5.2 GENERAL INFORMATION ON THE COMPANY'S LEGAL AND REGULATORY ENVIRONMENT

5.2.1 Regulations applicable to the company
The following provisions of the French financial markets regulations apply to the company:
• provisions requiring foreign issuers to provide information to the investing public pursuant to AMF General Regulations, Book II, Title II, chapter 2;
• AMF General Regulations Book VI, Title III, chapter 1 regarding the way prices are determined;
• AMF General Regulations Book VI, Title I, chapter 1 and Title II, chapters 1 and 2 regarding insider trading;
• AMF General Regulations Book II, Title IV, chapter 1 regarding the dissemination of information during
buy-back programmes for securities that have been admitted to listing on a regulated market, without prejudice where appropriate to European Commission regulation (EC) 2273/2003 of 22 December 2003;
• AMF General Regulations Book II, Title I, chapter 1 regarding the dissemination of information when an application to admit new shares to listing is made;
• AMF General Regulations Book II, Title I, chapter 4 in the event of a tender offer for shares that have already been admitted to listing.

In addition, the rules governing the organization and functioning of the markets (the Euronext Rule Book) are applicable to the company as a listed issuer. The Euronext Rule Book may be consulted at the offices of all Euronext locations and is available on the company website. The Dutch statutory provisions governing tender offers, as described in section 5.1.14, will apply to the company until the EU directive 2004/25/EC of 21 April 2004 on takeover bids is transposed in national laws, which is expected to be in 2006. The Dutch statutory provisions governing the disclosure of holdings exceeding certain thresholds in the company's capital are described in section 5.1.13.
In addition to the laws and statutory provisions applicable to the company summarized above, the company has to comply with the public information requirements. Euronext is listed on the Eurolist Market (former Premier Marché of Euronext Paris) and is traded but not listed on the Euronext platforms in Brussels (Trading Facility) and Amsterdam. Euronext committed itself to comply also with the Dutch requirements concerning the provisions of information to the public in the event of a capital reduction.

5.2.2 Regulatory structure and environment
5.2.2.1 Euronext markets overview
From a regulatory perspective, and without prejudice to its unified operational structure, Euronext N.V. fully owns the exchange organizations in Amsterdam, Brussels, Lisbon, London and Paris, which in turn hold the regulatory licenses to operate the local markets. This structure does not have any impact on the unified trading platform, the central order book or the common clearing and settlement platforms. Listed companies are subject to the local listing requirements at the location via which they enter the market (Amsterdam, Brussels, Lisbon or Paris).
Euronext's regulated markets are as follows:
- Euronext Amsterdam operates one stock market and one derivatives market;
- Euronext Brussels operates the five Belgian regulated markets, including four stock markets (the Premier Marché/Eerste Markt, the Second Marché/Tweede Markt, the Nouveau Marché/Nieuwe Markt and the Trading Facility), and Euronext Brussels derivatives market, the Belgian futures and options market;
- Euronext Lisbon operates three Portuguese regulated markets, including two stock markets (the Principal Market/Mercado de Cotações Oficiais and the Second Market/Segundo Mercado) and one derivatives market, the Mercado de Futuros e Opções;
- Euronext Paris operates the three French regulated markets, including one stock market (Eurolist by Euronext, since
21 February, as a result of the change of the name of the Bourse de Paris and the suppression of the Nouveau Marché) and two derivatives markets (Monep and Matif);
- LIFFE Administration and Management operates a derivatives market.
All the aforementioned regulated stock markets are due to be merged in the course of year 2005 in each jurisdiction in order to be governed by common Listing rules (except for the Trading Facility in Brussels, which has no Listing function).Euronext also operates the following non-regulated markets:
- in Brussels, the Marché Libre for companies that do not want to abide by specific listing requirements or ongoing obligations and the Public Auction Markets (Ventes publiques) for trading securities which are non listed but traded on an occasional basis;
- in Lisbon, the Unlisted market/Mercado Sem Cotações, which is a stock market with minimal listing requirements and EasyNext Lisbon, which is a new non-regulated market for structured products. The New Market/Novo Mercado was extinguished following the restructuring of the Portuguese cash markets, on 1 October 2004;
- in Paris, the Marché Libre for companies or offering shareholders that do not want to abide by the listing requirements of a regulated market.

5.2.2.2 Regulatory achievements within integration process
The Euronext Rule Book currently consists of two books:
- Book I contains the harmonized rules, including rules
of conduct that are designed to protect the markets, as well as rules on trading and membership;
- Book II contains all rules of the individual markets
that have not been harmonized. Many of the matters covered in Book II are currently being harmonized but will remain specific to each Euronext market operator during the transitional period.The notices adopted by Euronext for the enforcement of Book I apply to all Euronext markets (unless otherwise specified), while those for the enforcement of Book II are specific to local jurisdictions. The regulators in Belgium, France, the Netherlands, Portugal and the United Kingdom have approved the market rules of Books I and II. Apart from provisions directly linked to and implied by national laws and regulations, listing conditions for issuers remain the only domain not yet harmonized in Book I. It is anticipated that rules relating to Listing will be implemented in the course of 2005.The following rules have been integrated in Book I:
- membership rules for cash and derivatives markets;
- trading rules for cash and derivatives markets;
- rules of conduct for cash and derivatives markets;
- transparency obligations for certain issuers (applicable only to cash markets);
- enforcement of the rules (applicable to cash and derivatives markets).
Euronext intends to pursue harmonization as rapidly as possible in order to transfer rules from Book II to Book I.

5.2.2.3 Supervision and approval of regulatory texts
The Euronext Rule Book and all subsequent amendments have to be submitted to the regulators of Euronext N.V. and those of its subsidiaries. On 22 March 2001 the COB (Commission des Opérations de Bourse) and the CMF (Conseil des Marchés Financiers) which merged into Autorité des Marchés Financiers in 2003, the CBF (now CBFA [Commission Bancaire, Financière et des Assurances/ Commissie voor het Bank, Financie en Assurantiewezen]), and the STE (now the AFM [Autoriteit Financiële Markten]) - the regulators responsible for overseeing Euronext N.V. and its subsidiaries - signed a Memorandum of Understanding to co-ordinate the supervision and regulation of Euronext's market activities and the associated regulated markets it operates. The Memorandum of Understanding covers the following matters:
- creation of a chairmen's committee composed of the chairman of each of the regulatory authorities that signed the Memorandum of Understanding;
- creation of a steering committee composed of a representative of each of the principal authorities that signed the Memorandum of Understanding;
- regular meetings between the chairmen's committee and the Managing Board;
- prior agreement of the chairmen's committee to certain decisions made by the subsidiaries of Euronext N.V. regarding such matters as its articles of association and those of its subsidiaries, the Euronext Rule Book, any subsequent amendments to these documents, the creation of alliances, mergers, cross-holdings and cross-membership agreements, the implementation of integration and restructuring measures, the supervision of trading members'activities, the monitoring of transactions, and the opening or closing of a regulated market.The CMVM (Comissão do Mercado de Valores Mobiliários), the regulatory authority for Euronext Lisbon, signed the Memorandum of Understanding on 26 March 2002. On 3 March 2003, these regulators, together with the Financial Services Authority (FSA) in the UK, also agreed on the provisions of a separate Memorandum of Understanding in relation to all of Euronext's derivatives market activities. Euronext continues to discuss with its regulators ways in which the arrangements implemented pursuant to these Memoranda of Understanding can be enhanced.

5.2.3 National regulation of market operators
Euronext Amsterdam N.V.
Euronext Amsterdam operates one stock market, one financial derivatives market and one commodity derivatives market. Under Article 22 of the Dutch securities transactions (Supervision) Act 1995, the establishment of a recognized exchange in the Netherlands is subject to prior authorization by the Dutch minister of Finance who may, at any time, amend or revoke this authorization if this is necessary to ensure the proper functioning of the markets or the position of the investors. Authorization may also be revoked for non-compliance with applicable rules. It should be noted that the exchange licence was jointly issued to Euronext Amsterdam N.V. and Euronext N.V.Among other responsibilities, the Dutch Autoriteit Financiële Markten (AFM), together with the Dutch Central Bank (De Nederlandsche Bank [DNB]), acts as the regulatory authority for members of Euronext Amsterdam, supervises the primary and secondary markets, ensures compliance with market rules, and monitors clearing and settlement operations, while the Dutch minister of Finance authorizes the recognition of exchanges, ensures compliance with European Directives, and issues declarations of no objection in connection with the acquisition of holdings in entities that own the exchanges.
Euronext Amsterdam is responsible for approving prospectuses and admitting financial instruments to Listing on its markets. It is also in charge of establishing, monitoring compliance with and enforcing rules governing its primary markets. These responsibilities, as currently foreseen, will be transferred to AFM in the course of 2005.Finally, the Dutch minister of Finance has imposed on Euronext Amsterdam N.V. and Euronext N.V. a number of specific conditions and restrictions regarding the integration process. In particular, both entities are required to inform the AFM of progress made in integration. Furthermore, the following decisions are subject to prior approval from the Dutch minister of Finance and/or the AFM:
- principal integration steps affecting the operation of the exchanges in the Netherlands;
- adoption of the applicable Rule Books;
- any merger or similar arrangement involving Euronext in as far as these may affect the operation of the exchanges in the Netherlands.
In certain cases, the Dutch minister of Finance has the discretion to amend or supplement any conditions or restrictions stipulated in connection with the exchange recognition.

Euronext Brussels S.A./N.V.
Euronext Brussels S.A./N.V., a subsidiary of Euronext N.V., is the market operator for the following five Belgian regulated markets: the Premier Marché/Eerste Markt, the Second Marché/Tweede Markt, the Nouveau Marché/Nieuwe Markt, the Trading Facility and the Belgian derivatives market. Euronext Brussels is governed by the Belgian Act of 2 August 2002 which entered into force on 1 June 2003 and is recognized as a Market undertaking according to article 16 of this Act. The principal subject of that law was to transfer to the CBFA some of the competences previously executed by the exchange (disciplinary powers against members and issuers, control of sensitive information, supervision of the markets, and investigative powers). Euronext Brussels continues to be responsible for matters such as the organization of the markets and the admission, suspension and exclusion of members, and has been appointed by law as a "competent authority" within the meaning of the Listing Directive regarding the Listing, suspension and delisting of securities. Euronext Brussels S.A./N.V., also governs two non-regulated markets: the Marché Libre created in October 2004 and the Public Auction Market for non-listed companies.

Euronext Lisbon S.A.
Euronext Lisbon, a subsidiary of Euronext N.V., is the recognized market operator of the three Portuguese regulated markets: the Principal Market (Mercado de Cotações Oficiais), the Second Market (Segundo Mercado) and the Derivatives Market (Mercado de Futuros e Opções). It is governed by act no. 394/99 of 13 October 1999 (Regime Jurídico das Entidades Gestoras de Mercados de Valores Mobiliários e de Sistemas Conexos), which governs the legal regime for regulated and non-regulated markets and all companies with related activities. This act was amended on 15 January 2002 (Act no. 8-D/2002) to allow Euronext N.V. to acquire all the shares of BVLP and to allow an amendment to the articles of association which, until that date, restricted voting rights to 15%.The creation of regulated markets is subject to prior authorization in the form of a decree from the Portuguese minister of Finance, following consultation with the CMVM. The CMVM is an independent public authority that monitors the markets and market participants, public offerings and collective investment undertakings. In addition, a regulated market must be registered with the CMVM prior to starting operations. The minister of Finance may withdraw recognition of a regulated market in certain cases stipulated in the abovementioned act.
The CMVM is the regulatory authority for Euronext Lisbon as stipulated in the Portuguese Securities Act.

Euronext Paris S.A.
Euronext Paris, a subsidiary of Euronext N.V., is the market operator that manages the three French regulated markets: "Eurolist by Euronext", Monep and Matif.
Euronext Paris is governed by French Law no. 96-597 dated 2 July 1996, as amended and codified in the French Monetary and Financial Code (the MAF act), which implemented the European Investments Services Directive (ISD) of 10 May 1993 in French law.Under the MAF act, the French minister of Finance has the authority to confer or revoke regulated market status on the recommendation of the AMF and following an opinion from the Banque de France. This status is granted if the market meets specific conditions for proper operation. In particular, the market must have rules governing access to the market, Listing of securities, the organization of trading, the suspension of trading, and the recording and publication of trades.The AMF is responsible for safeguarding investments in financial instruments and in all other savings and investment vehicles, ensuring that investors receive material information, maintaining orderly financial markets. It establishes the rules of conduct that must be observed by market operators and their personnel, determining the conditions for granting or revoking professional licenses for individuals acting on behalf of market operators, and establishing the general principles for the organization and operation of regulated markets.It is also responsible for formulating the rules governing the execution and publication of transactions involving securities or futures and options contracts listed on these markets. It also has the authority to regulate and monitor initial public offerings (i.e. vetting of prospectuses), financial communication of listed companies and tender offers. It can oppose the decision of a market operator to admit a security or a futures and/or option contract to trading on its market. Furthermore, as mentioned above, the AMF makes recommendations to the French minister of Finance on conferring regulated market status. Finally, the AMF approves the rule books of regulated markets. All amendments to the rule book of a regulated market are subject to the prior approval of the AMF following an opinion from the Banque de France.The AMF is also empowered to lay down standards for certain non-regulated markets or obligations for persons having made forms of public offerings other than Listing on a regulated market, which may be relevant for the operation of non-regulated markets by Euronext Paris.
In addition to its status as a market operator, Euronext Paris is approved as a specialized financial institution. It is therefore governed by French banking legislation and regulations (notably the Banking Act as amended and codified in the French Monetary and Financial code), which means that it is subject to supervision by the Comité des Établissements de Crédit et des Entreprises d'Investissement (CECEI) and the Banking Commission. As such, it must comply with prudential ratios related to the banking regulation applicable to its activities (on a consolidated basis at the 2004 balance sheet date, prudential equity amounted to e185.94 million, and the solvency ratio to 44%).

LIFFE (Holdings) plc
LIFFE (Holdings) plc is a UK company formed on 25 February 1988 and is governed by the UK Companies Acts of 1985 and 1989. LIFFE (Holdings plc) shares are held by Euronext UK plc, a subsidiary of Euronext N.V. The company has three principal regulated subsidiaries: LIFFE Administration and Management (LAM) and LIFFE Services Limited (LSL) in the UK, and NQLX LLC in the USA.
LIFFE Administration and Management (LIFFE) manages the markets for financial derivatives and commodity derivatives in London, which are overseen by the FSA pursuant to the Financial Services and Markets Act 2000. Under current legislation, LIFFE is a recognized investment exchange.
LIFFE Services Limited is a technology supplier and is also governed by the FSA regulations as a service company.NQLX LLC is a wholly owned subsidiary of LIFFE (Holdings) plc NQLX LLC, which is registered with the SEC, is regulated in the US by the Commodity Futures Trading Commission (CFTC). NQLX announced in September 2004 that it would suspend trading in all of its securities futures products following the expiry of the December 2004 contracts. However, NQLX will retain its status as a Designated Contract Market in anticipation of Listing other contracts in the future.In the UK, financial services legislation comes under the jurisdiction of Her Majesty's Treasury, whilst responsibility for overseeing the conduct of regulated activity rests with the FSA. The powers of this authority are set out in the UK Financial Services and Markets Act 2000 (FiSMA).

5.2.4 Intellectual property
The names of the principal companies, indices and services of Euronext are registered trademarks. Many of the trademarks are registered in several countries. For example, the Euronext® trademark has been registered worldwide. The BEL 20® and Mini® trademarks are registered throughout Europe, and the Mini® trademark is about to be registered in the US. The AEX-Index® and PSI 20® are also registered as European trademarks.
Clearing 21® has been registered in France, as have various SBF® and CAC 40® - related trademarks (such as SBF Paris Bourse®, MIDCAC® and SUPERCAC®). With the exception of BEL 20® and Mini®, these trademarks have also been registered worldwide and in the US.
The trademarks LIFFE and LIFFE CONNECT® are registered in the UK and the European Union, as well as in Australia, Hong Kong, Japan, Singapore and the US. The Euronext.liffe logo is registered in Benelux, the European Union, the UK, Australia, Switzerland and Japan and is pending registration in the USA and various other countries.
Licensing agreements allow the use of FLEX®, a trademark owned by the Chicago Board Options Exchange Inc., the MSCIEuro Index and MSCIPan-Euro Index, and Swapnote®. Swapnote® is a registered trademark of ICAP plc and a licence has been granted to LIFFE. In addition, the construction and the algorithm of the Swapnote® contract are protected by US patent 6.304.858 B1 held by Adams,Viner and Mosler Ltd; LIFFE has been granted an exclusive worldwide licence of this patent.The Clearing 21® trademark is owned by the Chicago Mercantile Exchange Inc. and the New York Mercantile Exchange Inc.; the SPAN® trademark is owned by the Chicago Mercantile Exchange Inc., and the Globex® trademark is owned by P-M-T Limited Partnership, a not-for-profit association registered in the State of Illinois. Euronext holds a user's licence for each of these trademarks. The FTSE™ trademark is owned by the London Stock Exchange Ltd and Financial Times Ltd. Under a series of licensing agreements with various parties, Euronext has the right to use the FTSE™ name in its various indices. All of these trademarks have been duly licensed or sub-licensed to Euronext or its ad hoc subsidiaries. Under a licensing agreement, LIFFE has the right to use the FTSE™ 100, FTSE™ 250, FTSE™ Eurotop 100 and FTSE™ Eurotop 300 indices. As for FTSEurofirst 80 and FTSEurofirst 100 indices are the proprietary interest of FTSE and Euronext N.V., Eurofirst being a jointly owned trademark of FTSE and Euronext N.V.