Related provisions for MAR 1.3.18
1 - 12 of 12 items.
The following behaviours are, in the opinion of the FCA , market abuse (insider dealing):(1) dealing on the basis of inside information which is not trading information; (2) front running/pre-positioning - that is, a transaction for a person's own benefit, on the basis of and ahead of an order (including an order relating to a bid)4 which he is to carry out with or for another (in respect of which information concerning the order is inside information), which
In the opinion of the FCA , the following factors are to be taken into account in determining whether or not a person's behaviour is in pursuit of legitimate business, and are indications that it is:(1) the extent to which the relevant trading by the person is carried out in order to hedge a risk, and in particular the extent to which it neutralises and responds to a risk arising out of the person's legitimate business; or(2) whether, in the case of a transaction
In the opinion of the FCA , the following factors are to be taken into account in determining whether or not a person's behaviour is dutiful execution of an order (including an order relating to a bid)41 on behalf of another, and are indications that it is:(1) whether the person has complied with the applicable provisions of COBS2 , or their equivalents in the relevant jurisdiction; or2(2) whether the person has agreed with its client
Behaviour, based on inside information relating to another company, in the context of a public takeover bid or merger for the purpose of gaining control of that company or proposing a merger with that company, does not of itself amount to market abuse (insider dealing) [Note: see Recital 29 Market Abuse Directive], including:(1) seeking from holders of securities, issued by the target, irrevocable undertakings or expressions of support to accept an offer to acquire those securities
The following examples of market abuse (insider dealing) concern the definition of inside information relating to financial instruments other than commodity derivatives.(1) X, a director at B PLC has lunch with a friend, Y. X tells Y that his company has received a takeover offer that is at a premium to the current share price at which it is trading. Y enters into a spread bet priced or valued by reference to the share price of B PLC based on his expectation that
The following example of market abuse (insider dealing) concerns the definition of inside information relating to commodity derivatives.Before the official publication of LME stock levels, a metals trader learns (from an insider) that there has been a significant decrease in the level of LME aluminium stocks. This information is routinely made available to users of that prescribed market . The trader buys a substantial number of futures in that metal on
The following example of market abuse (insider dealing)concerns the definition of inside information relating to pending client orders. A dealer on the trading desk of a firm dealing in oil derivatives accepts a very large order from a client to acquire a long position in oil futures deliverable in a particular month. Before executing the order, the dealer trades for the firm and on his personal account by taking a long position in those oil futures, based on the
The following connected examples of market abuse (insider dealing) concerns the differences in the definition of inside information for commodity derivatives and for other financial instruments.(1) A person deals, on a prescribed market , in the equities of XYZ plc, a commodity producer, based on inside information concerning that company. (2) A person deals, in a commodity futures contract traded on a prescribed market , based
(1) Delaying disclosure of inside information will not always mislead the public, although a developing situation should be monitored so that if circumstances change an immediate disclosure can be made.(2) Investors understand that some information must be kept confidential until developments are at a stage when an announcement can be made without prejudicing the legitimate interests of the issuer.
(1) does not envisage that an issuer will: DTR 2.5.3 R (1) does not allow an issuer to delay public disclosure of the fact that it is in financial difficulty or of its worsening financial condition and is limited to the fact or substance of the negotiations to deal with such a situation. An issuer cannot delay disclosure of inside information on the basis that its position in subsequent negotiations to deal with the situation will be jeopardised by the disclosure of its financial
An issuer should not be obliged to disclose impending developments that could be jeopardised by premature disclosure. Whether or not an issuer has a legitimate interest which would be prejudiced by the disclosure of certain inside information is an assessment which must be made by the issuer in the first instance. However, the FCA considers that, other than in relation to impending developments or matters described in DTR 2.5.3 R or DTR 2.5.5A R1, there are unlikely to be other
(1) When an issuer is permitted to delay public disclosure of inside information in accordance with DTR 2.5.1 R, it may selectively disclose that information to persons owing it a duty of confidentiality.(2) Such selective disclosure may be made to another person if it is in the normal course of the exercise of his employment, profession or duties. However, selective disclosure cannot be made to any person simply because they owe the issuer a duty of confidentiality. For example,
In the opinion of the FCA , the following factors are to be taken into account in determining whether or not a person could reasonably be expected to know that information in his possession is inside information and therefore whether he is an insider under section 118B(e) of the Act, and indicate that the person is an insider:(1) if a normal and reasonable person in the position of the person who has inside information would know or should have known that
In the opinion of the FCA , the following factors are to be taken into account in determining whether or not information is generally available, and are indications that it is (and therefore not inside information):(1) whether the information has been disclosed to a prescribed market or a prescribed auction platform3 through a regulatory information service or RIS or otherwise in accordance with the rules of that market;(2) whether the information is contained
The following are examples of behaviour that might fall within the scope of section 123(1)(b) :(1) a director of a company, while in possession of inside information, instructs an employee of that company to deal in qualifying investments or related investments in respect of which the information is inside information;(2) a person recommends or advises a friend to engage in behaviour which, if he himself engaged
The following behaviours are, in the opinion of the FCA , market abuse (improper disclosure):(1) disclosure of inside information by the director of an issuer to another in a social context; and(2) selective briefing of analysts by directors of issuers or others who are persons discharging managerial responsibilities.
4Disclosure of inside information by a broker to a potential buyer regarding the fact that the seller of qualifying investments is a person discharging managerial responsibilities or the identity of the person discharging managerial responsibilities or the purpose of the sale by the person discharging managerial responsibilities where:(1) the disclosure is made only to the extent necessary, and solely in order to dispose of the investment;(2) the illiquidity of the stock is such
In the opinion of thewhether the disclosure is permitted by the rules of a prescribed market , a prescribed auction platform,3 of the FCA or the Takeover Code; or FCA , the following factors are to be taken into account in determining whether or not the disclosure was made by a person in the proper course of the exercise of his employment, profession or duties, and are indications that it was:(1) whether the disclosure
The following are examples 4of market abuse (improper disclosure).444(1) 4X, a director at B PLC has lunch with a friend, Y, who has no connection with B PLC or its advisers. X tells Y that his company has received a takeover offer that is at a premium to the current share price at which it is trading.(2) 4A, a person discharging managerial responsibilities in B PLC, asks C, a broker, to sell some or all of As shares in B PLC. C discloses to a potential buyer that A is a person
An issuer and its advisers are best placed to make an initial assessment of whether particular information amounts to inside information. The decision as to whether a piece of information is inside information may be finely balanced and the issuer (with the help of its advisers) will need to exercise its judgement.Note:DTR 2.7 provides additional guidance on dealing with market rumour.
(1) Subject to the limited ability to delay release of inside information to the public provided by DTR 2.5.1 R, an issuer is required to notify, via a RIS, all inside information in its possession as soon as possible.(2) If an issuer is faced with an unexpected and significant event, a short delay may be acceptable if it is necessary to clarify the situation. In such situations a holding announcement should be used where an issuer believes that there is a danger of inside information
The FCA is aware that many issuers provide unpublished information to third parties such as analysts, employees, credit rating agencies, finance providers and major shareholders, often in response to queries from such parties. The fact that information is unpublished does not in itself make it inside information. However, unpublished information which amounts to inside information is only permitted to be disclosed in accordance with the disclosure rules and an issuer must ensure
Where there is press speculation or market rumour regarding an issuer, the issuer should assess whether a disclosure obligation arises under DTR 2.2.1 R. To do this an issuer will need to carefully assess whether the speculation or rumour has given rise to a situation where the issuer has inside information.
The knowledge that press speculation or market rumour is false is not likely to amount to inside information. Even if it does amount to inside information, the FCA expects that in most of those cases an issuer would be able to delay disclosure (often indefinitely) in accordance with DTR 2.5.1 R.
Examples of when the FCA may require the suspension of trading of a financial instrument include:(1) if an issuer fails to make a RIS announcement as required by the disclosure rules within the applicable time-limits which the FCA considers could affect the interests of investors or affect the smooth operation of the market; or(2) if there is or there may be a leak of inside information and the issuer is unwilling or unable to issue an appropriate RIS announcement within a reasonable
2Articles 26a, 26b and 26c respectively provide for a proportionate disclosure regime for rights issues (as defined by the PD Regulation); for small and medium-sized enterprises and companies with reduced market capitalisation; and for issues by credit institutions referred to in Article 1 (2) (j) of the PD.4Proportionate schedule for rights issues26a1.The proportionate schedules set out in Annexes XXIII and XXIV shall apply to rights issues, provided that the issuer has shares
(1) 5The Act provides that an individual who is not a director can still be a person discharging managerial responsibilities in relation to an issuer if they are a "senior executive of such an issuer" and they meet the criteria set out in the Act.(2) 5An individual may be a "senior executive of such an issuer" irrespective of the nature of any contractual arrangements between the individual and the issuer and notwithstanding the absence of a contractual arrangement between the