Corporate weekly highlights—11 May 2017

Welcome to the weekly highlights from the Lexis®PSL Corporate team for the week ending 11 May 2017, which provide news updates and a comprehensive list of dates for your diary. This week’s edition features: the FMLC’s report on issues of legal uncertainty relating to the Market Abuse Regulation; the publication of the LSE’s new ISM rulebook; and IA guidance on long-term reporting.

This update is part of the Lexis®PSL Corporate team’s news offering. Some of the links require a LexisPSL subscription. If you are not a subscriber, you can take a free trial here.

Headlines (News updates & analysis)

Market Abuse Regulation

FMLC report suggests ways of clarifying MAR

The Financial Markets Law Committee (FMLC) has published a report exploring uncertainty around the financial instruments that fall within the scope of the Market Abuse Regulation (MAR).

The FMLC has drawn attention to issues of uncertainty relating to the new EU-wide market soundings regime introduced by Article 11 of the MAR, as well as the meanings of the terms ‘transaction’ and ‘announcement’ within the definition of market sounding. To address these uncertainties, the paper sets out a proposed solution which involves the provision of further guidance by the European Securities and Markets Authority on these issues in the form of amendments to the existing MAR Q&A document, or other guidance by national competent authorities.

For details see: LNB News 08/05/2017 150.

Equity capital markets

LSE introduces International Securities Market rulebook

The London Stock Exchange (LSE) has published the new International Securities Market (ISM) rulebook. ISM is a multilateral trading facility designed to meet the demands of issuers and professional investors and to improve the effectiveness and competitiveness of UK primary debt markets.

ISM has been open for applications for admission to trading since 8 May 2017. LSE has confirmed the Admission and Disclosure Standards have been amended to reflect the introduction of ISM. These amendments also took effect on 8 May 2017.

For details see: LNB News 05/05/2017 103.

Accounts and reports

Investment Association guidance on long-term reporting

The expectations of the Investment Association’s (IA) members on various aspects of long-term reporting have been set out in IA guidance. IA has recommended that companies should focus on long-term performance and strategic issues (stopping quarterly reporting and earnings guidance), as well as regularly assess the level of productivity within their business and explain its impact on operations. The guidance outlines investor expectations on capital management disclosures and how companies can improve reporting on the connection between capital management and its long term strategy, as well as outlining disclosures that the IA's members would expect to see concerning material environmental and social risks and human capital and culture.

The IA guidance is intended to support the Financial Reporting Council's (FRC) guidance on the strategic report, as well as complement the requirements set out in the Companies Act 2006 and the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013, SI 2013/1970.

The guidance applies to companies whose shares are admitted to the Premium Segment of the Official List of the UK Listing Authority. IA encourages companies whose shares are admitted to the Standard Segment of the Official List, to trading on AIM or to the High Growth Segment of the London Stock Exchange’s Main Market to also adopt the guidance as best practice. The IA's Institutional Voting Information Service (IVIS) will be responsible for monitoring implementation of the guidance through analysis of annual reports reporting on year-ends on or after 30 September 2017.

For details see: LNB News 10/05/2017 51.

Dates for your diary

Date Subjects covered
12 May 2017 Deadline for responses on the last two proposals in the Financial Conduct Authority's (FCA) fifth MiFID II consultation paper (CP17/8). For further information, see LNB News 31/03/2017 156.
14 May 2017 Deadline for responses to the FCA's discussion paper on the effectiveness of Primary Markets (DP17/2). This seeks feedback on how the UK primary capital markets can most effectively meet the needs of issuers and investors.
14 May 2017 Deadline for responses to the FCA's consultation paper on proposed technical enhancements to the Listing Rules (CP17/4). This considers improvements to FCA rules and guidance to ensure the Listing Rules continue to service the needs of issuers and investors.
15 May 2017 Deadline for responses to the Department for Business, Energy & Industrial Strategy's (BEIS) call to evidence on proposals on the first public beneficial ownership register. BEIS has set out proposals for the world's first public beneficial ownership register to increase transparency of overseas investments in UK property. For further information, see LNB News 06/04/2017 54.
26 May 2017 Deadline for responses to the Financial Reporting Council's (FRC) consultation on guidance on obtaining bank reports for audit purposes. The FRC proposes to update guidance on obtaining bank reports for audit purposes. This will involve the withdrawal of Practice Note 16, and its replacement with additional application material in ISA (UK) 330—The Auditor’s Responses to Assessed Risks and ISA (UK) 505—External Confirmations. For further information, see LNB News 26/04/2017 99.
Further dates To look further ahead, see: Corporate horizon scanning—2017 and beyond.

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