4.5 Prospectus: Meaning, Contents, and Liabilities for Misstatement

The prospectus = any public invitation to subscribe shares or debentures — the public company's courtship paper. Contents: the company's and promoters' particulars, the objects, the capital structure, the promoters' and experts' interests, the financial information and the risk factors (the Securities Act 2063's disclosure schedule and SEBON's rules — the offer document's modern discipline). Liabilities for misstatement: (i) civil — rescission of the subscription and/or damages against the company, directors, promoters and experts who authorised the false statement (the innocent-subscriber's remedies); (ii) criminal/regulatory — the false prospectus's offences (the Securities Act's penalties; SEBON's enforcement); (iii) the expert's limited liability for the non-expert parts. The discipline's principle: the market may risk, but not be deceived (the full doctrinal development in Securities Law, LAW5409, this semester).