BaFin’s new takeover circular: more than a consolidation exercise

On 18 August 2026, BaFin published Circular 05/2026 (WA), bringing together for the first time its administrative practice under the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz, “WpÜG”). While the circular formally consolidates existing supervisory positions rather than introducing new legal requirements, its practical significance should not be underestimated. The document is likely to become the primary supervisory reference point for German public M&A transactions and, in doing so, it will shape how transactions have to be structured, documented and executed going forward.

The key message running through the circular is clear: BaFin expects, in particular with regard to critical transactions, that regulatory and disclosure issues be largely resolved before an offer is launched, not during the offer process itself.

Less flexibility after announcement

One of the most notable themes is BaFin's insistence on certainty at the outset of a transaction.

The circular confirms that the type of offer announced under Section 10 WpÜG is binding and cannot subsequently be changed. Likewise, the announced form and amount of consideration may not later be reduced or replaced. Even qualifications such as "approximately" or "expected" do not preserve flexibility.

For bidders, this reinforces a practical reality: announcements should be viewed as the culmination of transaction planning rather than the starting point. Offer structure, financing and consideration mechanics will need to be substantially finalised before the transaction enters the public domain.

Long-stop dates enter the mainstream

The circular also offers welcome clarification regarding regulatory long-stop dates. BaFin indicates that it will generally not object to regulatory long-stop dates of up to twelve months following publication of the offer results, provided the circumstances of the transaction justify such timeline. At the same time, bidders will be expected to explain the relevant approval process, identify the competent authority and substantiate the proposed timeline in the offer document.

In practice, regulatory strategy will increasingly become a disclosure issue. For transactions requiring merger control, foreign investment or sector-specific approvals, regulatory planning is therefore likely to move further upstream in the deal timetable.

Section 35(3) WpÜG takes centre stage

The most significant part of the circular is its extensive guidance on the exemption from the mandatory offer obligation under Section 35(3) WpÜG.

The Circular substantially expands on the circumstances in which BaFin considers the exemption under Section 35(3) WpÜG to remain available, including delayed acquisitions of control resulting from regulatory approvals, commercial register procedures, indirect control structures and acting-in-concert arrangements. At the same time, the Circular repeatedly emphasises proper disclosure of the relevant acquisition structure and implementation steps.

The result is a more structured and, in some respects, more pragmatic framework for analysing control acquisitions in complex transactions. However, the Circular also suggests that disclosure and substantive exemption analysis can no longer be viewed as entirely separate workstreams.

A reminder that control means control

Among the most widely discussed statements is BaFin's confirmation that a mandatory offer obligation may arise even where the control threshold is exceeded for only a "judicial second".

Although this reflects BaFin's existing position, its inclusion in the circular serves as a reminder that transaction parties must carefully analyse every implementation step and not merely the intended final result. This may be particularly relevant for consortium structures, private equity transactions and internal reorganisations.

Higher expectations for exchange offers and target board statements

The circular also formalises extensive expectations regarding exchange offers. In particular, bidders will be required to support the liquidity of share consideration through a detailed liquidity forecast based on historic trading data and future transaction-specific assumptions.

Target company boards face a similar increase in expectations. BaFin makes clear that reasoned statements under Section 27 WpÜG must contain a genuine assessment of the offer and its implications. Merely summarising the offer document or acknowledging the bidder's intentions will not be sufficient.

Our view

The Circular does not change German takeover law. What it does change is the framework within which takeover transactions must be planned and reviewed.

By consolidating previously dispersed supervisory positions into a single document, BaFin has effectively published a comprehensive statement of its current supervisory expectations for public M&A transactions. The consequence is likely to be greater predictability, but also heightened expectations regarding transaction preparation, disclosure and documentation.

For bidders, target companies and advisers alike, the key takeaway is simple: BaFin increasingly expects public takeover transactions to be substantially planned before they are announced and comprehensively explained once they are launched. The circular therefore marks another step towards a more structured and disclosure-driven takeover environment in Germany.