Market Abuse Regulation: Key issues for corporates

Transcription

1 Market Abuse Regulatio: Key issues for corporates

2 Backgroud Implemetatio of MAR is 3 July 2016 Detailed EU implemetatio measures are still beig fialised FCA cosultatio expected late summer LLP

3 Why do we eed MAR? What is market abuse?: a cocept that ecompasses ulawful behaviour o the fiacial markets (Recital 7, MAR) MAD adopted i 2003 ad established EU wide framework for tacklig market abuse ad market maipulatio Problem? Creatio of ew forms of fiacial istrumets Emergece of ew tradig platforms ad veues Creatio of MAR ad MAD II Poor track record of prevetig/eforcig market abuse i some Member States Desire to create a sigle Europea Rulebook LLP 3

4 Structure of MAR ad supportig regulatio MAR: Level 1 text, has direct effect i Member States from 3 July 2016 (.b. some provisios oly take effect o 3 Jauary 2017) Supportig Level 2 regulatio: ESMA preparig techical advice ad stadards for adoptio by Commissio Likely to be further ESMA guidace to assist with implemetatio e.g. Q&A Natioal implemetatio: FCA/HMT CP expected late summer Ca expect chages to FSMA, LRs ad DTRs 4 LLP

5 What are the key chages of which you should be aware? LLP 5

6 Scope of MAR (Article 2) MAR applies to a wider rage of tradig veues ad securities ad derivatives tha MAD MAD MAR Applies to fiacial istrumets admitted to tradig o regulated markets or where request for admissio made ad related fiacial istrumets whose price depeds o or has a effect o the above Will also apply to fiacial istrumets o other tradig platforms (MTFs ad OTFs) ad related fiacial istrumets e.g. MAR will apply to AIM Maipulatio of bechmarks ot expressly covered Maipulatio of bechmarks brought withi the market maipulatio offece New offece of attempted market maipulatio Defiitio of fiacial istrumets exteded to cover emissios allowaces 6 LLP

7 Iside Iformatio Defiitio of iside iformatio (article 7) Iformatio must be (i) precise, (ii) have ot bee made public, (ii) relate to oe or more issuers or fiacial istrumets ad (iv) if made public, be likely to have a sigificat effect o the price of those fiacial istrumets Largely uchaged except that reasoable ivestor test ow forms part of defiitio (previously cotaied i a supportig directive to MAD) Isider dealig (article 8) Broadly i lie with MAD, but ew offece of cacellig or amedig orders whilst i possessio of iside iformatio Rebuttable presumptio that perso dealig whilst i possessio of iside iformatio has used that iside iformatio (Recital 24 MAR) LLP 7

8 Disclosure of iside iformatio (Article 17) New requiremets uder MAR Issuer still require to disclose iside iformatio asap 1. Where issuer has delayed aoucig iside iformatio, o aoucemet it must iform regulator of its decisio to delay ad explai i writig why it thiks the delay was permissible. NB: FCA has discretio o implemetatio to require explaatio oly to be provided o request (Article 17(4)) Issuer may still delay so as ot to prejudice legitimate iterest provided delay does ot mislead public ad cofidetiality maitaied 2. Fiacial istitutios ca delay where disclosure would risk udermiig fiacial stability of issuer ad fiacial system, delay i public iterest, cofidetiality maitaied ad prior coset of regulator (Article 17(5)) 8 LLP

9 Isider Lists (Article 18) MAD MAR Issuer must maitai isider lists Broader scope of MAR meas issuers o MTFs ad OTFs caught (although exemptio for issuers o SME growth markets) Lists to be maitaied for 5 years Where third party maitais isider list, issuer retais primary resposibility ESMA madated to create a harmoised template for isider lists causig cocer due to level of detail beig requested (ESMA draft techical stadards) LLP 9

10 Directors trasactios (Article 19) MAD MAR PDMRs ad coected persos must report trasactios i issuer s securities asap Broader scope of MAR meas PDMRs of issuers o MTFs ad OTFs caught No de miimis threshold for reportig such trasactios Time limit for otificatio of dealig to be reduced to 3 busiess days De miimis threshold for otificatio of trasactios oce threshold of 5,000 per caledar year reached (o ettig) Member states may raise threshold to 20,000 No tradig i close periods ecapsulates some of the provisios of the Model Code but without may of the clarificatios of the Code e.g. what is ot a dealig, ad the types of dealigs permitted durig a prohibited period 10 LLP

11 Market Soudigs (Article 11) Article 11(4): disclosure of iside iformatio made i course of a market soudig deemed to be made i ormal course of perso s employmet/duties where disclosig party complies with certai specified coditios (i.e. ot ulawful disclosure) Prior to disclosure disclosig party must assess whether market soudig ivolves disclosure of iside iformatio keep writte record of assessmet ad ratioale for coclusio draw obtai recipiet s coset to receive iside iformatio ad provide specific warigs (ESMA has developed stadard script for market soudigs (cotaied i its draft techical stadards)) Disclosig party must keep record of soudigs ad disclosures made If iformatio ceases to be iside iformatio after wall crossig, disclosig party to otify recipiet otherwise recipiet to determie for themselves whether iformatio still iside iformatio Records to be kept for 5 years ad provided to regulator o request ESMA also preparig guidelies for recipiets of market soudigs (ot yet published) New rules to cover soudigs to gauge ivestor iterest i offerig of securities ad also soudigs i coectio with takeovers ad mergers LLP 11

12 Market Abuse Directive 2 New Directive o crimial sactios for market abuse To be implemeted by member states by 3 July 2016 UK has ot opted ito MAD2 I UK isider dealig ad market maipulatio are already crimial offeces uder the Crimial Justice Act 1993 ad the Fiacial Services Act LLP

13 Cotacts Patrick Sarch Parter, Lodo T: M: E: Carlos Coceicao Parter, Lodo T: M: E: Carolie Dawso Seior Associate, Lodo T: M: E: The Global M&A Toolkit ad Fiacial Markets Toolkit Offerig cliets our high-quality global resources Desktop Tablet Mobile The Toolkits brig together a wealth of targeted ad isightful resources to support your decisio-makig. You ca fid what you eed quickly ad easily by browsig the sites by Geography, Topic, Resource, Product or Sector. Global M&A Toolkit M&A Tools for quick aswers Topical Videos ad Webiars Our Cross Border Acquisitio Guide M&A Hadbooks ad Takeover Guides Clarifyig the complex world of Global M&A Global M&A treds ad i-depth materials o hot topics M&A directory of cotacts My Toolkit bookmark your favourite cotet for quick access Fiacial Markets Toolkit Topic Guides i-depth materials o hot topics ECM Deal Tools ad Comparative Tax Tables Legal ad regulatory updates available o a self-service basis Our Perspectives Series ad other semiars Equippig cliets for the global fiacial markets Our briefigs ad other reports, articles ad aalysis, orgaised to give you easier access Isights ito over 30 jurisdictios LLP 13

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