The provisions of the Code fall into two categories. On the one hand the Code sets out certain General Principles to be observed in affected transactions. These General Principles are essentially a codification of acceptable standards of commercial behaviour and they have an obvious and universal application. On the other hand, the Code lays down a series of Rules. Some of the Rules are no more than examples of the application of the General Principles and the Panel seeks to interpret them in accordance with those principles. Others are Rules of procedure designed to govern specific types of affected transactions. Accordingly, the Code, through the General Principles, may apply to a situation not specifically covered by a Rule. Also the Panel is allowed a discretion to relax the application of a Rule in exceptional circumstances, for example, when it considers that its strict application would operate unduly harshly.

The boards of an offeror and the offeree company and their respective advisers have a duty to act in the best interests of the holders of the respective securities. The General Principles and the Code will, inevitably, impinge on the freedom of action of boards and persons involved in affected transactions.

Each director of an offeror and of the offeree company has a responsibility to ensure, so far as he is reasonably able, that the Code is complied with in the conduct of an affected transaction.

Financial advisers have a particular responsibility to comply with the Code and to ensure, so far as they are reasonably able, that an offeror and the offeree company, and their respective directors, are aware of their responsibilities under the Code and comply with them. Financial advisers shall ensure that the Panel is consulted whenever necessary or desirable and shall co-operate fully with the Panel on any inquiries made by it. Financial advisers should also be mindful of conflicts of interest.

The Panel has appointed an Executive Director, and an Executive Committee [see sections 440B(11) and (12) of the Act]. A Deputy Executive Director will be appointed.

When there is any doubt as to whether a proposed course of conduct is in accordance with the General Principles or the Rules, parties or their advisers may consult the Executive Director in advance. In this way, the parties can obtain clarification of the basis on which they can properly proceed on the facts presented and so avoid taking action which might, in the event, be a breach of the Code.

Both principals and their advisers are encouraged to make full use of this service.

A ruling on the application or interpretation of the Code is generally given in the first place by the Executive Director on the basis of hearing the applicant alone. In some cases, however, it may not be possible for a ruling to be given unless the Executive Director is able to hear the views of other parties. The requirements of confidentiality shall be respected unless the circumstances require otherwise.

The Executive Director may refer a matter to the Executive Committee or to the Panel for decision without himself giving a ruling when he considers that there is an unusual, important or difficult point at issue. He may make such reference mero motu or on the application of any party.

The Panel expects prompt co-operation from those to whom inquiries are directed so that decisions may be both properly informed and given as speedily as possible.

If a party or his adviser wishes to contest a ruling of the Executive Director, he may take the matter on appeal to the Executive Committee, a quorum for which is three members, which committee can be convened at short notice. The same right is given to an aggrieved holder of relevant securities, subject to certain safeguards designed to discourage frivolous or vexatious appeals. A similar right of appeal exists against rulings of the Executive Committee, such further appeal being to the panel. In the case of appeals to the Panel, the quorum is five members.

Appeals shall be noted within three business days of notification of the ruling against which the appeal is directed, provided that the Executive Director or the Executive Committee, as the case may be, may direct that the appeal be noted within a shorter period if the circumstances so require, or within a longer period if justified. An appeal from the Executive Director, or from the Executive Committee, as the case may be, involves a rehearing, save to the extent that the party or parties involved may otherwise agree.

At hearings by the Executive Director and in appeals the case is normally presented in person by the parties or their advisers. Formal legal representation will not normally be permitted. Normally, each party shall set out its case briefly in writing beforehand. The parties are permitted to call such witnesses as may give relevant and material evidence. There are no rules of evidence other than those requisite to ensure fairness. All rulings by the Executive Director, Executive Committee or the Panel shall be confirmed in writing.

In general parties with a direct interest in the hearing are entitled to be present throughout the hearing and to see all papers submitted. However, a party may wish to present evidence which is of a confidential commercial nature. In such cases, if such course is considered justified, the evidence in question may be received in the absence of some, or all, of the other parties involved. Representations by holders of relevant securities or other interested parties may be made in writing.

Proceedings are informal and private. The Executive Director, Executive Committee or Panel, as the case may be, may himself or itself call any such evidence where it deems that course to be desirable. A recording may be taken, but it will not necessarily be transcribed or retained.

It is the panel's policy in the case of important decisions to publish its conclusions and the reasons for them. The Panel's decisions will be announced to the parties as soon as possible.

Any holder of relevant securities shall have the right to approach the Panel at any time in respect of any matter within the competence of the Panel either personally, by prior appointment, or in writing and to be informed of the decision of the Panel with regard to his approach.