Market Abuse Regulation (Regulation 596/2014) (MAR) sets out a new regime for tackling unlawful behaviour” in financial markets. This EU Regulation will apply from 3 July 2016 and covers insider dealing, market manipulation and the improper disclosure of inside information. This updates the civil market abuse framework established by the Market Abuse Directive (MAD).
The Financial Conduct Authority (FCA) is seeking views on the amendments to its Handbook, necessary to implement the new regime. The consultation“Policy proposals and Handbook changes related to the implementation of the Market Abuse Regulation” invite comments on the different options for implementation the regime offers Member States in two areas.
The first area under discussion is alternative options for implementing two specific EU MAR requirements: a) Managers’ transactions; and, b) Public disclosure of inside information.
The second area under scrutiny is the legal framework where, as the paper sets out, the move from a Directive to a Regulation, marks a step change in the EU market abuse framework. A Regulation under EU law applies directly in all Member States and legislation to transpose the provisions into domestic law is not needed.
This will ensure consistency across the EU by preventing different approaches in the way Member States implement the legislation. That said, there are a number of changes that will have to be made to ensure compliance with this new regime. The Treasury is preparing secondary legislation to repeal or modify existing domestic law, where it conflicts MAR, to meet the UK’s amended obligations under the new regime.
This secondary legislation will also cover MAR obligations which are not covered by the existing market abuse regime, such as the requirement for employers to have internal procedures for employees to report infringements of MAR.
The consultation closes on 6 February 2016.