New Market Abuse powers for the FCA
The Financial Services and Markets Act 2000 (Market Abuse) Regulations 2016
On 29 June 2016, the Government adopted the Financial Services and Markets Act 2000 (Market Abuse) Regulations 2016 (the "regulations"). This left negligible time for Parliamentary scrutiny before they came into force with the Market Abuse Regulation (EU) 596/2014 ("MAR") on 3 July 2016.
The purpose of the regulations was to amend UK law to ensure its compatibility with MAR, to give effect to those parts of MAR which required implementing legislation, and to ensure it is fully enforceable in the UK. The regulations amend the Financial Services and Markets Act 2000 (FSMA) and give the Financial Conduct Authority ("FCA") new powers to:
require information from issuers and other persons;
compel the publication of information by issuers,
compel the publication of corrective statements by issuers and other persons;
suspend trading in financial instruments; and
impose penalties, prohibitions and suspensions or restrictions for contraventions of the market abuse regulation.
This will be our last quarterly Market Abuse update before 3 July 2016, the date when both the new Market Abuse Regulation and the Criminal Sanctions (Market Abuse) Directive come into application across Europe. Some significant pieces of the regulatory jigsaw have yet to be slotted into place, so we have set out the current state of play in a little more detail. Both pieces of legislation have significant extra-territorial implications: in this briefing we highlight some quirks in the potential application of the criminal regime.
The advent of new regulation has not led to any significant let-up of regulators' enforcement efforts, and this briefing also reviews some recent cases in the UK, the US and Australia.
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ESMA has published two Consultation Papers setting out proposed draft secondary measures under the Market Abuse Regulation (“MAR”). These ESMA Consultation Papers follow the Discussion Paper issued last November, which set out initial views on the policy approach to implementing MAR, and covered all the proposed MAR implementing measures, namely technical advice to the European Commission on delegated acts, technical standards and Guidelines.
Some of the responses to the consultation of the November 2013 Discussion Paper are summarised in these latest consultation papers, which deal only with technical advice and technical standards. Both consultations close on 15 October 2014. ESMA guidelines will be consulted on at a later date. Continue reading
In Hellenic Capital Market Commission (HCMC) (Case E-23/13), the Court of the European Free Trade Association (EFTA) took the view that a provision which required a competent authority making an information request of another competent authority to specify the facts giving rise to its suspicion would be incompatible with the Market Abuse Directive. Continue reading