Earlier this year, the UK Financial Services Authority issued a statement confirming that the grant of security over shares of an issuer (by the creation of a security interest such as a pledge, mortgage or charge) comes within Chapter 3 of the UK Disclosure and Transparency Rules. Accordingly, persons discharging managerial responsibilities, such as directors of listed companies and their connected persons, are required to notify to their issuer any such grant of security over shares held by them in the issuer, and the issuer must then notify the market. This caused concern in the UK as the view of many up to that point had been that the language of Chapter 3 of the UK Disclosure and Transparency Rules did not extend to the grant of security over shares.

This development in the UK raised uncertainty as to whether such an obligation existed here in Ireland under the Irish market abuse regime. Again the prevailing view here has been that no such disclosure is required. IFSRA have now considered the point and, on 24 April, issued a consultation paper on the issue, stating that the legal position is not free from doubt and inviting submissions as to how to address the issue.

Helpfully, as regards issuers' current obligations, IFSRA state in their consultation paper that, as it is not current practice to disclose security over shares, the Regulator "is not currently in a position to pursue cases where a failure to disclose is uncovered".

IFSRA also states that its current position, pending the consultation process, is that it favours the introduction of legislation to clarify that such disclosures are required.