Extension of the UK Statutory Regime for Liability of Issuers of Securities


In January 2007, in response to the Transparency Directive, the UK?s Financial Services and Markets Act 2000

(FSMA) was amended by the insertion of section 90A so as to introduce a statutory civil liability regime for untrue

or misleading statements in all periodic disclosures made to the market by issuers of securities. This regime

enables investors who acquire securities and suffer losses as a result of a fraudulent misstatement, or the omission

of material information from such disclosure, to be compensated by the issuer pursuant to a civil statutory action.

As part of the same package of legislative amendments, section 90B was introduced to enable the Treasury to

extend the section 90A regime to make further provisions about liability for published information. The Treasury

is currently considering exercising the powers granted to it by section 90B to iron out certain inconsistencies in

the liability regime in relation to disclosures which were highlighted by the interplay between section 90A and the

Disclosure and Transparency Rules (DTR).

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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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