Treasury has published its response and proposals on issuer liability, following analysis of responses to its 2008 consultation. It has decided to amend section 90A of FSMA and insert a new Schedule 10A to deal with several points, including to:

  • make no change to the current basis of liability (fraud);
  • attach liability in respect of securities traded on a UK regulated market or MTF and to apply the regime to all cases where securities are admitted to trading on a securities market where either the market is situated or operating in the UK or the UK is the issuer's home state;
  • apply the regimes to "transferable securities" as defined in section 102A(3) of FSMA (clarifying who is liable to pay compensation in the case of depositary receipts and other secondary securities);
  • apply a disclosure regime based on disclosures on recognised information services;
  • specifically preserve certain forms of civil liability;
  • include situations where an issuer dishonestly delays publication with the intention of enabling a gain or causing a loss; and
  • extend the regime to cover sellers and holders of securities, but not directors and advisers.

Treasury plans the new law to take effect from 1 October.