The European Commission Publishes Legislative Proposals For A New Criminal And Civil Market Abuse Regime

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Adopted in January 2003, the Market Abuse Directive (MAD) 2003/6/EC, together with other implementing legislation, established an EU-wide framework for preventing and tackling market abuse. The European Commission embarked on a review of MAD in 2010, culminating in the publication of legislative proposals on 20 October 2011. These consist of a draft Regulation (the “Regulation”), which sets out a revised and harmonised civil market abuse regime and ancillary requirements, and a draft Directive (“MAD 2”), which contains a new criminal market abuse regime. The existing directive, MAD, will be repealed in its entirety.

The Commission’s legislative proposals for a new market abuse regime have to be considered also in conjunction with its parallel proposals, published on the same day, for a revised Markets in Financial Instruments Directive (MiFID II) and an accompanying Markets in Financial Instruments Regulation (MiFIR). These would introduce a wider set of trading venues, including, apart from regulated markets and multilateral trading facilities, so-called organised trading facilities. MAD 2 and the Regulation would create civil and criminal offences in relation to securities that are admitted to trading on any of these MiFID II trading venues. MAD 2 and the Regulation would also track the anticipated wider scope of MiFID II, which would treat emission allowance certificates as financial instruments.

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Published In: Business Torts Updates, Criminal Law Updates, Finance & Banking Updates, International Trade Updates, Securities Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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