The new market abuse regime—impact on issuers of debt securities

The new market abuse regime—impact on issuers of debt securities

Matthew Tobin, partner, and Eric Phillips, professional support lawyer, at Slaughter & May examine the impact of the new market abuse regime on issuers of debt securities.

What are the key changes effected by MAR and what actions should issuers take?

In brief:

  • the EU's market abuse regime now applies to debt securities admitted to multi-lateral trading facilities as well as regulated markets
  • all issuers should review and update internal policies and procedures relating to the disclosure and control of inside information and market soundings, and
  • issuers should consider providing training to relevant employees about their obligations under the new regime

The new market abuse regulation (MAR) came into effect in the UK and across the EU on 3 July 2016. MAR impacts all UK and EU debt issuers, expanding the scope of the current regime in terms of markets covered and introducing more stringent obligations and detailed procedural requirements in a number of areas.

At the EU level the existing market abuse directive has been repealed and replaced by MAR, which sets out the framework for the new regime, as well as a number of related delegated acts, technical standards and guidelines setting out detailed provisions. The majority of the new regulations came into effect on 3 July 2016 and are directly applicable across the EU. In the UK the existing market abuse provisions within Financial Services and Markets Act 2000 have been recast and relevant provisions within the Financial Conduct Authority (FCA) handbook have been repealed and replaced with 'signposts' to the appropriate MAR provisions. Although the overall structure of the regime has not been radically overhauled, there are many technical changes and issuers will therefore need to consider amending policies and procedures.

What is the scope of the new regime?

The previous EU market abuse regime applied to issuers of debt securities admitted to trading on EU regulated markets,

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About the author:

Emma is head of the Banking and Finance team and the Finance Group at LexisNexis®UK.

Emma has wide-ranging experience in derivatives and capital markets with a particular emphasis on credit derivatives and structured products. Emma qualified as a solicitor with Allen & Overy LLP, working in the derivatives and structured finance teams in both their London and Paris offices before gaining experience with Deutsche Bank AG (advising the foreign exchange prime brokerage desk) and Crédit Agricole CIB (advising the fixed income and derivatives desk) before joining LexisNexis®.