and applying the expression. Code and Lexis+® UK resources Practice Statements from the Panel Executive (the body responsible for the day-to-day supervision and regulation of takeovers) offering informal guidance on how the Executive generally reads and applies the Code Panel Statements (P/S) and Panel Instruments Public Consultation Papers (PCP) and Response Statements (RS) issued by the Code Committee Annual Reports from the Panel discussing overarching matters Relevant Lexis+® UK resources What it covers The Code definition and Notes apply in the same way to references to interests in shares and to interests in relevant securities. Application The expression is used across the Code....
21 May
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