They have much less control on their ownership

More and more international, including French, groups are listed on us without having requested. A change in the U.S. Regulation last October (see box) allowed an explosion of sides and "non-sponsored" ADR (which are not on the initiative of a company, but investors and banks). Of ADR have been implemented on French companies 40 the last six months, based on data Bank of NY Mellon Depositary Receipts and Deutsche Bank. In the CAC 40, 37 groups have now certificates of shares: 16 via a selected rating and 21 via of ADR not sponsored. Among major companies, only Lagardère, Renault and Saint-Gobain are of exception, according to Bank of New York.

In the world, some 860 programs have been implemented since the beginning of last autumn (companies, British, Japanese and Hong Kong, especially), in addition to the pre-existing 230. "More than 80 of the values of the major European indices are not sponsored or sponsored ADR programs", said Laurent Drouin, responsible of the Paris Office of Bank of New York.

This rain of new programs is grind teeth in some societies where the ADR are sometimes launched without their knowledge. They have much less control on their ownership. The four banks that dominate this market (Bank of New York, Citigroup, Deutsche Bank and JP Morgan), each with its own assessment of the precautions to be taken with the companies. Some ask their opinion leaders, others simply warn them. If a company expressed a refusal marked, institutions ensure respect their will. "Even if we have no obligation to ask permission or even warn them", said Laurent Drouin.

"Legal risk".

For several weeks, lawyers are increasing the risk of this practice alerts and offer their services to to prevent. Orrick Rambaud Martel comes to disseminate a note reminding that "several federal courts have considered that the existence of an ADR program was sufficient to submit a transmitter outside their jurisdiction." "Exposure to the risk of litigation is not only related to having or not the ADR but it helps." "The increase in the number of shareholders is mechanically increase risk of"class actions"", says Anne Maréchal, associate lawyer with DLA Piper, who comes to organize a meeting with French companies concerned. The specialist noted several examples of actions collective "referring to the ADR, sponsored or not, as in the case of Fortis and Société Générale, last year, or, in the past, Parmalat and rock," says." The problem of the non-sponsored ADR, is that several banks can implement on a same company: therefore there is no contract. Carriers have no information about their obligations, as the statements of threshold-crossing, and there is no procedure to organize the voting rights. "Finally, unlike the sponsored programs, banks do pay not a portion of the commissions to the transmitters.

To avoid problems, companies choose to implement the ADR of "level 1", not rated, but their initiative and with a single bank custodian. "The beginning of discussion on non-sponsored ADR has settled but it had the merit of publicizing the ADR, indicates Stanislas Bénéteau, responsible for Deutsche Bank for the France activity." Many companies are interested in non-quoted shares certificates. Between October and March, 24 programs have been initiated in the world. Either as well as on the whole of 2007, which shows the appetite of the business.