EU Market Abuse Regulation A Commentary On Regulation (EU) No 5962014

© The Editors and Contributors Severally 2021
Based on translations by Donna Stockenhuber
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any
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of the publisher.
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A catalogue record for this book

is available from the British Library
Library of Congress Control Number: 2021947960
This book is available electronically in the

Law subject collection
http://dx.doi.org/10.4337/9781800882249
ISBN 978 1 80088 223 2 (cased)

ISBN 978 1 80088 224 9 (eBook)
Susanne Kalss, Martin Oppitz, Ulrich Torggler and Martin Winner - 9781800882249
CONTENTS
Extended contentsviii
List of contributorsxix
Prefacexxii
List of abbreviationsxxiii
Table of casesxxxiv
Table of legislationxxxix
Recitalslvii
1 Subject matter 1
Elena Guggenberger
2 Scope 4
Elena Guggenberger
3 Definitions 10
Elena Guggenberger
4 Notifications and list of financial instruments 29

Elena Guggenberger
5 Exemption for buy-back programmes and stabilisation 33

Susanne Kalss
6 Exemption for monetary and public debt management activities and climate policy activities 51
Susanne Kalss
7 Inside information 55
Mario Hössl-Neumann and Ulrich Torggler
8 Insider dealing 81
Martin Winner
9 Legitimate behaviour 115

Martin Winner
10 Unlawful disclosure of inside information 138

11 Market soundings 153

v
CONTENTS
12 Market manipulation 168

Susanne Kalss
13 Accepted market practices 181

Susanne Kalss
14 Prohibition of insider dealing and of unlawful disclosure of inside information 189

Martin Winner
15 Prohibition of market manipulation 194

Martin Oppitz
16 Prevention and detection of market abuse 198

Florian Kusznier
17 Public disclosure of inside information 202

Susanne Kalss and Clemens Hasenauer
18 Insider lists 242

Ursula Rath
19 Managers’ transactions 260

20 Investment recommendations and statistics 295

Martin Oppitz
21 Disclosure or dissemination of information in the media 300

Martin Oppitz
22 Competent authorities 306

Peter Jedlicka
23 Powers of competent authorities 314

Peter Jedlicka
24 Cooperation with ESMA 324

Alfred Schramm
25 Obligation to cooperate 329

Alfred Schramm
26 Cooperation with third countries 340

Alfred Schramm
27 Professional secrecy 347

Alfred Schramm
28 Data protection 352

Alfred Schramm
29 Disclosure of personal data to third countries 353

Alfred Schramm
30 Administrative sanctions and other administrative measures 354

Michael Rohregger and Nina Palmstorfer
vi
CONTENTS
30A Appendix to Art 30 MAR – Private enforcement 360

Chris Thomale
31 Exercise of supervisory powers and imposition of sanctions 414

Michael Rohregger and Charlotte Pechhacker
32 Reporting of infringements 418

33 Exchange of information with ESMA 424

34 Publication of decisions 428

35 Exercise of the delegation 432

Elisabeth Drach
36 Committee procedure 435

Elisabeth Drach
37 Repeal of Directive 2003/6/EC and its implementing measures 437

Elisabeth Drach
38 Report 439
Elisabeth Drach
39 Entry into force and application 441

Elisabeth Drach
Annex I443
Annex II445
Index450
vii
EXTENDED CONTENTS
Contributorsxix
Prefacexxii
Abbreviationsxxiii
Table of casesxxxiv
Table of legislationxxxix
Recitalslvii
ARTICLE 1 SUBJECT MATTER

A. INTRODUCTION 1.001
B. OBJECTIVES 1.004
C. BACKGROUND 1.007
ARTICLE 2 SCOPE
B. FINANCIAL INSTRUMENTS ON AN ORGANISED TRADING VENUE 2.002
C. OTHER FINANCIAL INSTRUMENTS 2.007
1. General 2.007
2. Emission allowances 2.009
3. Spot commodity contracts, derivatives and benchmarks 2.011
D. EXTENDED SCOPE OF APPLICATION IN RELATION TO FINANCIAL INSTRUMENTS 2.016
1. Independence of trading venues 2.016
2. International scope of application 2.017
ARTICLE 3 DEFINITIONS
A. FINANCIAL INSTRUMENTS (1) 3.001
B. INVESTMENT FIRM (2) 3.004
C. CREDIT INSTITUTION (3) 3.016
D. FINANCIAL INSTITUTION (4) 3.018
E. MARKET OPERATOR (5) 3.020
F. REGULATED MARKET (6) 3.023
G. MULTILATERAL TRADING FACILITY (7) 3.027
H. ORGANISED TRADING FACILITY (8) 3.029
I. ACCEPTED MARKET PRACTICE (9) 3.032
J. TRADING VENUE (10) 3.034
K. SME GROWTH MARKET (11) 3.035
L. COMPETENT AUTHORITY (12) 3.036
M. PERSON (13) 3.037
N. COMMODITY (14) 3.038
viii
EXTENDED CONTENTS
O. SPOT COMMODITY CONTRACT (15) 3.039

P. SPOT MARKET (16) 3.041
Q. BUY-BACK PROGRAMME (17) 3.042
R. ALGORITHMIC TRADING (18) 3.043
S. EMISSION ALLOWANCE (19) 3.044
T. EMISSION ALLOWANCE MARKET PARTICIPANT (20) 3.046
U. ISSUER (21) 3.049
V. WHOLESALE ENERGY PRODUCT (22) 3.050
W. NATIONAL REGULATORY AUTHORITY (23) 3.052
X. COMMODITY DERIVATIVES (24) 3.053
Y. PERSON DISCHARGING MANAGERIAL RESPONSIBILITIES (25) 3.054
Z. PERSON CLOSELY ASSOCIATED (26) 3.055
AA. DATA TRAFFIC RECORDS (27) 3.057
BB. PERSON PROFESSIONALLY ARRANGING OR EXECUTING TRANSACTIONS (28) 3.058
CC. BENCHMARK (29) 3.059
DD. MARKET MAKER (30) 3.060
EE. STAKE-BUILDING (31) 3.061
FF. DISCLOSING MARKET PARTICIPANT (32) 3.062
GG. HIGH-FREQUENCY TRADING (33) 3.063
HH. RECOMMENDING AN INVESTMENT STRATEGY (34) 3.064
II. INVESTMENT RECOMMENDATIONS (35) 3.065
JJ. DEFINITIONS ACCORDING TO PARA 2 3.067
ARTICLE 4 NOTIFICATIONS AND LIST OF FINANCIAL INSTRUMENTS

A. NOTIFICATION OBLIGATION 4.001
B. NOTIFICATION PROCEDURE 4.004
ARTICLE 5 EXEMPTION FOR BUY-BACK PROGRAMMES AND STABILISATION

A. BASIC PRINCIPLES 5.001
B. TWO SETS OF FACTS 5.008
C. BUY-BACK PROGRAMME 5.013
D. TRANSPARENCY REQUIREMENTS 5.021
E. LIMITS WITH REGARD TO PRICE AND VOLUME 5.029
F. STABILISATION 5.033
G. IMPLEMENTATION 5.043
ARTICLE 6 EXEMPTION FOR MONETARY AND PUBLIC DEBT

MANAGEMENT ACTIVITIES AND CLIMATE POLICY ACTIVITIES
A. FOUNDATIONS 6.001
B. MONETARY AND EXCHANGE RATE POLICY – PUBLIC DEBT MANAGEMENT 6.002
C. PUBLIC DEBT MANAGEMENT – COMMISSION 6.004
D. MOBILISATION OF FINANCIAL RESOURCES AND FINANCIAL SUPPORT 6.006
E. CLIMATE POLICY, AGRICULTURAL POLICY, FISHERIES POLICY 6.007
F. GENERAL QUESTIONS 6.008
G. BREXIT 6.010
ARTICLE 7 INSIDE INFORMATION

1. Content and purpose 7.001
2. Historical development 7.003
3. Legal (knowledge) sources 7.005
B. INFORMATION ON ISSUERS OR FINANCIAL INSTRUMENTS (PARA 1 LIT A) 7.009
1. Introduction 7.009
ix
EXTENDED CONTENTS
2. Information 7.011
(a) Introduction 7.011
(b) Nature of the information (paras 2 f ) 7.012
(c) Intermediate steps in particular (para 3) 7.013
3. Relation to issuers or financial instruments 7.014
4. Lack of disclosure 7.015
(a) Notion 7.015
(b) Scope 7.017
5. Precision (para 2) 7.020
(b) Objectifiability (para 2 sentence 1 criterion 1) 7.022
(c) Price specificity 7.027
6. Price significance (para 4) 7.028
(b) Trade incentive test 7.030
(c) Point of view 7.033
C. INFORMATION ON COMMODITY DERIVATIVES (PARA 1 LIT B) 7.036
D. INFORMATION ON EMISSION ALLOWANCES (PARA 1 LIT C) 7.040
E. CLIENT ORDERS IN PARTICULAR (PARA 1 LIT D) 7.043
ARTICLE 8 INSIDER DEALING

B. INSIDERS (PARAS 4 AND 5) 8.006
1. General 8.006
2. Legal persons 8.008
3. Primary insiders 8.012
4. Secondary insiders 8.021
5. Participation in decisions by legal persons (para 5) 8.025
C. INSIDER DEALING (PARA 1) 8.028
1. Knowledge of inside information 8.029
(a) Natural persons 8.029
(b) Legal persons 8.034
2. Transactions covered 8.042
(a) General 8.042
(b) Acquisition and disposal 8.044
(c) For their own account or for the account of others 8.053
(d) Direct or indirect 8.054
(e) Cancellation or amendment of orders 8.057
(f ) Emission allowances 8.062
(g) Actions of legal persons 8.063
3. Use of inside information 8.066
(b) Use in decision-making, not in behaviour 8.067
(c) Advantage for the trader? 8.079
(d) ‘Presumption’ of use 8.083
(e) Absence of use 8.088
(f ) Legal persons 8.095
D. TIPPING (PARA 2) 8.097
1. General 8.097
2. Knowledge 8.101
3. Recommend or induce 8.102
4. On the basis of inside information 8.110
E. LIABILITY OF THE TIPPEE (PARA 3) 8.115
1. General 8.115
2. Use 8.116
3. Knowledge 8.119
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EXTENDED CONTENTS
ARTICLE 9 LEGITIMATE BEHAVIOUR

B. COMPLIANCE OF LEGAL PERSONS (PARA 1) 9.007
1. General 9.007
2. Genuine exemption 9.011
3. Knowledge 9.013
4. Compliance organisation 9.014
5. No influence 9.020
6. Consequences 9.025
C. MARKET MAKER AND COUNTERPARTIES (PARA 2 LIT A) 9.029
D. EXECUTION OF ORDERS (PARA 2 LIT B) 9.034
E. DISCHARGE OF OBLIGATIONS (PARA 3) 9.041
F. TAKEOVER BIDS (PARA 4) 9.049
1. General 9.049
2. Takeovers, mergers 9.053
3. Making information public 9.058
4. Consequences 9.061
5. Limitations 9.065
G. USE OF OWN DECISION (PARA 5) 9.068
1. General 9.068
2. Permitted transactions 9.070
3. Acquisition by third parties 9.073
H. COUNTER-EXEMPTION (PARA 6) 9.075
ARTICLE 10 UNLAWFUL DISCLOSURE OF INSIDE INFORMATION

B. DISCLOSURE OF INSIDE INFORMATION (PARA 1) 10.006
1. Introduction 10.006
2. Possession of inside information 10.007
3. Disclosure 10.010
4. Exemption: normal exercise of employment, etc. (para 1 subpara 1) 10.014
(b) Purpose of disclosure 10.017
(c) ‘Normal’ exercise of employment, etc. 10.018
(d) Accompanying measures 10.022
(e) Groups of cases 10.024
C. ONWARD DISCLOSURE OF RECOMMENDATIONS OR INDUCEMENTS (PARA 2) 10.032
ARTICLE 11 MARKET SOUNDINGS

B. SCOPE OF APPLICATION 11.008
1. Issue or sale of financial instruments (paras 1 f ) 11.008
2. Takeover of financial instruments (para 2) 11.011
C. OBLIGATIONS UNDER ART 11 11.015
1. Conditions for access to the safe harbour 11.015
2. Obligations of the party conducting the market sounding 11.017
(a) Procedural (exemption) requirements (paras 3, 5) 11.017
(b) Ensuing obligations (paras 6, 8) 11.021
3. Obligations of the market sounding recipient (para 7) 11.024
xi
EXTENDED CONTENTS
ARTICLE 12 MARKET MANIPULATION

1. Subject of the regulation 12.001
2. Purpose of the norm 12.003
3. History of origins 12.004
4. Significant changes to existing law 12.005
5. Practical significance 12.006
B. TRADE AND BEHAVIOUR-BASED MARKET MANIPULATION 12.007
1. Trade and other deceptive manipulation 12.007
2. Other acts of deception 12.017
C. TRADE-BASED PRICE MANIPULATION 12.020
D. INFORMATION-BASED PRICE MANIPULATION 12.022
E. MANIPULATION OF BENCHMARKS 12.030
F. SUBJECTIVE REQUIREMENTS – FAULT 12.031
1. Natural person – legal person relationship 12.033
G. COMPELLING EXAMPLES OF MARKET MANIPULATION (ART 12 PARA 2) 12.034
H. INDICATORS AND EXAMPLES (PARA 3, PARA 5) 12.037
I. IMPLEMENTATION 12.038
ARTICLE 13 ACCEPTED MARKET PRACTICES

C. CONCRETE BEHAVIOUR 13.010
D. ACCEPTED MARKET PRACTICE 13.012
E. PREVIOUS FMA MARKET PRACTICE 13.019
F. IMPLEMENTATION 13.020
ARTICLE 14 PROHIBITION OF INSIDER DEALING AND OF UNLAWFUL

DISCLOSURE OF INSIDE INFORMATION
A. GENERAL REMARKS 14.001
B. ATTEMPT TO ENGAGE IN INSIDER DEALING 14.004
C. SANCTIONS 14.009
1. Criminal law 14.009
2. Administrative law 14.013
3. Contract and tort law 14.014
ARTICLE 15 PROHIBITION OF MARKET MANIPULATION

A. CONTENT OF THE PROVISION 15.001
B. DEFINITION ISSUES 15.004
1. Attempt 15.004
2. Constellations of attempts 15.005
C. PUNISHMENT OF THE ATTEMPT 15.013
ARTICLE 16 PREVENTION AND DETECTION OF MARKET ABUSE

B. ADDRESSEES OF THE NORM 16.004
C. FACTS OF THE NORM 16.006
D. PROCEDURE AND RESPONSIBILITIES 16.008
E. EXECUTION OF NOTIFICATIONS 16.011
F. IMPLEMENTATION 16.013
xii
EXTENDED CONTENTS
ARTICLE 17 PUBLIC DISCLOSURE OF INSIDE INFORMATION

1. Subject matter of the provision 17.001
2. Purpose of the norm 17.005
3. History of origins 17.006
4. Significant changes to the existing law 17.007
5. Practical significance 17.008
B. ISSUERS 17.009
C. INSIDE INFORMATION 17.017
1. Confidentiality 17.024
2. Precise information 17.029
(a) Events which have occurred 17.032
(b) Future events 17.036
(c) Price specificity 17.039
3. Price relevance 17.042
(a) Trading incentive for reasonable investors 17.045
(b) Protracted process 17.054
(c) Price relevance of intermediate steps 17.057
D. NATURE AND CONTENT OF THE DISCLOSURE (PARA 1) 17.065
E. DEADLINE FOR DISCLOSURE 17.077
F. UPDATING THE AD HOC NOTIFICATION 17.078
G. DISCLOSURE UPON ONWARD DISCLOSURE OF INSIDE INFORMATION (PARA 8) 17.079
H. DELAY OF THE DISCLOSURE OBLIGATION 17.080
1. Decision on delay 17.086
2. FMA information 17.090
3. Conditions for the delay 17.093
(a) Legitimate interests 17.095
(b) Not misleading 17.102
(c) Maintaining the confidentiality of information 17.106
I. PRESERVING FINANCIAL STABILITY – CREDIT AND FINANCIAL INSTITUTIONS 17.111
J. EMISSION ALLOWANCES 17.113
K. SANCTIONS 17.116
L. IMPLEMENTATION 17.121
ARTICLE 18 INSIDER LISTS

1. Issuers 18.007
2. Persons acting on behalf or on the account of the issuer 18.009
3. Relief 18.012
C. INSIDER LISTS 18.015
1. Occasion and time 18.015
2. Persons to be included 18.017
(a) Reference to issuer 18.017
(b) Authorised access 18.019
(c) Case groups 18.020
3. Language, format and content 18.024
(a) Event-based section 18.027
(b) Permanent insider section 18.029
(c) Data to be included 18.030
(d) SMEs growth market issuers 18.034
(e) Electronic list management 18.035
D. OBLIGATION TO UPDATE 18.037
1. Trigger 18.037
2. Case groups 18.039
xiii
EXTENDED CONTENTS
3. Time limit 18.041

4. Cessation 18.042
E. DECLARATIONS OF ACKNOWLEDGEMENT 18.043
1. Obligation to inform 18.044
2. Content 18.047
3. Form 18.052
4. Time and repetition 18.053
F. TRANSMISSION OBLIGATION 18.056
G. MAINTENANCE AND DESTRUCTION 18.058
1. Manner of maintenance and access 18.058
2. Retention period 18.059
3. Destruction 18.062
H. SANCTIONS 18.063
ARTICLE 19 MANAGERS’ TRANSACTIONS

1. Overview 19.001
2. Legal basis 19.005
3. Purpose of the notification duty 19.006
1. Material scope of application 19.013
(a) Markets covered 19.013
(b) Financial instruments covered 19.017
(c) Transactions covered 19.022
2. Personal scope of application 19.037
(a) Persons discharging managerial responsibilities 19.038
(i) Board members 19.040
(ii) Other management 19.044
(b) Close connection to management 19.047
(i) Close family relationship 19.052
(ii) Close business relationship 19.059
3. Notification threshold 19.070
C. DUTY TO NOTIFY 19.078
D. LIST 19.082
E. TIME, CONTENT AND FORM OF NOTIFICATION AND DISCLOSURE 19.085
1. Time of notification and disclosure 19.085
2. Content of the notification 19.090
3. Form of the notification 19.092
F. PROHIBITION ON TRADING 19.098
1. Scope 19.098
2. Exemptions from the trade prohibition 19.106
G. SANCTIONS 19.112
H. IMPLEMENTATION 19.118
ARTICLE 20 INVESTMENT RECOMMENDATIONS AND STATISTICS

B. CATEGORIES OF PERSONS COVERED 20.003
C. PUBLIC INSTITUTIONS 20.007
D. ESMA 20.011
E. JOURNALISTS’ PRIVILEGE 20.012
xiv
EXTENDED CONTENTS
ARTICLE 21 DISCLOSURE OR DISSEMINATION OF INFORMATION IN THE MEDIA

B. ON THE SCOPE OF THE EXEMPTION 21.002
1. Journalistic purposes 21.003
2. Other form of expression in the media 21.005
3. Media 21.006
4. Privileged actions 21.007
C. FREEDOM OF THE PRESS, FREEDOM OF OPINION AND JOURNALISTIC RULES OF
PROFESSIONAL CONDUCT 21.013
D. COUNTER-EXEMPTIONS 21.015
1. Advantage or profit 21.016
2. Intention to mislead 21.018
ARTICLE 22 COMPETENT AUTHORITIES

B. DIRECT APPLICABILITY AND LIMITED DIRECT EFFECT 22.004
C. CONTENT OF THE PROVISION 22.010
1. Competent authorities 22.011
2. Material and local competence 22.016
ARTICLE 23 POWERS OF COMPETENT AUTHORITIES

B. DIRECT APPLICABILITY AND LIMITED DIRECT EFFECT 23.004
C. METHOD OF EXERCISING SUPERVISORY OR INVESTIGATORY POWERS 23.006
D. SUPERVISORY AND INVESTIGATORY POWERS 23.008
ARTICLE 24 COOPERATION WITH ESMA

B. COOPERATION OBLIGATION 24.006
C. IMPLEMENTATION AUTHORISATIONS 24.008
ARTICLE 25 OBLIGATION TO COOPERATE

B. COOPERATION AMONG SUPERVISORY AUTHORITIES 25.003
C. COOPERATION WITH ESMA 25.009
D. COOPERATION WITH ACER 25.010
E. COOPERATION WITH THE COMMISSION 25.012
F. COOPERATION AS REGARDS SPOT MARKETS AND EMISSION ALLOWANCES TRADE 25.013
G. OBTAINING INFORMATION FROM JUDICIAL AUTHORITIES 25.014
H. NOTIFICATIONS OF MAR INFRINGEMENTS 25.015
I. CONCILIATION PROCEDURE 25.016
J. COOPERATION AGREEMENTS (MOU) 25.020
K. IMPLEMENTATION AUTHORISATIONS 25.022
ARTICLE 26 COOPERATION WITH THIRD COUNTRIES

B. COOPERATION AGREEMENTS 26.003
C. PROFESSIONAL SECRECY 26.009
D. ESMA 26.012
E. IMPLEMENTATION AUTHORISATIONS 26.016
F. IOSCO MMOU 26.018
xv
EXTENDED CONTENTS
ARTICLE 27 PROFESSIONAL SECRECY

B. PROFESSIONAL SECRECY 27.004
C. DATA PROTECTION 27.011
ARTICLE 28 DATA PROTECTION

A. NOTE 28.001
ARTICLE 29 DISCLOSURE OF PERSONAL DATA TO THIRD COUNTRIES

A. NOTE 29.001
ARTICLE 30 ADMINISTRATIVE SANCTIONS AND OTHER ADMINISTRATIVE

MEASURES
A. SUBJECT OF THE PROVISION 30.001
B. OBJECTIVE OF THE PROVISION 30.004
C. PROVISIONS FOR NATIONAL SANCTIONS REGIMES 30.006
1. Administrative fines 30.006
2. Other administrative measures 30.009
D. NEED FOR IMPLEMENTATION AND IMPLEMENTATION 30.010
APPENDIX 30A APPENDIX TO ART 30 MAR – PRIVATE ENFORCEMENT

A. INTRODUCTION 30A.001
1. MAR refrains from harmonising private enforcement 30A.001
2. Capital market tort law relies on non-harmonised national tort laws 30A.002
3. EU by choice refrains from regulating private enforcement in the MAR 30A.005
(a) EU has legislative jurisidiction to regulate private enforcement of capital markets law
under Art 114 para 1 TFEU 30A.005
(b) Private enforcement of capital markets law is not required by the effet utile principle 30A.010
4. Conclusion: private international law as a minimum harmonisation 30A.016
B. NATIONAL CIVIL LIABILITY REGIMES FOR INFRACTIONS OF ART 17 MAR 30A.017
1. US: Civil enforcement of wrongful ad hoc disclosure only in cases of intentional market
manipulation30A.018
(a) Introduction 30A.018
(b) SEC Rule 10b-5 30A.020
2. United Kingdom: Restrictions on civil liability for wrongful continuous disclosure, focus on
corporate governance 30A.025
(b) Section 90A FSMA 30A.027
3. Germany: Civil liability even in cases of gross negligence, combined with broad attribution
of knowledge in company structures 30A.031
(b) Sections 97 and 98 WpHG 30A.032
4. Portugal: Special liability clause for ad hoc disclosure obligations, yet little practical
relevance30A.036
5. France, Italy and Spain: General tort law clauses provide private cause of action for false or
misleading ad hoc disclosure 30A.037
(a) France 30A.037
(b) Italy 30A.038
(c) Spain 30A.039
6. Austria and the Netherlands: Art 17 MAR implemented as a ‘protective’ rule within national
law of torts 30A.040
(a) Austria 30A.040
(b) The Netherlands 30A.041
7. Ireland and Sweden: Focus on public enforcement and no civil issuer liability 30A.042
xvi
EXTENDED CONTENTS
(a) Ireland 30A.042

(b) Sweden 30A.043
C. INTERNATIONAL JURISDICTION IN SECURITIES LITIGATION FOR MARKET ABUSE 30A.044
1. Introduction 30A.044
2. Art 4 para 1, Art 63 para 1 Brussels Ia-Regulation: Domicile 30A.045
3. Art 17 para 1, Art 18 para 1 Brussels Ia-Regulation: Place of domicile of the consumer
investor30A.047
4. Art 7 (2) Brussels Ia-Regulation: Special jurisdiction for torts 30A.050
(a) General aspects 30A.050
(b) Place where the damage occurred (locus damni) 30A.054
(c) Place of the event giving rise to the damage (locus delicti commissi) 30A.063
5. Summary: Default venues of jurisdiction for capital market torts by issuers 30A.065
D. APPLICABLE LAW IN SECURITIES LITIGATION FOR MARKET ABUSE 30A.066
2. Applicability of the Rome II-Regulation 30A.067
(a) Non-contractual obligations in civil and commercial matters 30A.067
(b) ‘Negotiable instrument’ under Art 1 para 2 lit c Rome II-Regulation 30A.068
(c) ‘Law of companies’ under Art 1 para 2 lit d Rome II-Regulation 30A.069
(d) Evictive supremacy over national conflict of laws rules 30A.070
3. General rule: Art 4 para 1 Rome II-Regulation (lex loci damni) 30A.071
4. Alternative connecting factors: Art 4 paras 2 and 3 Rome II-Regulation 30A.075
(a) Art 4 para 2 Rome II-Regulation: lex domicilii communis 30A.076
(b) Art 4 para 3 Rome II-Regulation: lex societatis or lex auctoritatis competentis 30A.077
5. Summary 30A.080
E. CHOICE OF COURT AND CHOICE OF LAW AGREEMENTS IN SECURITIES LITIGATION FOR
MARKET ABUSE 30A.081
2. Choice of court clauses under Art 25 para 1 Brussels Ia-Regulation 30A.082
(a) General scope of application 30A.082
(b) Charter clause 30A.083
(c) Prospectus clause 30A.084
3. Choice of law clauses under Art 14 para 1 lit b Rome II-Regulation 30A.087
(a) General scope of application 30A.087
(b) Choice of law agreements in the issuer’s charter or the prospectus 30A.088
4. Summary 30A.091
ARTICLE 31 EXERCISE OF SUPERVISORY POWERS AND IMPOSITION OF

SANCTIONS
A. SUBJECT OF REGULATION 31.001
B. PENALTY ASSESSMENT CRITERIA (PARA 1) 31.004
C. COOPERATION OF MEMBER STATES (PARA 2) 31.012
ARTICLE 32 REPORTING OF INFRINGEMENTS

A. SUBJECT MATTER 32.001
B. ESTABLISHMENT OF A WHISTLEBLOWING SYSTEM BY THE AUTHORITIES 32.004
C. ESTABLISHMENT OF A WHISTLEBLOWING SYSTEM BY THE EMPLOYER 32.009
D. FINANCIAL INCENTIVES 32.010
E. IMPLEMENTING ACTS (PARA 5) 32.012
ARTICLE 33 EXCHANGE OF INFORMATION WITH ESMA

B. COOPERATION WITH ESMA 33.003
C. IMPLEMENTING TECHNICAL STANDARDS (PARA 5) 33.007
xvii
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ARTICLE 34 PUBLICATION OF DECISIONS

A. OBJECT AND STRUCTURE OF THE PROVISION 34.001
B. OBJECTIVE OF THE PROVISION 34.004
C. CONTENT AND SCOPE OF THE PUBLICATION OBLIGATION 34.006
D. NEED FOR IMPLEMENTATION AND IMPLEMENTATION 34.011
ARTICLE 35 EXERCISE OF THE DELEGATION432
ARTICLE 36 COMMITTEE PROCEDURE435
ARTICLE 37 REPEAL OF DIRECTIVE 2003/6/EC AND ITS IMPLEMENTING

MEASURES437
ARTICLE 38 REPORT439
ARTICLE 39 ENTRY INTO FORCE AND APPLICATION441
Annex I443
Annex II445
Index450
xviii
CONTRIBUTORS
Elisabeth Drach is Research Assistant to Professor Ulrich Torggler at the Department of

Commercial and Business Law of the University of Vienna. She holds a Master’s degree in law
from the University of Vienna.
Elena Guggenberger has a law degree from the University of Vienna and is a legal expert at the
Austrian Federal Ministry of Finance, where she is part of the Unit for Legal Affairs of Banks
and the Capital Market. She previously worked in the Finance and Projects department at the
law firm DLA Piper Weiss-Tessbach and as a consultant in the Financial Services Industry
Advisory division at Deloitte Vienna.
Clemens Hasenauer is Managing Partner and head of the Corporate Transactions department
at CERHA HEMPEL, one of the most renowned law firms in Austria and the Central
Eastern Europe region. Having completed his doctoral thesis at the University of Vienna,
he also graduated at an LL.M. program at New York University and gained several years of
working experience in London and New York. As a lawyer, he is admitted to the bar in Austria,
England and Wales as well as in New York and specialises in Mergers and Acquisitions, takeo-
ver law, capital markets law, banking and finance, reorganisations and restructurings. His expe-
rience includes numerous complex public and private M&A transactions and structuring large
international joint ventures and public takeovers. Clemens is a member of the Council of the
Vienna Bar Association and a delegate to the Austrian Bar Association. He is also a member of
the British Law Society, the American Bar Association, the New York State Bar Association
and the International Bar Association. He is widely published, a frequent speaker at seminars
and a permanent lecturer at a number of institutions.
Mario Hössl-Neumann obtained his Master’s degree in jurisprudence from University of
Vienna; after visiting scholarships at Københavns Universitet and Stanford Law School, he
received his doctorate (summa cum laude) for his thesis on comparative insider trading regula-
tion. Mario then joined an international law firm, focusing on cross-border transactions and
takeover law. Since 2021, he has been Assistant Professor at the Department of Commercial
and Business Law, University of Vienna. Mario’s main research interests are in capital markets
law and corporate governance. He teaches comparative securities regulation and related aspects
of corporate finance.
Peter Jedlicka is a senior legal officer in the Banking Division of the Financial Market Authority
(FMA) Liechtenstein. His work covers all aspects of EU and EEA Law in the area of banking
supervision with a focus on drafting implementing acts transposing EEA Law into the national
legal order of Liechtenstein. He represents the FMA Liechtenstein in different expert groups
of the European Commission and different standing committees of the European Banking
Authority (EBA) and the European Securities and Markets Authority (ESMA). Before joining
xix
CONTRIBUTORS
the FMA Liechtenstein in June 2018, Peter was a senior legal officer at the Austrian FMA
from 2009 until 2018. He represented the Austrian FMA in several working groups of EBA,
ESMA, the European Central Bank (ECB) and the Council. From 2014 to 2016 he spent
two years with the ECB’s Single Supervisory Mechanism (SSM) working on all aspects of
EU administrative law and its enforcement. He regularly publishes on matters of EU financial
markets law and matters of administrative enforcement, in particular on issues related to the
SSM.
Susanne Kalss is Professor and Director of the Institute of Business Law at the Vienna
University of Economics and Business. Her main areas of research are corporate law, capital
markets law, and foundation law. She is author of numerous books and articles in these fields.
Florian Kusznier is a partner at WOLF THEISS and co-head of the firm-wide Corporate/
M&A team. He has more than 15 years of experience in cross-border M&A transactions, joint
ventures, public takeovers and general corporate (governance) work. The vast majority of his
work consists of assistance to international clients. He advises strategic and financial investors
across a range of industry sectors but has a particular focus on healthcare and life science, as
well as on technology and digitalisation. Florian is admitted to the bar in Austria but regularly
assists clients on transactions covering the entire Central and Eastern Europe/Southeast
Europe region.
Martin Oppitz is an advocate and partner at a2o legal, Vienna. His main areas of practice and
research are, inter alia, banking law, capital markets law, and corporate law.
Nina Palmstorfer studied corporate law at the Vienna University of Economics and Business
(LL.B., LL.M.). She worked as research fellow and lecturer (prae doc) at the Institute for
European and International Law and completed her doctoral studies (Dr. iur.) at the Vienna
University of Economics and Business. From 2016 to 2018 Nina Palmstorfer was a candidate
lawyer at Rohregger Scheibner Rechtsanwälte GmbH, a law firm in Vienna. Since 2018 she
has been working as a scientific assistant at the Austrian Constitutional Court.
Charlotte Pechhacker is an associate at Rohregger Rechtsanwalts GmbH, Vienna. Her main
areas of practice are, inter alia, constitutional law, criminal law, and business law.
Ursula Rath is a partner at Schoenherr Rechtsanwälte GmbH, Vienna, Austria and specialises
in (equity and debt) capital markets transactions, investment funds and financial services regu-
lation. For over a decade, she has advised issuers, selling shareholders, banks and other financial
institutions as well as investors on international and local capital markets transactions, and on
combined bank debt and high-yield bond issuances. She has a broad range of experience in
initial public and secondary offerings, stock exchange listings, liability management transac-
tions, notes offerings (in particular, high yield), private placements of debt and equity instru-
ments. Ursula Rath also advises national and international players on regulatory developments
and changes such as in relation to Brexit contingency planning, Payment Services Directive II
or Markets in Financial Instruments Directive II. She is a member of the Austrian Ministry of
Finance's FinTech Advisory Board and of the Regulatory Sandbox Advisory Board where she
consults on priority actions around start-up financing, Information Commissioner’s Offices
and digital assets and regulatory aspects of coming to market of innovative business models.

xx
CONTRIBUTORS
Michael Rohregger is an advocate and partner at Rohregger Rechtsanwalts GmbH, Vienna.

His main areas of practice are, inter alia, capital markets law, constitutional law, and
white-collar crime law.
Alfred Schramm is working at the International Department of the Austrian Financial Market
Authority where the focus of his work lies in supervisory cooperation (including, inter alia,
third country equivalence assessments and consultation of Memoranda of Understanding).
Prior to joining the FMA in 2010 he worked as Assistant Professor at the Vienna University
of Economics at the Department of Austrian and European Public Law with special emphasis
on European and comparative banking supervision law. Mr. Schramm holds a JD in law from
the University of Graz and the venia docendi for Administrative and Comparative Law from the
Vienna University of Economics.
Chris Thomale holds the Chair for International Company and Business Law at the University
of Vienna and the Chair for Comparative Law at the University Roma Tre. He publishes
regularly on European capital markets law.
Ulrich Torggler is Professor at the Department of Commercial and Business Law of the
University of Vienna. He has a Ph.D in Law (1996) from the University of Vienna, and
an LL.M. from the Cornell Law School, New York. Ulrich Torggler has won the Walther
Kastner Prize on two occasions (1996, 2009) and the Cardinal Innitzer Promotion Prize
(2009). He is the editor of various books and commentaries on company law, corporate law and
capital markets law and has also published widely in these fields.
Martin Winner is a Professor of Business Law at the Vienna University of Economics and
Business and Director of its Research Institute of Central and Eastern European Business Law.
His research interests include company law, capital markets law, and comparative law. Martin
is the author of more than 100 publications in these fields, both in German and in English. He
is Chairman of the Austrian Takeover Commission, the supervisory authority for public M&A.
Since 2014, Martin has been a member of the European Commission’s Informal Company
Law Experts’ Group (ICLEG), the academic advisory body to the Commission in this field.
xxi
PREFACE
This book is based on a commentary on Austrian capital markets law published by Linde
Verlag, Austria. However, MAR, as a directly applicable centrepiece of European capital
market regulation, is also relevant beyond Austria’s borders and thus of interest to a wider
readership. Therefore, we decided to publish a more internationally focused version in English.
We are confident that the book’s format of an article-by-article commentary will be extremely
valuable for academic as well as practical purposes.
We are indebted to Linde Verlag for their approval of this project. Our special thanks go
to Donna Stockenhuber for her tireless translation work and other invaluable assistance in
linguistic matters. We would also like to thank the B&C Privatstiftung for supporting the
project. Furthermore, we would like to express our gratitude to Elisabeth Drach and all those
involved at Edward Elgar Publishing, in particular, Emily Mew, Stephanie Tytherleigh and
Sabrina Zaher, for their efforts in the completion of this book.
Susanne Kalss
Martin Oppitz
Ulrich Torggler
Martin Winner
xxii
ABBREVIATIONS
2. FFG (German) Zweites Finanzmarktförderungsgesetz 1994, BGBl I

1749
ABGB (Austrian) Allgemeines bürgerliches Gesetzbuch für die gesam-
ten deutschen Erbländer der Oesterreichischen Monarchie, JGS
1811/946 (Civil Code)
ACER Agency for the Cooperation of Energy Regulators
AIFM Alternative Investment Fund Managers
AFM Autoriteit Financiële Markten (Netherlands)
AfP Zeitschrift für das gesamte Medienrecht (journal)
AG a) Die Aktiengesellschaft (journal)
b) Advocate General
c) Aktiengesellschaft (stock corporation)
AIF Alternative Investment Fund
AktG (Austrian) Aktiengesetz, BGBl 1965/98
ALR Arizona Law Review (journal)
AMAFI L’Association française des marchés financiers (France)
AMF Autorité des marchés financiers (France)
App no Application number
ARaktuell Aufsichtsrat aktuell (journal)
Art/Arts article/articles
ATS Alternative Trading System
BaFin Bundesanstalt für Finanzdienstleistungsaufsicht (German Federal
Financial Supervisory Authority)
BaFinVersMeldV (German) Bundesanstalt für Finanzdienstleistungsaufsicht
Verstoßmeldeverordnung 2016, BGBl I 1572
BB Betriebs-Berater (journal)
Begr Begründung (justification)
BGB (German) Bürgerliches Gesetzbuch 2002, BGBl I 42
BGBl Bundesgesetzblatt
xxiii
ABBREVIATIONS
BGH (German) Bundesgerichtshof

BJB Bulletin Joly Bourse (journal)
BJR business judgement rule
BKR Zeitschrift für Bank- und Kapitalmarktrecht (journal)
BlgNR Beilage zu den stenographischen Protokollen des Nationalrates
BMR Regulation (EU) 2016/1011 of 8 June 2016 on indices used as
benchmarks in financial instruments and financial contracts or
to measure the performance of investment funds and amending
Directive 2008/48/EC and 2014/17/EU and Regulation (EU)
596/2014 (Benchmark Regulation) [2016] OJ L 171/1
BörseG 1989 (Austrian) Börsegesetz 1989, BGBl 555
BörseG 2018 (Austrian) Börsegesetz 2018 BGBl 2017/149
BörseG-Nov 1993 (Austrian) Bundesgesetz, mit dem das Börsegesetz 1989 geändert,
die Beitragsleistung zum Wiener Börsefonds neu geregelt
(Börsefondsgesetz) und die Börsefondsnovelle 1925 aufgehoben
wird, BGBl 1993/529
BT-Drs Drucksachen des (deutschen) Bundestages
B-VG (Austrian) Bundes-Verfassungsgesetz, BGBl 1930/1
BVwG a) (Austrian) Bundesverwaltungsgericht
b) (German) Bundesverwaltungsgericht
BWG (Austrian) Bankwesengesetz, Art I BGBl 532/1993
c. mon. fin. (French) code monétaire et financier
CA cour d'appel (France)
Cass. Com. Cour de Cassation Chambre commerciale (France)
CC a) Code Civil (French Civil Code)
b) Codice Civile (Italian Civil Code)
c) Código Civil (Spanish Civil Code)
CCP central counterparty
CCZ Corporate Compliance Zeitschrift (journal)
CDS Commission des sanctions (France)
CEO chief executive officer
cert certiorari
CESR Committee of European Securities Regulators
CEST Central European Summer Time
CET Central European Time
cf confer
xxiv
ABBREVIATIONS
CFDIP comité français de droit international privé (France)

CFR Charter of Fundamental Rights of the European Union [2012] OJ
C 326/391
ch chapter
Cir Circuit
CJEU Court of Justice of the European Union
CJTL Columbia Journal of Transnational Law (journal)
CLJ Cambridge Law Journal (journal)
CLR Columbia Law Review (journal)
CML Rev Common Market Law Review (journal)
CMLJ Capital Markets Law Journal (journal)
COM Commission
CoMC Code of Market Conduct
CONSOB commissione nazionale per le societa e la borsa (Italian securities
and exchange commission)
CPI consumer price index
CRD IV Capital Requirements Directive IV; Directive 2013/36/EU of the
European Parliament and of the Council of 26 June 2013 on access
to the activity of credit institutions and the prudential supervision
of credit institutions and investment firms, amending Directive
2002/87/EC and repealing Directives 2006/48/EC and 2006/49/
EC [2013] OJ L 176/338
CRIM-MAD Directive 2014/57/EU of the European Parliament and of the
Council of 16 April 2014 on criminal sanctions for market abuse
(Market Abuse Directive – CRIM-MAD) [2014] OJ L 173/179
CRR Regulation (EU) 575/2013 of the European Parliament and of
the Council of 26 June 2013 on prudential requirements for credit
institutions and investment firms and amending Regulation (EU)
648/2012 [2013] OJ L 176/1
CUT Coordinated Universal Time
CVM (Portuguese) Código dos Valores Mobiliários
DB Der Betrieb (journal)
DEPP Decision Procedure and Penalties Manual (UK)
DGAP Deutsche Gesellschaft für Ad-hoc-Publizität mbH
DIP droit international privé
DJCL Delaware Journal of Corporate Law (journal)
xxv
ABBREVIATIONS
DMP disclosing market participant

DStR Deutsches Steuerrecht (journal)
DTR Disclosure Guidance and Transparency Rules sourcebook (UK)
EBA European Banking Authority
EBA Regulation Regulation (EU) No 1093/2010 of the European Parliament and
of the Council of 24 November 2010 establishing a European
Supervisory Authority (European Banking Authority), amending
Decision No 716/2009/EC and repealing Commission Decision
2009/78/EC [2010] OJ L 331/12
EBLR European Business Law Review (journal)
EBOR European Business Organization Law Review (journal)
ECFR European Company and Financial Law Review (journal)
ECGI European Corporate Governance Institute
ECHR a) European Court of Human Rights
b) European Convention on Human Rights
ECJ European Court of Justice
ecolex ecolex – Fachzeitschrift für Wirtschaftsrecht (journal)
ECR European Court Reports
ECtHR European Court of Human Rights
ed/eds editor/editors
edn edition
EDPB European Data Protection Board
EEA European Economic Area
EFSF European Financial Stability Facility
e.g., exempli gratia
EG The Enforcement Guide (UK)
EIB European Investment Bank
EIOPA European Insurance and Occupational Pensions Authority
EL Rev European Law Review (journal)
ELJ European Law Journal (journal)
EMIR Regulation (EU) 648/2012 of the European Parliament and of the
Council of 4 July 2012 on OTC derivatives, central counterparties
and trade repositories [2012] OJ L 201/1
EP European Parliament
ERA Europäische Rechtsakademie (Academy of European Law)
xxvi
ABBREVIATIONS
ErlRV (Austrian) Erläuterungen zur Regierungsvorlage

ERPL European Review of Private Law (journal)
ESAs European Supervisory Authorities
ESCB European System of Central Banks
ESFS European System of Financial Supervisors
ESM European Stability Mechanism
ESMA European Securities and Markets Authority
ESMA Regulation Regulation (EU) No 1095/2010 of the European Parliament and
of the Council of 24 November 2010 establishing a European
Supervisory Authority (European Securities and Markets
Authority) [2010] OJ L 331/84
esp especially
ESRB European Systemic Risk Board
EU European Union
EUR euro
EURIBOR Euro Interbank Offered Rate
EuZW Europäische Zeitschrift für Wirtschaftsrecht (journal)
EWiR Entscheidungen zum Wirtschaftsrecht (journal)
EWS Europäische Wirtschafts- und Steuerrecht (journal)
f and the following
F.2d Federal Reporter, Second Series (US)
FCA Financial Conduct Authority (UK)
ff and following
FinDAG (German) Finanzdienstleistungsaufsichtgesetz 2002, BGBl I 1310
(Act Establishing the Federal Financial Supervisory Authority)
FMA Finanzmarktaufsichtsbehörde (Austrian Financial Market
Authority)
FMABG (Austrian) Finanzmarktaufsichtsbehordengesetz 2001, Art I BGBl
I 2001/97
fn footnote (external to the work)
FSA Financial Services Authority (UK)
FSMA Financial Services and Markets Act 2000, SI 2000/8
GDPR General Data Protection Regulation: Regulation (EU) 2016/679 of
the European Parliament and of the Council of 27 April 2016 on
the protection of natural persons with regard to the processing of
personal data and on the free movement of such data, and repealing
Directive 95/46/EC [2016] OJ L 119/1
xxvii
ABBREVIATIONS
GER Germany
GeS Zeitschrift für Gesellschaftsrecht und angrenzendes Steuerrecht
(journal)
GesRZ Der Gesellschafter, Zeitschrift für Gesellschafts- und
Unternehmensrecht (journal)
GLJ Georgetown Law Journal (journal)
GmbHG (Austrian) GmbH-Gesetz, RGBl 1906/58
GP Gesetzgebungsperiode (legislation period)
GPR Zeitschrift für das Privatrecht der Europäischen Union (journal)
GWh Gigawatt hours
GWR Gesellschafts- und Wirtschaftsrecht (journal)
HarvIntlLJ Harvard International Law Journal (journal)
HFT high frequency trading
HLJ Hastings Law Journal (journal)
HLR Harvard Law Review (journal)
HLRA Harvard Law Review Association
HM Her Majesty's
ICLQ International & Comparative Law Quarterly (journal)
IDD Insider Dealing Directive: Council Directive 89/592/EEC of 13
November 1989 coordinating regulations on insider dealing [1989]
OJ L 334/30
i.e. id est
IOSCO International Organization of Securities Commissioners
IPO initial public offering
IPRax Praxis des Internationalen Privat- und Verfahrensrechts (journal)
ISO International Organization for Standardization
IT information technology
ITS implementing technical standards
J Fin Crim Journal of Financial Crime (journal)
JAR Journal of Accounting Research (journal)
JBl Juristische Blätter (journal)
JCLS Journal of Corporate Law Studies (journal)
JCMS Journal of Common Market Studies (journal)
JFE Journal of Financial Economics (journal)
xxviii
ABBREVIATIONS
JPIL Journal of Private International Law (journal)

JZ Juristen-Zeitung
KMG (Austrian) Kapitalmarktgesetz, BGBl 1991/625
KWG (German) Kreditwesengesetz 1998, BGBl I 2776
L & Fin Mkts Rev Law and Financial Markets Review
L Rev Law Review
LCP Law and Contemporary Problems (journal)
LIBOR London Interbank Offered Rate
lit litera
LMV (Spanish) Ley del Mercado de Valores
LSN Legal Scholarship Network
Ltd Limited
LWP Law Working Paper
M&A mergers and acquisitions
MAD Market Abuse Directive: Directive 2003/6/EC of the European
Parliament and of the Council of 28 January 2003 on insider deal-
ing and market manipulation [2003] OJ L 96/16
MAR Market Abuse Regulation: Regulation (EU) No 596/2014 of the
European Parliament and of the Council of 16 April 2014 on
market abuse (market abuse regulation) and repealing Directive
2003/6/EC of the European Parliament and of the Council and
Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/
EC [2014] OJ L 173/1
mbH mit beschränkter Haftung
MCH Handbook on Market Conduct (UK)
Md L Rev Maryland Law Review (journal)
MiFID I Markets in Financial Instruments Directive: Directive 2004/39/EC
of the European Parliament and of the Council of 21 April 2004
on markets in financial instruments amending Council Directives
85/611/EEC and 93/6/EEC and Directive 2000/12/EC of the
European Parliament and of the Council and repealing Council
Directive 93/22/EEC [2004] OJ L 145/1
MiFID II Markets in Financial Instruments Directive II: Directive 2014/65/
EU of the European Parliament and of the Council of 15 May
2014 on markets in financial instruments and amending Directive
2002/92/EC and Directive 2011/61/EU [2014] OJ L 173/349
MiFIR Regulation (EU) No 600/2014 of the European Parliament and of
the Council of 15 May 2014 on markets in financial instruments
and amending Regulation (EU) No 648/2012 (MiFIR) [2014] OJ
L 173/84
xxix
ABBREVIATIONS
MJ Maastricht Journal of European and Comparative Law (journal)

MM-Compl- Commission Delegated Regulation (EU) 2016/957 supplementing
Regulation Regulation (EU) No 596/2014 of the European Parliament and of
the Council with regard to regulatory technical standards for the
appropriate arrangements, systems and procedures as well as notifi-
cation templates to be used for preventing, detecting and reporting
abusive practices or suspicious orders or transactions [2016] OJ L
160/1
MM-Insider Lists Commission Implementing Regulation (EU) 2016/347 of 10
Regulation March 2016 laying down implementing technical standards with
regard to the precise format of insider lists and for updating insider
lists in accordance with Regulation (EU) No 496/2014 of the
European Parliament and of the Council [2016] OJ L 65/49
MMoU Multilateral Memorandum of Understanding
MoU Memorandum of Understanding
MpV Verordnung der Finanzmarktaufsichtsbehörde (FMA) über
zulässige Marktpraktiken an österreichischen Finanzmärkten
(Marktpraxisverordnung) BGBl II 2005/1
MR Medien und Recht (journal)
MSR market sounding recipient
MTF multilateral trading facility
MVP-Portal Melde- und Veröffentlichungsplattform
n/nn footnote/footnotes (internal to the work)
NCA national competent authority
NDA non-disclosure agreement
NJW Neue Juristische Wochenschrift (journal)
No number (of a Report etc)
NYSE New York Stock Exchange
NZG Neue Zeitschrift für Gesellschaftsrecht (journal)
NZWiSt Neue Zeitschrift für Wirtschafts-, Steuer- und
Untenehmensstrafrecht (journal)
ÖBA Österreichisches Bankarchiv (journal)
ÖECD Organisation for Economic Co-operation and Development
OeKB Österreichische Kontrollbank AG
OeNB Österreichische Nationalbank
OGH (Austrian) Oberster Gerichtshof
OJ Official Journal of the European Communities
xxx
ABBREVIATIONS
OJLS Oxford Journal of Legal Studies (journal)

OLG a) (Austrian) Oberlandesgericht
b) (German) Oberlandesgericht
OTC over-the-counter
OTF organized trading facility
OWiG (German) Gesetz über Ordnungswidrigkeiten 1987, BGBl I 602
ÖZW Österreichische Zeitschrift für Wirtschaftsrecht (journal)
para/paras paragraph/paragraphs
PDMR person discharging managerial responsibilities
plc public limited company
PRIIP Regulation Packaged Retail and Insurance-based Investment Products
Regulation
Q&A question and answer
RablesZ Rabels Zeitschrift für ausländisches und internationales Privatrecht
(journal)
RdW Österreichisches Recht der Wirtschaft (journal)
RegE Regierungsentwurf (government draft)
REMIT Regulation on wholesale Energy Market Integrity and
Transparency: Regulation (EU) 1227/2011 of the European
Parliament and of the Council of 25 October 2011 on wholesale
energy market integrity and transparency [2011] OJ L 326/1
Rev crit DIP Revue critique de droit internationale privé (journal)
RIDC Revue internationale de droit comparé (journal)
RIW Recht der internationalen Wirtschaft (journal)
RTDF Revue Trimestrielle de Droit Financier (journal)
RTS regulatory technical standards
s/ss section/sections
SE societas europaea
SEC Securities Exchange Commission (US)
sent/sents sentence/sentences
SI statutory instrument
SLR Stanford Law Review (journal)
SME small- to medium-sized enterprise
Solvency II Directive 2009/138/EC of the European Parliament and of the
Council of 25 November 2009 on the taking-up and pursuit of the
business of Insurance and Reinsurance [2009] OJ L 335/1
xxxi
ABBREVIATIONS
SPA Share Purchase Agreement

SRD Shareholder Rights Directive: Directive 2007/36/EC of the
European Parliament and of the Council of 11 July 2007 on the
exercise of certain rights of shareholders in listed companies [2007]
OJ L 132/1
SSRN Social Science Research Network
STOR Suspicious Transaction and Order Reports
subpara/subparas subparagraph/subparagraphs
Sublit Sublitera
SWK Österreichische Steuer- und Wirtschaftskartei (journal)
SYSC Senior Management Arrangements, Systems and Controls (UK)
TEU Consolidated Version of the Treaty on European Union [2012] OJ
C 326/13
TFEU Consolidated Version of the Treaty on the Functioning of the
European Union [2012] OJ C 326/47
TILJ Texas International Law Journal (journal)
UCITS undertakings for collective investment in transferable securities
UCLR University of Chicago Law Review (journal)
UDRB Umlaufgewichtete Durchschnittsrendite für Bundesanleihen (aver-
age bond yield weighted by outstanding amount)
UFITA Archiv für Medienrecht und Medienwissenschaft (journal)
UGB (Austrian) Unternehmensgesetzbuch, BGBl I 2005/120
UK United Kingdom
US United States of America
UVS (Austrian) Unabhängiger Verwaltungssenat
VAG (German) Versicherungsaufsichtsgesetz 2015, BGBl I 434
VbR Zeitschrift für Verbraucherrecht (journal)
VGR Gesellschaftsrechtliche Vereinigung
VMV a) (Austrian) Veröffentlichungs- und Meldeverordnung (Disclosure
and Reporting Ordonance), BGBl II 2015/2017
b) (Austrian) Verbreitungs- und Meldeverordnung (Dissemination
and Notification Ordinance), BGBl II 205/2017
VStG (Austrian) Verwaltungsstrafgesetz 1991, BGBl 52
VwGH a) (Austrian) Verwaltungsgerichtshof
b) (German) Verwaltungsgerichtshof
WAG 2007 (Austrian) Wertpapieraufsichtsgesetz 2018, BGBl I 107/2017
WAG 2018 (Austrian) Wertpapieraufsichtsgesetz 2007, BGBl I 60/2007
Wash & Lee L Rev Washington and Lee Law Review (journal)
xxxii
ABBREVIATIONS
Wash U L Rev Washington University Law Review (journal)

wbl Wirtschaftsrechtliche Blätter (journal)
WM Zeitschrift für Wirtschafts- und Bankrecht (journal)
WpHG (German) Wertpapierhandelsgesetz 1998, BGBl I 2708
YEL Yearbook of European Law (journal)
YPIL Yearbook of Private International Law (journal)
ZBB Zeitschrift für Bankrecht und Bankwirtschaft (journal)
ZEuP Zeitschrift für Europäisches Privatrecht (journal)
ZFR Zeitschrift für Finanzmarktrecht (journal)
ZGR Zeitschrift für Unternehmens- und Gesellschaftsrecht (journal)
ZHR Zeitschrift für das gesamte Handels- und Wirtschaftsrecht (journal)
ZIP Zeitschrift für Wirtschaftsrecht (journal)
ZVglRWiss Zeitschrift für Vergleichende Rechtswissenschaft (journal)
ZZP Zeitschrift für Zivilprozessrecht (journal)
xxxiii
TABLE OF CASES
COURT OF JUSTICE OF THE EUROPEAN UNION
Case C-617/10 Akerberg-Fransson [2013] ECLI:EU:C:2013:10523.005

Case C-269/95 Benincasa [1997] ECR I-3767 30A.047; 30A.048
Case C-548/12 Brogsitter [2014] ECLI:EU:C:2014:14830A.050
Case 9/74 Casagrande v Landeshauptstadt München [1974] ECR 77322.005
Case C-352/13 CDC Hydrogen Peroxide [2015] ECLI:EU:C:2015:335 30A.052; 30A.057; 30A.063
Case 283/81 CILFIT [1982] ECR I-034157.005
Case C-217/97 Commission v Germany [1997] ECR I-5087 22.008; 23.004
Case 427/85 Commission v Germany [1988] ECR 112322.011
Case 6/64 Costa v ENEL [1964] ECR 585 22.011; 30A.070
C-453/99 Courage [2001] ECR-I 629730A.011
Case C-583/13 P Deutsche Bahn and others v Commission [2015] ECLI:EU:C:2015:40423.014
Case C-220/88 Dumez France [1990] ECR I-4930A.052
Joined Cases C-509/09 eDate Advertising and C-161/10 Martinez [2011] ECR I-1026930A.050;
30A.053
Case 327/82 Ekro [1984] ECR 10722.011
Case C-218/12 Emrek [2013] ECLI:EU:C:2013:66630A.047
Case C-27/02 Engler [2005] ECR I-481 30A.048; 30A.049
Case C-133/11 Folien Fischer [2012] ECLI:EU:C:2012:664 30A.051; 30A.053
Joined Cases C-6/90 Francovich and C-9/90 Bonifaci [1991] ECR I-535730A.011
Case C-96/00 Gabriel [2002] ECR I-636730A.049
Case C-19/11 Geltl [2012] ECLI:EU:C:2012:397 7.002; 7.005; 7.006; 7.013; 7.018; 7.020; 7.021;
7.025; 7.026; 7.029; 7.032; 17.061; 17.062
Case C-391/04 Georgakis [2007] ECR I-03741 7.002; 7.011; 7.032; 8.079; 8.089; 8.093; 8.094
Case C-384/02 Grøngaard and Bang [2005] ECR I-09939 7.002; 9.004; 10.001; 10.014; 10.017;
10.020; 10.021; 10.023; 11.002; 11.013
Case C-464/01 Gruber [2005] ECR I-43930A.048
Joined Cases C-46/87 and 227/88 Hoechst v Commission [1989] ECR 285923.013
Case C-40/11 Iida [2012] ECLI:EU:C:2012:69123.005
Case C-180/06 Ilsinger [2009] ECR I-396130A.048
Case C-45/13 Kainz [2014] ECLI:EU:C:2014:730A.053
Case C-445/09 IMC Securities [2011] ECR I-0591712.014
Case 189/87 Kalfelis [1988] ECR 556530A.050
Case C-25/18 Kerr [2019] ECLI:EU:C:2019:37630A.069
Case C-375/13 Kolassa [2015] ECLI:EU:C:2015:37 30A.049; 30A.056; 30A.058
Case C-168/02 Kronhofer [2004] ECR I-600930A.056
Case C-230, 231/09 Kurt and Thomas Etling [2011] ECR I-030977.005
Case C-628/13 Lafonta [2015] ECLI:EU:C:2015:162 7.002; 7.006; 7.020; 7.026; 7.027; 7.030; 7.032;
17.041
Case C-287/98 Linster [2000] ECR I‑691722.011
Case C-304/17 Löber [2018] ECLI:EU:C:2018:701 30A.056; 30A.058
Case C-364/93 Marinari [1995] ECR I-2719 30A.052; 30A.064
Case C-62/00 Marks & Spencer [2002] ECR I-6325 22.008; 23.004
Case C-273/90 Meico-Fell v Hauptzollamt Darmstadt [1991] ECR I-556922.007
xxxiv
TABLE OF CASES
Case C-372/88 Milk Marketing Board v Cricket St. Thomas [1990] ECR I-0134522.011
Case 21/76 Mines de Potasse d‘Alsace [1976] ECR 1735 30A.046; 30A.051; 30A.053
Case C-253/00 Muñoz [2002] ECR I-728930A.011
Case 39/70 Norddeutsches Vieh- und Fleischkontor GmbH v Hauptzollamt Hamburg-St. Annen [1971] ECR
4922.007
Case C-147/12 ÖFAB [2013] ECLI:EU:C:2013:490 30A.052; 30A.063
Case C-215/10 Pacific World [2011] ECR I-072557.005
Cases C-585/08 Pammer and 144/09 Hotel Alpenhof [2010] ECR I-1252730A.048
Case 43/71 Politi v Ministero delle finanze [1971] ECR 103922.005
Case C-214/89 Powell Duffryn [1992] ECR I-174530A.083
Case C-366/13 Profit Investment SIM [2016] ECLI:EU:C:2016:28230A.085
Case C-543/10 Refcomp [2013] ECLI:EU:C:2013:6230A.083
Case 30/77 Regina v Bouchereau [1977] ECR 199922.011
Case C-94/00 Roquette Frères SA [2002] ECR I-0901123.013
Case C-498/16 Schrems II [2018] ECLI:EU:C:2018:3730A.049
Case C-68/93 Shevill [1995] ECR I-415 30A.050; 30A.052; 30A.053; 30A.063
Case C-206/13 Siragusa [2014] ECLI:EU:C:2014:12623.005
Case 19/67 Sociale Verzekeringsbank v Van der Vecht [1967] ECR 34522.011
Case C-45/08 Spector Photo Group [2009] ECR I-12073 7.002; 7.005; 7.032; 8.029; 8.080, 8.081;
8.083; 8.085; 8.088; 8.093; 9.052; 10.009; 12.031
Case C-194/16 Svensk Handel [2017] ECLI:EU:C:2017:766 30A.050; 30A.053
Case C-272/18 TVP [2019] ECLI:EU:C:2019:82730A.069
Case C-12/15, Universal Music [2016] ECLI:EU:C:2016:449 30A.055; 30A.057; 30A.058
Case C-270/12 UK and Northern Ireland v EP and Council [2014] ECLI:EU:C2014:1830A.005;
30A.007
Case 26/62 Van Gend en Loos [1963] ECR 122.005
Case C-28/99 Verdonck and Everaert [2001] ECR I-0339910.028
Case C-709/19 Vereniging van Effectenbezitters [2021] ECLI:EU:C:2021:377 30A.056; 30A.060
Case C-52/17 VTB Bank (Austria) AG [2018] ECLI:EU:C:2018:64823.010
Case C-343/19 VW [2020] ECLI:EU:C:2020:534 30A.052; 30A.055; 30A.058
Case C-523/10 Wintersteiger [2012] ECLI:EU:C:2012:22030A.053
Case C 87/12 Ymeraga and Ymeraga Tafarshiku [2013] ECLI:EU:C:2013:29123.005
Case 94/77 Zerbone [1978] ECR 9922.005
Joined Cases C-424/10 and C-425/10 Ziolkowski v Land Berlin and Szeja v Land Berlin [2011]
I-1403522.011
Case C-189/08 Zuid-Chemie [2009] ECR I-6917 30A.052; 30A.053
EUROPEAN COURT OF HUMAN RIGHTS
Salabiaku vs France, App no 10519/83 (ECtHR, 7 October 1988)8.085

Markt Intern Verlag GmbH and Beermann v Germany, App no 10572/83 (ECtHR, 20 November 1989)
21.005
Casado Coca v Spain, App no 15450/89 (ECtHR, 24 February 1994)21.005
Janosevic v Sweden, App no 34619/97 (ECtHR, 23 July 2002)8.085
Harju vs Finland, App no 56716/09 (ECtHR, 15 February 2011)23.014
DOMESTIC COURTS
Austria
BVwG 14.2.2019, W210 2195872-1/6E, Wiener Privatbank 7.017; 7.029; 17.062

BVwG 13.6.2019, W204 2209288-117.062
xxxv
TABLE OF CASES
BVwG 21.8.2019, W148 2196914-117.062

BVwG 8.5.2020, W148 2217970-117.062
OGH 24.1.2002, 8 Ob 384/01z8.100
OGH 27.9.2006, 9 ObA 130/05s19.041
OGH 15.3.2012, 6 Ob 28/12d 17.119; 30A.040
OGH 14.6.2012, 3 Ob 14/12y30A.056
OGH 24.1.2013, 8 Ob 104/12w 17.119; 30A.040
OGH 17.4.2014, 4 Ob 73/ 14k8.083
OGH 20.3.2015, 9 Ob 26/14k30A.040
OGH 7.7.2017, 6 Ob 18/17s30A.040
OLG Wien 12.1.2012, 23 Bs 192/11w 8.076, 8.085
UVS Wien, 22 February 2010, 06/FM/57/7999/2008 7.021; 7.026
VwGH 16 May 2011, 2009/17/0187-612.026
VwGH 24 March 2014, 2012/17/0118, OMV 7.027; 7.029; 17.061
VwGH 24 April 2014, 2014/02/001617.047
VwGH 29 April 2014, 2012/17/0554, RBI 7.026; 7.029; 17.061
VwGH 23 May 2014, 2014/02/0032, Miba 7.032; 17.043
VwGH 26 May 2014, 2011/17/02355.042
VwGH 30 January 2015, 2011/17/0267, Skylink 7.030; 7.032; 17.032
VwGH 20 April 2016, Ra 2015/02/0152, Verbund I
7.021; 7.023; 7.027; 7.030; 17.041; 17.044; 17.047
VwGH 27 April 2017, Ro 2016/02/0020, Verbund II 7.023; 7.029; 7.032; 17.056
Denmark
BioPorto, Vestre Landsret 26.8.2014, UfR 2014.3464 V7.016

Erhversankenævnet, 11.9.2008, no 2007-00122397.021
Højesteret 14 May 2009, 219/200810.014
France
AMF CDS, 23 November 2006, SAN-2007-0211.003

AMF CDS, 29 March 2007, SAN-2007-137.035
AMF CDS, 7 June 2007, SAN-2007-19 11.003; 11.018
AMF CDS, 10 April 2008, SAN-2008-157.018
AMF CDS, 30 October 2008, SAN-2009-0511.018
AMF CDS, 4 December 2008, SAN-2009-1110.002
AMF CDS, 17 March 2011, SAN-2011-0511.018
AMF CDS, 24 November 2011, SAN-2012-0211.018
AMF CDS, 14 June 2012, SAN-2012-07 7.018; 11.012
AMF CDS, 22 October 2012, SAN-2012-177.018
AMF CDS, 5 June 2013, SAN-2013-147.027
AMF CDS, 22 July 2014, SAN-2014-167.016
AMF CDS, 3 March 2015, SAN-2015-047.027
AMF CDS, 23 July 2015, SAN-2015-157.016
AMF CDS, 11 January 2016, SAN-2016-02 10.020; 10.024; 10.030
AMF CDS, 29 May 2017, SAN-2017-057.027
AMF CDS, 29 September 2017, SAN-2017-087.030
AMF CDS, 24 October 2018, SAN 2018-137.011
AMF CDS, 25 April 2019, SAN-2017-18 10.008; 10.015; 10.017
CA Paris, 26 November 2008, no 07/146137.015
CA Paris, 28 January 2009, no 08/020027.031
xxxvi
TABLE OF CASES
CA Paris, 2 February 2010, no 09/026237.024

CA Paris, 27 November 2014, no 13/16393 7.026, 7.030; 7.031
CA Paris, 22 January 2015, no 13/18202 7.026; 7.027
CA Paris, 10 April 2015, no 13/080177.015
CA Paris, 31 March 2016, no 15/123517.024
Cass. Com. 1 March 2017, no 14-26225 7.026
Cass. Com. 1 March 2017, no 14-268927.026
Cass. Com. 1 March 2017, no 15-123627.026
Conseil d'État, 12 June 2013, no 35924511.018
Conseil d'État, 3 February 2016, no 369198 7.015; 7.027
Conseil d'État, 30 January 2019, no 4127897.035
Germany
BGH 6.11.2003 1 StR 24/03, Sascha Opel 7.011; 7.035; 12.035

BGH 09.05.2005, II ZR 287/0230A.035
BGH 25.2.2008, II ZB 9/07, Daimler-Chrysler I 7.021; 7.026
BGH 27.1.2010, 5 StR 224/09, freenet 7.015; 7.017
BGH 13.12.2011, XI ZR 51/10, IKB 7.035; 30A.032; 30A.035
BGH 23.4.2013, II ZB 7/09, Daimler-Chrysler II 7.026; 7.029; 7.033; 17.059
BGH 9.2.2017, IX ZR 67/1630A.098
BGH 10.7.2018, II ZB 24/14, CorealCredit Bank 7.021; 7.023
BVwG 7 C 6.10, ZIP 2011, 13137.007
Hessischer VwGH 8 TZ 98/98, Thyssen Krupp, NJW-RR 1999, 1207.024
LG Stuttgart 28.02.2017, 22 AR 1/1730A.069
LG Stuttgart, 24.10.2018, 22 O 101/1630A.069
OLG Düsseldorf 4.3.2010, I-6 U 94/09, IKB 7.026; 17.077
OLG Frankfurt, 2 Ss-OWi 514/08, NJW 2009, 15207.021
OLG Karlsruhe 4.2.2004, 3 Ws 195/03, NZG 2004, 3778.049
OLG Stuttgart 15.2.2007, 901 Kap 1/06, Daimler-Chrysler I7.026
OLG Stuttgart 22.4.2009, 20 Kap 1/08, Daimler-Chrysler II7.021
Greece
Greek State Council, Συμβούλιο της Επικρατείας 317/2014, Χρηματοπιστωτικό Δίκαιο 2014, 147, NBG
7.029
Italy
Corte di Cassazione, 20 January 2010, no 85887.019

Corte di Cassazione, 5 July 2016, no 136627.035
Corte di Cassazione, 16 October 2017, no 243107.011
Corte di Cassazione, 15 April 2019, no 39999 7.029; 7.034
The Netherlands
Hoge Raad 5.7.2011, 08/04981 E, Veer Palthe Voûte7.032

Rechtbank Rotterdam 22.7.2010, AWB 09/498 BC-T2, Numico7.029
xxxvii
TABLE OF CASES
Portugal
Supremo Tribunal de Justiça 5.4.2016, case no Az. 127/10.0TBPDL.L1.S130A.036
Spain
Sentencia de la Audiencia Nacional, 20 November 2006, no 217/06 7.018; 7.034

Sentencia de la Audiencia Nacional, 17 June 2008, no 346/057.027
Sentencia de la Audiencia Nacional, 17 July 2008, no 176/200510.012
Sentencia de la Audiencia Nacional, 21 October 2008, no 290/067.012
Sentencia de la Audiencia Nacional, 21 June 2011, no 548/20107.018
Sentencia de la Audiencia Nacional, 4 December 2012 and Auto de Rectificación, 1 January 2013, no
56/20127.015
Sentencia de la Audiencia Nacional, 12 February 2019, no 482/20177.029
Sentencia de la Audiencia Nacional, 12 February 2019, no 731/2017 7.027; 7.030
Sentencia de la Audiencia Nacional, 4 March 2019, no 673/2017 7.027; 7.030
Sentencia de la Audiencia Nacional, 13 November 2019, no 1082/20187.029
Sentencia del Tribunal Supremo, 27.9.2011, no 418/20097.023
Sweden
Hövrätt för Västra Sverige, 20 Feburary 2008, B 2944-07, RH 2009-297.012

Svea Hovrätt, 20 December 2006, B 3917-06, Tivox AB7.024
Switzerland
Bundesstrafgericht, 8.6.2017, SK.2017.3, Santhera7.016
UK
Arif Mohammed v FSA UK FSMT, 29 March 20057.015

David Massey v FSA [2011] UKUT 49 (TCC) 7.015; 7.027; 7.032
FSA Final Notice of 19 January 2009 to Wolfson Microelectronics7.012
FSA Final Notice of 15 February 2012 to Andrew Jon Osborne 10.010; 10.017; 10.023; 11.018
FSA Final Notice of 6 October 2009 to Darren Morton11.009
Hannam [2014] UKUT 0233 (TCC) 7.011; 7.026; 7.032
USA
Birnbaum v Newport Steel Corp, 193 F.2d 461 (2nd Cir 1952) cert denied, 343 US 956 (1952)
30A.022; 30A.059
SEC v Texas Gulf Sulphur Co, 401 F.2d (2nd Cir 1968) 8337.034
Superintendent of Ins of State of N Y v Bankers Life & Cas. Co., 404 US 6 (1971)30A.021
Blue Chip Stamps v Manor Drug Stores, 421 US 723 (1975)30A.022
Ernst & Ernst v. Hochfelder, 425 US 185 (1976)30A.023
Santa Fe Indus Inc v Green, 430 US 462 (1977)30A.022
Basic Inc v Levinson, 485 US 224 (1988) 30A.018; 30A.022; 30A.024
Tellabs Inc v Makor Issues & Rights Ltd, 551 US 308 (2007) 30A.021; 30A.023
Stoneridge Inv Partners, LLC v Scientific-Atlanta, 552 US 148 (2008)30A.023
Matrixx Initiatives, Inc v Siracusano, 563 US 27 (2011)30A.023
BioScrip, Inc Securities Litigation, 95 F.Supp.3d 711 (2015)30A.022
xxxviii
TABLE OF LEGISLATION
AGREEMENTS, CONVENTIONS AND EU REGULATIONS

TREATIES
Regulation (EU) 596/2014 of the European
Consolidated Version of the Treaty on European Parliament and of the Council of 16 April
Union [2012] OJ C 326/13 2014 on market abuse (Market Abuse
Article 4 para 3 22.008; 22.009; Regulation – MAR) [2014] OJ L 173/1
30A.010–30A.012 1.001; 1.003–1.005;
Article 5 para 3 30A.006; 30A.008 1.009; 2.001; 2.007–2.014; 2.016; 2.017; 3.001;
Consolidated Version of the Treaty on the 3.040; 4.001; 4.003; 4.007; 5.001; 5.043; 5.044;
Functioning of the European Union [2012] 5.046–5.049; 6.001; 6.005–6.008; 6.010; 7.001;
OJ C 326/47 7.002; 7.005; 7.008; 7.011; 7.012; 7.016; 7.018;
Articles 51ff30A.005 7.020; 7.024; 7.028; 7.029; 7.035; 7.039; 7.040;
Article 6230A.005 8.033–8.035; 8.044; 8.048; 8.054; 8.057; 8.062;
Article 63ff30A.005 8.064; 8.066; 8.080; 8.083; 8.105; 8.115; 9.010;
Article 8322.012 9.031; 9.037; 9.040; 9.060; 9.066; 10.002;
Article 114 22.012; 30A.005 10.003; 10.005; 10.013; 10.015; 10.021;
Article 114 para 130A.005; 30A.007; 30A.008; 11.002; 11.015; 11.021; 12.030; 12.036;
30A.016 12.038; 14.005; 14.006; 14.009; 14.014;
Article 25825.019 15.004; 16.004; 17.015; 17.018; 17.021;
Article 288 para 2 22.004; 22.005; 22.007; 17.070; 17.078; 17.086; 18.004; 18.007;
23.004; 30.010; 30A.070 18.012; 18.015; 18.016; 18.024; 18.050;
Article 290 24.005; 26.016 19.013; 19.018; 19.049; 19.054; 19.056;
Article 291 22.012; 24.001; 24.005; 24.008 19.059; 19.115; 19.118; 20.013; 21.006;
Annex I25.012 22.002; 22.004; 22.008–22.010; 22.012;
Charter of Fundamental Rights of the European 22.014; 22.016–22.018; 23.007–23.010;
Union [2012] OJ C 326/39123.005 23.013; 23.016; 23.017; 23.020; 25.001;
Article 7 23.013; 23.014; 32.008; 34.002 25.003; 25.006; 25.011; 25.013–25.015;
Article 8 32.008; 34.002 26.006–26.009; 26.011; 26.013; 26.016;
Article 11 21.001; 21.005; 21.013 27.001; 27.005; 27.009; 27.010; 30.001;
Article 11 para 2 21.003; 21.006 30.006; 30A.001; 30A.002; 30A.008; 30A.013;
Article 4832.008 30A.014; 30A.016; 30A.017; 30A.079; 31.001;
Article 48 para 17.039 32.001; 32.002; 32.004; 32.007; 32.009;
Article 4910.034 33.001; 33.003; 34.005; 34.006
European Convention on Human Rights Recital 17.018
Article 6 para 2 8.085; 8.088 Recital 2 7.002; 14.003
Article 7 7.039; 10.034 Recital 3 1.002; 33.001
Article 8 23.014; 34.002 Recital 4 1.004; 14.003; 15.001
Convention providing a Uniform Law for Bills of Recital 5 1.006; 14.003
Exchange and Promissory Notes (Geneva, Recital 618.012
1930) Recital 8 2.001; 2.016; 17.015
Article 4330A.068 Recital 136.005
Corpus Juris 200015.004 Recital 14 7.006; 7.030; 7.031; 7.035; 17.043
Article 11 para 215.004 Recital 15 7.006; 7.031; 17.045
Recital 16 7.006; 7.013; 7.021; 7.025; 7.026
Recital 17 7.006; 7.013; 7.021; 7.029; 7.035
xxxix
Recital 187.006 Article 2 para 1 lit c 2.008; 22.017

Recital 20 7.037; 7.040; 22.017 Article 2 para 1 lit d 2.008; 8.043; 8.050;
Recital 23 7.002; 7.030; 7.035; 8.005; 8.080; 22.017
8.094 Article 2 para 1 subpara 1 2.009; 2.010; 4.003
Recital 24 7.002; 8.005; 8.075; 8.080; 8.083; Article 2 para 1 subpara 2 4.003; 7.040; 22.017
8.085; 10.001 Article 2 para 2 2.017; 12.007; 22.017
Recital 25 8.005; 8.061; 8.067; 8.083; 8.085 Article 2 para 2 lit a 2.011; 13.009; 22.017
Recital 26 8.005; 8.007; 8.023; 8.033; 8.122 Article 2 para 2 lit b 2.011; 2.013; 13.009;
Recital 27 8.005; 11.012; 11.013 22.017
Recital 28 7.006; 7.016; 7.035 Article 2 para 2 lit c 2.011; 22.017
Recital 29 9.004; 9.029 Article 2 para 3 2.016; 8.042; 8.094; 22.017
Recital 30 8.071; 9.004; 9.011; 9.026; 9.034; Article 2 para 4 2.017; 22.018
9.037; 9.039; 9.052; 9.067; 10.003 Article 3 3; 17.011; 19.053
Recital 31 7.006; 7.011; 9.004; 9.068; 9.076 Article 3 para 1 (1) 3.001–3.003; 3.039; 3.040;
Recital 32 10.026; 11.001; 11.002; 11.006; 11.008
11.008; 11.016 Article 3 para 1 (2) 3.004–3.015; 16.004;
Recital 33 10.020; 10.026 23.018
Recital 3411.001 Article 3 para 1 (3) 3.016; 3.017; 23.018
Recital 35 3.062; 10.015; 10.016; 11.002; Article 3 para 1 (4) 3.018; 3.019; 23.018
11.003; 11.006; 11.015 Article 3 para 1 (5) 3.020–3.022; 16.004
Recital 36 3.062; 11.005 Article 3 para 1 (6) 3.023–3.026; 3.041; 17.003
Recital 377.040 Article 3 para 1 (7) 3.027; 3.028; 3.041; 3.060;
Recital 4010.003 17.003
Recital 4115.003 Article 3 para 1 (8) 3.029–3.031; 3.041; 17.003
Recital 4213.006 Article 3 para 1 (9) 3.032; 3.033
Recital 47 12.022; 12.025 Article 3 para 1 (11) 3.035; 3.044
Recital 48 12.025; 21.006 Article 3 para 1 (12)3.036
Recital 549.069 Article 3 para 1 (14)3.038–3.040
Recital 5618.065 Article 3 para 1 (15) 3.038–3.041; 7.036
Recital 57 18.002; 18.018; 18.065 Article 3 para 1 (16) 3.040; 3.041
Recital 58 19.006; 19.025; 19.026; 19.070 Article 3 para 1 (17) 3.042; 5.015
Recital 5919.007 Article 3 para 1 (18)3.043
Recital 62 22.013; 22.014; 23.002; 23.007; Article 3 para 1 (20) 13.046–13.048; 19.021
23.009 Article 3 para 1 (21) 3.049; 8.007; 8.016;
Recital 6322.012 11.008; 30A.046
Recital 6623.007 Article 3 para 1 (23)3.052
Recital 67 22.013; 31.013 Article 3 para 1 (24) 3.039; 3.053; 7.036
Recitals 70ff31.001 Article 3 para 1 (26) 3.055; 3.056; 8.009;
Recital 71 30.011; 31.001; 31.009 19.037; 19.048–19.050; 19.054; 19.059
Recital 7334.003–34.005 Article 3 para 1 (27)3.057
Article 1 1; 14.003; 14.014 Article 3 para 1 (30) 3.060; 9.030
Article 1 para 12.016 Article 3 para 1 (31) 3.061; 9.055; 9.065
Article 1 para 2 2.013; 2.016 Article 3 para 1 (32) 3.062; 11.003
Article 2 2; 3.040; 4.003; 5.018; 11.008; Article 3 para 1 (33)3.063
22.010; 22.016; 22.017 Article 3 para 1 (34) 3.064; 20.003
Article 2 para 1 2.011; 2.012; 2.017; 8.043; Article 3 para 1 (35) 3.065; 3.066; 20.003;
8.062; 12.007; 17.003; 30A.078 21.009
Article 2 para 1 lit a 2.008; 22.017 Article 3 para 23.067–3.071
Article 2 para 1 lit b 2.008; 22.017 Article 3 para 2 lit a3.068
xl
Article 3 para 2 lit d 3.071; 5.033 Article 8 para 3 8.002; 8.004; 8.006; 8.026;
Article 44 8.116; 8.119; 9.006; 10.033; 14.004;
Article 4 para 1 subpara 14.007 14.007
Article 4 para 34.002 Article 8 para 4 8.002; 8.004; 8.006;
Article 5 3.071; 5; 8.052; 9.074; 13.006 8.007; 8.012; 8.029; 8.033; 8.083;
Article 5 para 1 3.042; 5.013; 5.021; 5.025 8.097; 8.119; 8.121; 10.008
Article 5 para 1 lit a5.023 Article 8 para 4 lit a 8.010; 8.016
Article 5 para 1 lit c5.029 Article 8 para 4 lit b 8.010; 8.012; 8.017
Article 5 para 1 lit d5.031 Article 8 para 4 lit c 8.010; 8.012; 8.016–8.018
Article 5 para 23.042 Article 8 para 4 lit d 8.010; 8.012; 8.020
Article 5 para 3 3.042; 5.022; 5.028 Article 8 para 4 subpara 110.004
Article 5 para 4 5.033; 5.037 Article 8 para 4 subpara 2 10.004; 10.023;
Article 5 para 55.033 10.033; 11.004
Article 66 Article 8 para 5 8.002; 8.004; 8.008;
Article 6 para 26.002 8.025–8.027; 8.055
Article 6 para 36.007 Article 9 7.001; 8.001; 8.039; 8.083–8.085;
Article 6 para 46.010 8.088; 8.096; 9
Article 6 para 76.009 Article 9 para 1 8.029; 8.032; 8.038;
Article 7 3.039; 7; 8.001; 10.007; 8.064; 8.095; 8.096; 8.114; 8.124;
10.009–10.011; 10.022; 11.009; 17.017; 9.003; 9.007–9.011; 9.013; 9.017;
17.018; 17.020 9.018; 9.022–9.025; 9.030; 9.033; 9.077
Article 7 para 1 7.014–7.019; 7.024; 7.028; Article 9 para 1 lit a8.064; 9.007; 9.014; 9.018;
7.032 9.019; 9.022
Article 7 para 1 lit a7.009; 7.010; 7.014; 7.042; Article 9 para 1 lit b8.064; 8.097; 9.006; 9.007;
11.014; 17.042; 21.010 9.020; 9.024
Article 7 para 1 lit b 3.053; 7.036–7.039 Article 9 para 2 9.006; 9.026
Article 7 para 1 lit c 7.004; 7.040–7.042 Article 9 para 2 lit a3.060; 9.003; 9.029; 9.030;
Article 7 para 1 lit d7.009; 7.011; 7.035; 7.036; 9.037; 9.077
7.043 Article 9 para 2 lit b9.003; 9.034; 9.036; 9.038;
Article 7 para 2 7.004; 7.013; 7.020–7.027; 9.040; 9.043; 9.076
7.029; 17.029; 17.034; 17.036; 17.037; Article 9 para 3 9.003; 9.036; 9.041; 9.042;
17.039 9.045–9.048; 9.076
Article 7 para 3 7.004; 7.012; 7.013; 7.021; Article 9 para 3 lit a 8.067; 9.043; 9.044;
7.029; 17.033; 17.050; 17.052 19.102
Article 7 para 4 7.004; 7.009; 7.014; Article 9 para 3 lit b9.044
7.028–7.035; 7.042; 8.084; 17.042 Article 9 para 4 3.061; 8.048;
Article 7 para 5 7.007; 7.039 8.071; 8.077; 8.078; 9.003; 9.006;
Article 8 3.039; 7.001; 7.006; 7.022; 7.029; 9.049; 9.050–9.053; 9.055; 9.058;
8; 9.006; 9.011; 9.039; 9.051; 9.058; 9.061–9.063; 9.065–9.067; 9.076
10.001; 10.005; 10.007; 11.019; 11.024; Article 9 para 5 8.112; 9.003; 9.006; 9.068;
11.025; 14.001; 14.004; 14.009; 22.017 9.069; 9.071; 9.073; 9.076
Article 8 para 1 8.002; 8.004; Article 9 para 6 9.003; 9.027; 9.033; 9.063;
8.006; 8.026–8.029; 8.042; 8.049; 9.075–9.077
8.054–8.057; 8.059; 8.060; 8.062; Article 10 3.039; 7.001; 7.022;
8.073; 8.101; 8.102; 8.105; 8.110; 8.001; 8.093; 8.104; 10; 11.003; 11.019;
8.113; 8.115; 8.118; 8.121; 9.001; 11.024; 11.025; 14.001; 14.009; 17.079;
9.008; 9.026; 9.034; 9.036; 9.049; 21.001
9.051; 9.062; 9.063; 9.066; 9.072; Article 10 para 1 8.006; 9.001; 9.044;
14.004; 14.007; 14.008 9.062; 10.001; 10.006–10.013; 10.015;
Article 8 para 2 8.002; 8.004; 8.006; 8.026; 10.016; 10.023; 10.026; 10.032; 10.034;
8.029; 8.056; 8.097; 8.100–8.102; 11.002–11.004; 11.007; 11.009; 11.011;
8.104; 8.109; 8.111; 8.112; 8.114; 11.015; 11.016
8.117; 8.118; 8.124; 9.001; 9.006; Article 10 para 1 subpara 1 10.006; 10.007;
9.021; 9.034; 10.017; 10.032; 10.033 10.009; 10.014–10.031; 11.010
Article 8 para 2 lit a 8.106; 8.110 Article 10 para 1 subpara 2 10.008; 10.023;
Article 8 para 2 lit b 8.106; 8.110 11.004
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Article 10 para 2 8.107; 8.115; 10.001; 10.005; Article 12 para 2 lit d12.035
10.008; 10.012; 10.032–10.034 Article 12 para 2 lit e12.035
Article 11 7.001; 10.006; 10.015; 10.016; Article 12 para 3 12.001; 12.013; 12.037
10.023; 11; 13.006; 30A.033 Article 12 para 4 12.001; 12.033
Article 11 para 1 3.062; 10.015; 10.016; Article 12 para 5 12.013; 12.037
10.023; 11.001; 11.003; 11.008–11.010 Article 13 3.032; 5.001; 5.005; 5.042; 12.016;
Article 11 para 1 lit a 11.002–11.004; 11.007; 13
11.008; 11.010 Article 13 para 113.005
Article 11 para 1 lit b11.008 Article 13 para 2 subpara 113.017
Article 11 para 1 lit c11.008 Article 13 para 313.018
Article 11 para 1 lit d 11.008; 11.013 Article 13 para 413.018
Article 11 para 2 3.062; 10.020; 10.026; Article 13 para 513.018
10.028; 11.003; 11.010–11.014 Article 13 para 613.018
Article 11 para 2 lit a 11.012; 11.014 Article 143.039;
Article 11 para 2 lit b11.012–11.014 5.001; 5.003; 5.012; 5.013; 8.001;
Article 11 para 3 3.062; 10.026; 11.003; 8.006; 9.004; 9.011; 11.002; 11.003; 14;
11.010; 11.015–11.020; 11.022 17.018; 17.079; 19.111; 30.002
Article 11 para 4 3.062; 10.016; Article 14 lit a 8.115; 8.123; 10.002; 14.001;
11.002; 11.004; 11.006; 11.010; 11.013; 14.004; 23.019
11.015; 11.016; 11.023 Article 14 lit b 8.097; 14.004; 23.019
Article 11 para 5 3.062; 11.010; Article 14 lit c10.002
11.015–11.020; 11.022 Article 15 2.011; 2.013; 3.039; 5.001;
Article 11 para 5 subpara 1 11.002; 11.018; 5.003; 5.012; 5.013; 12.032; 15; 30.002;
11.019 30A.033; 30A.041
Article 11 para 5 subpara 1 lit d10.023 Article 16 1.003; 9.010; 16; 33.002
Article 11 para 5 subpara 211.020 Article 16 para 116.002
Article 11 para 6 3.062; 11.003; 11.004; Article 17 1.003; 5.006; 7.001; 7.014; 7.018;
11.021–11.023 7.020–7.022; 7.038; 10.010; 10.022;
Article 11 para 7 11.003; 11.004; 11.014; 11.025; 17; 18.015; 18.016;
11.024–11.026 18.021; 18.028; 19.009; 19.011; 19.100;
Article 11 para 8 11.003; 11.004; 11.015; 30A.017; 30A.040; 30A.041
11.021–11.023 Article 17 para 1 7.016; 17.001; 17.021;
Article 11 para 9 11.005; 11.011; 11.015 17.065; 17.066; 17.078; 18.028; 30.002
Article 11 para 9 subpara 1 11.005; 11.015 Article 17 para 1 subpara 3 17.009; 17.015
Article 11 para 10 11.005; 11.011; 11.015 Article 17 para 2 3.046; 30.002
Article 11 para 10 subpara 1 11.005; 11.015 Article 17 para 2 subpara 13.047
Article 11 para 11 11.005; 11.024 Article 17 para 2 subpara 219.077
Article 12 2.011; 2.013; 3.039; 11.006; 12; Article 17 para 2 subpara 37.042
13.009; 15.001; 15.004; 15.005; 22.017; Article 17 para 317.068
30A.033; 30A.041 Article 17 para 4 7.001; 7.029; 11.008; 17.062;
Article 12 para 1 12.001; 12.002; 12.031; 17.078; 17.079; 17.081; 17.082; 17.085;
12.034 17.090; 17.093; 18.028; 30.002
Article 12 para 1 lit a3.032; Article 17 para 4 lit a10.029
12.002; 12.008; 13.002; 13.005; 13.008; Article 17 para 4 lit b17.102
13.012; 15.006; 15.007 Article 17 para 4 lit c 10.022; 17.106
Article 12 para 1 lit b 12.002; 12.017; 12.019; Article 17 para 4 subpara 27.029
12.020; 15.006; 15.008 Article 17 para 5 7.001; 7.029; 10.023; 17.081;
Article 12 para 1 lit c12.002; 17.111; 30.002
12.018; 12.022; 12.024; 12.027; 15.006; Article 17 para 6 7.001; 7.029; 17.111
15.009; 21.001; 21.011 Article 17 para 7 10.022; 11.008; 17.104;
Article 12 para 1 lit d 3.059; 12.004; 12.030; 17.105; 17.110
15.010 Article 17 para 8 10.022; 10.023; 10.029;
Article 12 para 2 12.001; 12.034; 12.035 11.008; 17.066; 17.079; 30.002
Article 12 para 2 lit a12.035 Article 17 para 1117.096
Article 12 para 2 lit b12.035 Article 18 1.003; 9.010; 10.022; 11.025;
Article 12 para 2 lit c12.035 17.107; 18; 30.008
xlii
Article 18 para 1 18.003–18.005; 18.018; Article 23 para 1 lit a23.006

18.044 Article 23 para 1 lit b23.006
Article 18 para 1 lit a 8.039; 18.017 Article 23 para 1 lit c23.006
Article 18 paras 1–630.002 Article 23 para 1 lit d23.006
Article 18 para 218.043 Article 23 para 2 23.004; 23.009; 23.010
Article 18 para 2 subpara 2 18.004; 18.045; Article 23 para 2 lit a 23.011; 23.012
18.046; 18.058; 18.065 Article 23 para 2 lit b 23.011; 23.012
Article 18 para 318.025 Article 23 para 2 lit c 23.011; 23.016
Article 18 para 4 18.037; 18.041 Article 23 para 2 lit d 23.011; 23.013; 23.014
Article 18 para 5 18.038; 18.059 Article 23 para 2 lit e 23.011; 23.015
Article 18 para 6 18.011; 18.013; 18.034 Article 23 para 2 lit f 23.011; 23.017
Article 18 para 6 lit a18.013 Article 23 para 2 lit g 23.011; 23.018
Article 18 para 6 lit b18.013 Article 23 para 2 lit h 23.011; 23.019
Article 18 para 718.007 Article 23 para 2 lit i 23.011; 23.012
Article 18 para 818.008 Article 23 para 2 lit j 23.011; 23.012
Article 19 1.003; 19; 30.008; 30A.028 Article 23 para 2 lit k 23.011; 23.020
Article 19 para 1 3.056; 19.001; Article 23 para 2 lit l 23.011; 23.012
19.024; 19.037; 19.049; 19.085; 19.088; Article 23 para 2 lit m 23.011; 23.021
19.114; 19.117; 30.002 Article 23 para 2 subpara 223.015
Article 19 paras 1 f19.111 Article 23 para 3 11.012; 23.004; 23.010
Article 19 para 1a19.029 Article 24 22.004; 24
Article 19 para 2 19.088; 30.002 Article 24 para 1 24.001; 24.002; 24.006
Article 19 para 3 19.003; 19.087; 30.002 Article 24 para 2 24.001; 24.002; 24.009
Article 19 para 4 lit a 19.013; 19.023 Article 24 para 3 24.001; 24.008
Article 19 para 5 19.004; 19.078; 19.079; Article 25 22.004; 24.002; 24.005; 25; 31.013
19.081; 19.082; 30.002 Article 25 para 1 24.002; 25.002; 25.003;
Article 19 para 5 subpara 119.113 25.009; 25.015; 25.016
Article 19 para 5 subpara 219.113 Article 25 para 1 subpara 2 25.002; 25.012
Article 19 para 6 19.090; 30.002 Article 25 para 1 subpara 3 25.002; 25.009
Article 19 para 7 19.022; 19.024; 19.026; Article 25 para 1 subpara 425.014
19.030; 19.090; 30.002 Article 25 para 2 22.018; 25.002; 25.005;
Article 19 para 7 lit b 3.058; 19.028; 19.029; 25.012
Article 19 para 7 lit c19.030 Article 25 para 3 25.002; 25.011; 25.016
Article 19 para 7 subpara 319.029 Article 25 para 4 25.002; 25.006; 25.009;
Article 19 para 819.070–19.072 25.012; 25.015; 25.016
Article 19 para 919.071 Article 25 para 5 25.015; 25.016
Article 19 para 10 3.054; 19.038 Article 25 para 6 25.002; 25.003; 25.007;
Article 19 para 11 5.032; 6.030; 19.004; 25.008; 25.015; 25.016
19.098–19.100; 19.103; 19.105; 19.106; Article 25 para 7 25.005; 25.016; 25.019
19.110; 19.113; 30.002 Article 25 para 8 25.013; 25.020
Article 19 para 1219.106 Article 25 para 8 subpara 125.002
Article 19 para 12 lit b19.109 Article 25 para 8 subpara 225.002
Article 19 paras 12 f 19.101; 19.111 Article 25 para 8 subpara 325.013
Article 20 1.003; 20; 21.001; 30.008 Article 25 para 925.022
Article 20 para 1 3.066; 20.001; 20.003; Article 26 22.004; 24.005; 25.021; 26
20.005; 30.002 Article 26 para 1 26.007; 26.008; 26.012
Article 20 para 2 20.007; 20.008; 20.010 Article 26 para 2 26.001; 26.006; 26.010;
Article 20 para 3 20.002; 20.011; 20.012 26.012–26.016
Article 21 1.003; 12.029; 21 Article 26 para 3 26.001; 26.009; 26.011
Article 21 lit a21.016 Article 27 24.005; 25.021; 26.009; 26.017; 27;
Article 21 lit b 21.016; 21.018; 21.019 32.008
Chapter 4 MAR (Arts 22–29)1.003 Article 27 para 127.009
Article 22 3.036; 11.022; 17.004; 22; 23.001; Article 27 para 2 26.011; 27.008; 27.009
23.004 Article 27 para 3 27.001; 27.004; 27.005;
Article 23 22.004; 22.010; 23 27.007; 27.008; 27.009
Article 23 para 1 23.006; 23.007 Article 28 24.005; 27.002; 27.010; 28; 32.008
xliii
Article 29 24.005; 27.002; 27.011; 29; 32.008 Regulation (EC) 45/2001 of the European
Chapter 5 MAR (Arts 30–35)1.003 Parliament and of the Council of 18 December
Article 30 8.011; 8.034; 8.087; 8.106; 2000 on the protection of individuals with
14.002; 14.013; 22.004; 22.010; 25.014; regard to the processing of personal data by
26.015; 30; 31.012 the Community institutions and bodies and
Article 30 para 1 16.007; 30.010; 33.003 on the free movement of such data [2001] OJ
Article 30 para 1 lit a 10.002; 14.013 L 8/127.010
Article 30 para 1 subpara 2 30.011; 33.003 Council Regulation (EC) 1/2003 of 16 December
Article 30 para 230A.001 2002 on the implementation of the rules on
Article 30 para 2 lits a–g 18.063; 30.009; competition laid down in Articles 81 and 82
30.012 of the Treaty [2003] OJ L 1/1
Article 30 para 2 lit h 30.006; 30.012 Article 2023.013
Article 30 para 2 lit i 18.063; 30.012 Article 2123.015
Article 30 para 2 lit j 10.002; 18.063; 30.008; Commission Regulation (EC) 2273/2003 of 22
30.012 December 2003 implementing Directive
Article 30 para 2 subpara 330.008 2003/6/EC as regards exemptions for
Article 31 14.002; 22.004; 22.010; 26.015; 31 buy-back programmes and stabilisation of
Article 31 para 1 18.063; 31.001; 31.003; financial instruments [2003] OJ L 336/33
31.004 5.007
Article 31 para 1 lit a31.005 Council Regulation (EC) 139/2004 of 20 January
Article 31 para 1 lit b31.006 2004 on the control of concentrations between
Article 31 para 1 lit c31.007 undertakings (EC Merger Regulation)
Article 31 para 1 lit d31.008 [2004] 24/1
Article 31 para 1 lit e31.009 Article 3 para 1 lit b 11.012; 11.013
Article 31 para 1 lit f31.010 Commission Regulation (EC) 1287/2006 of
Article 31 para 1 lit g31.011 10 August 2006 implementing Directive
Article 31 para 2 25.015; 31.002; 31.013 2004/39/EC of the European Parliament
Article 32 14.002; 32 and of the Council as regards record-keeping
Article 32 para 1 32.001; 32.004 obligations for investment firms, transaction
Article 32 para 232.001 reporting, market transparency, admission of
Article 32 para 2 lit a 32.005 financial instruments to trading, and defined
Article 32 para 2 lit b32.006 terms for the purposes of that Directive
Article 32 para 2 lit c 32.008 [2006] OJ L 241/1
Article 32 para 3 32.001; 32.009 Article 2 para 13.038
Article 32 para 432.010 Regulation (EC) 864/2007 of the European
Article 3333 Parliament and of the Council of 11 July
Article 33 para 1 33.003; 33.008 2007 on the law applicable to non-contractual
Article 33 para 2 33.003; 33.008 obligations (Rome II) [2007] OJ L 199/40
Article 33 para 333.006 30A.016; 30A.066; 30A.070
Article 33 para 533.007 Recital 7 30A.073; 30A.088
Article 34 33.006; 34 Recital 1430A.076
Article 34 para 1 subpara 3 34.003; 34.008; Recital 3130A.089
34.009 Article 1 para 130A.067
Article 34 para 334.010 Article 1 para 2 lit c30A.068
Article 35 para 219.005 Article 1 para 2 lit d30A.069
Article 36 para 232.013 Article 2 para 130A.071
Article 39 para 3 31.003; 32.003; 34.011 Article 330A.080
Annex I 12.001; 12.037 Article 4 30A.066; 30A.080
Annex I Section B 12.019; 12.021 Article 4 para 1 30A.071–30A.075; 30A.077;
Annex II12.001 30A.078
Council Regulation (EC) 44/2001 of 22 December Article 4 para 2 30A.075; 30A.076
2000 on jurisdiction and the recognition Article 4 para 3 30A.075–30A.077; 30A.079
and enforcement of judgements in civil and Article 1430A.066
commercial matters (Brussels I) [2001] OJ L Article 14 para 1 30A.081; 30A.087
12/1 Article 14 para 1 lit b30A.087–30A.091
Recital 1330A.047 Article 14 para 230A.090
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Article 14 para 330A.090 Article 12 24.005; 25.005; 26.016

Article 1530A.080 Article 13 24.005; 25.005; 26.016
Article 1630A.080 Article 14 24.005; 26.016
Article 1730A.080 Article 15 24.001; 24.005; 24.008; 25.005;
Article 2430A.080 33.007; 33.008
Article 2630A.080 Article 15 para 111.015
Article 2730A.078 Article 16 8.005; 24.005; 25.005; 33.003
Regulation (EC) 593/2008 of the European Article 16 para 37.007
Parliament and of the Council of 17 June Article 17 24.005; 25.005; 25.018; 25.019
2008 on the law applicable to contractual Article 17 para 624.005
obligations (Rome I) [2008] OJ L 177/6 Article 18 24.005; 25.005
Recitals 28ff30A.060 Article 18 para 424.005
Article 1 para 2 lit f30A.069 Article 19 24.005; 25.005; 25.016; 25.017;
Article 3 para 530A.088 25.019
Article 4 para 1 lit b30A.056 Article 19 para 424.005
Article 4 para 1 lit h30A.060 Article 3033.002
Article 6 para 130A.089 Article 31 24.004; 24.005
Article 6 para 4 lit d30A.060 Article 33 26.003; 26.006; 33.003
Article 6 para 4 lit e30A.060 Article 35 24.001; 24.006; 24.007
Article 1030A.088 Article 35 para 224.006
Article 11 para 130A.060 Article 35 para 524.007
Article 11 para 1330A.060 Article 35 para 624.007
Regulation (EU) 1031/2010 of the Commission Regulation (EU) 182/2011 of the European
of 12 November 2010 on the timing, Parliament and of the Council of 16 February
administration and other aspects of the 2011 laying down the rules and general
auctioning of greenhouse gas emission principles concerning mechanisms for control
allowances pursuant to Directive 2003/87/ by Member States of the Commission’s
EC of the European Parliament and of the exercise of implementing powers [2011] OJ L
Council establishing a scheme for greenhouse 55/2013.32.013
gas emission allowances trading within the Regulation (EU) 1227/2011 of the European
Community [2010] OJ L 302/1 2.009; Parliament and of the Council of 25 October
4.003; 8.062; 18.008 2011 on wholesale energy market integrity
Recital 142.009 and transparency (REMIT) [2011] OJ L
Article 43.045 326/1 2.012; 25.010
Articles 36–437.040 Article 1 para 27.040
Regulation (EU) 1093/2010 of the European Article 2 para 17.040
Parliament and of the Council of 24 November Article 2 (4)3.050
2010 establishing a European Supervisory Article 2 (10)3.052
Authority (European Banking Authority), Articles 3–525.010
amending Decision No 716/2009/EC and Article 725.010
repealing Commission Decision 2009/78/EC Article 1025.010
[2010] OJ L 331/12 Article 1625.011
Article 3326.003 Article 16 para 4c25.011
Regulation (EU) 1095/2010 of the European Regulation (EU) 236/2012 of the European
Parliament and of the Council of 24 Parliament and of the Council of 14 March
November 2010 establishing a European 2012 on short selling and certain aspects of
Supervisory Authority (European Securities credit default swaps [2012] OJ L86/1
and Markets Authority) (ESMA Regulation) Article 2830A.007
[2010] OJ L 331/8424.004 Regulation (EU) 648/2012 of the European
Article 8 para 1 lit b33.002 Parliament and of the Council of 4 July 2012
Article 8 para 424.004 on OTC derivatives, central counterparties
Article 10 24.005; 26.016 and trade repositories (EMIR) [2012] OJ L
Article 10 para 111.016 201/1
Article 11 24.005; 25.005; 26.016 Article 2 para 19.031
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Regulation (EU) No 1215/2012 of the European Article 26 para 15.028

Parliament and of the Council of 12 Article 26 para 25.028
December 2012 on jurisdiction and the Article 26 para 35.028
recognition and enforcement of judgments Regulation (EU) 655/2014 of the European
in civil and commercial matters (Brussels Ia) Parliament and of the Council of 15 May 2014
[2012] OJ L 351/1 establishing a European Account Preservation
30A.016; 30A.044; 30A.064; 30A.066 Order procedure to facilitate cross-border
Recital 1430A.047 debt recovery in civil and commercial matters
Recital 1630A.073 [2014] OJ L 189/59
Recital 1830A.047 Article 4 (4) lit a30A.056
Recital 1930A.047 Regulation (EU) 1286/2014 of the European
Article 4 para 1 30A.044; 30A.045; 30A.065 Parliament and of the Council of 26 November
Article 530A.045 2014 on key information documents
Article 630A.045 for packaged retail and insurance-based
Article 7 (2)30A.044; investment products (PRIIPs Regulation)
30A.050; 30A.053; 30A.055–30A.058; [2014] OJ L 352/1
30A.063; 30A.065; 30A.072–30A.074 Article 11 30A.004; 30A.008
Article 830A.065 Article 11 para 230A.013
Articles 17–19 30A.047; 30A.049 Regulation (EU) 2015/848 of the European
Article 17 para 1 30A.048; 30A.049 Parliament and of the Council of 20 May
Article 17 para 1 lit c30A.048 2015 on insolvency proceedings [2015] OJ L
Article 18 para 1 30A.044; 30A.047 141/19
Article 25 para 1 30A.081–30A.084; 30A.086; Article 2 (9)30A.056
30A.088; 30A.091 Article 6 para 130A.061
Article 26 para 1 30A.044; 30A.065 Commission Implementing Regulation (EU)
Article 63 para 1 30A.044; 30A.046; 30A.065 2016/347 of 10 March 2016 laying down
Article 7630A.045 implementing technical standards with
Regulation (EU) 462/2013 of the European regard to the precise format of insider lists
Parliament and of the Council of 21 May 2013 and for updating insider lists in accordance
amending Regulation (EC) No 1060/2009 with Regulation (EU) No 496/2014 of the
on credit rating agencies (Rating Agency European Parliament and of the Council
Regulation) [2013] OJ L146/1 (MM-Insider Lists Regulation) [2016] OJ L
Article 35a 30A.004; 30A.008 65/4918.024; 18.026; 18.030; 18.063; 18.065
Article 35a para 130A.013 Recital 218.026
Regulation (EU) 575/2013 of the European Recital 318.027
Parliament and of the Council of 26 June Recital 418.029
2013 on prudential requirements for credit Recital 718.035
institutions and investment firms and Recital 9 18.034; 18.057
amending Regulation (EU) No 648/2012 Article 218.035
(CRR) [2013] OJ L 176/1 Article 2 para 218.029
Article 4 para 1 (1) 3.016; 3.017 Article 2 para 318.035
Article 4 para 1 (26) 3.018; 3.019 Article 2 para 518.057
Regulation (EU) 600/2014 of the European Article 318.034
Parliament and of the Council of 15 May Annex I18.026
2014 on markets in financial instruments and Annex II 18.014; 18.034
amending Regulation (EU) No 648/2012 Commission Implementing Regulation (EU)
(MiFIR) [2014] OJ L 173/843.009 2016/378 of the Commission of 11 March
Recital 9 2.006; 3.031 2016 laying down implementing technical
Article 2 para 1 (30)3.053 standards with regard to the timing,
Article 619.075 format and template for the submission of
Article 1019.075 notifications to the competent authorities
Article 2019.075 according to Regulation (EU) 596/2014 of
Article 2119.075 the European Parliament and of the Council
Article 25 para 15.028 [2016] OJ L72/1 4.008; 4.010
Article 25 para 25.028
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Commission Delegated Regulation (EU) 2016/522 Recital 213.013

of 17 December 2015 supplementing Commission Delegated Regulation (EU)
Regulation (EU) No 596/2014 as regards an 2016/957 supplementing Regulation (EU)
exemption for certain third countries public No 596/2014 of the European Parliament
bodies and central banks, the indicators and of the Council with regard to regulatory
of market manipulation, the disclosure technical standards for the appropriate
thresholds, the competent authority for arrangements, systems and procedures as
notifications of delays, the permission for well as notification templates to be used for
trading during closed periods and types of preventing, detecting and reporting abusive
notifiable managers' transactions [2015] OJ L practices or suspicious orders or transactions
88/1 12.001; 12.014; 19.005 (MM-Compl-Regulation) [2016] OJ L
Recital 812.016 160/1
Recital 3019.023 Article 316.003
Article 5 7.042; 17.114; 19.077 Article 416.003
Article 630A.079 Commission Delegated Regulation (EU) 2016/958
Article 719.107 of 9 March 2016 supplementing Regulation
Article 8 19.107; 19.110 No 596/2014 with regard to regulatory
Article 9 19.109; 19.110 technical standards for the technical
Article 10 19.032; 19.034 arrangements for objective presentation
Article 10 para 2 8.044; 19.019; 19.034 of investment recommendations or other
Article 10 para 2 lit b19.031 information recommending or suggesting
Article 10 para 2 lit i19.031 an investment strategy and for disclosure of
Article 10 para 2 lit k19.034 particular interests or indications of conflicts
Annex II 12.034; 12.037 of interest [2016] OJ L 160/1520.002;
Commission Implementing Regulation (EU) 20.011
2016/523 laying down implementing technical Article 3 para 120.004
standards with regard to the format and Article 3 para 1 lit a20.004
template for notification and public disclosure Article 3 para 1 lit b20.004
of managers’ transactions in accordance with Article 3 para 1 lit c20.004
Regulation (EU) No 596/2014 [2016] OJ L Article 3 para 1 lit d20.004
88/19 19.005; 19.092; 19.096 Article 3 para 1 lit e20.004
Annex19.093 Article 520.005
Regulation (EU) 2016/679 of the European Article 620.006
Parliament and of the Council of 27 April Commission Implementing Regulation (EU)
2016 on the protection of natural persons 2016/959 of 17 May 2016 laying down
with regard to the processing of personal implementing technical standards for market
data and on the free movement of such data, soundings with regard to the systems and
and repealing Directive 95/46/EC (GDPR) notification templates to be used by disclosing
[2016] OJ L 119/1 27.010; 27.011; 34.008 market participants and the format of the
Article 1 para 134.008 records in accordance with Regulation (EU)
Article 4 (1)27.010 No 596/2014 of the European Parliament and
Article 4526.018 of the Council [2016] OJ L 160/23
Article 4626.018 11.005; 11.010; 11.015; 11.017
Article 9427.010 Recitals 2 f10.012
Commission Delegated Regulation (EU) Article 111.017
2016/908 of 26 February 2016 supplementing Article 211.019
Regulation (EU) No 596/2014 laying down Article 3 para 1 11.017; 11.020
regulatory technical standards on the criteria, Article 411.021
the procedure and the requirements for Annex I11.019
establishing an accepted market practice Annex II11.019
and the requirements for maintaining it,
terminating it or modifying the conditions for
its acceptance [2016] OJ L 153/313.017
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Commission Delegated Regulation (EU) Article 55.033

2016/960 of 17 May 2016 supplementing Article 6 5.033; 5.039
Regulation (EU) No 596/2014 with regard Article 6 para 45.040
to regulatory technical standards for the Article 75.033
appropriate arrangements, systems and Article 8 5.033; 5.041
procedures for disclosing market participants Commission Implementing Regulation (EU)
conducting market soundings [2016] OJ L 2016/1055 of 29 June 2016 laying down
160/29 11.010; 11.015–11.017 implementing technical standards with
Recital 1 10.020; 11.004; 11.016 regard to the technical means for appropriate
Recital 410.023 public disclosure of inside information and
Recital 5 10.016; 11.002; 11.005; 11.016; for delaying the public disclosure of inside
11.023 information in accordance with Regulation
Article 2 para 1 10.012; 11.019 (EU) No 596/2014 [2016] OJ L 173/47
Article 2 para 211.019 17.068; 19.005
Article 3 para 111.019 Recital 1 7.002; 7.018
Article 3 para 211.019 Article 2 para 1 lit a 7.018; 17.068
Article 3 para 3 10.020; 11.019 Article 2 para 1 lit b17.068
Article 3 para 411.019 Article 317.069
Article 3 para 511.019 Article 3 lit a7.018
Article 4 para 1 11.017; 11.020 Article 4 para 1 lit c 10.015; 10.020
Article 4 para 211.018 Article 4 para 217.090
Article 5 11.016; 11.021 Article 11 para 210.015
Article 6 11.016; 11.017; 11.022 Article 11 para 2 lit c10.020
Article 6 para 311.020 Commission Delegated Regulation (EU) 2017/565
Regulation (EU) 2016/1011 of 8 June 2016 on of 25 April 2016 supplementing Directive
indices used as benchmarks in financial 2014/65/EU as regards organisational
instruments and financial contracts or to requirements and operating conditions for
measure the performance of investment funds investment firms and defined terms for the
and amending Directive 2008/48/EC and purposes of that Directive [2016] OJ L 87/1
2014/17/EU and Regulation (EU) 596/2014 Article 4 para 1 (40)3.063
(Benchmark Regulation) [2016] OJ L 171/1 Articles 28ff9.009
12.030 Article 3011.010
Article 3 para 1 (8)20.007 Articles 33ff9.009
Article 5619.029 Annex II11.010
Regulation (EU) 2016/1033 of 23 June 2016 Regulation (EU) 2017/1129 of the European
amending Regulation (EU) 600/2014 on Parliament and of the Council of 14 June
markets in financial instruments, Regulation 2017 on the prospectus to be published when
(EU) No 596/2014 on market abuse and securities are offered to the public or admitted
Regulation (EU) No 909/2014 on improving to trading on a regulated market, and
securities settlement in the European Union repealing Directive 2003/71/EC (Prospectus
and on central securities depositories17.082 Regulation) [2017] OJ L 168/12
Article 417.083 20.008; 22.015
Commission Delegated Regulation (EU) Recital 7030A.078
2016/1052 of 8 March 2016 supplementing Article 1 para 130A.078
Regulation No 596/2014 with regard Article 1 para 2 lit a20.008
to regulatory technical standards for the Article 1 para 2 lit c20.008
conditions applicable to buy-back programmes Article 1 para 4 lit e20.008
and stabilisation measures5.005; 5.021; 5.031 Article 1 para 4 lit h20.008
Article 1 lit e5.041 Article 1 para 4 lit i20.008
Article 2 para 15.025 Article 2 lit e11.010
Article 2 para 2 5.023; 5.027; 5.028 Article 11 para 230A.013
Article 3 para 35.029 Articles 25 f30A.079
Article 4 para 35.032
xlviii
Commission Implementing Regulation (EU) Recital 610.026

2017/1158 of 29 June 2017 laying down Recital 6 para 2 11.007; 11.010
implementing technical standards with regards Article 111.010
to the procedures and forms for competent Regulation (EU) 2019/2175 of the European
authorities exchanging information with the Parliament and of the Council of 18
European Securities Market Authority as December 2019 amending Regulation (EU)
referred to in Article 33 of Regulation (EU) No  1093/2010 establishing a European
No 596/2014 of the European Parliament and Supervisory Authority (European Banking
of the Council [2017] OJ L 167/22 Authority), Regulation (EU) No 1094/2010
33.004; 33.008 establishing a European Supervisory
Recital 233.004 Authority (European Insurance and
Recital 333.004 Occupational Pensions Authority),
Recital 433.003 Regulation (EU) No 1095/2010 establishing
Article 233.004 a European Supervisory Authority (European
Article 3 para 233.003 Securities and Markets Authority),
Annex I33.004 Regulation (EU) No 600/2014 on markets
Commission Implementing Regulation (EU) in financial instruments, Regulation (EU)
2018/292 of 26 February 2018 laying down 2016/1011 on indices used as benchmarks in
implementing technical standards with regard financial instruments and financial contracts
to procedures and forms for exchange of or to measure the performance of investment
information and assistance between competent funds, and Regulation (EU) 2015/847 on
authorities according to Regulation (EU) No information accompanying transfers of funds
596/2014 of the European Parliament and [2019] OJ L 334/124.005
of the Council on market abuse [2018] OJ L Commission Implementing Regulation (EU)
55/34 25.004; 25.009; 25.022; 27.009 2020/1406 of 2 October 2020 laying
Article 5 para 325.006 down implementing technical standards
Article 825.007 with regard to procedures and forms for
Article 925.008 exchange of information and cooperation
Article 1025.015 between competent authorities, ESMA,
Annex I–III25.004 the Commission and other entities under
Annex IV25.015 Articles 24 (2) and 25 of Regulation (EU) No
Regulation (EU) 2018/1725 of the European 596/2014 of the European Parliament and
Parliament and of the Council of 23 October of the Council on market abuse [2020] OJ L
2018 on the protection of natural persons 325/7
with regard to the processing of personal data 24.009; 25.009; 25.011; 25.012; 25.022
by the Union institutions, bodies, offices and Article 1025.011
agencies and on the free movement of such
data, and repealing Regulation (EC) No
45/2001 and Decision No 1247/2002/EC
[2018] OJ L 295/3927.010 EU DIRECTIVES
Commission Delegated Regulation (EU) 2019/461
of 30 January 2019 amending Delegated Council Directive 79/279/EEC of 5 March 1979
Regulation (EU) 2016/522 as regards the coordinating the conditions for the admission
exemption of the Bank of England and the of securities to official stock exchange listing
United Kingdom Debt Management Office [1979] OJ L 66/21 17.006; 7.011
from the scope of Regulation (EU) No Schedule C7.011
596/2014 of the European Parliament and of Council Directive 85/374/EEC of 25 July 1985
the Council [2019] OJ L 80/106.010 on the approximation of the laws, regulations
Recitals 6ff6.010 and administrative provisions of the Member
Regulation (EU) 2019/2115 of the European States concerning liability for defective
Parliament and of the Council of 27 November products (Product Liability Directive) [1985]
2019 amending Directive 2014/65/EU and OJ L 210/29 30A.008
Regulations (EU) No 596/2014 and (EU)
2017/1129 as regards the promotion of the
use of SME growth markets [2019] OJ L
320/111.007
xlix
Council Directive 89/592/EEC of 13 November Article 3 para 1 8.023; 11.007

1989 coordinating regulations on insider Article 3 lit a 10.014; 11.007
dealing (IDD) [1989] OJ L 334/30 Article 3 lit b 8.004; 8.097; 8.105
7.005; 7.006; 7.017; 7.028; 8.079; 10.004; Article 3 para 39.006
10.021; 17.006 Article 4 7.001; 8.004; 10.009
Recital 137.016 Article 6 7.003; 17.006
Article 1 para 1 7.003; 7.020 Article 102.017
Article 28.004 Article 1122.003
Article 2 para 28.004 Article 12 23.002; 23.003
Article 48.004 Article 12 para 2 23.009; 23.012; 23.013;
Council Directive 93/13/EEC of 5 April 1993 23.020
on unfair terms in consumer contracts Article 12 para 2 lit a23.012
(Unfair Terms Directive) [1993] OJ L 95/29 Article 12 para 2 lit b23.012
30A.090 Article 12 para 2 lit c23.013
Article 3 para 230A.090 Article 12 para 2 lit d23.018
Directive 95/46/EC of the European Parliament Article 12 para 2 lit f23.012
and of the Council of 24 October 1995 on the Article 12 para 2 lit g23.012
protection of individuals with regard to the Article 12 para 2 lit h23.012
processing of personal data and on the free Article 1327.001
movement of such data [1995] OJ L 281/31 Article 14 para 123.017
27.010; 27.011 Article 15a24.003
Directive 2002/58/EC of the European Article 1625.001
Parliament and of the Council of 12 July 2002 Directive 2003/87/EC of the European Parliament
concerning the processing of personal data and of the Council of 13 October 2003
and the protection of privacy in the electronic establishing a scheme for greenhouse gas
communications sector (Directive on privacy emission allowance trading within the the
and electronic communications) [2002] OJ L Union and amending Council Directive
201/37 96/61/EC (Emissions Trading Scheme
Article 2 para 2 lit b3.057 Directive) [2003] OJ L 275/323.044
Directive 2003/6/EC of the European Parliament Article 3 lit e3.047
and of the Council of 28 January 2003 on Annex I3.047
insider dealing and market manipulation Commission Directive 2003/124/EC of 22
(Market Abuse Directive – MAD) [2003] OJ December 2003 implementing Directive
L 96/16 1.003; 1.007;1.008; 2.001; 2003/6/EC as regards the definition and
5.007; 7.004; 7.006; 7.008; 7.017; 7.026; 7.028; public disclosure of inside information and
7.032; 7.040; 8.007; 8.008; 8.079; 8.083; the definition of market manipulation [2003]
9.052; 10.002; 10.004; 11.007; 11.018; OJ L 339/70 7.004; 7.024; 12.004
15.002; 23.002; 23.017; 26.003; 33.001 Article 1 para 1 7.003; 7.005; 7.020
Recital 51.003 Article 1 para 2 7.003; 7.028
Recital 18 9.006; 9.034 Directive 2004/25/EC of the European Parliament
Recital 249.006 and of the Council of 21 April 2004 on
Recital 299.006 takeover bids [2004] OJ L 142/12
Recital 30 9.006; 9.068 Article 2 para 1 lit a 9.055; 11.012
Recital 317.016 Article 9 para 29.074
Recital 3723.002 Directive 2004/39/EC of the European Parliament
Article 1 para 1 7.003; 7.020 and of the Council of 21 April 2004 on
Article 1 para 1 subpara 2 7.036; 7.037 markets in financial instruments amending
Article 1 para 1 subpara 37.043 Council Directives 85/611/EEC and 93/6/
Article 1 para 1 (2)12.004 EEC and Directive 2000/12/EC of the
Article 1 para 2 lit a12.004 European Parliament and of the Council
Article 2 para 1 8.004; 8.045 and repealing Council Directive 93/22/EEC
Article 2 para 2 8.004; 8.008; 8.034 (MiFID I) [2004] OJ L 145/1
Article 2 para 39.041 2.004; 2.005; 2.009; 3.001; 3.002; 3.004; 3.005;
Article 3 7.001; 7.006 3.014; 3.021; 3.025; 3.028
l
Article 4 para 1 (1)3.004 Directive 2011/61/EU of the European

Article 4 para 1 (15)3.028 Parliament and of the Council of 8 June 2011
Article 2524.003 on Alternative Investment Fund Managers
Article 62a24.003 and amending Directives 2003/41/EC and
Annex I Section C19.019 2009/65/EC and Regulations (EC) No
Commission Directive 2004/72/EC of 29 April 1060/2009 and (EU) No 1095/2010 [2011]
2004 implementing Directive 2003/6/EC of OJ L 174/122.015
the European Parliament and of the Council Directive 2012/30/EU of the European Parliament
as regards accepted market practices, the and of the Council of 25 October 2012 on
definition of inside information in relation to coordination of safeguards which, for the
derivatives on commodities, the drawing up of protection of the interests of members and
lists of insiders, the notification of managers' others, are required by Member States of
transactions and the notification of suspicious companies within the meaning of the second
transactions [2004] OJ L 162/70 paragraph of Article 54 of the Treaty on
Article 47.036 the Functioning of the European Union, in
Directive 2004/109/EC of the European respect of the formation of public limited
Parliament and of the Council of 15 liability companies and the maintenance
December 2004 on the harmonisation of and alteration of their capital, with a view
transparency requirements in relation to to making such safeguards equivalent [2012]
information about issuers whose securities are 315/74
admitted to trading on a regulated market and Articles 21 f5.015
amending Directive 2001/34/EC [2004] OJ Articles 21–273.042
L 390/3822.015 Directive 2013/34/EU of the European Parliament
Articles 9ff9.071 and of the Council of 26 June 2013 on the
Directive 2007/36/EC of the European Parliament annual financial statements, consolidated
and of the Council of 11 July 2007 on the financial statements and related reports of
exercise of certain rights of shareholders in certain types of undertakings, amending
listed companies [2007] OJ L 132/1 Directive 2006/43/EC of the European
Article 9 10.028; 10.029 Parliament and of the Council and repealing
Directive 2009/65/EC of the European Council Directives 78/660/EEC and 83/349/
Parliament and of the Council of 13 July EEC [2013] OJ L 182/19
2009 on the coordination of laws, regulations Arts 30ff10.024
and administrative provisions relating to Directive 2013/36/EU of the European Parliament
undertakings for collective investment in and of the Council of 26 June 2013 on access
transferable securities (UCITS) [2009] OJ L to the activity of credit institutions and the
302/3222.015 prudential supervision of credit institutions
Directive 2009/138/EC of the European and investment firms, amending Directive
Parliament and of the Council of 25 2002/87/EC and repealing Directives
November 2009 on the taking-up and pursuit 2006/48/EC and 2006/49/EC (CRD IV)
of the business of Insurance and Reinsurance [2013] OJ L 176/3383.009
(Solvency II) [2009] OJ L 335/1 Article 4 para 422.015
Article 63 27.003; 27.004 Article 5327.007
Article 63 para 127.004 Article 54 27.003; 27.007; 27.008
Articles 63ff27.008 Article 54 para 127.004
Article 212 para 1 lit f 3.018 Article 55 26.003; 26.006; 27.007; 27.008
Article 212 para 1 lit g3.018 Article 5627.008
Articles 65ff23.010
Annex I (2)–(12)3.018
Annex I (15)3.018
li
Directive 2013/50/EU of the European Parliament Directive 2014/65/EU of the European

and of the Council of 22 October 2013 Parliament and of the Council of 15 May
amending Directive 2004/109/EC of the 2014 on markets in financial instruments
European Parliament and of the Council and amending Directive 2002/92/EC and
on the harmonisation of transparency Directive 2011/61/EU (MiFID II) [2014] OJ
requirements in relation to information L 173/3492.002;
about issuers whose securities are admitted 2.004–2.006; 2.009; 3.001–3.003; 3.009;
to trading on a regulated market, Directive 3.014; 3.015; 3.020–3.022; 3.026; 3.028;
2003/71/EC of the European Parliament 3.030; 7.040; 16.004; 22.015
and of the Council on the prospectus to Recital 133.030
be published when securities are offered Recital 1213.021
to the public or admitted to trading and Recital 1323.035
Commission Directive 2007/14/EC laying Article 330.001
down detailed rules for the implementation Article 430.001
of certain provisions of Directive 2004/109/ Article 4 para 1 (1) 3.004; 3.006; 3.014
EC (Transparency Directive) [2013] OJ L Article 4 para 1 (7) 3.060; 9.030
294/13 3.028; 30A.026 Article 4 para 1 (12)3.035
Article 1 para 130A.078 Article 4 para 1 (13)3.035
Article 1630A.078 Article 4 para 1 (15) 2.002; 3.001
Articles 28–28c30A.013 Article 4 para 1 (18)3.020
Directive 2014/57/EU of the European Parliament Article 4 para 1 (21) 2.002; 2.004; 3.023
and of the Council of 16 April 2014 on Article 4 para 1 (22) 2.002; 2.005; 3.027
criminal sanctions for market abuse (market Article 4 para 1 (23) 2.002; 2.006; 3.029
abuse directive; CRIM-MAD) [2014] OJ L Article 4 para 1 (24) 2.002; 3.034; 30A.060
173/179 14.002; 15.013; 22.010; 22.013; Article 4 para 1 (39)3.043
23.017; 30A.001 Article 4 para 1 (40)3.063
Recital 1114.011 Article 4 para 1 (44) lit c3.053
Recital 1315.001 Articles 5ff (Title II) 3.029; 33.006
Recital 2312.031 Article 5 para 19.035
Article 3 10.002; 14.010; 22.013 Article 5 para 333.006
Article 3 para 2 8.054; 14.011 Article 1610.013
Article 522.013 Article 2730A.060
Article 6 para 212.001; 14.005; 14.006; 15.013 Title III (Arts 44–56)3.024
Article 715.013 Article 76 27.003; 27.008
Article 8 8.011; 8.036; 8.064; 14.010 Article 76 para 127.004
Article 8 para 1 lit a8.036 Article 79 para 425.015
Article 8 para 1 lit c8.036 Article 8724.003
Article 8 para 2 9.011; 9.023 Article 88 26.003; 26.006
Article 915.013 Annex I Section A 3.005; 3.014; 9.035
Annex I Section C 3.001; 3.044; 3.065
Annex I Section C para 53.053
Annex I Section C para 6 3.003; 3.053
Annex I Section D3.005
lii
Directive 2014/104/EU of the European Bundes-Verfassungsgesetz (B-VG)

Parliament and of the Council of 26 Article 20 para 23.036
November 2014 on certain rules governing Börsegesetz 1989 (BörseG 1989)
actions for damages under national law Sections 48a-48r3.014
for infringements of the competition law Section 48a para 17.011
provisions of the Member States and of the Section 48a para 1 (2)12.004
European Union (Cartel Damages Directive) Section 48a para 1 (3) lit b13.003
[2014] OJ L 349/1 30A.008 Section 48a para 1 (11)3.014
Directive (EU) 2015/2366 of the European Section 48b para 1 (2)10.014
Parliament and of the Council of 25 Section 48c5.007
November 2015 on payment services in Section 48d17.007
the internal market, amending Directives Section 48d para 117.009
2002/65/EC, 2009/110/EC and 2013/36/ Section 48d para 217.006
EU and Regulation (EU) No 1093/2010, Section 48d para 419.116
and repealing Directive 2007/64/EC (PSD) Section 48e para 52.017
[2015] OJ L 337/353.018 Section 48e para 5a2.017
Commission Implementing Directive (EU) Section 48e para 65.007
2015/2392 of 17 December 2015 on Section 48h32.003
Regulation (EU) No 596/2014 of the Section 48i 32.003; 32.014
European Parliament and of the Council as Section 48j34.011
regards reporting to competent authorities Section 82 para 617.006
of actual or potential infringements of that Section 82 para 105.025
Regulation [2015] OJ L 332/12632.004; Bundesgesetz über die Wertpapier- und
32.007; 32.012 allgemeinen Warenbörsen 2018
Recital 632.007 (Börsegesetz 2018 – BörseG 2018)3.014;
Article 4 para 2 lit a32.005 3.028; 12.005; 12.033
Article 6 para 232.005 Section 1 (17)3.022
Article 6 para 332.005 Sections 3ff3.026
Article 832.006 Section 76 para 13.025
Article 932.008 Sections 80ff3.028
Article 1132.008 Section 823.028
Directive 2017/1132 of the European Parliament Section 11034.011
and of the Council of 14 June 2017 relating Section 117 para 717.025
to certain aspects of company law [2017] OJ Section 118 para 1 (7)5.025
L 169/46 Section 119 para 417.107
Articles 60 f5.015 Section 119 para 617.066
Articles 87ff 9.056; 11.012 Section 119 para 717.071
Article 105 para 1 lit a8.048 Section 119 para 9 5.025; 19.035
Section 119 para 105.025
Sections 124 f19.100
Section 12619.100
NATIONAL LAWS Section 130 17.023; 19.064
Sections 130ff19.042
Austria Section 135 para 219.003
Section 137 19.117
Allgemeines Bürgerliches Gesetzbuch (ABGB) Section 14534.011
Sections 1293ff30A.040 Section 152 3.036; 17.004
Section 131130A.040 Section 154 12.004; 12.007; 30.012
Aktiengesetz (AktG) Section 154 para 212.032
Section 655.015 Section 155 19.113; 33.003
Section 65 para 1 (4) 5.019; 5.025 Section 155 para 1 17.116; 30.012
Section 65 para 1 (6) 5.019; 5.025 Section 155 para 1 (4) 19.104; 19.112
Section 65 para 1 (8) 5.001; 5.025 Section 155 para 2 19.089; 19.114
Section 65 para 1a5.025 Section 155 para 417.090
Section 95 17.098; 19.064 Section 15630.012
Section 1745.019 Section 156 para 117.117
liii
Section 157 17.117; 30.012 Section 1 para 113.019

Section 15831.003 Section 1 para 213.019
Section 15932.003 Verwaltungsstrafgesetz (VStG)
Section 160 32.003; 32.014 Section 512.033
Section 161 33.006; 34.011 Section 9 para 712.033
Section 162 para 2 (2)5.024 Wertpapieraufsichtsgesetz 2007 (WAG 2007)
Bankwesengesetz (BWG) 3.014; 12.033 3.014
Section 1 para 1 3.017; 3.019 Wertpapieraufsichtsgesetz 2018 (WAG 2018)
Section 1 para 1 (1)–(23)3.017 3.014
Section 1 para 2 (1)–(8) 3.019 Section 1 para 1 (1)3.014
Emissionszertifikategesetz 20113.044 Section 33.014
Emittenten-Compliance-Verordnung 2007 Section 3 para 2 3.014
(ECV) Section 10524.003
Article 819.098
Finanzmarktaufsichtsbehördengesetz (FMABG) France
Section 13.036
Gesetz über Gesellschaftem mit beschränkter
Haftung (GmbhG, Limited Liability Code civil (CC)
Companies Act) Article 1430A.045
Section 30j para 5 17.098; 19.041 Article 1530A.045
Section 3519.041 Article 124030A.037
Investmentfondsgesetz 2011 (InvFG) Articles 1240 f30A.055
Section 23.02 Code monétaire et financier (c. mon. fin.)
Jurisdiktionsnorm (JN) Article L321–13.014
Section 9930A.045 Article L421–13.025
Kapitalmarktgesetz (KMG) Articles L421–1ff3.026
Section 1 para 1 (1)20.008 Article L465–1–L465–3-330.012
Section 320.008 Article L511–21 para 43.019
Section 23 para 120.008 Article L531–43.014
Section 23 para 3 (1)20.009 Article L621–1023.011
Section 23 para 3 (2)20.008 Article L621–10–223.011
Section 23 para 3 (3)20.008 Article L621–1223.011
Section 2420.008 Article L621–1323.011
Section 24 para 120.008 Article L621–13–723.011
Section 24 para 220.008 Article L621–13–823.011
Section 24 para 320.008 Article L621–1430.012
Bundesgesetz über die Presse und andere Article L621–15 30.012; 31.003; 34.011
publizistische Medien (MedienG) Article L621–1823.011
Section 2921.014 Article L621–20–123.011
Unternehmensgesetzbuch (UGB) Articles L634–1–L634–432.003
Section 18919.066 règlement général de l'autorité des marchés
Section 189 para 219.063 financiers
Section 24419.066 Article 143–223.011
Verbreitungs- und Meldeverordnung (VMV, Articles 145–1 to 145–432.003
Dissemination and Notification Ordinance), Article 622–110.024
BGBl II 205/2017 Instruction AMF DOC-2018–1332.014
Section 2 para 2 17.028; 17.071
Veröffentlichungs- und Meldeverordnung (VMV, Germany
Disclosure and Reporting Ordinance), BGBl
II 2015/2017 5.025; 17.110 Aktiengesetz
Section 317.070 Section 131 para 3 (5)10.029
Verordnung der Finanzmarktaufsichtsbehörde Bundesanstalt für Finanzdienstleistungsaufsicht
(FMA) über zulässige Marktpraktiken Verstoßmeldeverordnung 2016
an österreichischen Finanzmärkten (BaFinVersMeldV)32.014
(Marktpraxisverordnung–MpV) BGBl II Börsengesetz (BörsG)
2005/1 13.003; 13.019; 17.070 Section 2 para 13.022
liv
Sections 4ff3.026 Market Abuse (Directive 2003/6/EC) Regulations

Section 5 para 732.003 2005, Statutory Instrument No 342 of 5 July
Bürgerliches Gesetzbuch (BGB) 2005 (IRL)
Section 82630A.030 Section 34 para 230A.042
Finanzdienstleistungsaufsichtsgesetz (FinDAG) Statutory Instrument No 349 of 30 June 2016
Section 4d32.003 (IRL)30A.042
Kreditwesengesetz (KWG)
Section 1 para 13.017 Italy
Section 1 para 1 (1)–(12)3.017
Section 25a para 132.003 Codice Civile (CC)
Section 35 para 230.012 Article 204330A.038
Section 36a para 130.012 Legislative Decree no 107 of 10th August 2018,
Gesetz über Ordnungswidrigkeiten (OWiG) Gazzetta Ufficiale Della Repubblica Italiana
30.012 n 2145.047
Section 1731.003 Italian law No 218 of 31 May 1995
Versicherungsaufsichtsgesetz (VAG) Article 430A.045
Wertpapierhandelsgesetz (WpHG) Portugal
Section 2 para 113.025 Código dos Valores Mobiliários (CVM)30A.036
Section 6 para 223.011 Article 7 para 130A.036
Section 6 para 323.011 Articles 149–15430A.036
Section 6 para 5 3.036; 22.007 Article 149 para 1 lit c30A.036
Section 6 para 6 23.011; 30.012 Article 149 para 230A.036
Section 6 para 13 23.011; 30.012 Spain
Section 7 para 123.011 Código Civil (CC)30A.039
Section 7a24.003 Ley del Mercado de Valores (LMV, Securities
Section 8 para 223.011 Code)30A.039
Section 13 para 17.011 Article 2277.001
Section 97 30A.030–30A.035; 30A.070 The Netherlands
Section 97 para 230A.033
Section 98 30A.030–30A.035; 30A.070 Burgerlijk Wetboek (Civil Code)
Section 98 para 230A.033 Article 6:162–230A.041
Section 120 para 14 30.012; 31.003 Article 6:163 30A.041
Section 120 para 15 30.012; 31.003 Listing and Liability Rules of Euronext Amsterdam
Section 120 para 1830.012 Rule 28h30A.041
Section 12534.011 Wet op het financieel toezicht (Securities Act)
Zivilprozessordnung (ZPO) Article 5:25i30A.041
Section 2330A.045 Article 5:5930A.041
Ireland United Kingdom

Investment Funds, Companies and Miscellaneous Criminal Justice Act 1993
Provisions Act 2005 Section 58 para 37.017
Section 3330A.042
lv
Financial Services and Markets Act 2000 DTR 3 5.044; 5.046; 19.118
Section 55J para 7ZB30.012 DTR 5.55.049
Section 90A30A.026–30A.029 DTR 6.317.121
Section 11812.038 EG 4.1223.011
Section 122A23.011 EG 10.323.011
Section 122B23.011 EG 12.1.223.011
Section 122C23.011 MAR 1.4.210.017
Section 122D23.011 MAR 1.4.310.024
Section 122G23.011 MAR 1.4.5 10.015; 10.024; 11.014
Section 122H23.011 MAR 1.4.610.026
Section 122I23.011 MAR 1.612.038
Section 12330.012 MAR 1 Annex 213.020
Section 123A30.012 MAR 25.049
Section 123B23.011 MAR 2.5.15.045
Section 12431.003 MAR 2.5.25.045
Section 131AA32.003 MAR Annex 15.049
Section 38123.011 SUP 15.1016.012
Section 391 para 8B34.011 SYSC 18.3.132.003
Section 424A para 13.014 SYSC 10A.123.011
Schedule 10A30A.026–30A.028 Glossary 3.014; 3.019; 3.022; 3.025
Financial Services and Markets Act 2000 (Market
Abuse) Regulations 2016 United States of America
Section 3 3.036; 22.007
Schedule 32.003; 32.014
FCA Handbook Securities Act (1933)30A.019
DEPP 6.530.012 Securities Exchange Act (1934)30A.019; 30A.023
DEPP 6.5A30.012 Section 10(b) 30A.019; 30A.021; 30A.022
DEPP 6.2.131.003 Rule 10b-5 30A.019; 30A.020; 30A.021;
DTR 15.044 30A.022; 30A.023
DTR 2 5.044; 5.045 Uniform Commercial Code
DTR 2.217.121 Section 5–116 lit b30A.056
DTR 2.5.710.015
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REGULATION (EU) NO 596/2014

OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of 16 April 2014
on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of
the European Parliament and of the Council and Commission Directives 2003/124/
EC, 2003/125/EC and 2004/72/EC
Whereas:
(1) A genuine internal market for financial EU, chaired by Jacques de Larosière (the
services is crucial for economic growth ‘de Larosière Group’).
and job creation in the Union. 4) There is a need to establish a more
2) An integrated, efficient and transparent uniform and stronger framework in order
financial market requires market integ- to preserve market integrity, to avoid
rity. The smooth functioning of securities potential regulatory arbitrage, to ensure
markets and public confidence in markets accountability in the event of attempted
are prerequisites for economic growth and manipulation, and to provide more legal
wealth. Market abuse harms the integrity certainty and less regulatory complexity
of financial markets and public confi- for market participants. This Regulation
dence in securities and derivatives. aims at contributing in a determining
3) Directive 2003/6/EC of the European manner to the proper functioning of the
Parliament and of the Council com- internal market and should therefore be
pleted and updated the Union’s legal based on Article 114 of the Treaty on
framework to protect market integrity. the Functioning of the European Union
However, given the legislative, market (TFEU), as interpreted consistently in
and technological developments since the the case-law of the Court of Justice of the
entry into force of that Directive, which European Union.
have resulted in considerable changes to 5) In order to remove the remaining obsta-
the financial landscape, that Directive cles to trade and the significant dis-
should now be replaced. A new legislative tortions of competition resulting from
instrument is also needed to ensure that divergences between national laws and
there are uniform rules and clarity of to prevent any further obstacles to trade
key concepts and a single rule book in and significant distortions of competition
line with the conclusions of the report from arising, it is necessary to adopt
of 25 February 2009 by the High Level a Regulation establishing a more uniform
Group on Financial Supervision in the interpretation of the Union market abuse
framework, which more clearly defines
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rules applicable in all Member States. on multilateral trading facilities (MTFs).

Shaping market abuse requirements in There are also financial instruments which
the form of a regulation will ensure that are traded only on other types of organ-
those requirements are directly applicable. ised trading facilities (OTFs) or only over
This should ensure uniform conditions the counter (OTC). The scope of this
by preventing diverging national require- Regulation should therefore include any
ments as a result of the transposition of financial instrument traded on a regulated
a directive. This Regulation will require market, an MTF or an OTF, and any
that all persons follow the same rules in other conduct or action which can have
all the Union. It will also reduce regu- an effect on such a financial instrument
latory complexity and firms’ compliance irrespective of whether it takes place on
costs, especially for firms operating on a trading venue. In the case of certain
a cross-border basis, and it will contribute types of MTFs which, like regulated
to eliminating distortions of competition. markets, help companies to raise equity
(6) The Commission Communication of 25 finance, the prohibition against market
June 2008 on ‘A ‘Small Business Act’ abuse also applies where a request for
for Europe’ calls on the Union and its admission to trading on such a market has
Member States to design rules in order been made. The scope of this Regulation
to reduce administrative burdens, to should therefore include financial instru-
adapt legislation to the needs of issuers ments for which an application for admis-
on markets for small and medium-sized sion to trading on an MTF has been
enterprises (SMEs) and to facilitate access made. This should improve investor pro-
to finance for those issuers. A number tection, preserve the integrity of markets
of provisions in Directive 2003/6/EC and ensure that market abuse of such
impose administrative burdens on issuers, instruments is clearly prohibited.
in particular on those whose financial (9) For the purposes of transparency, oper-
instruments are admitted to trading on ators of a regulated market, an MTF or
SME growth markets, which should be an OTF should notify, without delay,
reduced. their competent authority of details of
(7) Market abuse is a concept that encom- the financial instruments which they have
passes unlawful behaviour in the financial admitted to trading, for which there has
markets and, for the purposes of this been a request for admission to trading
Regulation, it should be understood to or that have been traded on their trading
consist of insider dealing, unlawful dis- venue. A second notification should be
closure of inside information and market made when the instrument ceases to be
manipulation. Such behaviour prevents admitted to trading. Such obligations
full and proper market transparency, should also apply to financial instruments
which is a prerequisite for trading for all for which there has been a request for
economic actors in integrated financial admission to trading on their trading
markets. venue and financial instruments that
(8) The scope of Directive 2003/6/EC have been admitted to trading prior to
focused on financial instruments admit- the entry into force of this Regulation.
ted to trading on a regulated market The notifications should be submitted
or for which a request for admission to the European Securities and Markets
to trading on such a market has been Authority (ESMA) by the competent
made. However, in recent years financial authorities and ESMA should publish
instruments have been increasingly traded a list of all of the financial instruments
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notified. This Regulation applies to hibitions against market abuse provided

financial instruments whether or not that the actions are carried out under the
they are included in the list published by necessary transparency, where relevant
ESMA. information regarding the stabilisation or
(10) It is possible that certain financial instru- buy-back programme is disclosed.
ments which are not traded on a trading (12) Trading in own shares in buy-back
venue are used for market abuse. This programmes and Stabilising a financial
includes financial instruments the price instrument which would not benefit from
or value of which depends or has an the exemptions under this Regulation
effect on financial instruments traded should not of itself be deemed to consti-
on a trading venue, or the trading of tute market abuse.
which has an effect on the price or value (13) Member States, members of the European
of other financial instruments traded on System of Central Banks (ESCB), min-
a trading venue. Examples of where such istries and other agencies and special
instruments can be used for market abuse purpose vehicles of one or several Member
include inside information relating to States, and the Union and certain other
a share or bond, which can be used to public bodies or persons acting on their
buy a derivative of that share or bond, behalf should not be restricted in carrying
or an index the value of which depends out monetary, exchange-rate or public
on that share or bond. Where a finan- debt management policy insofar as they
cial instrument is used as a reference are undertaken in the public interest and
price, an OTC-traded derivative can be solely in pursuit of those policies. Neither
used to benefit from manipulated prices, should transactions or orders carried out,
or be used to manipulate the price of or behaviour by, the Union, a special
a financial instrument traded on a trading purpose vehicle of one or several Member
venue. A further example is the planned States, the European Investment Bank,
issue of a new tranche of securities that the European Financial Stability Facility,
do not otherwise fall within the scope the European Stability Mechanism or an
of this Regulation, but where trading international financial institution estab-
in those securities could affect the price lished by two or more Member States, be
or value of existing listed securities that restricted in mobilising funding and pro-
fall within the scope of this Regulation. viding financial assistance to the benefit of
This Regulation also covers the situation its members. Such an exemption from the
where the price or value of an instrument scope of this Regulation may, in accord-
traded on a trading venue depends on ance with this Regulation, be extended
an OTC-traded instrument. The same to certain public bodies charged with, or
principle should apply to spot commodity intervening in, public debt management
contracts the prices of which are based and to central banks of third countries.
on that of a derivative and to the buying At the same time, the exemptions for
of spot commodity contracts to which monetary, exchange-rate or public debt
financial instruments are referenced. management policy should not extend
(11) Trading in securities or associated instru- to cases where those bodies engage in
ments for the stabilisation of securities or transactions, orders or behaviour other
trading in own shares in buy-back pro- than in pursuit of those policies or where
grammes can be legitimate for economic persons working for those bodies engage
reasons and should, therefore, in certain in transactions, orders or behaviour on
circumstances, be exempt from the pro- their own account.
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(14) Reasonable investors base their invest- (17) Information which relates to an event or
ment decisions on information already set of circumstances which is an inter-
available to them, that is to say, on ex mediate step in a protracted process may
ante available information. Therefore, the relate, for example, to the state of contract
question whether, in making an invest- negotiations, terms provisionally agreed
ment decision, a reasonable investor in contract negotiations, the possibility of
would be likely to take into account a par- the placement of financial instruments,
ticular piece of information should be conditions under which financial instru-
appraised on the basis of the ex ante avail- ments will be marketed, provisional terms
able information. Such an assessment has for the placement of financial instru-
to take into consideration the anticipated ments, or the consideration of the inclu-
impact of the information in light of the sion of a financial instrument in a major
totality of the related issuer’s activity, index or the deletion of a financial instru-
the reliability of the source of informa- ment from such an index.
tion and any other market variables likely (18) Legal certainty for market participants
to affect the financial instruments, the should be enhanced through a closer defi-
related spot commodity contracts, or the nition of two of the elements essential
auctioned products based on the emission to the definition of inside information,
allowances in the given circumstances. namely the precise nature of that infor-
(15) Ex post information can be used to check mation and the significance of its poten-
the presumption that the ex ante informa- tial effect on the prices of the financial
tion was price sensitive, but should not be instruments, the related spot commodity
used to take action against persons who contracts, or the auctioned products based
drew reasonable conclusions from ex ante on the emission allowances. For deriva-
information available to them. tives which are wholesale energy prod-
(16) Where inside information concerns ucts, information required to be disclosed
a process which occurs in stages, each in accordance with Regulation (EU) No
stage of the process as well as the overall 1227/2011 of the European Parliament
process could constitute inside informa- and of the Council should, in particular,
tion. An intermediate step in a protracted be considered as inside information.
process may in itself constitute a set of (19) This Regulation is not intended to pro-
circumstances or an event which exists hibit discussions of a general nature
or where there is a realistic prospect that regarding the business and market
they will come into existence or occur, developments between shareholders and
on the basis of an overall assessment of management concerning an issuer. Such
the factors existing at the relevant time. relationships are essential for the efficient
However, that notion should not be inter- functioning of markets and should not be
preted as meaning that the magnitude prohibited by this Regulation.
of the effect of that set of circumstances (20) Spot markets and related derivative
or that event on the prices of the finan- markets are highly interconnected and
cial instruments concerned must be taken global, and market abuse may take place
into consideration. An intermediate step across markets as well as across borders
should be deemed to be inside infor- which can lead to significant systemic
mation if it, by itself, meets the criteria risks. This is true for both insider dealing
laid down in this Regulation for inside and market manipulation. In particular,
information. inside information from a spot market
can benefit a person trading on a financial
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market. Inside information in relation to financial instruments related to wholesale

a derivative of a commodity should be energy products.
defined as information which both meets (21) Pursuant to Directive 2003/87/EC of the
the general definition of inside infor- European Parliament and of the Council
mation in relation to financial markets , the Commission, Member States and
and which is required to be made public other officially designated bodies are,
in accordance with legal or regulatory inter alia, responsible for the technical
provisions at the Union or national level, issuance of emission allowances, their
market rules, contracts or customs on free allocation to eligible industry sectors
the relevant commodity derivative or spot and new entrants and more generally the
market. Notable examples of such rules development and implementation of the
include Regulation (EU) No 1227/2011 Union’s climate policy framework which
for the energy market and the Joint underpins the supply of emission allow-
Organisations Database Initiative (JODI) ances to compliance buyers of the Union’s
database for oil. Such information may emissions trading scheme (EU ETS).
serve as the basis of market participants’ In the exercise of those duties, those
decisions to enter into commodity deriv- public bodies can, inter alia, have access
atives or the related spot commodity to price-sensitive, non-public information
contracts and should therefore constitute and, pursuant to Directive 2003/87/EC,
inside information required to be made may need to perform certain market oper-
public, where it is likely to have a signif- ations in relation to emission allowances.
icant effect on the prices of such deriva- As a consequence of the classification of
tives or related spot commodity contracts. emission allowances as financial instru-
Moreover, manipulative strategies can ments as part of the review of Directive
also extend across spot and derivatives 2004/39/EC of the European Parliament
markets. Trading in financial instru- and of the Council , those instruments
ments, including commodity derivatives, will also fall within the scope of this
can be used to manipulate related spot Regulation.
commodity contracts and spot commod- In order to preserve the ability of the
ity contracts can be used to manipulate Commission, Member States and other
related financial instruments. The pro- officially designated bodies to develop and
hibition of market manipulation should implement the Union’s climate policy, the
capture these inter-linkages. However, it activities of those public bodies, insofar as
is not appropriate or practicable to extend they are undertaken in the public interest
the scope of this Regulation to behaviour and explicitly in pursuit of that policy and
that does not involve financial instru- concerning emission allowances, should
ments, for example, to trading in spot be exempt from the application of this
commodity contracts that only affects Regulation. Such exemption should not
the spot market. In the specific case of have a negative impact on overall market
wholesale energy products, the compe- transparency, as those public bodies
tent authorities should take into account have statutory obligations to operate
the specific characteristics of the defini- in a way that ensures orderly, fair and
tions of Regulation (EU) No 1227/2011 non-discriminatory disclosure of, and
when they apply the definitions of inside access to, any new decisions, develop-
information, insider dealing and market ments and data that have a price-sensitive
manipulation under this Regulation to nature. Furthermore, safeguards of fair
and non-discriminatory disclosure of spe-
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cific price-sensitive information held by the application of this Regulation. Such

public authorities exist under Directive exemption should not have a negative
2003/87/EC and the implementing impact on overall market transparency, as
measures adopted pursuant thereto. At those public bodies have statutory obli-
the same time, the exemption for public gations to operate in a way that ensures
bodies acting in pursuit of the Union’s orderly, fair and non-discriminatory
climate policy should not extend to cases disclosure of, and access to, any new
in which those public bodies engage in decisions, developments and data that
conduct or in transactions which are not have a price-sensitive nature. At the same
in the pursuit of the Union’s climate time, the exemption for public bodies
policy or when persons working for those acting in pursuance of the CAP and the
bodies engage in conduct or in transac- CFP should not extend to cases where
tions on their own account. those public bodies engage in conduct or
(22) Pursuant to Article 43 TFEU and to in transactions which are not in pursu-
the implementation of international ance of the CAP and the CFP or where
agreements concluded under the TFEU, persons working for those bodies engage
the Commission, Member States and in conduct or in transactions on their own
other officially designated bodies are, account.
inter alia, responsible for pursuing the 23) The essential characteristic of insider
Common Agricultural Policy (CAP) and dealing consists in an unfair advantage
the Common Fisheries Policy (CFP). In being obtained from inside information
the exercise of those duties, those public to the detriment of third parties who
bodies undertake activities and take meas- are unaware of such information and,
ures aiming to manage the agricultural consequently, the undermining of the
markets and fisheries, including those of integrity of financial markets and investor
public intervention, imposing additional, confidence. Consequently, the prohibi-
or suspending, import duties. In the light tion against insider dealing should apply
of the scope of this Regulation, certain where a person who is in possession of
provisions thereof that apply to spot com- inside information takes unfair advantage
modity contracts which have or which of the benefit gained from that informa-
are likely to have an effect on financial tion by entering into market transactions
instruments and financial instruments the in accordance with that information by
value of which depends on the value acquiring or disposing of, by attempting
of spot commodity contracts and which to acquire or dispose of, by cancelling or
have or which are likely to have an effect amending, or by attempting to cancel or
on spot commodity contracts, it is nec- amend, an order to acquire or dispose of,
essary to ensure that the activity of the for his own account or for the account of
Commission, Member States and other a third party, directly or indirectly, finan-
bodies officially designated to pursue the cial instruments to which that information
CAP and the CFP, is not restricted. relates. Use of inside information can also
In order to preserve the ability of the consist of trading in emission allowances
Commission, Member States and other and derivatives thereof and of bidding in
officially designated bodies to develop and the auctions of emission allowances or
pursue the CAP and the CFP, their activ- other auctioned products based thereon
ities, insofar as they are undertaken in the that are held pursuant to Commission
public interest and solely in pursuance of Regulation (EU) No 1031/2010 .
those policies, should be exempted from
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(24) Where a legal or natural person in pos- should consider what a normal and rea-
session of inside information acquires or sonable person knows or should have
disposes of, or attempts to acquire or known in the circumstances.
dispose of, for his own account or for (27) This Regulation should be interpreted
the account of a third party, directly in a manner consistent with the meas-
or indirectly, financial instruments to ures adopted by the Member States to
which that information relates, it should protect the interests of holders of trans-
be implied that that person has used ferable securities carrying voting rights
that information. That presumption is in a company (or which may carry such
without prejudice to the rights of the rights as a consequence of the exercise of
defence. The question whether a person rights or conversion) where the company
has infringed the prohibition on insider is subject to a public take-over bid or
dealing or has attempted to commit any other proposed change of control.
insider dealing should be analysed in the In particular this Regulation should be
light of the purpose of this Regulation, interpreted in a manner consistent with
which is to protect the integrity of the the laws, regulations and administrative
financial market and to enhance investor provisions adopted in relation to takeover
confidence, which is based, in turn, on the bids, merger transactions and other trans-
assurance that investors will be placed on actions affecting ownership or control
an equal footing and protected from the of companies regulated by the supervi-
misuse of inside information. sory authorities appointed by Member
(25) Orders placed before a person possesses States pursuant to Article 4 of Directive
inside information should not be deemed 2004/25/EC of the European Parliament
to be insider dealing. However, where and of the Council .
a person comes into possession of inside (28) Research and estimates based on pub-
information, there should be a presump- licly available data, should not per se be
tion that any subsequent change relating regarded as inside information and the
that information to orders placed before mere fact that a transaction is carried
possession of such information, includ- out on the basis of research or estimates
ing the cancellation or amendment of an should not therefore be deemed to consti-
order, or an attempt to cancel or amend tute use of inside information. However,
an order, constitutes insider dealing. That for example, where the publication or
presumption could, however, be rebutted distribution of information is routinely
if the person establishes that he or she expected by the market and where such
did not use the inside information when publication or distribution contributes to
carrying out the transaction. the price-formation process of financial
(26) Use of inside information can consist of instruments, or the information provides
the acquisition or disposal of a finan- views from a recognised market commen-
cial instrument, or an auctioned product tator or institution which may inform the
based on emission allowances, of the prices of related financial instruments, the
cancellation or amendment of an order, information may constitute inside infor-
or the attempt to acquire or dispose of mation. Market actors must therefore
a financial instrument or to cancel or consider the extent to which the infor-
amend an order, by a person who knows, mation is non-public and the possible
or ought to have known, that the infor- effect on financial instruments traded in
mation constitutes inside information. In advance of its publication or distribu-
this respect, the competent authorities
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tion, to establish whether they would be company should not be deemed to consti-
trading on the basis of inside information. tute insider dealing.
(29) In order to avoid inadvertently prohibit- (31)
Since the acquisition or disposal of
ing forms of financial activity which are financial instruments necessarily involves
legitimate, namely where there is no effect a prior decision to acquire or dispose
of market abuse, it is necessary to recog- taken by the person who undertakes one
nise certain legitimate behaviour. This or other of those operations, the mere fact
may include, for example, recognising the of making such an acquisition or disposal
role of market makers, when acting in the should not be deemed to constitute use of
legitimate capacity of providing market inside information. Acting on the basis
liquidity. of one’s own plans and strategies for
(30) The mere fact that market makers or trading should not be considered as using
persons authorised to act as counterpar- inside information. However, none of
ties confine themselves to pursuing their those legal or natural persons should be
legitimate business of buying or selling protected by virtue of their professional
financial instruments or that persons function; they should only be protected
authorised to execute orders on behalf if they act in a fit and proper manner,
of third parties with inside information meeting both the standards expected of
confine themselves to carrying out, can- their profession and of this Regulation
celling or amending an order dutifully, namely market integrity and investor pro-
should not be deemed to constitute use tection. An infringement could still be
of such inside information. However, the deemed to have occurred if the competent
protection, laid down in this Regulation, authority established that there was an
of market makers, bodies authorised to illegitimate reason behind those transac-
act as counterparties or persons author- tions or orders or that behaviour, or that
ised to execute orders on behalf of third the person used inside information.
parties with inside information, does (32) Market soundings are interactions
not extend to activities clearly prohib- between a seller of financial instruments
ited under this Regulation including, for and one or more potential investors, prior
example, the practice commonly known to the announcement of a transaction, in
as ‘front-running’. Where legal persons order to gauge the interest of potential
have taken all reasonable measures to investors in a possible transaction and
prevent market abuse from occurring but its pricing, size and structuring. Market
nevertheless natural persons within their soundings could involve an initial or sec-
employment commit market abuse on ondary offer of relevant securities, and
behalf of the legal person, this should not are distinct from ordinary trading. They
be deemed to constitute market abuse are a highly valuable tool to gauge the
by the legal person. Another example opinion of potential investors, enhance
that should not be deemed to constitute shareholder dialogue, ensure that deals
use of inside information is transactions run smoothly, and that the views of
conducted in the discharge of a prior issuers, existing shareholders and poten-
obligation that has become due. The mere tial new investors are aligned. They may
fact of having access to inside information be particularly beneficial when markets
relating to another company and using lack confidence or a relevant benchmark,
it in the context of a public takeover bid or are volatile. Thus the ability to conduct
for the purpose of gaining control of that market soundings is important for the
company or proposing a merger with that proper functioning of financial markets
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and market soundings should not in sidered to be acting within the normal
themselves be regarded as market abuse. course of his employment, profession or
(33) Examples of market soundings include duties where, at the time of making the
situations in which the sell-side firm has disclosure, he informs and receives the
been in discussions with an issuer about consent of the person to whom the disclo-
a potential transaction, and it has decided sure is made that he may be given inside
to gauge potential investor interest in information; that he will be restricted by
order to determine the terms that will the provisions of this Regulation from
make up a transaction; where an issuer trading or acting on that information;
intends to announce a debt issuance or that reasonable steps must be taken to
additional equity offering and key inves- protect the ongoing confidentiality of the
tors are contacted by a sell-side firm and information; and that he must inform
given the full terms of the deal to obtain the disclosing market participant of the
a financial commitment to participate in identities of all natural and legal persons
the transaction; or where the sell-side is to whom the information is disclosed in
seeking to sell a large amount of securities the course of developing a response to the
on behalf of an investor and seeks to market sounding. The disclosing market
gauge potential interest in those securities participant should also comply with the
from other potential investors. obligations, to be set out in detail in reg-
(34) Conducting market soundings may ulatory technical standards, regarding the
require disclosure to potential investors of maintenance of records of information
inside information. There will generally disclosed. There should be no presump-
only be the potential to benefit finan- tion that market participants that do not
cially from trading on the basis of inside comply with this Regulation when con-
information passed in a market sounding ducting a market sounding have unlaw-
where there is an existing market in the fully disclosed inside information but they
financial instrument that is the subject should not be able to take advantage of
of the market sounding or in a related the exemption given to those who have
financial instrument. Given the timing complied with such provisions. The ques-
of such discussions, it is possible that tion whether they have infringed the pro-
inside information may be disclosed to hibition against the unlawful disclosure of
the potential investor in the course of the inside information should be analysed in
market sounding after a financial instru- light of all the relevant provisions of this
ment has been admitted to trading on Regulation, and all disclosing market par-
a regulated market or has been traded on ticipants should be under an obligation to
an MTF or an OTF. Before engaging in record in writing their assessment, before
a market sounding, the disclosing market engaging in a market sounding, whether
participant should assess whether that that market sounding will involve the
market sounding will involve the disclo- disclosure of inside information.
sure of inside information. (36) Potential investors who are the subject of
(35) Inside information should be deemed as a market sounding should, in turn, con-
being disclosed legitimately if it is dis- sider if the information disclosed to them
closed in the normal course of the exercise amounts to inside information which
of a person’s employment, profession or would prohibit them from dealing on the
duties. Where a market sounding involves basis of it or further disclosing that infor-
the disclosure of inside information, the mation. Potential investors remain subject
disclosing market participant will be con- to the rules on insider dealing and unlaw-
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ful disclosure of inside information, as set in market abuse, persons who encour-
out in this Regulation. In order to assist age a person with inside information to
potential investors in their considerations disclose that information unlawfully or
and as regards what steps they should take persons who develop software in collab-
so as not to contravene this Regulation, oration with a trader for the purpose of
ESMA should issue guidelines. facilitating market abuse.
(37) Regulation (EU) No 1031/2010 provides (40) To ensure that liability is conferred
for two parallel market abuse regimes on both the legal person and any
applicable to the auctions of emission natural person who participates in the
allowances. However, as a consequence of decision-making of the legal person, it is
the classification of emission allowances necessary to give recognition of the differ-
as financial instruments, this Regulation ent national legal mechanisms in Member
should constitute a single rule book of States. Such mechanisms should relate
market abuse measures applicable to the directly to the methods of attribution of
entirety of the primary and secondary liability in national law.
markets in emission allowances. This (41) In order to complement the prohibition
Regulation should also apply to behaviour of market manipulation, this Regulation
or transactions, including bids, relating should include a prohibition against
to the auctioning on an auction plat- attempting to engage in market manip-
form authorised as a regulated market of ulation. An attempt to engage in market
emission allowances or other auctioned manipulation should be distinguished
products based thereon, including when from behaviour which is likely to result in
auctioned products are not financial market manipulation as both activities are
instruments, pursuant to Regulation (EU) prohibited under this Regulation. Such an
No 1031/2010. attempt may include situations where the
(38) This Regulation should provide measures activity is started but is not completed, for
regarding market manipulation that are example as a result of failed technology or
capable of being adapted to new forms an instruction to trade which is not acted
of trading or new strategies that may be upon. Prohibiting attempts to engage
abusive. To reflect the fact that trading in market manipulation is necessary to
in financial instruments is increasingly enable competent authorities to impose
automated, it is desirable that the defi- sanctions for such attempts.
nition of market manipulation provide (42) Without prejudice to the aim of this
examples of specific abusive strategies Regulation and its directly applicable pro-
that may be carried out by any available visions, a person who enters into transac-
means of trading including algorithmic tions or issues orders to trade which may
and high-frequency trading. The exam- be deemed to constitute market manip-
ples provided are neither intended to be ulation may be able to establish that his
exhaustive nor intended to suggest that reasons for entering into such transactions
the same strategies carried out by other or issuing orders to trade were legitimate
means would not also be abusive. and that the transactions and orders to
(39) The prohibitions against market abuse trade were in conformity with accepted
should also cover those persons who act practice on the market concerned. An
in collaboration to commit market abuse. accepted market practice can only be
Examples could include, but are not established by the competent authority
limited to, brokers who devise and recom- responsible for the market abuse supervi-
mend a trading strategy designed to result sion of the market concerned. A practice
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that is accepted in a particular market methodology, whether algorithmic or

cannot be considered applicable to other judgement-based in whole or in part.
markets unless the competent authori- Those rules are in addition to Regulation
ties of such other markets have officially (EU) No 1227/2011 which prohibits
accepted that practice. An infringement the deliberate provision of false infor-
could still be deemed to have occurred if mation to undertakings which provide
the competent authority established that price assessments or market reports on
there was an illegitimate reason behind wholesale energy products with the effect
these transactions or orders to trade. of misleading market participants acting
(43) This Regulation should also clarify that on the basis of those price assessments or
engaging in market manipulation or market reports.
attempting to engage in market manipu- (45) In order to ensure uniform market condi-
lation in a financial instrument may take tions between trading venues and facili-
the form of using related financial instru- ties subject to this Regulation, any person
ments such as derivative instruments that who operates regulated markets, MTFs
are traded on another trading venue or and OTFs should be required to establish
OTC. and to maintain effective arrangements,
(44) Many financial instruments are priced by systems and procedures aimed at prevent-
reference to benchmarks. The actual or ing and detecting market manipulation
attempted manipulation of benchmarks, and abusive practices.
including interbank offer rates, can have (46) Manipulation or attempted manipula-
a serious impact on market confidence tion of financial instruments may also
and may result in significant losses to consist in placing orders which may not
investors or distort the real economy. be executed. Furthermore, a financial
Therefore, specific provisions in relation instrument may be manipulated through
to benchmarks are required in order to behaviour which occurs outside a trading
preserve the integrity of the markets and venue. Persons professionally arranging or
ensure that competent authorities can executing transactions should be required
enforce a clear prohibition of the manip- to establish and to maintain effective
ulation of benchmarks. Those provisions arrangements, systems and procedures
should cover all published benchmarks in place to detect and report suspicious
including those accessible through the transactions. They should also report sus-
internet whether free of charge or not picious orders and suspicious transactions
such as CDS benchmarks and indices of that take place outside a trading venue.
indices. It is necessary to complement the (47) The manipulation or attempted manip-
general prohibition of market manipula- ulation of financial instruments may also
tion by prohibiting the manipulation of consist in disseminating false or mislead-
the benchmark itself and the transmission ing information. The spreading of false
of false or misleading information, provi- or misleading information can have a sig-
sion of false or misleading inputs, or any nificant impact on the prices of financial
other action that manipulates the calcu- instruments in a relatively short period
lation of a benchmark, where that calcu- of time. It may consist in the invention
lation is broadly defined to include the of manifestly false information, but also
receipt and evaluation of all data which the wilful omission of material facts, as
relates to the calculation of that bench- well as the knowingly inaccurate report-
mark and include in particular trimmed ing of information. That form of market
data, and including the benchmark’s manipulation is particularly harmful to
lxvii
RECITALS
investors, because it causes them to base provided that the delay would not be
their investment decisions on incorrect or likely to mislead the public and the issuer
distorted information. It is also harmful is able to ensure the confidentiality of the
to issuers, because it reduces the trust information. The issuer is only under an
in the available information related to obligation to disclose inside information
them. A lack of market trust can in turn if it has requested or approved admission
jeopardise an issuer’s ability to issue new of the financial instrument to trading.
financial instruments or to secure credit (50)
For the purposes of applying the
from other market participants in order requirements relating to public disclo-
to finance its operations. Information sure of inside information and delaying
spreads through the market place very such public disclosure, as provided for
quickly. As a result, the harm to investors in this Regulation, legitimate interests
and issuers may persist for a relatively long may, in particular, relate to the follow-
time until the information is found to be ing non-exhaustive circumstances: (a)
false or misleading, and can be corrected ongoing negotiations, or related elements,
by the issuer or those responsible for its where the outcome or normal pattern of
dissemination. It is therefore necessary those negotiations would be likely to be
to qualify the spreading of false or mis- affected by public disclosure. In particu-
leading information, including rumours lar, in the event that the financial viability
and false or misleading news, as being of the issuer is in grave and imminent
an infringement of this Regulation. It is danger, although not within the scope
therefore appropriate not to allow those of the applicable insolvency law, public
active in the financial markets to freely disclosure of information may be delayed
express information contrary to their own for a limited period where such a public
opinion or better judgement, which they disclosure would seriously jeopardise the
know or should know to be false or mis- interest of existing and potential share-
leading, to the detriment of investors and holders by undermining the conclusion of
issuers. specific negotiations designed to ensure
(48) Given the rise in the use of websites, blogs the long-term financial recovery of the
and social media, it is important to clarify issuer; (b) decisions taken or contracts
that disseminating false or misleading made by the management body of an
information via the internet, including issuer which need the approval of another
through social media sites or unattribut- body of the issuer in order to become
able blogs, should be considered, for the effective, where the organisation of such
purposes of this Regulation, to be equiv- an issuer requires the separation between
alent to doing so via more traditional those bodies, provided that public dis-
communication channels. closure of the information before such
(49) The public disclosure of inside infor- approval, together with the simultaneous
mation by an issuer is essential to avoid announcement that the approval remains
insider dealing and ensure that investors pending, would jeopardise the correct
are not misled. Issuers should therefore be assessment of the information by the
required to inform the public as soon as public.
possible of inside information. However (51) Moreover, the requirement to disclose
that obligation may, under special circum- inside information needs to be addressed
stances, prejudice the legitimate inter- to the participants in the emission allow-
ests of the issuer. In such circumstances, ance market. In order to avoid exposing
delayed disclosure should be permitted the market to reporting that is not useful
lxviii
RECITALS
and to maintain cost-efficiency of the mation they have access to and which is
measure foreseen, it appears necessary inside information.
to limit the regulatory impact of that (52) In order to protect the public interest,
requirement to only those EU ETS oper- to preserve the stability of the finan-
ators which, by virtue of their size and cial system and, for example, to avoid
activity, can reasonably be expected to liquidity crises in financial institutions
be able to have a significant effect on the from turning into solvency crises due to
price of emission allowances, of auctioned a sudden withdrawal of funds, it may be
products based thereon, or of deriva- appropriate to allow, in exceptional cir-
tive financial instruments relating thereto cumstances, the delay of the disclosure of
and for bidding in the auctions pursu- inside information for credit institutions
ant to Regulation (EU) No 1031/2010. or financial institutions. In particular, this
The Commission should adopt meas- may apply to information pertinent to
ures establishing a minimum threshold temporary liquidity problems, where they
for the purposes of application of that need to receive central banking lending
exemption by means of a delegated act. including emergency liquidity assistance
The information to be disclosed should from a central bank where disclosure of
concern the physical operations of the the information would have a systemic
disclosing party and not own plans or impact. This delay should be conditional
strategies for trading emission allow- upon the issuer obtaining the consent
ances, auctioned products based thereon, of the relevant competent authority and
or derivative financial instruments relat- it being clear that the wider public and
ing thereto. Where emission allowance economic interest in delaying disclosure
market participants already comply outweighs the interest of the market in
with equivalent inside information dis- receiving the information which is subject
closure requirements, notably pursuant to delay.
to Regulation (EU) No 1227/2011, the (53) In respect of financial institutions, in
obligation to disclose inside information particular where they receive central bank
concerning emission allowances should lending, including emergency liquidity
not lead to the duplication of mandatory assistance, the assessment of whether the
disclosures with substantially the same information is of systemic importance
content. In the case of participants in the and whether delay of disclosure is in the
emission allowance market with aggre- public interest should be made by the
gate emissions or rated thermal input competent authority, after consulting, as
at or below the threshold set, since the appropriate, the national central bank, the
information about their physical opera- macro-prudential authority or any other
tions is deemed to be non-material for the relevant national authority.
purposes of disclosure, it should also be (54) The use or attempted use of inside infor-
deemed not to have a significant effect on mation to trade on one’s own account or
the price of emission allowances, of auc- on the account of a third party should be
tioned products based thereon, or of the clearly prohibited. Use of inside informa-
derivative financial instruments relating tion can also consist of trading in emis-
thereto. Such participants in the emission sion allowances and derivatives thereof
allowance market should nevertheless and of bidding in the auctions of emission
be covered by the prohibition of insider allowances or other auctioned products
dealing in relation to any other infor- based thereon that are held pursuant
to Regulation (EU) No 1031/2010 by
lxix
RECITALS
persons who know, or who ought to know, exempt from this obligation in order to
that the information they possess con- reduce the administrative costs imposed
stitutes inside information. Information by this Regulation. However, such issuers
regarding the market participant’s own should provide an insider list to the com-
plans and strategies for trading should not petent authorities upon request.
be considered to be inside information, (57) The establishment, by issuers or any
although information regarding a third person acting on their behalf or account,
party’s plans and strategies for trading of lists of persons working for them under
may amount to inside information. a contract of employment or otherwise
(55) The requirement to disclose inside infor- and having access to inside information
mation can be burdensome for small and relating, directly or indirectly, to the
medium-sized enterprises, as defined in issuer, is a valuable measure for protecting
Directive 2014/65/EU of the European market integrity. Such lists may serve
Parliament and of the Council , whose issuers or such persons to control the
financial instruments are admitted to flow of inside information and thereby
trading on SME growth markets, given help manage their confidentiality duties.
the costs of monitoring information in Moreover, such lists may also constitute
their possession and seeking legal advice a useful tool for competent authorities
about whether and when information to identify any person who has access to
needs to be disclosed. Nevertheless, inside information and the date on which
prompt disclosure of inside information is they gained access. Access to inside infor-
essential to ensure investor confidence in mation relating, directly or indirectly, to
those issuers. Therefore, ESMA should the issuer by persons included on such
be able to issue guidelines which assist a list is without prejudice to the prohibi-
issuers to comply with the obligation to tions laid down in this Regulation.
disclose inside information without com- (58) Greater transparency of transactions con-
promising investor protection. ducted by persons discharging managerial
(56) Insider lists are an important tool for regu- responsibilities at the issuer level and,
lators when investigating possible market where applicable, persons closely associ-
abuse, but national differences in regard ated with them, constitutes a preventive
to data to be included in those lists impose measure against market abuse, particularly
unnecessary administrative burdens on insider dealing. The publication of those
issuers. Data fields required for insider transactions on at least an individual basis
lists should therefore be uniform in order can also be a highly valuable source of
to reduce those costs. It is important information to investors. It is necessary to
that persons included on insider lists are clarify that the obligation to publish those
informed of that fact and of its implica- managers’ transactions also includes the
tions under this Regulation and Directive pledging or lending of financial instru-
2014/57/EU of the European Parliament ments, as the pledging of shares can result
and of the Council . The requirement to in a material and potentially destabilising
keep and constantly update insider lists impact on the company in the event of
imposes administrative burdens specifi- a sudden, unforeseen disposal. Without
cally on issuers on SME growth markets. disclosure, the market would not know
As competent authorities are able to exer- that there was the increased possibility of,
cise effective market abuse supervision for example, a significant future change in
without having those lists available at all share ownership, an increase in the supply
times for those issuers, they should be of shares to the marketplace or a loss of
lxx
RECITALS
voting rights in that company. For that would justify a permission by the issuer
reason, notification under this Regulation allowing a person discharging managerial
is required where the pledge of the secu- responsibilities to trade. However, any
rities is made as part of a wider transac- such permission by the issuer is without
tion in which the manager pledges the prejudice to the prohibitions laid down in
securities as collateral to gain credit from this Regulation.
a third party. Additionally, full and proper (62) A set of effective tools and powers and
market transparency is a prerequisite for resources for the competent authority of
the confidence of market actors and, in each Member State guarantees super-
particular, the confidence of a company’s visory effectiveness. Accordingly, this
shareholders. It is also necessary to clarify Regulation, in particular, provides for
that the obligation to publish those man- a minimum set of supervisory and inves-
agers’ transactions includes transactions tigative powers competent authorities of
by another person exercising discretion Member States should be entrusted with
for the manager. In order to ensure an under national law. Those powers should
appropriate balance between the level of be exercised, where the national law so
transparency and the number of reports requires, by application to the competent
notified to competent authorities and the judicial authorities. When exercising their
public, thresholds should be introduced in powers under this Regulation competent
this Regulation below which transactions authorities should act objectively and
need not be notified. impartially and should remain autono-
(59) The notification of transactions con- mous in their decision making.
ducted by persons discharging manage- (63) Market undertakings and all economic
rial responsibilities on their own account, actors should also contribute to market
or by a person closely associated with integrity. In that sense, the designation of
them, is not only valuable information a single competent authority for market
for market participants, but also con- abuse should not exclude collaboration
stitutes an additional means for com- links or delegation under the responsibil-
petent authorities to supervise markets. ity of the competent authority, between
The obligation to notify transactions is that authority and market undertakings
without prejudice to the prohibitions laid with a view to guaranteeing efficient
down in this Regulation. supervision of compliance with the pro-
(60) Notification of transactions should be visions in this Regulation. Where persons
in accordance with the rules on transfer who produce or disseminate investment
of personal data laid down in Directive recommendations or other information
95/46/EC of the European Parliament recommending or suggesting an invest-
and of the Council . ment strategy in one or more financial
(61) Persons discharging managerial respon- instruments also deal on own account in
sibilities should be prohibited from such instruments, the competent authori-
trading before the announcement of an ties should, inter alia, be able to require or
interim financial report or a year-end demand from such persons any informa-
report which the relevant issuer is obliged tion necessary to determine whether the
to make public according to the rules recommendations produced or dissemi-
of the trading venue where the issu- nated by that person are compliant with
er’s shares are admitted to trading or this Regulation.
according to national law, unless specific (64) For the purpose of detecting cases of
and restricted circumstances exist which insider dealing and market manipulation,
lxxi
RECITALS
it is necessary for competent authori- by an investment firm, a credit institution

ties to have, in accordance with national or a financial institution in accordance
law, the ability to access the premises with Directive 2014/65/EU. Access to
of natural and legal persons in order to data and telephone records is necessary
seize documents. Access to such premises to provide evidence and investigate leads
is necessary where there is a reasona- on possible insider dealing or market
ble suspicion that documents and other manipulation, and therefore for detecting
data relating to the subject matter of an and imposing sanctions for market abuse.
investigation exist and may be relevant In order to introduce a level playing field
to prove a case of insider dealing or in the Union in relation to the access to
market abuse. Additionally access to such telephone and existing data traffic records
premises is necessary where the person held by a telecommunications operator
of whom a demand for information has or the existing recordings of telephone
already been made fails, wholly or in conversations and data traffic held by an
part, to comply with it or where there are investment firm, a credit institution or
reasonable grounds for believing that if a financial institution, competent author-
a demand were to be made it would not ities should, in accordance with national
be complied with or that the documents law, be able to require existing telephone
or information to which the information and existing data traffic records held by
requirement relates would be removed, a telecommunications operator, insofar as
tampered with or destroyed. If prior permitted under national law and existing
authorisation is needed from the judicial recordings of telephone conversations as
authority of the Member State concerned, well as data traffic held by an investment
in accordance with national law, access to firm, in cases where a reasonable suspi-
premises should take place after having cion exists that such records related to
obtained that prior judicial authorisation. the subject matter of the inspection or
(65) Existing recordings of telephone con- investigation may be relevant to prove
versations and data traffic records from insider dealing or market manipulation
investment firms, credit institutions and infringing this Regulation. Access to tele-
financial institutions executing and docu- phone and data traffic records held by
menting the execution of transactions, as a telecommunications operator does not
well as existing telephone and data traffic encompass access to the content of voice
records from telecommunications oper- communications by telephone.
ators, constitute crucial, and sometimes (66)
While this Regulation specifies
the only, evidence to detect and prove the a minimum set of powers competent
existence of insider dealing and market authorities should have, those powers
manipulation. Telephone and data traffic are to be exercised within a complete
records may establish the identity of system of national law which guaran-
a person responsible for the dissemina- tees the respect for fundamental rights,
tion of false or misleading information including the right to privacy. For the
or that persons have been in contact exercise of those powers, which may
at a certain time, and that a relation- amount to serious interferences with the
ship exists between two or more people. right to respect for private and family
Therefore, competent authorities should life, home and communications, Member
be able to require existing recordings of States should have in place adequate and
telephone conversations, electronic com- effective safeguards against any abuse, for
munications and data traffic records held instance, where appropriate a require-
lxxii
RECITALS
ment to obtain prior authorisation from 45/2001 of the European Parliament and
the judicial authorities of a Member State of the Council .
concerned. Member States should allow (70) A sound prudential and conduct of busi-
the possibility for competent authorities ness framework for the financial sector
to exercise such intrusive powers to the should rest on strong supervisory, inves-
extent necessary for the proper investiga- tigation and sanction regimes. To that
tion of serious cases where there are no end, supervisory authorities should be
equivalent means for effectively achieving equipped with sufficient powers to act
the same result. and should be able to rely on equal, strong
(67) Since market abuse can take place across and deterrent sanction regimes against
borders and markets, in all but excep- all financial misconduct, and sanctions
tional circumstances competent authori- should be enforced effectively. However,
ties should be required to cooperate and the de Larosière Group considered that
exchange information with other com- none of those elements is currently in
petent and regulatory authorities, and place. A review of existing powers to
with ESMA, in particular in relation to impose sanctions and their practical
investigation activities. Where a compe- application aimed at promoting conver-
tent authority is convinced that market gence of sanctions across the range of
abuse is being, or has been, carried out in supervisory activities has been carried out
another Member State or affects financial in the Commission Communication of 8
instruments traded in another Member December 2010 on Reinforcing sanction-
State, it should notify that fact to the ing regimes in the financial sector.
competent authority and ESMA. In cases (71) Therefore, a set of administrative sanc-
of market abuse with cross-border effects, tions and other administrative meas-
ESMA should be able to coordinate the ures should be provided for to ensure
investigation if requested to do so by one a common approach in Member States
of the competent authorities concerned. and to enhance their deterrent effect.
(68) It is necessary for competent authorities The possibility of a ban from exercising
to have the necessary tools for effective management functions within investment
cross-market order book surveillance. firms should be available to the compe-
Pursuant to Directive 2014/65/EU, tent authority. Sanctions imposed in spe-
competent authorities are able to request cific cases should be determined taking
and receive data from other competent into account where appropriate factors
authorities relating to the order book to such as the disgorgement of any identified
assist in monitoring and detecting market financial benefit, the gravity and duration
manipulation on a cross-border basis. of the infringement, any aggravating or
(69) In order to ensure exchanges of informa- mitigating factors, the need for fines to
tion and cooperation with third-country have a deterrent effect and, where appro-
authorities in relation to the effective priate, include a discount for cooperation
enforcement of this Regulation, compe- with the competent authority. In particu-
tent authorities should conclude coopera- lar, the actual amount of administrative
tion arrangements with their counterparts fines to be imposed in a specific case may
in third countries. Any transfer of per- reach the maximum level provided for in
sonal data carried out on the basis of those this Regulation, or the higher level pro-
agreements should comply with Directive vided for in national law, for very serious
95/46/EC and with Regulation (EC) No infringements, while fines significantly
lower than the maximum level may be
lxxiii
RECITALS
applied to minor infringements or in case administrative measures on an anony-

of settlement. This Regulation does not mous basis in accordance with national
limit Member States’ ability to provide for law or delay the publication. Competent
higher administrative sanctions or other authorities should have the option of not
administrative measures. publishing sanctions and other admin-
(72) Even though nothing prevents Member istrative measures where anonymous or
States from laying down rules for admin- delayed publication is considered to be
istrative as well as criminal sanctions for insufficient to ensure that the stability
the same infringements, they should not of the financial markets will not be jeop-
be required to lay down rules for adminis- ardised. Competent authorities should
trative sanctions for infringements of this also not be required to publish measures
Regulation which are already subject to which are deemed to be of a minor nature
national criminal law by 3 July 2016. In and the publication of which would be
accordance with national law, Member disproportionate.
States are not obliged to impose both (74) Whistleblowers may bring new infor-
administrative and criminal sanctions for mation to the attention of competent
the same offence, but they can do so if authorities which assists them in detect-
their national law so permits. However, ing and imposing sanctions in cases of
maintenance of criminal sanctions insider dealing and market manipula-
rather than administrative sanctions for tion. However, whistleblowing may be
infringements of this Regulation or of deterred for fear of retaliation, or for lack
Directive 2014/57/EU should not reduce of incentives. Reporting of infringements
or otherwise affect the ability of compe- of this Regulation is necessary to ensure
tent authorities to cooperate and access that a competent authority may detect
and exchange information in a timely and impose sanctions for market abuse.
manner with competent authorities in Measures regarding whistleblowing are
other Member States for the purposes of necessary to facilitate detection of market
this Regulation, including after any refer- abuse and to ensure the protection and
ral of the relevant infringements to the the respect of the rights of the whis-
competent judicial authorities for crimi- tleblower and the accused person. This
nal prosecution. Regulation should therefore ensure that
(73) In order to ensure that decisions made adequate arrangements are in place to
by competent authorities have a dissua- enable whistleblowers to alert competent
sive effect on the public at large, they authorities to possible infringements of
should normally be published. The pub- this Regulation and to protect them from
lication of decisions is also an important retaliation. Member States should be
tool for competent authorities to inform allowed to provide for financial incentives
market participants of what behaviour for those persons who offer relevant infor-
is considered to be an infringement of mation about potential infringements of
this Regulation and to promote good this Regulation. However, whistleblowers
behaviour amongst market participants. should only be entitled to such financial
If such publication causes dispropor- incentives where they bring to light new
tionate damage to the persons involved information which they are not already
or jeopardises the stability of financial legally obliged to notify and where that
markets or an ongoing investigation information results in a sanction for an
the competent authority should publish infringement of this Regulation. Member
the administrative sanctions and other States should also ensure that whistle-
lxxiv
RECITALS
blowing schemes that they implement media and the rules or codes governing
include mechanisms that provide appro- the journalist profession, account should
priate protection of an accused person, be taken of those freedoms as guaranteed
particularly with regard to the right to the in the Union and in the Member States
protection of his personal data and pro- and as recognised pursuant to Article
cedures to ensure the right of the accused 11 of the Charter and to other relevant
person of defence and to be heard before provisions.
the adoption of a decision concerning (78) In order to increase transparency and
him as well as the right to seek effective to better inform the operation of the
remedy before a court against a decision sanction regimes, competent authorities
concerning him. should provide anonymised and aggre-
(75) Since Member States have adopted leg- gated data to ESMA on an annual basis.
islation implementing Directive 2003/6/ That data should comprise the number of
EC, and since the delegated acts, regula- investigations that have been opened, the
tory technical standards and implement- number that are ongoing and the number
ing technical standards provided for in that have been closed during the relevant
this Regulation should be adopted before period.
the framework to be introduced can be (79) Directive 95/46/EC and Regulation (EC)
usefully applied, it is necessary to defer No 45/2001 govern the processing of per-
the application of the substantive provi- sonal data carried out by ESMA within
sions of this Regulation for a sufficient the framework of this Regulation and
period of time. under the supervision of the Member
(76) In order to facilitate a smooth tran- States competent authorities, in particu-
sition to the entry into application of lar the public independent authorities
this Regulation, market practices designated by the Member States. Any
existing before the entry into force of exchange or transmission of information
this Regulation and accepted by com- by competent authorities should be in
petent authorities in accordance with accordance with the rules on the transfer
Commission Directive 2004/72/EC for of personal data as laid down in Directive
the purpose of applying point 2(a) of 95/46/EC. Any exchange or transmis-
Article 1 of Directive 2003/6/EC, may sion of information by ESMA should
remain applicable provided that they are be in accordance with the rules on the
notified to ESMA within a prescribed transfer of personal data as laid down in
time period, until the competent author- Regulation (EC) No 45/2001.
ity has made a decision regarding the con- (80) This Regulation, as well as the dele-
tinuation of those practices in accordance gated acts, implementing acts, regulatory
with this Regulation. technical standards, implementing tech-
(77) This Regulation respects the fundamental nical standards and guidelines adopted in
rights and observes the principles rec- accordance therewith, are without preju-
ognised in the Charter of Fundamental dice to the application of Union rules on
Rights of the European Union (Charter). competition.
Accordingly, this Regulation should be (81) In order to specify the requirements set
interpreted and applied in accordance out in this Regulation, the power to adopt
with those rights and principles. In par- acts in accordance with Article 290 TFEU
ticular, when this Regulation refers to should be delegated to the Commission in
rules governing the freedom of the press respect of the exemption from the scope
and the freedom of expression in other of this Regulation of certain public bodies
lxxv
RECITALS
and central banks of third countries and the elaboration of draft regulatory tech-
of certain designated public bodies of nical standards and draft implementing
third countries that have a linking agree- technical standards which do not involve
ment with the Union within the meaning policy choices, for submission to the
of Article 25 of Directive 2003/87/EC; Commission.
the indicators for manipulative behaviour (84) The Commission should be empowered
listed in Annex I to this Regulation; the to adopt the draft regulatory technical
thresholds for determining the applica- standards developed by ESMA to specify
tion of the public disclosure obligation to the content of notifications that will have
emission allowance market participants; to be made by the operators of regu-
the circumstances under which trading lated markets, MTFs and OTFs con-
during a closed period is permitted; and cerning the financial instruments that are
the types of certain transactions con- admitted to trading, traded, or for which
ducted by persons discharging mana- a request for admission to trading on
gerial responsibilities or persons closely their trading venue has been made; the
associated with them that would trigger manner and conditions of compilation,
a requirement to notify. It is of particular publication and maintenance of the list of
importance that the Commission carry those instruments by ESMA; the condi-
out appropriate consultations during its tions that buy-back programmes and sta-
preparatory work, including at expert bilisation measures must meet including
level. The Commission, when preparing conditions for trading, time and volume
and drawing-up delegated acts, should restrictions, disclosure and reporting
ensure a simultaneous, timely and appro- obligations and price conditions for the
priate transmission of relevant documents stabilisation; in relation to procedures and
to the European Parliament and to the arrangements, systems for trading venues
Council. aimed at preventing and detecting market
(82) In order to ensure uniform conditions for abuse and of systems and templates to
the implementation of this Regulation in be used by persons in order to detect
respect of procedures for the reporting of and notify suspicious orders and transac-
infringements of this Regulation, imple- tions; appropriate arrangements, proce-
menting powers should be conferred on dures and record-keeping requirements
the Commission to specify those proce- in the process of market soundings; and
dures, including the arrangements for fol- in respect of technical arrangements for
lowing up of the reports and measures for categories of persons for objective pres-
the protection of persons working under entation of information recommending
a contract of employment and measures an investment strategy and for disclosure
for the protection of personal data. Those of particular interests or indications of
powers should be exercised in accord- conflicts of interest by means of delegated
ance with Regulation (EU) No 182/2011 acts pursuant to Article 290 TFEU and
of the European Parliament and of the in accordance with Articles 10 to 14 of
Council . Regulation (EU) No 1093/2010 of the
(83) Technical standards in financial services European Parliament and of the Council
should ensure uniform conditions across . It is of particular importance that the
the Union in matters covered by this Commission carry out appropriate con-
Regulation. As a body with highly spe- sultations during its preparatory work,
cialised expertise, it would be efficient including at expert level.
and appropriate to entrust ESMA with
lxxvi
RECITALS
(85) The Commission should also be empow- principle of proportionality, as set out
ered to adopt implementing technical in that Article, this Regulation does not
standards by means of implementing acts go beyond what is necessary in order to
pursuant to Article 291 TFEU and in achieve that objective.
accordance with Article 15 of Regulation (87) The provisions of Directive 2003/6/EC
(EU) No 1093/2010. ESMA should be being no longer relevant or sufficient,
entrusted with drafting implementing that Directive should be repealed from 3
technical standards for submission to July 2016. The requirements and prohibi-
the Commission with regard to public tions of this Regulation are strictly related
disclosure of inside information, formats to those in Directive 2014/65/EU and
of insider lists and formats and proce- should therefore enter into force on the
dures for the cooperation and exchange date of entry into force of that Directive.
of information of competent authorities (88) For the correct application of this
among themselves and with ESMA. Regulation, it is necessary that Member
(86) Since the objective of this Regulation, States take all necessary measures in order
namely to prevent market abuse in the to ensure that their national law comply
form of insider dealing, the unlawful dis- by 3 July 2016 with the provisions of
closure of inside information and market this Regulation concerning competent
manipulation, cannot be sufficiently authorities and their powers, adminis-
achieved by the Member States but can trative sanctions and other administrative
rather, by reason of its scale and effects, measures, the reporting of infringements
be better achieved at Union level, the and the publication of decisions.
Union may adopt measures, in accord- (89) The European Data Protection
ance with the principle of subsidiarity Supervisor delivered an opinion on 10
as set out in Article 5 of the Treaty on February 2012.
European Union. In accordance with the
REGULATION (EU) 2019/2115

OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of 27 November 2019
amending Directive 2014/65/EU and Regulations (EU) No 596/2014 and
(EU) 2017/1129 as regards the promotion of the use of SME growth markets
Whereas:
(1) The Capital Markets Union initiative on trading venues face high one-off and
seeks to reduce dependence on bank ongoing disclosure and compliance costs
lending, diversify market-based sources of which can deter them from ever seeking
financing for all small and medium-sized admission to trading on Union trading
enterprises (‘SMEs’) and promote the venues. In addition, shares issued by
issuance of bonds and shares by SMEs on SMEs on Union trading venues tend to
public markets. Companies established suffer from lower levels of liquidity and
in the Union that seek to raise capital higher volatility, thereby increasing the
lxxvii
RECITALS
cost of capital and making that source and of the Council apply in the same
of funding too onerous. A horizontal manner to all issuers, irrespective of their
Union policy for SMEs in that regard is size or the trading venue where their
therefore essential. Such policy needs to financial instruments are admitted to
be inclusive, coherent and effective, and trading. That low level of differentiation
take into account the variety of SMEs and between issuers of financial instruments
their different needs. admitted to trading on SME growth
(2) Directive 2014/65/EU of the European markets and those on other MTFs acts as
Parliament and of the Council created a disincentive for MTFs to seek registra-
a new type of trading venue, the SME tion as an SME growth market, which is
growth market, a subcategory of multi- illustrated by the low uptake of the SME
lateral trading facilities (‘MTFs’), in order growth market status to date. It is there-
to facilitate access to capital for SMEs fore necessary to introduce additional
and enable them to grow, and also to proportionate alleviations to adequately
facilitate the further development of spe- foster the use of SME growth markets.
cialist markets catering for the needs of The use of SME growth markets should
SME issuers that have growth potential. be actively promoted. Many SMEs are
Directive 2014/65/EU also anticipated still not aware of the existence of SME
that ‘[a]ttention should be focused on growth markets as a new type of trading
how future regulation should further venue.
foster and promote the use of that market (4) The attractiveness of SME growth
so as to make it attractive for investors, markets should be reinforced by further
and provide a lessening of administrative reducing the compliance costs and
burdens and further incentives for SMEs administrative burdens faced by issuers of
to access capital markets through SME financial instruments admitted to trading
growth markets’. In its opinion on the on SME growth markets. To maintain
Commission proposal for this amending the highest standards of compliance on
Regulation, the European Economic and regulated markets, the measures provided
Social Committee reiterated that the low for in this Regulation should be limited
level of communication and bureaucratic to companies listed on SME growth
approaches are significant barriers and markets, irrespective of the fact that not all
that much more effort must be put into SMEs are listed on SME growth markets
overcoming those obstacles. In addition, and not all companies listed on SME
it stated that the bottom of the chain, growth markets are SMEs. Pursuant to
SMEs themselves, should be targeted by Directive 2014/65/EU, up to 50 % of the
involving, among others, SME associ- issuers of financial instruments admitted
ations, social partners, and chambers of to trading on SME growth markets can
commerce. be non-SMEs, in order to maintain the
(3) It has, however, been noted that issuers of profitability of the SME growth markets’
financial instruments admitted to trading business model through, inter alia, liquid-
on an SME growth market benefit from ity in non-SMEs securities. In view of
relatively few regulatory alleviations com- the risks involved in applying different
pared to issuers of financial instruments sets of rules to issuers listed on the same
admitted to trading on other MTFs or category of venue, namely SME growth
regulated markets. Most of the obliga- markets, the measures provided for in this
tions set out in Regulation (EU) No Regulation should not be limited only
596/2014 of the European Parliament to SME issuers. For the sake of consist-
lxxviii
RECITALS
ency for issuers and clarity for investors, ment), issuers enter into discussions with
the reduction in compliance costs and a limited number of potential qualified
administrative burdens should apply to all investors, as defined in Regulation (EU)
issuers of financial instruments admitted 2017/1129 of the European Parliament
to trading on SME growth markets, irre- and of the Council , and negotiate all the
spective of their market capitalisation. contractual terms and conditions of the
(5) The success of an SME growth market transaction with those qualified investors.
should not be measured simply by the The aim of the communication of
number of companies listed thereon, but information in that negotiation phase is
rather by the rate of growth achieved to structure and complete the transac-
by those companies. There is a need for tion as a whole, and not to gauge the
a sharper focus on SMEs — the ultimate interest of potential investors as regards
beneficiaries of this Regulation — and a pre-defined transaction. The market
their needs. Cutting red tape is a vital part sounding regime in respect of private
of that process, but other steps also need placements of bonds can sometimes be
to be taken. Efforts need to be made to burdensome and act as a disincentive to
improve the information that is directly entering into discussions for such trans-
available to SMEs about the financing actions for both issuers and investors. In
options open to them, in order to foster order to increase the attraction of private
their development. Regulatory alleviation placements of bonds, the disclosure of
should be for the benefit of smaller com- inside information to qualified investors
panies that have growth potential. for the purpose of such transactions should
(6) According to Article 10(1) of Regulation be deemed to be made in the normal exer-
(EU) No 596/2014, unlawful disclo- cise of a person’s employment, profession
sure of inside information arises where or duties and should be excluded from
a person possesses inside information and the scope of the market sounding regime,
discloses that information to any other provided that an adequate non-disclosure
person, except where the disclosure is agreement is in place.
made in the normal exercise of an employ- (7) Some liquidity in an issuer’s shares can be
ment, a profession or duties. Pursuant to achieved through liquidity mechanisms
Article 11(4) of that Regulation, disclo- such as market-making arrangements
sure of inside information in the course or liquidity contracts. A market-making
of a market sounding is deemed to be arrangement comprises a contract between
made in the normal exercise of a person’s the market operator and a third party who
employment, profession or duties, pro- commits to maintaining the liquidity in
vided there is compliance with certain certain shares and, in return, benefits
procedures established by the market from rebates on trading fees. A liquidity
sounding regime. A market sounding contract comprises a contract between
comprises the communication of infor- an issuer and a third party who commits
mation, prior to the announcement of to providing liquidity in the shares of
a transaction, in order to gauge the inter- the issuer, and on its behalf. To ensure
est of potential investors in a possible that market integrity is fully preserved,
transaction and the conditions relating to liquidity contracts should be available to
it such as its potential size or pricing, to all issuers of financial instruments admit-
one or more potential investors. During ted to trading on SME growth markets
the negotiation phase of an offer of secu- across the Union, subject to a number of
rities to qualified investors (private place- conditions.
lxxix
RECITALS
Not all competent authorities have pursuant to Article 290 of the Treaty on
established accepted market practices in the Functioning of the European Union
accordance with Regulation (EU) No and in accordance with Articles 10 to 14
596/2014 in relation to liquidity con- of Regulation (EU) No 1095/2010.
tracts, which means that not all issuers of (9) According to Article 17(4) of Regulation
financial instruments admitted to trading (EU) No 596/2014, issuers can decide to
on SME growth markets currently have delay disclosure of inside information to
access to liquidity schemes across the the public if issuers’ legitimate interests
Union. That absence of liquidity schemes are likely to be prejudiced, if the delay
can be an impediment to the effective is not likely to mislead the public, and if
development of SME growth markets. It issuers are able to ensure the confiden-
is therefore necessary to create a Union tiality of the information. Issuers are,
framework that will enable issuers of however, required to notify the competent
financial instruments admitted to trading authority thereof and to provide a written
on SME growth markets to enter into explanation of the rationale supporting
a liquidity contract with a liquidity pro- the decision. That notification obligation,
vider in the absence of an accepted market when imposed on issuers whose finan-
practice established at national level. cial instruments are admitted to trading
Under such a Union framework, a person only on an SME growth market, can be
entering into a liquidity contract with burdensome. A lighter requirement for
a liquidity provider would not be deemed such issuers, whereby they are required to
to be engaging in market manipulation. provide an explanation of the reasons for
It is, however, essential that the pro- the delay only upon request by the compe-
posed Union framework on liquidity content authority, would reduce the adminis-
tracts for SME growth markets does not trative burden for issuers without having
replace, but rather complements, existing any significant impact on the ability of
or future accepted national market prac- the competent authority to monitor the
tices. It is also essential that compe- disclosure of inside information, provided
tent authorities retain the possibility of that the competent authority is still noti-
establishing accepted market practices in fied of the decision to delay and is able to
respect of liquidity contracts in order to open an investigation if it has doubts as
tailor their conditions to local specificities regards that decision.
or to extend such agreements to illiquid (10) The current less stringent requirement for
securities other than shares admitted to issuers whose financial instruments are
trading on trading venues. admitted to trading on an SME growth
(8) In order to ensure consistent harmonisa- market to produce, in accordance with
tion of the proposed Union framework Article 18(6) of Regulation (EU) No
for liquidity contracts, the Commission 596/2014, an insider list only upon the
should adopt regulatory technical stand- request of the competent authority is
ards, setting out a template to be used of limited practical effect because those
for the purposes of such contracts, issuers remain subject to requirements
developed by the European Supervisory concerning ongoing monitoring of the
Authority (European Securities and persons who qualify as insiders in the
Markets Authority) (ESMA), established context of ongoing projects. The exist-
by Regulation (EU) No 1095/2010 of ing requirement should therefore be
the European Parliament and of the replaced by the possibility for issuers
Council , by means of delegated acts whose financial instruments are admitted
lxxx
RECITALS
to trading on an SME growth market to business days after the transaction. The
maintain only a list of persons who, in same deadline applies to PDMRs and
the normal exercise of their duties, have PCAs as regards their duty to report their
regular access to inside information, such transactions to the issuer or to the emis-
as directors, members of management sion allowance market participant. Where
bodies or in-house counsel. It would also issuers or emission allowance market par-
be burdensome for issuers whose finan- ticipants are notified late by PDMRs
cial instruments are admitted to trading and PCAs of their transactions, it is
on an SME growth market to promptly technically challenging for those issuers
update full insider lists in the manner pro- or emission allowance market participants
vided for in Commission Implementing to comply with the three-day deadline,
Regulation (EU) 2016/347 . However, which may give rise to liability issues.
since some Member States consider Issuers and emission allowance market
insider lists to be important for ensur- participants should therefore be allowed
ing a higher level of market integrity, to disclose transactions within two busi-
Member States should be given the ness days of receipt of notification of
option of introducing a requirement for those transactions by the PDMRs or the
issuers whose financial instruments are PCAs.
admitted to trading on an SME growth (13) Under Regulation (EU) 2017/1129, an
market to provide more extensive insider issuer is, under certain conditions, not
lists that include all persons who have required to publish a prospectus in the
access to inside information. Taking into case of securities offered in connection
account the need to ensure a propor- with a takeover by means of an exchange
tionate administrative burden for SMEs, offer and in the case of securities offered,
those more extensive lists should never- allotted or to be allotted in connection
theless represent a lighter administrative with a merger or division. Instead, a doc-
burden as compared to full insider lists. ument containing minimum information
(11) It is essential to clarify that the obligation describing the transaction and its impact
of drawing up insider lists rests both with on the issuer is to be made available
issuers and any person acting on their to the public. There is no requirement
behalf or on their account. The respon- under Union law for a national com-
sibilities of any person acting on behalf petent authority to review or approve
or on account of an issuer with regard to such a document before its publication,
the drawing up of insider lists should be and its content is lighter compared to
clarified in order to avoid divergent inter- a prospectus. An unintended consequence
pretations and practices across the Union. of such an exemption is that, in some
The relevant provisions of Regulation circumstances, an unlisted company can
(EU) No 596/2014 should be amended carry out an initial admission of its shares
accordingly. to trading on a regulated market without
(12) Pursuant to Article 19(3) of Regulation producing a prospectus. That deprives
(EU) No 596/2014, issuers and emis- investors of the useful information con-
sion allowance market participants are tained in a prospectus, while avoiding any
required to make public information review by a national competent authority
on transactions carried out by persons of the information provided to the market.
discharging managerial responsibilities It is therefore appropriate to introduce
(‘PDMRs’) and persons closely associ- a requirement to publish a prospectus for
ated with them (‘PCAs’) within three an unlisted company which seeks admis-
lxxxi
RECITALS
sion to trading on a regulated market markets to publish their financial state-

following an exchange offer, a merger or ments in conformity with International
a division. Financial Reporting Standards. However,
(14) Article 14 of Regulation (EU) 2017/1129 in order to avoid diverging from regu-
does not currently allow the use of a sim- lated market standards, issuers of finan-
plified prospectus for issuers whose equity cial instruments admitted to trading on
securities have been admitted to trading SME growth markets that wish to use
on either a regulated market or an SME the simplified disclosure regime set out in
growth market continuously for at least Article 14 of Regulation (EU) 2017/1129
the last 18 months and that would seek for the admission of their securities to
to issue securities giving access to equity trading on a regulated market should
securities fungible with equity securities nevertheless prepare their most recent
previously issued. Therefore, Article 14 financial statements in accordance with
of that Regulation should be amended to Regulation (EC) No 1606/2002, includ-
allow such issuers to use the simplified ing comparative information for the pre-
prospectus. vious year, provided that they would be
(15) SME growth markets should not be per- required to prepare consolidated accounts
ceived as a final step in the scaling up as a result of the application of Directive
of issuers and should enable successful 2013/34/EU of the European Parliament
companies to grow and move one day and of the Council after the admission of
to regulated markets, in order to benefit their financial instruments to trading on
from greater liquidity and a larger inves- a regulated market. Where the applica-
tors’ pool. To facilitate the transition tion of that Directive would not require
from an SME growth market to a regu- issuers to prepare such accounts, they
lated market, growing companies should should comply with the national law of
be able to use the simplified disclosure the Member State in which they are
regime set out in Article 14 of Regulation incorporated.
(EU) 2017/1129, for the admission to (17) The purpose of this Regulation is consist-
trading on a regulated market of securi- ent with the objectives of the EU Growth
ties fungible with securities which have prospectus, as set out in Article 15 of
been previously issued, provided that Regulation (EU) 2017/1129. The EU
those companies have offered securities Growth prospectus is short and therefore
to the public that have been continuously economical to produce, reducing costs for
admitted to trading on an SME growth SMEs. SMEs should be able to choose
market for at least two years and have to use the EU Growth prospectus. The
fully complied with reporting and disclo- current definition of SMEs in Regulation
sure obligations throughout that period. (EU) 2017/1129 can be too restrictive,
A two-year period should enable issuers in particular for those issuers seeking
to have a sufficient track record and to admission to trading on an SME growth
provide the market with information on market that tend to be larger than tra-
their financial performance and reporting ditional SMEs. As a result, as regards
requirements under Directive 2014/65/ public offers, immediately followed by an
EU. initial admission to trading on an SME
(16) Regulation (EC) No 1606/2002 of the growth market, smaller issuers would not
European Parliament and of the Council be able to use the EU Growth prospectus,
does not require issuers of financial instru- even if their market capitalisation after
ments admitted to trading on SME growth their initial admission to trading were
lxxxii
RECITALS
lower than EUR 200 000 000. Therefore,

Regulation (EU) 2017/1129 should be
amended to allow issuers seeking an
initial public offer with a tentative market
capitalisation below EUR 200 000 000 to
draw up an EU Growth prospectus.
(18) Given the importance of SMEs for the
functioning of the Union’s economy,
special attention should be paid to the
impact of Union law relating to finan-
cial services on the financing of SMEs.
To that end, the Commission should,
when undertaking the review of legal
acts affecting the financing of listed and
unlisted SMEs, analyse regulatory and
administrative barriers, including in rela-
tion to research, that limit or prevent
investment in SMEs. In doing so, the
Commission should assess the evolution
of capital flows to SMEs and strive to
create a favourable regulatory environ-
ment to foster the financing of SMEs.
(19) Directive 2014/65/EU and Regulations
(EU) No 596/2014 and (EU) 2017/1129
should therefore be amended accordingly.
(20) This Regulation should apply from 31
December 2019. However, Article 1
should apply from 1 January 2021.
lxxxiii
ARTICLE 1
SUBJECT MATTER
Elena Guggenberger
This Regulation establishes a common regulatory framework on insider dealing, the unlawful
disclosure of inside information and market manipulation (market abuse) as well as measures
to prevent market abuse to ensure the integrity of financial markets in the Union and to
enhance investor protection and confidence in those markets.
OVERVIEW
A. INTRODUCTION 1.001 C. BACKGROUND 1.007

B. OBJECTIVES 1.004
A. INTRODUCTION
Art 1 regulates the subject matter of the MAR, which is to establish a common legal framework 1.001
applicable throughout the Union for the purposes of the prevention and combatting of market
abuse. The legal form of the Regulation ensures the uniform application of the provisions of
the MAR in all Member States of the EU.
Market abuse is used here as a generic term for unlawful acts on the financial markets and 1.002
includes insider dealing, unlawful disclosure of inside information and market manipulation.1
The subject matter of the MAR also includes ‘Measures to prevent market abuse’. The preven- 1.003
tion measures themselves are not explicitly referred to in Art 1 but, on the one hand, they likely
refer to the obligations in Art 16 (‘Prevention and detection of market abuse’), the disclosure
requirements in Art 17 (‘Public disclosure of inside information’), Art 18 (‘Insider lists’),
Art 19 (‘Managers’ transactions’), Art 20 (‘Investment recommendations and statistics’), Art 21
(‘Disclosure or dissemination of information in the media’) and, on the other hand, however, to
1 cf Recital 3 MAR.
1
Elena Guggenberger - 9781800882249
Article 1 SUBJECT MATTER
the supervisory powers of the competent authorities in Chapter 4 MAR (Arts 22–29) and the
administrative measures and sanctions in Chapter 5 MAR (Arts 30–35).2
B. OBJECTIVES
1.004 In addition to preserving the integrity of financial markets, the MAR aims to improve investor
protection and to strengthen investor confidence in the markets. In particular, legal uncertainty
and regulatory arbitrage should thus be avoided.3
1.005 In contrast to a Directive, which allows national scope for implementation, the immediacy of
the application of the MAR in all Member States ensures a harmonised legal framework with
regard to the provisions on market abuse.
1.006 This will increase legal certainty for all market participants, prevent distortions of competition
and reduce compliance costs related to cross-border activities.4
C. BACKGROUND
1.007 A first comprehensive framework to combat market abuse was already established at the
European level with the Market Manipulation Directive 2003.5 The financial crisis of 2008
severely weakened the integrity of financial markets and investor confidence in them. In
response to these developments, the European Commission reviewed the content of the
Market Manipulation Directive 2003 in 2010 and identified a number of problems indicating
that the prevailing rules did not provide comprehensive protection against market abuse.
Regulatory gaps were identified in relation to new markets and platforms,6 over-the-counter
(OTC) instruments, commodities and commodity derivatives markets. Differences in the
enforcement powers of the national regulatory authorities facilitated regulatory arbitrage and
impeded cross-border cooperation.7
1.008 As a consequence thereof, in 2011, the Commission published a proposal to revise the content
of the Market Manipulation Directive 2003, the aim being to fill the gaps in the regulation of
market abuse resulting from technological, commercial and legal developments and thereby to
restore market integrity as well as confidence in the financial markets.
2 In this respect, however, a reference to the criminal sanctions and measures regulated by the CRIM-MAD would
be lacking. These are also part of the Commission’s ‘market abuse package’ and serve to prevent and combat market
abuse, see Stefan Grundmann in Claus-Wilhelm Canaris, Mathias Habersack and Carsten Schäfer (eds, established by
Hermann Staub), Handelsgesetzbuch - Großkommentar (5th edn, vol 11/1, De Gruyter 2017), 6. Teil Marktregeln Art 1
MAR para 270, cf also Recital 5 CRIM-MAD.
3 cf Recital 4 MAR.
4 See also Recital 5 MAR.
5 Directive 2003/6/EC of the European Parliament and of the Council of 28 January 2003 on insider dealing and market
manipulation (Market Abuse Directive – MAD) [2003] OJ L 96/16.
6 In particular through the increased use of MTFs and other organised trading systems, such as, e.g., crossing networks.
7 See Impact assessment of the Commission, ‘Proposal for a Regulation of the European Parliament and of the Council
on insider dealing and market manipulation (market abuse)’ COM (2011) 651 final.
2
C. Background
After the conclusion of negotiations with the Council and the European Parliament, the MAR 1.009
was published in the Official Journal of the EU on 12 June 2014 and entered into force on 3
July 2016.
Literature
Canaris C-W, Habersack M and Schäfer C (eds), Handelsgesetzbuch – Großkommentar (5th edn, De
Gruyter 2008 ff), established by Staub H
Commission, ‘Staff Working Paper Impact Assessment’ [2011] (SEC/2011/1217 final)
Grundmann S, in Claus-Wilhelm Canaris, Mathias Habersack and Carsten Schäfer (eds, established by
Hermann Staub), Handelsgesetzbuch - Großkommentar (5th edn, vol 11/1, De Gruyter 2017)
Hinterhofer H, ‘Aktuelle Entwicklungen bei der strafrechtlichen Sanktionierung des Marktmissbrauchs’
(2015) 4 ÖZW 151
Kalss S, Oppitz M and Zollner J (eds), Kapitalmarktrecht (2nd edn, Linde 2015)
Pachinger S and Mayr-Riedler T, ‘Verschärfungen im europäischen Kapitalmarktrecht – Das neue
EU-Marktmissbrauchsregime’ (2015) 4 GesRZ 230
3
ARTICLE 2
SCOPE
Elena Guggenberger
1. This Regulation applies to the following:

(a) financial instruments admitted to trading on a regulated market or for which a request
for admission to trading on a regulated market has been made;
(b) financial instruments traded on an MTF, admitted to trading on an MTF or for
which a request for admission to trading on an MTF has been made;
(c) financial instruments traded on an OTF;
(d) financial instruments not covered by point (a), (b) or (c), the price or value of which
depends on or has an effect on the price or value of a financial instrument referred to
in those points, including, but not limited to, credit default swaps and contracts for
difference.
This Regulation also applies to behaviour or transactions, including bids, relating to the
auctioning on an auction platform authorised as a regulated market of emission allowances
or other auctioned products based thereon, including when auctioned products are not
financial instruments, pursuant to Regulation (EU) No 1031/2010. Without prejudice
to any specific provisions referring to bids submitted in the context of an auction, any
requirements and prohibitions in this Regulation referring to orders to trade shall apply
to such bids.
2. Articles 12 and 15 also apply to:
(a) spot commodity contracts, which are not wholesale energy products, where the trans-
action, order or behaviour has or is likely or intended to have an effect on the price or
value of a financial instrument referred to in paragraph 1;
(b) types of financial instruments, including derivative contracts or derivative instru-
ments for the transfer of credit risk, where the transaction, order, bid or behaviour has
or is likely to have an effect on the price or value of a spot commodity contract where
the price or value depends on the price or value of those financial instruments; and
(c) behaviour in relation to benchmarks.
3. This Regulation applies to any transaction, order or behaviour concerning any financial
instrument as referred to in paragraphs 1 and 2, irrespective of whether or not such trans-
action, order or behaviour takes place on a trading venue.
4. The prohibitions and requirements in this Regulation shall apply to actions and omissions,
in the Union and in a third country, concerning the instruments referred to in paragraphs
1 and 2.
4
B. Financial instruments on an organised trading venue
OVERVIEW
A. INTRODUCTION 2.001 3. Spot commodity contracts, derivatives

B. FINANCIAL INSTRUMENTS ON AN ORGANISED and benchmarks 2.011
TRADING VENUE 2.002 D. EXTENDED SCOPE OF APPLICATION IN
C. OTHER FINANCIAL INSTRUMENTS 2.007 RELATION TO FINANCIAL INSTRUMENTS 2.016
1. General 2.007 1. Independence of trading venues 2.016
2. Emission allowances 2.009 2. International scope of application 2.017
A. INTRODUCTION
Art 2 provides an overview of the scope of application of the MAR. In contrast to the MAD 2.001
2003, which focused on financial instruments on a regulated market, the MAR has an extended
scope of application. In addition to the regulated market, financial instruments on multilateral
trading facilities (MTF) and organised trading facilities (OTF) are now also covered, as well
as all behaviours and measures that are carried out independently of a trading venue but which
may affect a financial instrument traded or admitted to trading there.1
B. FINANCIAL INSTRUMENTS ON AN ORGANISED TRADING VENUE
The main area of application of the MAR is based on two elements, the financial instrument 2.002
itself and the place where it can be traded (regulated market, MTF, OTF). The definition of
the term ‘financial instrument’ as well as that of trading venues – regulated market, MTF and
OTF – are regulated in MiFID II.2
Included are all financial instruments that have already been admitted to trading on one of 2.003
these venues or for which an application for admission to trading has been made.
The regulated market has existed since MiFID I and the core content of the term has not been 2.004
changed by MiFID II.3 The reference of the definitions of the MAR to MiFID II now also
covers those financial instruments that are admitted to EU/EEA foreign stock exchanges or
trading systems or for which an application for admission has been submitted.
1 See Recital 8 MAR.

2 Art 4 para 1 (15), (21–23) and (24) MiFID II.
3 According to Art 4 para 1 (21) MiFID II, a regulated market means a multilateral system operated and/or managed by
a market operator which brings together or facilitates the bringing together of multiple third-party buying and selling
interests in financial instruments – within the system and in accordance with its non-discretionary rules – in a way that
results in a contract in respect of the financial instruments admitted to trading under its rules and/or systems, and which
is authorised and functions regularly in accordance with Title III of this Directive. The term ‘regulated market’ is also
used to refer to stock exchanges.
5
Article 2 SCOPE
2.005 Financial instruments that are traded or authorised on an MTF or for which an application for
authorisation has been submitted are also covered by the MAR. The term MTF is also based
on MiFID I and is also found in MiFID II.4
2.006 The OTF trading platform was newly introduced by MiFID II.5 Similar to the MTF, this is
also a multilateral system, which, however, allows for discretion as regards the manner in which
transactions are executed.6
C. OTHER FINANCIAL INSTRUMENTS
1. General
2.007 The MAR aims at a broad scope of application and, therefore, also covers those financial
instruments which are not directly traded on an organised trading venue (regulated market,
MTF, OTF), but whose value or price depends on a financial instrument traded or authorised
on these trading venues. Thus acts of circumvention, in particular, should be prevented.
2.008 Credit default swaps or contracts for difference are explicitly mentioned as such financial
instruments in Art 2 para 1 lit d, as they are usually not traded with third parties through
multilateral systems, but directly with the respective provider. The MAR states that there is no
restriction only on these explicitly named instruments. Rather, the MAR applies to all financial
instruments whose price can be derived directly or indirectly from the instruments listed in Art
2 para 1 lit a–c, irrespective of whether or not they have their own admission to trading. For
example, conversion and option rights on shares and share options from employee programmes
relating to listed shares are covered, as are, for example, standardised derivative contracts on
financial instruments that are agreed off-exchange and can be concluded on the Internet with
various providers (so-called click options).7
4 According to Art 4 para 1 (22), a ‘multilateral trading facility’ (MTF) means a multilateral system operated by an invest-
ment firm or a market operator that brings together multiple third-party buying and selling interests in financial instru-
ments – in the system and in accordance with non-discretionary rules – in a way that results in a contract in accordance
with Title II of MiFID II.
5 According to Art 4 para 1 (23) MiFID II, an ‘organised trading facility’ (OTF) is a multilateral system that is not
a regulated market or an MTF and in which multiple third-party buying and selling interests in bonds, structured
finance products, emission allowances or derivatives are able to interact in the system in a way that results in a contract
in accordance with Title II of this Directive.
6 See Recital 9 MiFIR.
7 Klaus Hopt and Christoph Kumpan, ‘§ 107 Insider- und Ad-hoc-Publizitätsprobleme’ in Herbert Schimansky,
Hermann-Josef Bunte and Hans-Jürgen Lwowski (eds), Bankrechts-Handbuch (5th edn, C. H. Beck 2017) para 24; see
also BaFin, ‘Emittentenleitfaden Modul C’ [2020] 8 f; Petra Buck-Heeb, ‘§ 8 Insiderrecht’ in Heinz-Dieter Assmann,
Rolf Schütze and Petra Buck-Heeb (eds), Handbuch des Kapitalanlagerechts (5th edn, C. H. Beck 2020) paras 40ff.
6
C. Other financial instruments
2. Emission allowances
Actions and transactions relating to emission allowances and other auction objects based on 2.009
them, which are auctioned on auction platforms pursuant to Regulation 1031/2010,8 are now
included in the scope of application of the MAR. The MAR covers auction platforms that are
admitted as a regulated market and all products auctioned on them, regardless of whether or
not they are financial instruments (Art 2 para 1 subpara 1).9 Auctioned products pursuant to
Regulation (EU) 1031/2010 are futures, forwards and two-day spot contracts.10
The scope of the MAR already applies at the stage of allocation of allowances to the auction 2.010
platforms and thereafter also to trading itself. Art 2 para 1 subpara 1 clarifies that the prohibited
activities of the MAR are extended in time insofar as bids and all related legal and other behav-
iour are already covered by the prohibition of insider dealing and market manipulation of the
MAR in the preparatory phase of an auction. Only the reference to the auction must be given.11
3. Spot commodity contracts, derivatives and benchmarks
The scope of application of the MAR in Art 2 para 2 lit a, b and c refers only to the prohibition 2.011
of market manipulation (Art 12 and Art 15) and covers spot commodity contracts, derivative
contracts and derivative instruments as well as the influence of benchmarks. This is also
intended to include a possible ‘remote effect’ of manipulative behaviour on the market segments
(organised trading venues) and financial instruments that are actually covered by the MAR in
its core area in Art 2 para 1.12
Spot commodity contracts are only covered to the extent that they are not wholesale energy 2.012
products under REMIT,13 but their transaction, order or trading has an impact on a financial
instrument under Art 2 para 1. Spot commodity contracts have a short delivery time of two days
and are not financial instruments as defined by capital market law. However, since the MAR
wants to cover as many constellations of market manipulation as possible, spot commodity
contracts are also included in the scope of application, provided that they have an effect on the
price of financial instruments in accordance with Art 2 para 1.
8 Regulation (EU) 1031/2010 of the Commission of 12 November 2010 on the timing, administration and other aspects
of the auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament
and of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community [2010]
OJ L 302/1.
9 The provisions of Regulation (EU) 1031/2010 are not affected by those of the MAR, but apply in addition (Art 2 para
1 subpara 1 last sentence MAR).
10 Two-day spot contracts were included in the scope of Regulation (EU) 1031/2010 precisely because they are not
a financial instrument as defined by financial market law (e.g., under MiFID I and MiFID II). Market participants
should be granted the flexibility to choose the optimal delivery period for them. Short delivery periods encourage wide
participation, thereby mitigating the risk of market abuse and better ensure accessibility for small- and medium-sized
enterprises covered by the scheme and small emitters (cf Recital 14 of Regulation 1031/2010).
11 Stefan Grundmann in Claus-Wilhelm Canaris, Mathias Habersack and Carsten Schäfer (eds, established by Hermann
Staub), Handelsgesetzbuch - Großkommentar (5th edn, vol 11/1, De Gruyter 2017), 6. Teil Marktregeln Arts 2, 3 MAR
paras 291, 292.
12 Grundmann (n 11) para 294.
13 Regulation (EU) 1227/2011 of the European Parliament and of the Council of 25 October 2011 on wholesale energy
market integrity and transparency [2011] OJ L 326/1.
7
Article 2 SCOPE
2.013 In addition, the derivative contracts and derivative financial instruments referred to in Art
2 para 2 lit b are also covered by the prohibition on market manipulation under Arts 12 and
15, where conduct or behaviour (transactions, orders, bids) have a current or future effect on
the price or value of a spot commodity contract, which in turn has a relevance to a financial
instrument pursuant to Art 1 para 2. This interleaving is intended to ensure that also indirectly
executed manipulative behaviour, i.e., outside the core area of application of the MAR, can also
be penalised.
2.014 The extension of the prohibition of market manipulation in regard to benchmarks was not
included in the Commission’s original proposal. It was only inserted in the course of the negoti-
ations on the draft text of the MAR when it was recognised from practice that the manipulating
influence of benchmarks can cause lasting damage to financial markets.14
2.015 The term benchmark is defined in Art 3 para 1 (29). It is a rate, index or figure made available
to the public or published periodically or regularly. Benchmarks are used to determine prices
or values of or for financial instruments, especially derivative contracts, using a pre-established
procedure with regard to the formula and the collection of data.15
D. EXTENDED SCOPE OF APPLICATION IN RELATION TO FINANCIAL

INSTRUMENTS
1. Independence of trading venues
2.016 Art 2 para 3 reflects the intention of the MAR to cover trading with financial instruments as far
as possible.16 It is therefore explicitly clarified that the scope of application of the MAR extends
to all transactions, orders and behaviour concerning any financial instrument referred to in Art
2 paras 1 and 2, irrespective of whether or not the transaction, order or behaviour takes place
on an organised trading venue (regulated market, MTF or OTF) or outside such a venue in the
presence or absence of such a venue.17
2. International scope of application
2.017 Art 2 para 4 makes it clear that the rules of the MAR in relation to the instruments referred to
in paras 1 and 2 apply not only to behaviour and omissions in the EU area but also to those in
third countries.18 The MAR makes the territorial scope of application more general by referring
14 This necessity became particularly apparent in the wake of the LIBOR scandal in 2011, when manipulations of the
LIBOR (London Interbank Offered Rate) and EURIBOR (Euro Interbank Offered Rate) reference interest rates by
banks in Europe and the USA were uncovered.
15 See also Grundmann (n 11) para 295.
16 See also Recital 8 MAR.
17 Thus the transaction (or the order or the action) can be carried out face-to-face or also by telephone, see Hopt and
Kumpan (n 7) para 31; Christoph Kumpan and Robin Misterek, in Eberhard Schwark and Daniel Zimmer (eds),
Kapitalmarktrechtskommentar (5th edn, C. H. Beck 2020) Art 2 MAR para 31.
18 Similarly, Art 10 of the MAD 2003 (which was transposed into Austrian law by § 48e paras 5 and 5a Stock Exchange
Act 1989) had already defined the territorial scope of application, explicitly referring to the actions and the place of
admission of the financial instrument.
8
D. Extended scope of application in relation to financial instruments
solely and uniformly to the entire MAR regime and the instruments of paras 1 and 2 covered
therein.19 This general formulation is intended to ensure comprehensive protection of the
capital markets. In this sense, it is stressed that, automatically, all cross-border cases to which
behaviour and omissions relating to instruments of paras 1 and 2 refer fall within the scope of
the MAR. It is, therefore, no longer necessary to refer to a similar market abuse law in a third
country.
Literature
Buck-Heeb, P, ‘§ 8 Insiderrecht’ in Assmann, H-D, Schütze R and Buck-Heeb P (eds), Handbuch des
Kapitalanlagerechts (5th edn, C. H. Beck 2020)
Gebauer M and Teichmann C (eds), Enzyklopädie Europarecht, Band VI – Europäisches Privat- und
Unternehmensrecht (Nomos 2016)
Grundmann, S, in Claus-Wilhelm Canaris, Mathias Habersack and Carsten Schäfer (eds, established by
Hopt K and Kumpan C, ‘§ 107 Insider- und Ad-hoc-Publizitätsprobleme’ in Schimansky H, Bunte H-J
and Lwowski H-J (eds), Bankrechts-Handbuch (5th edn, C. H. Beck 2017)
Schwark E and Zimmer D (eds), Kapitalmarktrechts-Kommentar (5th edn, C. H. Beck 2020)
19 The disadvantage of the uniform regulation by the MAR is that specific national rules are no longer applicable. As
a result, the sanctioning of market abuse behaviour outside the MAR scope is not possible anymore.
9
ARTICLE 3
DEFINITIONS
Elena Guggenberger
(1) For the purposes of this Regulation, the following definitions apply:
1. ‘financial instrument’ means a financial instrument as defined in point (15) of Article
4(1) of Directive 2014/65/EU;
2. ‘investment firm’ means an investment firm as defined in point (1) of Article 4(1) of
Directive 2014/65/EU;
3. ‘credit institution’ means a credit institution as defined in point (1) of Article 4(1) of
Regulation (EU) No 575/2013 of the European Parliament and of the Council;
4. ‘financial institution’ means a financial institution as defined in point (26) of Article
4(1) of Regulation (EU) No 575/2013;
5. ‘market operator’ means a market operator as defined in point (18) of Article 4(1) of
6. ‘regulated market’ means a regulated market as defined in point (21) of Article 4(1) of
7. ‘multilateral trading facility’ or ‘MTF’ means a multilateral system as defined in point
(22) of Article 4(1) of Directive 2014/65/EU;
8. ‘organised trading facility’ or ‘OTF’ means a system or facility in the Union as defined
in point (23) of Article 4(1) of Directive 2014/65/EU;
9. ‘accepted market practice’ means a specific market practice that is accepted by a com-
petent authority in accordance with Article 13;
10. ‘trading venue’ means a trading venue as defined in point (24) of Article 4(1) of
11. ‘SME growth market’ means SME growth market as defined in point (12) of Article
12. ‘competent authority’ means an authority designated in accordance with Article 22,
unless otherwise specified in this Regulation;
13. ‘person’ means a natural or legal person;
14. ‘commodity’ means a commodity as defined in point (1) of Article 2 of Commission
Regulation (EC) No 1287/2006;
15. ‘spot commodity contract’ means a contract for the supply of a commodity traded
on a spot market which is promptly delivered when the transaction is settled, and
a contract for the supply of a commodity that is not a financial instrument, including
a physically settled forward contract;
10
Article 3 DEFINITIONS
16. ‘spot market’ means a commodity market in which commodities are sold for cash and
promptly delivered when the transaction is settled, and other non-financial markets,
such as forward markets for commodities;
17. ‘buy-back programme’ means trading in own shares in accordance with Articles 21 to
27 of Directive 2012/30/EU of the European Parliament and of the Council;
18. ‘algorithmic trading’ means algorithmic trading as defined in point (39) of Article
19. ‘emission allowance’ means emission allowance as described in point (11) of Section C
of Annex I to Directive 2014/65/EU;
20. ‘emission allowance market participant’ means any person who enters into trans-
actions, including the placing of orders to trade, in emission allowances, auctioned
products based thereon, or derivatives thereof and who does not benefit from an
exemption pursuant to the second subparagraph of Article 17(2);
21. ‘issuer’ means a legal entity governed by private or public law, which issues or pro-
poses to issue financial instruments, the issuer being, in case of depository receipts
representing financial instruments, the issuer of the financial instrument represented;
22. ‘wholesale energy product’ means wholesale energy product as defined in point (4) of
Article 2 of Regulation (EU) No 1227/2011;
23. ‘national regulatory authority’ means national regulatory authority as defined in point
(10) of Article 2 of Regulation (EU) No 1227/2011;
24. ‘commodity derivatives’ means commodity derivatives as defined in point (30) of
Article 2(1) of Regulation (EU) No 600/2014 of the European Parliament and of the
Council;
25. ‘person discharging managerial responsibilities’ means a person within an issuer, an
emission allowance market participant or another entity referred to in Article 19(10),
who is:
(a) a member of the administrative, management or supervisory body of that entity;
or
(b) a senior executive who is not a member of the bodies referred to in point (a), who
has regular access to inside information relating directly or indirectly to that entity
and power to take managerial decisions affecting the future developments and
business prospects of that entity;
26. ‘person closely associated’ means:
(a) a spouse, or a partner considered to be equivalent to a spouse in accordance with
national law;
(b) a dependent child, in accordance with national law;
(c) a relative who has shared the same household for at least one year on the date of
the transaction concerned; or
(d) a legal person, trust or partnership, the managerial responsibilities of which are
discharged by a person discharging managerial responsibilities or by a person
referred to in point (a), (b) or (c), or which is directly or indirectly controlled by
such a person, or which is set up for the benefit of such a person, or the economic
interests of which are substantially equivalent to those of such a person;
27. ‘data traffic records’ means records of traffic data as defined in point (b) of the second
paragraph of Article 2 of Directive 2002/58/EC of the European Parliament and the
Council;
11
28. ‘person professionally arranging or executing transactions’ means a person profes-

sionally engaged in the reception and transmission of orders for, or in the execution
of transactions in, financial instruments;
29. ‘benchmark’ means any rate, index or figure, made available to the public or published
that is periodically or regularly determined by the application of a formula to, or on
the basis of the value of one or more underlying assets or prices, including estimated
prices, actual or estimated interest rates or other values, or surveys, and by reference
to which the amount payable under a financial instrument or the value of a financial
instrument is determined;
30. ‘market maker’ means a market maker as defined in point (7) of Article 4(1) of
31. ‘stake-building’ means an acquisition of securities in a company which does not
trigger a legal or regulatory obligation to make an announcement of a takeover bid in
relation to that company;
32. ‘disclosing market participant’ means a person who falls into any of the categories set
out in points (a) to (d) of Article 11(1) or of Article 11(2), and discloses information
in the course of a market sounding;
33 ‘high-frequency trading’ means high-frequency algorithmic trading technique as
defined in point (40) of Article 4(1) of Directive 2014/65/EU;
34. ‘information recommending or suggesting an investment strategy’ means information:
(i) produced by an independent analyst, an investment firm, a credit institution, any
other person whose main business is to produce investment recommendations or
a natural person working for them under a contract of employment or otherwise,
which, directly or indirectly, expresses a particular investment proposal in respect
of a financial instrument or an issuer;
(ii) produced by persons other than those referred to in point (i), which directly pro-
poses a particular investment decision in respect of a financial instrument;
35. ‘investment recommendations’ means information recommending or suggesting
an investment strategy, explicitly or implicitly, concerning one or several financial
instruments or the issuers, including any opinion as to the present or future value or
price of such instruments, intended for distribution channels or for the public.
(2) For the purposes of Article 5, the following definitions apply:
(a) ‘securities’ means:
(i) shares and other securities equivalent to shares;
(ii) bonds and other forms of securitised debt; or
(iii) securitised debt convertible or exchangeable into shares or into other securities
equivalent to shares.
(b) ‘associated instruments’ means the following financial instruments, including those
which are not admitted to trading or traded on a trading venue, or for which a request
for admission to trading on a trading venue has not been made:
(i) contracts or rights to subscribe for, acquire or dispose of securities;
(ii) financial derivatives of securities;
(iii) where the securities are convertible or exchangeable debt instruments, the secu-
rities into which such convertible or exchangeable debt instruments may be con-
verted or exchanged;
12
A. Financial instruments (1)
(iv) instruments which are issued or guaranteed by the issuer or guarantor of the
securities and whose market price is likely to materially influence the price of the
securities, or vice versa;
(v) where the securities are securities equivalent to shares, the shares represented by
those securities and any other securities equivalent to those shares;
(c) ‘significant distribution’ means an initial or secondary offer of securities that is dis-
tinct from ordinary trading both in terms of the amount in value of the securities to be
offered and the selling method to be employed;
(d) ‘stabilisation’ means a purchase or offer to purchase securities, or a transaction in
associated instruments equivalent thereto, which is undertaken by a credit institution
or an investment firm in the context of a significant distribution of such securities
exclusively for supporting the market price of those securities for a predetermined
period of time, due to a selling pressure in such securities.
OVERVIEW
A. FINANCIAL INSTRUMENTS (1) 3.001 (20)3.046

B. INVESTMENT FIRM (2) 3.004 U. ISSUER (21) 3.049
C. CREDIT INSTITUTION (3) 3.016 V. WHOLESALE ENERGY PRODUCT (22) 3.050
D. FINANCIAL INSTITUTION (4) 3.018 W. NATIONAL REGULATORY AUTHORITY (23) 3.052
E. MARKET OPERATOR (5) 3.020 X. COMMODITY DERIVATIVES (24) 3.053
F. REGULATED MARKET (6) 3.023 Y. PERSON DISCHARGING MANAGERIAL
G. MULTILATERAL TRADING FACILITY (7) 3.027 RESPONSIBILITIES (25) 3.054
H. ORGANISED TRADING FACILITY (8) 3.029 Z. PERSON CLOSELY ASSOCIATED (26) 3.055
I. ACCEPTED MARKET PRACTICE (9) 3.032 AA. DATA TRAFFIC RECORDS (27) 3.057
J. TRADING VENUE (10) 3.034 BB. PERSON PROFESSIONALLY ARRANGING OR
K. SME GROWTH MARKET (11) 3.035 EXECUTING TRANSACTIONS (28) 3.058
L. COMPETENT AUTHORITY (12) 3.036 CC. BENCHMARK (29) 3.059
M. PERSON (13) 3.037 DD. MARKET MAKER (30) 3.060
N. COMMODITY (14) 3.038 EE. STAKE-BUILDING (31) 3.061
O. SPOT COMMODITY CONTRACT (15) 3.039 FF. DISCLOSING MARKET PARTICIPANT (32) 3.062
P. SPOT MARKET (16) 3.041 GG. HIGH-FREQUENCY TRADING (33) 3.063
Q. BUY-BACK PROGRAMME (17) 3.042 HH. RECOMMENDING AN INVESTMENT STRATEGY
R. ALGORITHMIC TRADING (18) 3.043 (34)3.064
S. EMISSION ALLOWANCE (19) 3.044 II. INVESTMENT RECOMMENDATIONS (35) 3.065
T. EMISSION ALLOWANCE MARKET PARTICIPANT JJ. DEFINITIONS ACCORDING TO PARA 2 3.067
A. FINANCIAL INSTRUMENTS (1)
The term ‘financial instruments’ in the MAR corresponds to that in MiFID II (Directive 3.001
2014/65/EU).1 Art 3 para 1 (1) MAR refers to Art 4 para 1 (15) MiFID II, which in turn refers
1 Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instru-
ments and amending Directive 2002/92/EC and Directive 2011/61/EU [2014] OJ L 173/349.
13
to Annex I Section C MiFID II, where, as under MiFID I,2 the types of financial instruments
are listed.
3.002 These are those instruments that already had to be implemented under MiFID I and which
are now also contained in MiFID II. Included are transferable securities, money market instru-
ments, units of collective investment (AIF and UCITS) and the various forms of derivatives
such as options, futures, forwards, swaps and comparable ‘other’ derivative contracts.
3.003 In an effort to cover as many financial products as possible, MiFID II included emission allow-
ances in the definition of ‘financial instruments’ and the concept of derivatives was extended to
include those derivatives that are traded on an OTF (Annex I Section C (6) MiFID II).3
B. INVESTMENT FIRM (2)
3.004 With regard to the concept of an investment firm, Art 3 para 1 (2) refers to Art 4 para 1 (1)
MiFID II. Accordingly, an investment firm means any legal person whose regular occupation
or business is the provision of one or more investment services to third parties and/or the per-
formance of one or more investment activities on a professional basis. The classification of the
definition was taken over from MiFID I.
3.005 As under MiFID I, the types of investment services and investment activities are listed in
Annex I Section A MiFID II and relate to the instruments listed in Annex I Section D.
3.006 According to Art 4 para 1 (1) of MiFID II, Member States may include in the definition of
investment firms undertakings which are not legal persons, provided that:
3.007 (a) their legal status ensures a level of protection for third parties’ interests equivalent to that
afforded by legal persons, and
3.008 (b) they are subject to equivalent prudential supervision appropriate to their legal form.
3.009 However, if a natural person provides services involving the holding of funds or transferable
investments of third parties, this person can only be considered an investment firm for the
purposes of MiFID II and MiFIR4 if, without prejudice to the other requirements of MiFID
II, MiFIR and CRD IV,5 the following conditions are fulfilled:
2 Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial
instruments amending Council Directives 85/611/EEC and 93/6/EEC and Directive 2000/12/EC of the European
Parliament and of the Council and repealing Council Directive 93/22/EEC [2004] OJ L 145/1.
3 This does not apply to wholesale energy products which are traded on OTFs and which must be effectively managed
(Annex I Section C (6) last sent MiFID II).
4 Regulation (EU) 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial
instruments and amending Regulation (EU) No 648/2012 [2014] OJ L 173/84.
5 Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit
institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC
and repealing Directives 2006/48/EC and 2006/49/EC [2013] OJ L 176/338.
14
C. Credit institution (3)
(a) the property rights of third parties to securities and funds must be protected, especially in 3.010
the event of insolvency of the firm or its owners, seizure, set-off or other claims asserted by
the creditors of the firm or its owners;
(b) the firm must be subject to provisions on the monitoring of its solvency, including that of 3.011
its owners;
(c) the annual financial statement of the company must be inspected by one or more persons 3.012
authorised to audit the accounts according to national law;
(d) where a firm has only one owner, that person must take appropriate measures to protect 3.013
investors in the event that the firm ceases trading as a result of his death, incapacity or any
other comparable event.
In France, the definition as set out in Art 4 para 1 (1) MiFID II is regulated in Art L531–4 3.014
code monétaire et financier (c. mon. fin.). The catalogue of securities services and investment
activities listed in annex I section A MiFID II was implemented in Art L321–1 c. mon. fin.
In Germany, Art 4 para 1 (1) MiFID II was implemented in § 2 para 10 WpHG.6 In the
UK, this Art was implemented by means of s 424A para 1 Financial Services and Markets Act
20007 and in the glossary to the FCA Handbook. In Austria, Art 4 para 1 (1) MiFID II was
implemented in § 1 para 1 (1) in conjunction with § 3 WAG (Austrian Securities Supervision
Act) 2018.8 The European law definition of investment firm is broader than the Austrian. As
in WAG 2007,9 WAG 2018 does not adopt the complete catalogue of securities services and
investment activities listed in Annex I section A MiFID II. § 3 para 2 WAG 2018 governs the
licensing requirements for securities firms and links their activities to commercial provision. If
investment firms base their entitlement to provide securities services and investment activities
on the BWG10 or the BörseG,11 they are not investment firms within the meaning of WAG
2018. However, since the MAR explicitly refers to the investment firm concept of MiFID II,
the European law concept is authoritative for the purposes of the MAR.12
MiFID II does not regulate the country of origin of the investment firm with regard to the 3.015
definition of the investment firm, and, therefore, both domestic and foreign investment firms
are covered.
C. CREDIT INSTITUTION (3)
With regard to the definition of the term ‘credit institution’, Art 3 para 1 (3) MAR refers to Art 3.016
4 para 1 (1) of Regulation (EU) 575/2013 – CRR.13 There, a credit institution is defined as an
6 Wertpapierhandelsgesetz 1998, BGBl I 2708.

7 Financial Services and Markets Act 2000, SI 2000/8.
8 Wertpapieraufsichtsgesetz 2018, BGBl I 107/2017.
9 Wertpapieraufsichtsgesetz 2007, BGBl I 60/2007.
10 Bankwesengesetz, Art I BGBl 532/1993.
11 Börsegesetz 2018, BGBl I 107/2017.
12 Also earlier, in implementation of the MAD 2003 in §§ 48a – 48r Börsegesetz 1989, the definition of investment firm
in § 48a para 1 (11) Börsegesetz 1989 also referred directly to MiFID I and not to WAG 2007.
13 Regulation (EU) 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements
for credit institutions and investment firms and amending Regulation (EU) 648/2012 [2013] OJ L 176/1.
15
undertaking the business of which is to take deposits or other repayable funds from the public
and to grant credits for its own account.
3.017 From a national perspective, in Germany, credit institutions are companies that conduct
banking business commercially or to an extent that requires a commercially oriented business
operation (§ 1 para 1 KWG).14 The activities carried out by those institutions are listed in
§ 1 para 1 (1)-(12) KWG. In Austria, according to § 1 para 1 BWG, a credit institution is
an institution which is authorised to carry out commercial banking transactions on the basis
of a licence. The corresponding concrete activities are listed in § 1 para 1 (1)-(23) BWG. In
France and in the UK the term ‘credit institution’ does not differ from the definition as set out
in Art 4 para 1 (1) CRR.
D. FINANCIAL INSTITUTION (4)
3.018 With regard to the definition of the term ‘financial institution’, Art 3 para 1 (4) MAR refers to
Art 4 para 1 (26) CRR. Accordingly, a ‘financial institution’ means an undertaking other than
an institution, the principal activity of which is to acquire holdings or to pursue one or more of
the activities listed in (2) to (12) and (15) of Annex I to Directive 2013/36/EU; this definition
includes financial holding companies, mixed financial holding companies, payment institutions
as defined in Directive 2015/2366/EU15 and asset management companies, excluding insur-
ance holding companies and mixed-activity insurance holding companies as defined in Art 212
para 1 lit f and lit g of Directive 2009/138/EC.16
3.019 In Austria, § 1 para 2 BWG defines the term ‘financial institution’ as one which is not a credit
institution pursuant to § 1 para 1 BWG and which conducts one or more of the activities
listed in § 1 para 2 (1)–(8) BWG as its main activity. In France, Germany and in the UK, the
definition of Art 4 para 1 (26) CRR was transposed into national law (Art L511–21 para 4 c.
mon. fin.; § 1 para 3 KWG; glossary to the FCA Handbook).
E. MARKET OPERATOR (5)
3.020 The definition of market operator17 is also taken over from MiFID II in that Art 3 para 1 (5)
MAR refers to Art 4 para 1 (18) MiFID II. Accordingly, a market operator is a person who
manages and/or operates the business of a regulated market, whereby this person may also be
the regulated market itself.
14 Kreditwesengesetz 1998, BGBl I 2776.

15 Directive 2015/2366/EU of the European Parliament and of the Council of 25 November 2015 on payment services
in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No
1093/2010, and repealing Directive 2007/64/EC [2015] OJ L 337/35.
16 Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and
pursuit of the business of Insurance and Reinsurance (Solvency II) [2009] OJ L 335/1.
17 In the original version of the MAR (OJ L 173/1 of 12 June 2014 ), the term ‘market participant’ was erroneously men-
tioned here, but reference was made to the term ‘market operator’ in MiFID II. This (obvious) error was corrected by the
amendment to MAR in OJ L 287/320 of 21 October 2016.
16
G. Multilateral trading facility (7)
MiFID I already introduced the concept of a regulated market, which is where the distinction 3.021
between market operator and regulated market originates. This classification was adopted in
MiFID II. Under MiFID II, the operators of a regulated market can therefore not only operate
a regulated market but also pursue the operation of an MTF or OTF.18
In Germany, the MiFID II definition was implemented in § 2 para 1 BörsG,19 thus ‘Börsen’ 3.022
are market operators. In the UK, this term is defined in the glossary to the FCA Handbook. In
Austria, the implementation was made in § 1 (17) BörseG 2018, according to which, a market
operator is an entity that manages and operates a regulated market including an Austrian
exchange operating company that operates a securities exchange. In accordance with the
requirements of MiFID II, it is added that a market operator can be the regulated market itself.
F. REGULATED MARKET (6)
The term ‘regulated market’ is defined by reference to Art 4 para 1 (21) MiFID II. 3.023
Accordingly, it is a multilateral system operated and/or managed by a market operator which 3.024
brings together or facilitates the bringing together of multiple third-party buying and selling
interests in financial instruments within the system and in accordance with its non-discretion-
ary rules in a way that results in a contract, in respect of the financial instruments admitted to
trading under the rules and/or systems of the market and which is authorised and functions
regularly and in accordance with Title III MiFID II.
In implementing MiFID I, § 76 para 1 of the Austrian BörseG 1989 provided that the Official 3.025
Market and the Second Regulated Market are regulated markets as defined by MiFID I. Since
the BörseG 2018, the regulated market has consisted only of the Official Market, as the Second
Regulated Market has ceased to exist. In France, the Regulated Market (marché réglementé) is
defined in Art L421–1 c. mon. fin.. In Germany, the so-called ‘organisierter Markt’ (organised
market) is defined in § 2 para 11 WpHG. In the UK, the definition is implemented in the
glossary to the FCA Handbook.
In the implementation of MiFID II, the regulations for the operation of a regulated market 3.026
are stated in Arts L421–1ff c. mon. fin. in France. In Germany, §§ 4ff BörsG provides for the
operation of a regulated market. In Austria, this is regulated in §§ 3ff BörseG 2018.
G. MULTILATERAL TRADING FACILITY (7)
With regard to the definition of the MTF, Art 3 para 1 (7) MAR refers to Art 4 para 1 (22) 3.027
MiFID II. This is a multilateral facility operated by an investment firm or a market operator,
which brings together multiple third-party buying and selling interests in financial instruments
18 Recital 121 MiFID II explicitly states that operators of regulated markets can also operate an MTF or OTF.
19 Börsengesetz 2007, BGBl I 1330.
17
in the system and in accordance with non-discretionary rules in a way that results in a contract
in accordance with Title II MiFID II.
3.028 The MTF was already introduced under MiFID I20 as an alternative trading platform to the
regulated market. Both are multilateral platforms. The best-known MTFs in Europe are
Turquoise, Lang und Schwarz and Tradegate Exchange.21 Euronext Paris operates Euronext
Growth and Euronext Access as MTFs.22 In Germany, an MTF is operated by the Deutsche
Börse Group as a ‘Freiverkehr’ (Open Market),23 whereas in Austria, it is operated by the
Wiener Börse AG as a so-called ‘Vienna MTF’.24 The regulatory provisions of the MTF are
very similar to those for regulated markets, in particular the admission requirements. The
BörseG 2018 regulates the MTF in a separate section,25 immediately after the provisions on the
regulated market, and also covers a special form of MTF newly introduced by MiFID II, the
SME growth market.26 MTFs have never been subject to the strict transparency requirements
imposed on issuers on regulated markets (e.g., the provisions of the Transparency Directive).
However, MiFID II now extends all MAR requirements to MTFs.
H. ORGANISED TRADING FACILITY (8)
3.029 Art 3 para 1 (8) MAR refers to Art 4 para 1 (23) MiFID II and defines an OTF as a multi-
lateral system which is not a regulated market or an MTF and in which multiple third-party
buying and selling interests in bonds, structured financial products, emission allowances or
derivatives are able to interact in the system in a way that results in a contract in accordance
with Title II MiFID II (Arts 5ff MiFID II).
3.030 The OTF was introduced as a new trading venue by MIFID II and aims in particular to take
account of the emerging new generation of organised trading systems alongside regulated
markets in order to continue to ensure the effective and orderly functioning of financial
markets. Above all, it should also be ensured that the new systems cannot benefit from regu-
latory loopholes.27
3.031 The difference between OTFs and other organised trading venues is that OTFs have dis-
cretionary power to execute orders, whereas regulated markets and MTFs execute orders in
20 Art 4 para 1 (15) MiFID I.

21 Lars Klöhn, ‘Artikel 2: Anwendungsbereich’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) para 94.
22 Euronext, MTFs operated by Euronext https://www.euronext.com/en/regulation/mtfs-operated-euronext accessed 19
August 2020.
23 Klöhn, ‘Artikel 2’ (n 21) para 94.
24 Wiener Börse, MTF https://www.wienerborse.at/wissen/boersenlexikon/buchstabe-m/mtf/ accessed 17 August 2020.
25 §§ 80ff BörseG 2018.
26 § 82 BörseG 2018.
27 cf Recital 13 MiFID II.
18
K. SME growth market (11)
accordance with non-discretionary rules.28 Unlike MTFs, OTFs are also allowed to execute
client orders against proprietary capital or to engage in matched principal trading.29
I. ACCEPTED MARKET PRACTICE (9)
The concept of accepted market practice is regulated in detail in Art 13. According to Art 12 3.032
para 1 lit a, there is no market manipulation if the person who enters into a transaction, places
an order to trade or engages in any other behaviour, establishes that such transactions, etc. have
been carried out for legitimate reasons and ‘conform with an accepted market practice as established
in accordance with Art 13’. Dogmatically, an exclusion of the facts is assumed.30
The determination of permissible market practices is not uniform throughout Europe, but is 3.033
the responsibility of the competent national authorities (see para 3.036).
J. TRADING VENUE (10)
The term ‘trading venue’ originates from MiFID II and covers the regulated market, an MTF 3.034
and an OTF (Art 3 para 1 (10) MAR in conjunction with Art 4 para 1 (24) MiFID II).
K. SME GROWTH MARKET (11)
Art 3 para 1 (11) MAR refers to Art 4 para 1 (12) MiFID II for the concept of the SME growth 3.035
market, which is an MTF registered as an SME growth market in accordance with Art 33.
This is intended to create a subcategory within MTFs.31 In order to be registered as an SME
growth market, the requirements set out in Art 33 para 3 MiFID II must be met. One of the
key requirements32 is that at least 50 per cent of the issuers must be small- and medium-sized
enterprises when the MTF is registered and in the following calendar years. According to Art
4 para 1 (13) MiFID II, this means companies that had an average market capitalisation of less
than EUR 200 million on the basis of end-year quotes for the previous three calendar years.
28 Dirk Zetsche and David Eckner, ‘§ 7: Europäisches Kapitalmarktrecht – A. Grundlagen’ in Martin Gebauer and
Christoph Teichmann (eds), Enzyklopädie Europarecht, Band 6 – Europäisches Privat- und Unternehmensrecht (Nomos
2016) para 166; cf also Recital 9 MiFIR.
29 Art 19 para 5 MiFID II.
30 Michael Racky, ‘§ 16: Zulässige Marktpraxis’ in Andreas Meyer, Rüdiger Veil and Thomas Rönnau (eds), Handbuch zum
Marktmissbrauchsrecht (C. H. Beck 2018) para 8; cf also evidence at Susanne Kalss, Martin Oppitz and Johannes Zollner
(eds), Kapitalmarktrecht (2nd edn, Linde 2015) paras 22–29.
31 Recital 132 MiFID II.
32 Rüdiger Veil, ‘KMU-Wachstumsmärkte nach MiFID II’, in Helmut Siekmann (ed), Festschrift für Theodor Baums (tome
2, Mohr Siebeck 2017) 1267, 1273.
19
L. COMPETENT AUTHORITY (12)
3.036 The competent authority for the purposes of monitoring the application of the provisions of
the MAR in Austria is the Financial Market Authority (FMA).33 34 Pursuant to § 1 FMABG35
(Financial Market Authority Act), the FMA is a public law institution with its own legal
personality. Its registered office is in Vienna and its area of activity extends to the entire
federal territory. The FMA is not bound by any instructions in the performance of its duties
(Art 20 para 2 of the B-VG). In the UK, the designated competent authority is the Financial
Conduct Authority (FCA)36, in Germany, the Bundesanstalt fur Finanzdienstleistungsaufsicht
(BaFin)37 and in France, the Autorité des marchés financiers (AMF).38
M. PERSON (13)
3.037 The purpose of the definition is to clarify that both natural persons and legal persons are
covered by the term ‘person’ (Art 3 para 1 (13) MAR).
N. COMMODITY (14)
3.038 Commodities within the meaning of (14) and the referred Art 2 (1) of Regulation 1287/200639
are ‘goods of a fungible nature that are capable of being delivered’. In other words, commodities are
marketable movable assets, in particular metals and their ores and alloys, agricultural products
and energy. The term is relevant to (15) (see below para 3.039).
O. SPOT COMMODITY CONTRACT (15)
3.039 In addition to financial instruments (1), Arts 7 and 12 cover spot commodity contracts (paras
7.036ff, 12.007). This extends the scope of the prohibitions of market abuse (Arts 14 f in
conjunction with Arts 8, 10, 12).40 The reason for this extention is that transactions on the
commodities market (14) can be price-relevant for commodity derivatives (24).
33 § 152 BörseG 2018.

34 Art 3 para 1 (12) in conjunction with Art 22 MAR.
35 Finanzmarktaufsichtsbehördengesetz, BGBl I 97/2001.
36 s 3 The Financial Services and Markets Act 2000 (Market Abuse) Regulations 2016, SI 2016/680.
37 § 6 para 5 Wertpapierhandelsgesetz (WpHG), BGBl I 62/1998 in the version BGBl I 14/2020.
38 See competent authorities of all Member States: ESMA, ‘List of competent authorities designated for the purposes of
Regulation (EU) No. 596/2014 on market abuse (MAR)’, 25 February 2020, www.esma.europa.eu/sites/default/files/
mar.pdf accessed 6 July 2020.
39 Commission Regulation (EC) 1287/2006 of 10 August 2006 implementing Directive 2004/39/EC of the European
Parliament and of the Council as regards record-keeping obligations for investment firms, transaction reporting, market
transparency, admission of financial instruments to trading, and defined terms for the purposes of that Directive [2006]
OJ L 241/1.
40 See also Stefan Grundmann in Claus-Wilhelm Canaris, Mathias Habersack and Carsten Schäfer (eds, established by
Hermann Staub), Handelsgesetzbuch – Großkommentar (5th edn, vol 11/1, De Gruyter 2017), 6. Teil Marktregeln Arts 2,
3 MAR paras 293 f.
20
R. Algorithmic trading (18)
In common parlance, spot contracts are contracts for immediate delivery (spot market), as 3.040
a rule, within two trading days. In contrast, spot commodity contracts in the sense of the
MAR also encompass forward transactions for commodities that are to be physically settled
and therefore are not already covered by the definition of financial instruments in the sense of
(1) (see also (16)).41 This in effect means that all exchange-based (Art 2) transactions involving
commodities as defined in (14) are covered by the MAR.42
P. SPOT MARKET (16)
The definition of spot markets (16) corresponds to that of spot commodity contracts (15); 3.041
therefore, see also above para 3.039. It covers all organised (forward) markets for commodities
which are not financial (i.e., futures) markets as defined in (6)ff (but see also below paras 3.050
f for wholesale energy trading).
Q. BUY-BACK PROGRAMME (17)
A buy-back programme is trading in own shares in accordance with Arts 21 to 27 of Directive 3.042
2012/30/EU:43 This defines the prohibition exemption pursuant to Art 5 para (1) to (3) with
regard to market manipulation and insider dealing (cf paras 5.013ff).
R. ALGORITHMIC TRADING (18)
For the definition of algorithmic trading, reference is made to Art 4 para 1 (39) MiFID II. 3.043
Accordingly, algorithmic trading is trading in which a computer algorithm automatically deter-
mines individual parameters of orders. These include the parameters of whether to initiate an
order, and the timing, price and quantity of the order. Systems that only route or process orders
without determining the order parameters are not covered. A prerequisite for algorithmic
trading is therefore that the algorithm (i.e., the arrangement of certain individual steps) auto-
matically determines and processes order parameters and does not merely perform the function
of routing. The algorithm therefore makes and executes an ‘independent’ decision.
41 See also Lars Klöhn, ‘Artikel 7: Insiderinformationen’ in Klöhn (n 21) para 314.
42 Dirk Zetzsche, ‘§ 7: Europäisches Kapitalmarktrecht – C. Marktintegrität/ Marktmissbrauchsrecht’ in Gebauer and
Teichmann (n 28) para 15.
43 Directive 2012/30/EU of the European Parliament and of the Council of 25 October 2012 on coordination of safeguards
which, for the protection of the interests of members and others, are required by member states of companies within the
meaning of the second paragraph of Article 54 of the Treaty on the Functioning of the European Union, in respect of
the formation of public limited liability companies and the maintenance and alteration of their capital, with a view to
making such safeguards equivalent [2012] OJ L 315/74.
21
S. EMISSION ALLOWANCE (19)
3.044 Art 3 para 1 (19) MAR refers to the list of financial instruments in Section C of Annex
I MiFID II, where the emission allowances are recorded in (11). These are shares whose
trading is based on the provisions of the Emissions Trading Scheme Directive (2003/87/EC).44
3.045 Since 2013, greenhouse gas emission allowances have been allocated in the Member States by
auction and offered for sale on auction platforms through standardised electronic contracts.
Each Member State auctions allowances in the form of two-day spots or five-day futures.45
T. EMISSION ALLOWANCE MARKET PARTICIPANT (20)
3.046 This refers to a person who enters into transactions – including the placing of orders to trade
– in emission allowances and other auctioned objects based thereon or derivatives thereof and
who is not covered by the exception pursuant to the second subparagraph of Art 17 para 2.
3.047 Art 17 para 2 subpara 1:
An emission allowance market participant shall publicly, effectively and in a timely manner disclose
inside information concerning emission allowances which it holds in respect of its business, including
aviation activities as specified in Annex I to Directive 2003/87/EC or installations within the meaning
of Article 3 lit e of that Directive which the participant concerned, or its parent undertaking or related
undertakings, owns or controls or for the operational matters of which the participant, or its parent
undertaking or related undertaking, is responsible, in whole or in part. With regard to installations,
such disclosure shall include information relevant to the capacity and utilisation of installations,
including planned or unplanned unavailability of such installations.
3.048 The first subparagraph shall not apply to a participant in the emission allowance market where
the installations or aviation activities that it owns, controls or is responsible for in the preced-
ing year have had emissions not exceeding a certain minimum threshold of carbon dioxide
equivalent and, where they carry out combustion activities, have had a rated thermal input not
exceeding a certain minimum threshold.
44 Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a system for
greenhouse gas emission allowance trading within the Union and amending Council Directive 96/61/EC [2003] OJ L
275/32. In implementation of the Emissions Trading Directive 2003/87/EC, as amended by Directive 2009/29/EC, OJ
L 140/63, through the Federal Act on a scheme for greenhouse gas emission allowance trading (Emission Allowance
Trading Act 2011), the preconditions for the functioning of the amended emissions trading system were created in
Austria from 2013.
45 Art 4 Commission Regulation (EU) 1031/2010 of 12 November 2010 on the timing, administration and other aspects
of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and
of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community [2010] OJ
L 302/1.
22
X. Commodity derivatives (24)
U. ISSUER (21)
According to Art 3 para 1 (21) MAR, an issuer is a legal entity governed by private or public 3.049
law, which issues or proposes to issue financial instruments. In the case of depository receipts
representing financial instruments, this is the person who is the issuer of the financial instru-
ment represented.
V. WHOLESALE ENERGY PRODUCT (22)
The term wholesale energy product is derived from Art 2 (4) of Regulation (EU) 1227/2011 3.050
(REMIT).46 Accordingly, the following contracts and derivatives are involved, regardless of
where and how they are traded:
(a) contracts for the supply of electricity or natural gas where delivery is in the Union;
(b) derivatives relating to electricity or natural gas produced, traded or delivered in the Union;
(c) contracts relating to the transportation of electricity or natural gas in the Union;
(d) derivatives relating to the transportation of electricity or natural gas in the Union.
Contracts for the supply and distribution of electricity or natural gas for the use of final cus- 3.051
tomers are not wholesale energy products. However, contracts for the supply and distribution of
electricity or natural gas to final customers with a consumption capacity greater than 600 GWh
per year, which are under the control of a single economic entity, shall be treated as wholesale
energy products.
W. NATIONAL REGULATORY AUTHORITY (23)
The national regulatory authority is the national regulatory authority as defined in Art 2 (10) 3.052
of Regulation (EU) No 1227/2011 on wholesale energy market integrity and transparency.47
X. COMMODITY DERIVATIVES (24)
Commodity derivatives within the meaning of (24) and the referred (30) of Art 2 para 1 3.053
MiFIR48 are all financial instruments which are based on commodity prices, climate vari-
ables, freight rates, inflation rates or other official economic statistics; emission allowances
are excluded as underlying instruments of commodity derivatives.49 Therefore, commodity
derivatives (unlike spot commodity contracts; see above paras 3.039 f) are by definition financial
46 Regulation (EU) 1227/2011 of the European Parliament and of the Council of 25 October 2011 on wholesale energy
47 Rüdiger Veil, ‘§ 4: Begriffsbestimmung’ in Meyer, Veil and Rönnau (n 30) para 12.
48 Art 2 para 1 (30) MiFIR in turn refers to Art 4 para 1 (44) lit c in conjunction with Annex 1 Section C paras 5, 6, 7, 10
MiFID 2; rightly critical of this unnessecary chain reference Zetzsche (n 42) § 7.C para 14.
49 See also Klöhn, ‘Artikel 7’ (n 41) para 311.
23
instruments. Thus, (24) is only relevant insofar as Art 7 para 1 lit b provides for special treat-
ment with regard to inside information (see below paras 7.036ff).
Y. PERSON DISCHARGING MANAGERIAL RESPONSIBILITIES (25)
3.054 According to Art 3 para 1 (25) MAR, this is a person who discharges managerial responsibili-
ties within an issuer, an emission allowance market participant or another entity referred to in
Art 19 para 10 MAR, who is a member of the administrative, management or supervisory body
of that entity or a senior executive who is not a member of these bodies but who has regular
access to inside information relating directly or indirectly to that entity and power to take
managerial decisions affecting the future developments and business prospects of that entity. It
follows from this definition that (i) members of executive bodies and (ii) other executives are
considered to be persons discharging managerial responsibilities and are therefore addressees of
the notification obligation (cf paras 19.037ff).
Z. PERSON CLOSELY ASSOCIATED (26)
3.055 Pursuant to Art 3 para 1 (26) MAR, persons closely associated are:
(a) a spouse, or a partner considered to be equivalent to a spouse in accordance with national

law;
(b) a dependent child, in accordance with national law;
(c) a relative who has shared the same household for at least one year on the date of the trans-
action concerned; or
(d) a legal person, trust or partnership, the managerial responsibilities of which are discharged
by a person discharging managerial responsibilities or by a person referred to in point (a),
(b) or (c), which is directly or indirectly controlled by such a person, which is set up for the
benefit of such a person, or the economic interests of which are substantially equivalent to
those of such a person. For all these persons, the law assumes generally that they can partake
in their advantage in knowledge due to their close relationship with persons discharging
managerial responsibilities.50
3.056 Although the German wording of Art 19 para 1 MAR (‘in enger Beziehung’) and Art 3 para
1 (26) MAR (‘eng verbunden’) is different, it can be assumed that the terms have the same
normative meaning, especially since the English version of the MAR also uniformly speaks of
‘person closely associated’.51
50 cf Leon Helm, ‘Pflichten des Wertpapierdienstleistungsunternehmens in der Finanzportfolioverwaltung bei Directors’

Dealings nach der Marktmissbrauchsverordnung’ [2016] ZIP 2201, 2203.
51 cf in this sense also Philipp Maume and Martin Kellner, ‘Director‘s Dealings unter der EU-Marktmissbrauchsverordnung’
(2017) 46/3 ZGR 273, 287.
24
DD. Market maker (30)
AA. DATA TRAFFIC RECORDS (27)
Data traffic records are records of traffic data as defined in Art 2 para 2 lit b Directive on 3.057
privacy and electronic communications, 2002/58/EC.52 Accordingly, ‘traffic data’ means any
data processed for the purpose of the conveyance of a communication on an electronic commu-
nications network or for the billing thereof.53
BB. PERSON PROFESSIONALLY ARRANGING OR EXECUTING TRANSACTIONS (28)
A ‘person professionally arranging or executing transactions’ refers to a person professionally 3.058

engaged in the reception, transmission and execution of orders. The term is also used in Art 19
para 7 lit b and includes asset managers as well as family offices.54
CC. BENCHMARK (29)
A ‘benchmark’ means any rate, index or figure, made available to the public or published that 3.059
is periodically or regularly determined by the application of a formula to, or on the basis of the
value of one or more underlying assets or prices, including estimated prices, actual or estimated
interest rates or other values, or surveys, and by reference to which the amount payable under
a financial instrument or the value of a financial instrument is determined. Art 12 para 1 lit d
extends the scope of application of market manipulation to the manipulation of benchmarks.55
DD. MARKET MAKER (30)
Art 3 para 1 (30) defines a market maker with a reference to (7) of Art 4 para 1 of Directive 3.060
2014/65/EU. According to that provision, a market maker is a person who: ‘holds himself
out on the financial markets on a continuous basis as being willing to deal on own account
by buying and selling financial instruments against that person’s proprietary capital at prices
defined by that person’.
A market maker can be a natural person or a legal person.56 The terms used in practice vary
(e.g., specialist, lead broker, designated sponsor), as does the exact scope of the market maker’s
obligation vis-à-vis the operator of the trading venue. Unlike normal trading participants,
market makers usually have access to trading-related information (e.g., order book) and can
therefore have knowledge of inside information. The exception in Art 9 para 2 lit a allows
52 Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of
personal data and the protection of privacy in the electronic communications sector (Directive on privacy and electronic
communications) [2002] OJ L 201/37.
53 Veil (n 47) § 4 para 122.
54 Gernot Wilfing, ‘Eigengeschäfte von Aufsichtsräten nach der Marktmissbrauchsverordnung’ (2015) 3 ARaktuell 10, 13,
with a reference to ESMA 2015/224 para 100.
55 Extensively, Hendrik Brinckmann, ‘§ 15: Benchmark-Manipulation’ in Meyer, Veil and Rönnau (n 30) paras 1ff.
56 Zetzsche (n 42) § 7C para 151.
25
market makers to take this information into account when setting quotes (which they are
obliged to do), thus maintaining market depth and keeping the bid/ask spread low and thus
contains an exemption to the insider dealing prohibition.
EE. STAKE-BUILDING (31)
3.061 (31) has significance for Art 9 para 4, the first sentence of which does not apply to
stake-building, i.e., to the acquisition of securities in a company which does not trigger
a legal or regulatory obligation to make an announcement of a takeover bid in relation to that
company. This encompasses both the purchase on the stock exchange and a public offer for
shares not resulting in a change of control according to the applicable takeover regulation.
FF. DISCLOSING MARKET PARTICIPANT (32)
3.062 The term disclosing market participant (DMP) is used in Art 11 paras 3–6 and Recitals 35 f.
The ‘definition’ of (32) is limited to a (re-)reference to Art 11 paras 1 f; therefore, the persons
covered are discussed below in paras 10.013 and 11.008.
GG. HIGH-FREQUENCY TRADING (33)
3.063 Pursuant to the MAR, high-frequency trading is a method of high-frequency algorithmic

trading as defined in (40) of Art 4 para 1 of Directive 2014/65/EU. High-frequency trading
is thus a particular form of algorithmic trading (see above para 3.043). The high-frequency
algorithmic trading technique is characterised by:
(a) infrastructure intended to minimise network and other types of latencies, including at least
one of the following facilities for algorithmic order entry: co-location, proximity hosting or
high-speed direct electronic access;
(b) system-determination of order initiation, generation, routing or execution without human
intervention for individual trades or orders; and
(c) high message intraday rates which constitute orders, quotes or cancellations.
HH. RECOMMENDING AN INVESTMENT STRATEGY (34)
3.064 The recommendation or the proposal of an investment strategy is information which has been
produced by an independent analyst, an investment firm, a credit institution or any other
person whose main business is to produce investment recommendations, or by a natural person
working for the aforementioned institutions under a contract of employment or otherwise, and
which directly or indirectly expresses a particular investment proposal in respect of a financial
instrument or an issuer; or which is produced by persons other than the aforementioned that
directly propose a particular investment decision in respect of a financial instrument (cf below
paras 20.003ff).
26
JJ. Definitions according to para 2
II. INVESTMENT RECOMMENDATIONS (35)
By definition, investment recommendations have the nature of explicit or implicit recommen- 3.065
dations or suggestions for investment strategies concerning one or several financial instru-
ments57 or issuers and must be tailored to have a broad impact.58
Persons who prepare or disseminate investment recommendations or other information rec- 3.066
ommending or suggesting an investment strategy shall, in accordance with Art 20 para 1, take
reasonable care to ensure that the information is presented objectively and to disclose their
interests or conflicts of interest concerning the financial instrument to which the information
relates.
JJ. DEFINITIONS ACCORDING TO PARA 2
Concerning the individual definitions of para 2, see below paras 5.015ff. 3.067
According to para 2 lit a, securities are shares, and other securities equivalent to shares, such as 3.068
American Depositary Receipts as well as bonds and other forms of securitised debt instruments
that can be converted into or exchanged for shares or other securities equivalent to shares, such
as convertible bonds or options and exchangeable bonds.
Associated instruments are certain financial instruments, which need not be directly related 3.069
to the market, and certain contracts that entitle the holder to subscribe for, acquire or dispose
of securities (call and put options) as well as certain other instruments (cf below para 5.009).
Significant distribution is any initial or secondary offer of securities which is distinct from 3.070
ordinary trading in terms of the value of the securities to be offered and the selling methods (cf
below paras 5.029ff).
Pursuant to Art 5, stabilisation as defined in para 2 lit d describes every purchase or offer 3.071
to purchase securities or a transaction in associated instruments equivalent thereto, which is
undertaken by a credit institution or an investment firm in the context of a significant distri-
bution of such securities with the sole aim of supporting the market price of those securities
for a predetermined period of time, due to a selling pressure in such securities (see below paras
5.033 f).
Literature
Brinckmann H, ‘§ 15: Benchmark-Manipulation’ in Meyer A, Veil R and Rönnau T (eds), Handbuch zum
Marktmissbrauchsrecht (C. H. Beck 2018)
57 cf the instruments referred to in Annex I Section C MiFID II.

58 On the purpose of the rule Kay Rothenhöfer, ‘§ 21: Begriff und Anwendungsbereich’ in Meyer, Veil and Rönnau (n 30)
paras 2 f.
27
Gruyter 2008 ff), established by Staub, H
Helm L, ‘Pflichten des Wertpapierdienstleistungsunternehmens in der Finanzportfolioverwaltung bei
Directors’ Dealings nach der Marktmissbrauchsverordnung’ [2016] ZIP 2201
Klöhn L, ‘Artikel 2: Anwendungsbereich’ in Klöhn L (ed), Marktmissbrauchsverordnung (C. H. Beck
2018)
Klöhn L, ‘Artikel 7: Insiderinformationen’ in Klöhn L (ed), Marktmissbrauchsverordnung (C. H. Beck
2018)
Maume P and Kellner M, ‘Director‘s Dealings unter der EU-Marktmissbrauchsverordnung’ (2017) 46/3
ZGR 273
Mock S, ‘Art 3: Definitions’ in Ventoruzzo M and Mock S (eds), Market Abuse Regulation (Oxford
University Press 2017)
Moloney N, EU Securities and Financial Markets Regulation (3rd edn, Oxford University Press 2014)
Racky M, ‘§ 16: Zulässige Marktpraxis’ in Meyer A, Veil R and Rönnau T (eds), Handbuch zum
Rothenhöfer K, ‘§ 21: Begriff und Anwendungsbereich’ in Meyer A, Veil R and Rönnau T (eds),
Handbuch zum Marktmissbrauchsrecht (C. H. Beck 2018)
Schwark E and Zimmer D (eds), Kapitalmarktrechts-Kommentar (5th edn, C. H. Beck 2020)
Veil R, ‘KMU-Wachstumsmärkte nach MiFID II’ , in Siekmann H (ed), Festschrift für Theodor Baums
(tome 2, Mohr Siebeck 2017) 1267
Veil R, ‘§ 4: Begriffsbestimmung’ in Meyer A, Veil R and Rönnau T (eds), Handbuch zum
Wilfing G, ‘Eigengeschäfte von Aufsichtsräten nach der Marktmissbrauchsverordnung’ (2015) 3
ARktuell 10
Zetzsche D, ‘§ 7: Europäisches Kapitalmarktrecht – C. Marktintegrität/ Marktmissbrauchsrecht’ in
Gebauer M and Teichmann C (eds), Enzyklopädie Europarecht, Band 6 – Europäisches Privat- und
Zetsche D and Eckner D, ‘§ 7: Europäisches Kapitalmarktrecht – A. Grundlagen’ in Gebauer M and
Teichmann C (eds), Enzyklopädie Europarecht, Band 6 – Europäisches Privat- und Unternehmensrecht
(Nomos 2016)
28
ARTICLE 4
NOTIFICATIONS AND LIST OF FINANCIAL
INSTRUMENTS
Elena Guggenberger
1. Market operators of regulated markets and investment firms and market operators operat-
ing an MTF or an OTF shall, without delay, notify the competent authority of the trading
venue of any financial instrument for which a request for admission to trading on their
trading venue is made, which is admitted to trading, or which is traded for the first time.
They shall also notify the competent authority of the trading venue when a financial
instrument ceases to be traded or to be admitted to trading, unless the date on which the
financial instrument ceases to be traded or to be admitted to trading is known and was
referred to in the notification made in accordance with the first subparagraph.
Notifications referred to in this paragraph shall include, as appropriate, the names and
identifiers of the financial instruments concerned, and the date and time of the request for
admission to trading, admission to trading, and the date and time of the first trade.
Market operators and investment firms shall also transmit to the competent authority
of the trading venue the information set out in the third subparagraph with regard to
financial instruments that were the subject of a request for admission to trading or that
were admitted to trading before 2 July 2014, and that are still admitted to trading or traded
on that date.
2. Competent authorities of the trading venue shall transmit notifications that they receive
pursuant to paragraph 1 to ESMA without delay. ESMA shall publish those notifications
on its website in the form of a list immediately on receipt. ESMA shall update that list
immediately on receipt of a notification by a competent authority of the trading venue. The
list shall not limit the scope of this Regulation.
3. The list shall contain the following information:
(a) the names and identifiers of financial instruments which are the subject of a request
for admission to trading, admitted to trading or traded for the first time, on regulated
markets, MTFs and OTFs;
(b) the dates and times of the requests for admission to trading, of the admissions to
trading, or of the first trades;
(c) details of the trading venues on which the financial instruments are the subject of
a request for admission to trading, admitted to trading or traded for the first time; and
(d) the date and time at which the financial instruments cease to be traded or to be admit-
ted to trading.
29
Article 4 NOTIFICATIONS AND LIST OF FINANCIAL INSTRUMENTS
4. In order to ensure consistent harmonisation of this Article, ESMA shall develop draft
regulatory technical standards to lay down:
(a) the content of the notifications referred to in paragraph 1; and
(b) the manner and conditions of the compilation, publication and maintenance of the
list referred to in paragraph 3.
ESMA shall submit those draft regulatory technical standards to the Commission by 3
July 2015.
Power is delegated to the Commission to adopt the regulatory technical standards
referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation
(EU) No 1095/2010 of the European Parliament and of the Council.1
5. In order to ensure uniform conditions of application of this Article, ESMA shall develop
draft implementing technical standards to lay down the timing, format and template of the
submission of notifications under paragraphs 1 and 2.
ESMA shall submit those draft implementing technical standards to the Commission
by 3 July 2015.
Power is conferred on the Commission to adopt the implementing technical standards
referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No
1095/2010.
OVERVIEW
A. NOTIFICATION OBLIGATION 4.001 B. NOTIFICATION PROCEDURE 4.004
A. NOTIFICATION OBLIGATION
4.001 One of the main objectives of the MAR is to increase transparency in the financial markets.
This is to be achieved with the list in the newly created Art 4 MAR, which contains detailed
information on all financial instruments that are traded in the EU area, are admitted to trading
or for which an application for admission to a trading venue has been submitted. The same
information obligation also exists in the event of the cessation of a financial instrument’s
admission.
4.002 The information to be contained in this list is defined in para 3.
4.003 Included in the notification obligation are financial instruments as defined in the scope of
application of MAR (Art 2). Since Art 4 explicitly only refers to financial instruments admit-
ted/to be admitted or traded on trading venues, all those financial instruments that are traded
1 Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing
a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC
and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84).
30
B. Notification procedure
outside regulated markets, MTFs or OTFs, even if they are related to them, are therefore not
covered by this provision.2
B. NOTIFICATION PROCEDURE
The notification procedure is implemented at two levels, depending on the parties affected by 4.004
the notification obligation.
The first level reporting parties are the operators of trading venues, i.e., regulated markets, 4.005
MTFs and OTFs, as well as investment firms. For the latter, this can only be interpreted as
meaning that, on the one hand, investment firms have to report if they themselves operate
a trading venue or, on the other hand, if they become aware, due to their business activities, that
a financial instrument is traded or admitted to trading on a trading venue or that an application
for admission to trading has been made and said financial instrument in question is not on the
list in question.3
The first-level notification shall be made to the competent authority of the trading venue, i.e., 4.006
to a national supervisory authority of a Member State (see para 22.007).
Notification must be made of all financial instruments already admitted to trading or already 4.007
trading at the time of the entry into force of the MAR4 and all financial instruments newly
admitted or traded or for which an application for admission has been submitted since the entry
into force of the MAR. Similarly, a notification must be made when the financial instrument
ceases to be traded or ceases to be admitted to trading. If a time limit for trading has already
been stated in the original notification of admission within the meaning of Art 4 para 1 subpara
1, the notification of the cessation of trading/admission may be omitted.
Details of the nature and content of the notification, as well as the timing, format and template 4.008
for the submission will be laid down in implementing rules.5
At a second level, the notification received by the competent (national) authority of the trading 4.009
venue shall be transmitted to ESMA, which shall publish it on its website and update it imme-
diately upon receipt of new notifications. The transmission to ESMA must be immediate,
i.e., without delay. The notifications will thus be made visible throughout the EU and can be
accessed centrally by all interested parties.
2 cf Stefan Grundmann in Claus-Wilhelm Canaris, Mathias Habersack and Carsten Schäfer (eds, established by
Hermann Staub), Handelsgesetzbuch – Großkommentar (5th edn, vol 11/1, De Gruyter 2017), 6. Teil Marktregeln Art
4 MAR para 316, referring to those financial instruments that fall within the core scope of application pursuant to Art 2
para 1 subpara 1 MAR, which is why greenhouse gas emission allowances pursuant to Art 2 subpara 2 are not included,
because they are auctioned on proprietary auction platforms pursuant to Regulation (EU) 1031/2010.
3 See also Grundmann (n 2) para 317.
4 2 July 2014.
5 Implementing Regulation (EU) 378/2016 of the Commission of 11 March 2016 laying down implementing technical
standards with regard to the timing, format and template for the submission of notifications to the competent authorities
according to Regulation (EU) 596/2014 of the EP and of the Council [2016] OJ L 72/1.
31
Article 4 NOTIFICATIONS AND LIST OF FINANCIAL INSTRUMENTS
4.010 Again, further details on reporting in the second level will be specified in implementing rules.6
Literature
6 See also Implementing Regulation (EU) 378/2016.
32
ARTICLE 5
EXEMPTION FOR BUY-BACK PROGRAMMES
AND STABILISATION
Susanne Kalss
1. The prohibitions in Articles 14 and 15 of this Regulation do not apply to trading in own
shares in buy-back programmes where:
(a) the full details of the programme are disclosed prior to the start of trading;
(b) trades are reported as being part of the buy-back programme to the competent
authority of the trading venue in accordance with paragraph 3 and subsequently
disclosed to the public;
(c) adequate limits with regard to price and volume are complied with; and
(d) it is carried out in accordance with the objectives referred to in paragraph 2 and the
conditions set out in this Article and in the regulatory technical standards referred to
in paragraph 6.
2. In order to benefit from the exemption provided for in paragraph 1, a buy-back programme
shall have as its sole purpose:
(a) to reduce the capital of an issuer;
(b) to meet obligations arising from debt financial instruments that are exchangeable into
equity instruments; or
(c) to meet obligations arising from share option programmes, or other allocations of
shares, to employees or to members of the administrative, management or supervi-
sory bodies of the issuer or of an associate company.
3. In order to benefit from the exemption provided for in paragraph 1, the issuer shall report
to the competent authority of the trading venue on which the shares have been admitted to
trading or are traded each transaction relating to the buy-back programme, including the
information specified in Article 25(1) and (2) and Article 26(1), (2) and (3) of Regulation
(EU) No 600/2014.
4. The prohibitions in Articles 14 and 15 of this Regulation do not apply to trading in securi-
ties or associated instruments for the stabilisation of securities where:
(a) stabilisation is carried out for a limited period;
(b) relevant information about the stabilisation is disclosed and notified to the competent
authority of the trading venue in accordance with paragraph 5;
(c) adequate limits with regard to price are complied with; and
(d) such trading complies with the conditions for stabilisation laid down in the regulatory
technical standards referred to in paragraph 6.
33
Susanne Kalss - 9781800882249
Article 5 EXEMPTION FOR BUY-BACK PROGRAMMES AND STABILISATION
5. Without prejudice to Article 23(1), the details of all stabilisation transactions shall be
notified by issuers, offerors, or entities undertaking the stabilisation, whether or not they
act on behalf of such persons, to the competent authority of the trading venue no later
than the end of the seventh daily market session following the date of execution of such
transactions.
regulatory technical standards to specify the conditions that buy-back programmes and
stabilisation measures referred to in paragraphs 1 and 4 must meet, including conditions
for trading, restrictions regarding time and volume, disclosure and reporting obligations,
and price conditions.
July 2015.
(EU) No 1095/2010.
COMMISSION DELEGATED REGULATION (EU) 2016/1052 of 8 March 2016 sup-
plementing Regulation (EU) No 596/2014 of the European Parliament and of the Council
with regard to regulatory technical standards for the conditions applicable to buy-back pro-
grammes and stabilisation measures
CHAPTER I
GENERAL PROVISIONS
Article 1
For the purposes of this Regulation, the following definitions shall apply:
(a) ‘time-scheduled buy-back programme’ means a buy-back programme where the dates
and volume of shares to be traded during the time period of the programme are set out at
the time of the public disclosure of the buy-back programme;
(b) ‘adequate public disclosure’ means making information public in a manner which
enables fast access and complete, correct and timely assessment of the information by
the public in accordance with Commission Implementing Regulation (EU) 2016/1055
and, where applicable, in the officially appointed mechanism referred to in Article 21 of
Directive 2004/109/EC of the European Parliament and of the Council;
(c) ‘offeror’ means the prior holder of, or the entity issuing, the securities;
(d) ‘allotment’ means the process or processes by which the number of securities to be
received by investors who have previously subscribed or applied for them is determined;
(e) ‘ancillary stabilisation’ means the exercise of an overallotment facility or of a greenshoe
option by investment firms or credit institutions, in the context of a significant distribu-
tion of securities, exclusively for facilitating stabilisation activity;
(f) ‘overallotment facility’ means a clause in the underwriting agreement or lead man-
agement agreement which permits acceptance of subscriptions or offers to purchase
a greater number of securities than originally offered;
(g) ‘greenshoe option’ means an option granted by the offeror in favour of the investment
firm(s) or credit institution(s) involved in the offer for the purpose of covering overal-
34
lotments, under the terms of which such firm(s) or institution(s) is allowed to purchase
up to a certain amount in securities at the offer price for a certain period of time after the
offer of the securities.
CHAPTER II
BUY-BACK PROGRAMMES
Article 2
Disclosure and reporting obligations
(1) In order to benefit from the exemption laid down in Article 5(1) of Regulation (EU) No
596/2014, prior to the start of trading in a buy-back programme permitted in accordance
with Article 21(1) of Directive 2012/30/EU of the European Parliament and of the
Council, the issuer shall ensure adequate public disclosure of the following information:
(a) the purpose of the programme as referred to in Article 5(2) of Regulation
(EU) No 596/2014;
(b) the maximum pecuniary amount allocated to the programme;
(c) the maximum number of shares to be acquired;
(d) the period for which authorisation for the programme has been given (hereafter:
‘duration of the programme’).
The issuer shall ensure adequate public disclosure of subsequent changes to the programme
and to the information already published in accordance with the first subparagraph.
(2) The issuer shall have in place mechanisms that allow it to fulfil reporting obligations to
the competent authority and to record each transaction related to a buy-back programme
including the information specified in Article 5(3) of Regulation (EU) No 596/2014.
The issuer shall report to the competent authority of each trading venue on which the
shares are admitted to trading or are traded no later than by the end of the seventh daily
market session following the date of the execution of the transaction, all the transactions
relating to the buy-back programme, in a detailed form and in an aggregated form. The
aggregated form shall indicate the aggregated volume and the weighted average price per
day and per trading venue.
(3) The issuer shall ensure adequate public disclosure of the information on the transactions
relating to buy-back programmes referred to in paragraph 2 no later than by the end of the
seventh daily market session following the date of execution of such transactions. The issuer
shall also post on its website the transactions disclosed and keep that information available to
the public for at least a 5-year period from the date of adequate public disclosure.
Article 3
Conditions for trading
(1) In order to benefit from the exemption laid down in Article 5(1) of Regulation (EU)
No 596/2014, transactions relating to buy-back programmes shall meet the following
conditions:
35
(a) the shares shall be purchased by the issuer on a trading venue where the shares are
admitted to trading or traded;
(b) for shares traded continuously on a trading venue, the orders shall not be placed
during an auction phase and the orders placed before the start of the auction phase
shall not be modified during that phase;
(c) for shares traded solely on a trading venue through auctions, the orders shall be
placed and modified by the issuer during the auction provided that other market
participants have sufficient time to react to them.
596/2014, issuers shall not, when executing transactions under a buy-back programme,
purchase shares at a price higher than the higher of the price of the last independent
trade and the highest current independent purchase bid on the trading venue where the
purchase is carried out, including when the shares are traded on different trading venues.
596/2014, issuers shall not, when executing transactions under a buy-back programme,
purchase on any trading day more than 25% of the average daily volume of the shares on
the trading venue on which the purchase is carried out.
For the purposes of the first subparagraph, the average daily volume shall be based on
the average daily volume traded during either of the following periods:
(a) the month preceding the month of the disclosure required under Article 2(1); such
a fixed volume shall be referred to in the buy-back programme and apply for the
duration of that programme;
(b) the 20 trading days preceding the date of purchase, where the programme makes no
reference to that volume.
Article 4
Trading restrictions
596/2014, the issuer shall not, for the duration of the buy-back programme, engage in
the following activities:
(a) selling of own shares;
(b) trading during the closed period referred to in Article 19(11) of Regulation (EU)
No 596/2014;
(c) trading where the issuer has decided to delay the public disclosure of inside infor-
mation in accordance with Article 17(4) or (5) of Regulation (EU) No 596/2014.
(2) Paragraph 1 shall not apply where:
(a) the issuer has in place a time-scheduled buy-back programme; or
(b) the buy-back programme is lead-managed by an investment firm or a credit insti-
tution which makes its trading decisions concerning the timing of the purchases of
the issuer’s shares independently of the issuer.
(3) Point (a) of paragraph 1 shall not apply if the issuer is an investment firm or credit insti-
tution and has established, implemented and maintains adequate and effective internal
arrangements and procedures, subject to the supervision of the competent authority,
to prevent unlawful disclosure of inside information by persons having access to inside
information concerning directly or indirectly the issuer to persons responsible for any
36
decision relating to the trading of own shares, when trading in own shares on the basis of
such decision.
(4) Points (b) and (c) of paragraph 1 shall not apply if the issuer is an investment firm or
credit institution and has established, implemented and maintains adequate and effec-
tive internal arrangements and procedures, subject to the supervision of the competent
authority, to prevent unlawful disclosure of inside information by persons having access
to inside information concerning directly or indirectly the issuer, including acquisition
decisions under the buy-back programme, to persons responsible for the trading of own
shares on behalf of clients, when trading in own shares on behalf of those clients.
CHAPTER III
STABILISATION MEASURES
Article 5
Conditions regarding the stabilisation period
(1) In respect of shares and other securities equivalent to shares, the limited period referred
to in Article 5(4)(a) of Regulation (EU) No 596/2014 (hereafter ‘stabilisation period’)
shall:
(a) in the case of a significant distribution in the form of an initial offer publicly
announced, start on the date of commencement of trading of the securities on the
trading venue concerned and end no later than 30 calendar days thereafter;
(b) in the case of a significant distribution in the form of a secondary offer, start on the
date of adequate public disclosure of the final price of the securities and end no later
than 30 calendar days after the date of allotment.
(2) For the purposes of point (a) of paragraph 1, where the initial offer publicly announced
takes place in a Member State that permits trading prior to the commencement of
trading on a trading venue, the stabilisation period shall start on the date of adequate
public disclosure of the final price of the securities and last no longer than 30 calendar
days thereafter. Such trading shall be carried out in compliance with the applicable rules
of the trading venue on which the securities are to be admitted to trading, including any
rules concerning public disclosure and trade reporting.
(3) In respect of bonds and other forms of securitised debt, including securitised debt
convertible or exchangeable into shares or into other securities equivalent to shares, the
stabilisation period shall start on the date of adequate public disclosure of the terms of
the offer of the securities and end either no later than 30 calendar days after the date on
which the issuer of the instruments received the proceeds of the issue, or no later than 60
calendar days after the date of allotment of the securities, whichever is earlier.
37
Article 6
Disclosure and reporting obligations
(1) Before the start of the initial or secondary offer of the securities, the person appointed
in accordance with paragraph 5 shall ensure adequate public disclosure of the following
information:
(a) the fact that stabilisation may not necessarily occur and that it may cease at any
time;
(b) the fact that stabilisation transactions aim at supporting the market price of the
securities during the stabilisation period;
(c) the beginning and the end of the stabilisation period, during which stabilisation
may be carried out;
(d) the identity of the entity undertaking the stabilisation, unless unknown at the time
of disclosure, in which case it shall be subject to adequate public disclosure before
the stabilisation begins;
(e) the existence of any overallotment facility or greenshoe option and the maximum
number of securities covered by that facility or option, the period during which the
greenshoe option may be exercised and any conditions for the use of the overallot-
ment facility or exercise of the greenshoe option; and
(f) the place where the stabilisation may be undertaken including, where relevant, the
name of the trading venue(s).
(2) During the stabilisation period, the persons appointed according to paragraph 5 shall
ensure adequate public disclosure of the details of all stabilisation transactions no later
than the end of the seventh daily market session following the date of execution of such
transactions.
(3) Within 1 week of the end of the stabilisation period, the person appointed in accordance
with paragraph 5 shall ensure adequate public disclosure of the following information:
(a) whether or not the stabilisation was undertaken;
(b) the date on which stabilisation started;
(c) the date on which stabilisation last occurred;
(d) the price range within which stabilisation was carried out, for each of the dates
during which stabilisation transactions were carried out;
(e) the trading venue(s) on which the stabilisation transactions were carried out, where
applicable.
(4) For the purpose of complying with the notification requirement set out in Article 5(5)
of Regulation (EU) No 596/2014, the entities undertaking the stabilisation, whether or
not they act on behalf of the issuer or the offeror, shall record each stabilisation order
or transaction in securities and associated instruments pursuant to Article 25(1) and
Article 26(1), (2) and (3) of Regulation (EU) No 600/2014 of the European Parliament
and of the Council. The entities undertaking the stabilisation, whether or not acting on
behalf of the issuer or the offeror, shall notify all stabilisation transactions in securities
and associated instruments carried out to:
(a) the competent authority of each trading venue on which the securities under the
stabilisation are admitted to trading or are traded;
(b) the competent authority of each trading venue where transactions in associated
instruments for the stabilisation of securities are carried out.
38
(5) The issuer, the offeror and any entity undertaking the stabilisation, as well as the persons
acting on their behalf, shall appoint one among them to act as central point responsible:
(a) for the public disclosure requirements referred to in paragraphs 1, 2 and 3; and
(b) for handling any request from any of the competent authorities referred to in paragraph 4.
Article 7
Price conditions
(1) In the case of an offer of shares or other securities equivalent to shares, stabilisation of
the securities shall not in any circumstances be carried out above the offering price.
(2) In the case of an offer of securitised debt convertible or exchangeable into shares or into
other securities equivalent to shares, stabilisation of these debt instruments shall not in
any circumstances be carried out above the market price of those instruments at the time
of the public disclosure of the final terms of the new offer.
Article 8
Conditions for ancillary stabilisation
Ancillary stabilisation shall be undertaken in accordance with Articles 6 and 7 and comply
with the following conditions:
(a) securities shall be overallotted only during the subscription period and at the offer price;
(b) a position resulting from the exercise of an overallotment facility by an investment firm
or credit institution which is not covered by the greenshoe option shall not exceed 5% of
the original offer;
(c) the greenshoe option shall be exercised by the beneficiaries of such an option only where
the securities have been overallotted;
(d) the greenshoe option shall not amount to more than 15% of the original offer;
(e) the period during which the greenshoe option may be exercised shall be the same as the
stabilisation period pursuant to Article 5;
(f) the exercise of the greenshoe option shall be disclosed to the public promptly, together
with all appropriate details, including in particular the date of exercise of the option and
the number and nature of securities involved.
CHAPTER IV
FINAL PROVISION
Article 9
Entry into force
This Regulation shall enter into force on the day following that of its publication in the Official
Journal of the European Union.
It shall apply from 3 July 2016.
39
OVERVIEW
A. BASIC PRINCIPLES 5.001 E. LIMITS WITH REGARD TO PRICE AND VOLUME 5.029
B. TWO SETS OF FACTS 5.008 F. STABILISATION 5.033
C. BUY-BACK PROGRAMME 5.013 G. IMPLEMENTATION 5.043
D. TRANSPARENCY REQUIREMENTS 5.021
A. BASIC PRINCIPLES
5.001 Exemption: Art 5 provides for an exemption from the central behavioural obligations of the
MAR, namely the prohibition of insider dealing pursuant to Art 14 and the prohibition of
market manipulation pursuant to Art 15 for buy-back programmes and price stabilisation
measures, if the conditions for this are met. Art 5 is therefore to be considered as a supplement
or restriction to Arts 13 and 14 f. The safe harbour of the exception applies in any case, pro-
vided that the conditions are met. Since, in the case of listed companies, the repurchase of own
shares is regularly a subject of the Annual General Meeting pursuant to § 65 para 1 (8) of the
AktG (Austrian Stock Corporation Act) and the companies are authorised to acquire their own
shares for no specific purpose, this exemption plays an important role in practice. 1
5.002 The exemption to this rule in Art 5 is justified on economic grounds, since, as a rule, in the case
of buy-back programmes of own shares and other stabilisation measures, detrimental selling
pressure can be removed from the shares, which influences the price formation from supply and
demand. The exemption is justified for special situations of only a temporary duration. Art 5
creates legal certainty by defining the exemption while maintaining strict transparency require-
ments, since it is only a question of compliance with relatively clearly defined requirements and
not of the existence of price influence.2
5.003 Safe harbour: As long as an issuer complies with the requirements of Art 5, it is relieved
of accusations of breaching the insider dealing prohibition pursuant to Art 14 or of market
manipulation pursuant to Art 15; conversely, however, non-compliance with the exemption
requirements of Art 5 does not automatically mean a breach of Art 14 or Art 15. Rather, it
must be examined independently, in accordance with Art 14 or Art 15, whether the conditions
laid down therein are met.3
1 Susanne Kalss, ‘§ 65 Erwerb eigener Aktien’ in Peter Doralt, Christian Nowotny and Susanne Kalss (eds), Kommentar
zum Aktiengesetz (2nd edn, Linde 2012) paras 58ff.
2 Lars Klöhn, ‘Artikel 5: Ausnahmen für Rückkaufprogramme und Stabilisierungsmaßnahmen’ in Lars Klöhn (ed),
Marktmissbrauchsverordnung (C. H. Beck 2018) para 6.
3 Gernot Wilfling, Praxishandbuch Börserecht (2nd edn, Linde 2019) para 666; Klaus J Hopt and Christoph Kumpan,
‘§107: Insider- und Ad-hoc-Publizitätsprobleme’ in Herbert Schimansky, Hermann-Josef Bunte and Hans-Jürgen
Lwowski (eds), Bankrechts-Handbuch (5th edn, C. H. Beck 2017) para 40; Klöhn (n 2) Art 5 para 8; Susanne Kalss,
Martin Oppitz and Johannes Zollner (eds), Kapitalmarktrecht (2nd edn, Linde 2015) § 22 para 62.
40
B. Two sets of facts
Buy-back programmes are economically recognised in the event of capital reductions, the issue 5.004
of shares to employees and members of executive bodies as well as in cases of the fulfilment
of obligations arising from debt instruments (convertible bonds). Above all, stabilisation pro-
grammes serve to prevent the share price in the course of a share issue from falling below the
placement price. This is intended to avoid uncertainty and panic reactions by investors who
have just entered the market.
Legal basis: In addition to the regulation in Art 5 MAR, the exemption in Commission 5.005
Delegated Regulation 1052/2016 and the level-2 technical regulatory standards of the
Lamfalussy process are specified in detail, the normative content of which is largely determined
by the supervisory authority, ESMA.4 In addition to Art 13, Art 5 is an independent exemption
to the prohibition of market manipulation and the prohibition of insider dealing. If conduct
is recognised as admissible market practice pursuant to Art 13 and meets the requirements
pursuant to Art 5, both exemptions apply (cf para 13.006).5
While Art 5 provides for an exemption to the prohibition of insider dealing and market manip- 5.006
ulation, it is lacking for the ad hoc publicity obligation (disclosure obligation).6 If inside infor-
mation comes to light in the course of a buy-back programme or price stabilisation, this must
be disclosed immediately in accordance with Art 17 if no delay is made (see paras 17.080ff).
Under previous law, § 48c BörseG 1989 (Austrian Stock Exchange Act 1989), which imple- 5.007
mented the Market Abuse Directive (MAD), provided for the prohibition of price manip-
ulation. § 48e para 6 BörseG 1989 already referred to the Commission Regulation, which
provided for exemptions for buy-back programmes and stabilisation measures.7 The Regulation
was already directly applicable under the previous law in Austria.8
B. TWO SETS OF FACTS
Art 5 regulates two different exemptions, buy-back and stabilisation. 5.008
Difference between Buy-back and stabilisation: buy-back refers only to shares, the stabilisation 5.009
exemption includes all securities and other financial instruments. In the case of a buy-back, the
exemption in fact only applies to the company’s acquisition of stocks, whereas, in the case of
4 ESMA, ‘Final Report Draft Technical Standards on the Market Abuse Regulation’, ESMA 2015/1455, 28
September 2015; Klöhn (n 2) Art 5 para 12; Dörte Poelzig, ‘Insider- und Marktmanipulationsverbot im neuen
Marktmissbrauchsrecht’ [2016] NZG 528, 528 f; Christoph H Seibt and Bernward Wollenschläger, ‘Revision des
Marktmissbrauchsrechts durch die Marktmissbrauchsverordnung und Richtlinie über strafrechtliche Sanktionen für
Marktmanipulation’ [2014] AG 593.
5 Klöhn (n 2) Art 5 para 15.
6 Klöhn (n 2) Art 5 para 23; see also Sebastian Mock, ‘Article 5: Exemption for buy-back programmes and stabilisation’
in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse Regulation: Commentary and Annotated Guide (Oxford
University Press 2017) paras B.5.29ff.
7 Commission Regulation (EC) 2273/2003 of 22 December 2003 implementing Directive 2003/6/EC as regards exemp-
tions for buy-back programmes and stabilisation of financial instruments [2003] OJ L 336/33.
8 Kalss, Oppitz and Zollner (n 3) § 22 para 43.
41
the stabilisation exemption, it applies to both sales and purchases, i.e., securities dispositions,
but not to other measures.
5.010 The buy-back exemption and the stabilisation exemption are only regulated in the same article;
however, they are not parallel but only alternative, as the first variant is linked to the earmarked
buy-back (buy-back exemption), whereas the stabilisation exemption is linked to the issue of
securities or financial instruments.
5.011 The rules are aimed at two completely different situations and only provide for comparable
rules in a broad sense, namely requirements in the form of disclosure, notification and material
barriers. However, they apply to completely different situations.
5.012 The exemptions in the areas of buy-back and stabilisation of emissions refer both to the prohi-
bition of insider dealing pursuant to Art 14 and to the prohibition of market price manipulation
pursuant to Art 15.
C. BUY-BACK PROGRAMME
5.013 The exemption for buy-back programmes pursuant to Art 5 para 1 applies only to trading in
own shares, i.e., shareholdings in shares and European public limited liability companies. The
exemption does not apply to other financial instruments, regardless of whether they are debt
or equity securities. Bonds and profit participation rights are therefore excluded from Art 5.
Neither a direct nor an analogous application is possible for the instruments just mentioned.
However, as the non-applicability of Art 5 does not automatically represent a violation of Art
14 or Art 15, this does not automatically mean that one of the above-mentioned circumstances
has been fulfilled, but rather the compliance with Art 5 clearly indicates that the conduct in
question is in conformity with the law.
5.014 Only own shares are included, not shares of third-party issuers, nor shares of companies in
the same group, such as subsidiaries or parent companies.9 Trading only means the buy-back
of own shares, not their resale. The term buy-back alone makes this clear.10 Only the transfer
and thus disposition to employees or controlling bodies within the scope of the redemption
of participation schemes and the redemption of convertible bonds or bonds with warrants or
participation rights is permissible.11
5.015 According to Art 3 para 1 (17), buy-back programmes of own shares only cover the acquisi-
tion of own shares in accordance with the Directive on certain aspects of company law.12 Arts
60f of the Company Law Directive corresponds to Arts 21 f of the former Capital Directive
9 Klöhn (n 2) Art 5 paras 24 f; Sebastian Mock, ‘§ 20a: Verbot der Marktmanipulation’ in Heribert Hirte and Thomas M
J Möllers (eds), Kölner Kommentar zum WpHG (2nd edn, Carl Heymanns 2014) para 345.
10 Klöhn (n 2) Art 5 para 26; Holger Fleischer, ‘§ 20a: Verbot der Marktmanipulation’ in Andreas Fuchs (ed),
Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016) para 93.
12 Directive (EU) 2017/1132 of the European Parliament and of the Council of 14 June 2017 relating to certain aspects of
company law [2017] OJ L 169/46.
42
D. Transparency requirements
(2nd Directive). This means that the regulations according to § 65 AktG for the buy-back of
own shares must be observed. The acquisition purposes mentioned in Art 5 only update the
exemption.
The buy-back of own shares must be carried out on a trading venue pursuant to Art 3 para 5.016
1 (10). This provision covers the regulated market as well as MTFs and OTFs. The term is
narrower than the other recognised market in the OECD, so that a buy-back on the SIX in
Zurich or on the New York Stock Exchange is not covered.
The issuer and a person who buys back the shares on behalf of the issuer or on its own behalf for 5.017
the account of the issuer fall within the scope of the exemption pursuant to Art 5, i.e., in addi-
tion to the issuer these are, in particular, but not only credit institutions and investment firms.
Narrowly defined purposes: Art 2 defines the purpose of the buy-back programme in a narrow 5.018
and conclusive manner.13 Only the explicitly stated purposes fall within the scope of the exemp-
tion. Neither an extension nor combination with other purposes is permitted.
The law refers to capital reduction, as provided for in § 65 para 1 (6) AktG, as the fulfilment 5.019
of the obligation to convert convertible bonds and similar debt instruments into share capital
(convertible and warrant bonds, profit participation rights and income bonds with conversion
and subscription rights in accordance with § 174 AktG). Finally, the third purpose is buy-back
for the purpose of allocating shares from an employee share programme pursuant to § 65 para
1 (4) of the AktG for the benefit of employees and members of executive bodies (management
board, supervisory board) both of the issuing company and of affiliated companies.14
Requirements: The provision lays down four conditions in order to actually fall within the 5.020
scope of the exemption, namely disclosure obligations, reporting obligations to the compe-
tent authorities, compliance with volume and price limits and compliance with other trading
conditions.
D. TRANSPARENCY REQUIREMENTS
In order to be able to actually make use of the exemptions under Art 5 para 1, Art 5 and the 5.021
Delegated Regulation provide for a dense structure of disclosure and notification obligations to
the competent authority.15
A distinction must be made between the general disclosure of the programme prior to the 5.022
implementation of the buy-back, the subsequent disclosure of the transactions carried out and
the reporting of the transactions to the competent authority, and finally a number of details
mentioned in Art 5 para 3.
13 Klöhn (n 2) Art 5 para 31; on the previous law Fleischer (n 10) § 20a para 96; Kalss, Oppitz and Zollner (n 3) § 22 para
44.
15 Kalss, Oppitz and Zollner (n 3) § 22 paras 47 f.
43
5.023 Details of the programme must be disclosed in full by the issuer before the buy-back (trading)
begins.16 This refers to the information stated in Art 5 para 1 lit a MAR and Art 2 para 2
Delegated Regulation 2016/1052, namely the purpose of the programme, the maximum
pecuniary amount allocated to the programme (e.g., acquisition costs), the maximum number
of shares to be acquired and finally the time period for which authorisation for the programme
has been given (= duration of the programme).
5.024 Pursuant to § 162 para 2 (2) BörseG 2018 (Austrian Stock Exchange Act 2018), the scope
of application of legal sanctions against market abuse does not apply to trading in own shares
within the scope of buy-back programmes and stabilisation measures, provided that trading
takes place in accordance with Art 5. Thus, the application of the exemption also means the
avoidance of a judicial punitive sanction that would otherwise apply to market abuse.
5.025 The information specified in Art 5 para 1 MAR and Art 2 para 1 Delegated Regulation
1052/2016 must in any case be disclosed in the authorisation resolution of the Annual General
Meeting pursuant to § 65 para 1 (4) AktG (employees and controlling bodies), § 65 para 1 (6)
AktG (capital reduction by withdrawal) and § 65 para 1 (8) AktG (acquisition without purpose,
e.g., conversion of convertible bonds). Listed companies must disclose this authorisation reso-
lution without delay pursuant to § 65 para 1a AktG in accordance with the general provisions
of the law governing stock corporations.17 The stock exchange law regulation corresponding to
§ 65 para 1a AktG is § 119 para 9 BörseG 2018, which provides for the immediate disclosure
of an authorisation resolution of the Annual General Meeting, as well as the buy-back pro-
gramme based on it immediately before its execution, in particular with respect to its duration.
In addition to the disclosure obligation, under the law governing stock corporations, in the
Official Gazette of the Wiener Zeitung, publication via Reuters, Bloomberg or Dow Jones
Newswire is thus prescribed.18 The disclosure obligations apply not only to issuers domiciled in
Austria, but also to issuers for which Austria is the home Member State pursuant to Art 118
para 1 (7) BörseG 2018. According to the VMV (Veröffentlichungs- und Meldeverordnung,
Disclosure and Reporting Ordinance), pursuant to § 119 para 10 BörseG 2018, disclosure
under stock exchange law replaces disclosure under stock corporation law as under the previous
law pursuant to § 82 para 10 BörseG 1989.19 If the programme changes, these changes must
also be published in the same way pursuant to Art 2 para 1 of the Delegated Regulation.
Consequently, the information must be updated.20
5.026 Subsequent disclosure: Before trading begins, i.e., at the latest immediately before the first
acquisition transaction of own shares, another disclosure must be made.
5.027 Financial statement related disclosure: After financial statements are prepared, they must be
disclosed. Art 2 para 2 sent 2 of the Delegated Regulation provides for a deadline no later
than by the end of the seventh daily market session following the date of the execution of
16 Klöhn (n 2) Art 5 para 36; on the previous law Kalss, Oppitz and Zollner (n 3) § 22 para 47.
17 Kalss, ‘§ 65’ (n 1) para 124; Kalss, Oppitz and Zollner (n 3) § 22 paras 47 f, 9.
20 Klöhn (n 2) Art 5 para 39; on the previous law Katharina Stüber, ‘Bekanntmachungen von durchgeführten Transaktionen
im Rahmen von Mitarbeiteraktienprogrammen nach der Safe Harbour-Verordnung’ [2015] ZIP 1374, 1378.
44
E. Limits with regard to price and volume
the transaction. This enables the aggregation of transactions that lie within a period of seven
trading days, i.e., more than one week. Transactions executed during this period can therefore
be reported in an aggregated form.21
Obligation to report to the authorities: Before disclosing the financial statements, the issuer 5.028
or its contractor must report the financial statements to the competent authority in order to be
able to make use of the exemption at all. According to Art 5 para 3 MAR in conjunction with
Art 2 para 2 Delegated Regulation 1052/2016 and pursuant to Art 25 paras 1 and 2, Art 26
paras 1, 2 and 3 MIFIR, the name and number of shares acquired, the volume, the date, the
time of the transaction, the price and information identifying the clients in whose name the
investment firm or credit institution concluded the transaction must be reported to the com-
petent authority, thus in Austria to the FMA. However, if the shares are admitted to trading
on several trading venues, all other competent authorities of these trading venues must also be
notified pursuant to Art 5 para 3 and Art 2 para 2 sent 2 Delegated Regulation 1052/2016.
E. LIMITS WITH REGARD TO PRICE AND VOLUME
According to Art 5 para 1 lit c, the exemption to trading in own shares in buy-back programmes 5.029
only applies if adequate limits with regard to price and volume are complied with, so that the
buy-back possibilities are substantively restricted.22 The maximum purchase price may not be
higher than that of the last independent trade or, if it is actually higher, than that of the highest
current independent purchase bid on the trading venue. The volume limit is 25 per cent of the
average daily volume of the shares pursuant to Art 3 para 3 Delegated Regulation.
The average is calculated, at the choice of the issuer, either after the month preceding the 5.030
month in which the details of the buy-back programme are announced or the 20 trading days
preceding the date of purchase.23
Compliance with the objectives of the buy-back programme: Finally, Art 5 para 1 lit d MAR 5.031
provides that the objectives of the buy-back programme must be complied with in order to fall
within the scope of the exemption. Thus, no purpose other than the purpose of the buy-back
to reduce capital, to meet obligations arising from share option programmes to employees or to
members of executive bodies and to meet obligations arising from debt financial instruments
may be pursued. Finally, the individual provisions of Delegated Regulation 1052/2016, when
carrying out the buy-back and the specific requirements for the individual acquisition transac-
tions, must be complied with.24
Limits on buy-back: Among other things, a buy-back may not be carried out if closed periods, 5.032
in accordance with Art 19 para 11 MAR, are determined for management transactions or if the
deferment of an ad hoc disclosure takes effect.25 If the buy-back is carried out independently
21 ESMA (n 4) para 23; Klöhn (n 2) Art 5 para 48.

22 Klöhn (n 2) Art 5 paras 53ff; on the previous law Kalss, Oppitz and Zollner (n 3) § 22 para 49.
23 Klöhn (n 2) Art 5 para 59; on the previous law Mock, (n 9) § 20a Annex II VO Art 5 paras 7ff.
24 See Klöhn (n 2) Art 5 paras 62ff.
25 Klöhn (n 2) Art 5 paras 71ff.
45
by an investment firm or a credit institution, i.e., if the investment firm makes the concrete
decision on the time of the acquisition independently of the issuer, the acquisition is permitted
provided that confidentiality arrangements pursuant to Art 4 para 3 Commission Delegated
Regulation 1052/2016 have been established.26
F. STABILISATION
5.033 Stabilisation also falls within the scope of the exemption for the prohibition of insider dealing
and market manipulation for trading in securities or related instruments pursuant to Art 5 paras
4 and 5 MAR and Arts 5–8 Delegated Regulation 1052/2016, provided that certain conditions
are met. Pursuant to Art 3 para 2 lit d MAR, stabilisation is any purchase or offer to purchase
securities or a transaction in associated instruments equivalent thereto that a credit institution
or an investment firm undertakes in the context of a significant distribution of such securities
exclusively for supporting the market price of these securities for a predetermined period of
time due to a selling pressure in such securities.
5.034 Stabilisation measures are therefore only permitted in the framework of a significant subscrip-
tion offer, i.e., in the case of an initial or secondary placement of securities where the value of
the securities offered and the selling methods differ significantly from normal trading.27 Initial
placement is the first offering of securities and secondary placement is the offering of securi-
ties already traded on a trading venue. Stabilisation measures may therefore only be taken in
connection with placement projects, regardless of whether they are public offerings or private
placements.28
5.035 Instruments: Covered are issues of securities or associated instruments. Thus, stabilisation
is not limited to equities alone, but covers all securities and associated instruments. As far
as securities are concerned, only the acquisition, but not the disposal, of securities is covered
by permissible stabilisation.29 Where associated instruments are concerned, stabilisation may
relate to both acquisition and disposal.30 Other measures such as contractual commitments in
lock-up agreements (market protection agreements) are not covered.
5.036 Persons entitled: Stabilisation measures can only be taken by investment firms and credit insti-
tutions. These can therefore act as so-called stabilisation managers.31 The issuer or any other
contractor of the issuer does not fall under the stabilisation exemption.32
5.037 Stabilisation measures only fall within the scope of the exemption under Art 5 para 4 if the
following conditions are met, namely the limited duration of the stabilisation, the disclosure of
26 Kalss, Oppitz and Zollner (n 3) § 22 para 51; Klöhn (n 2) Art 5 paras 74ff.
27 Klöhn (n 2) Art 5 para 92; on the previous law Fleischer (n 10) § 20a para 118.
28 Klöhn (n 2) Art 5 para 93; on the previous law Fleischer (n 10) § 20a para 109.
30 Klöhn (n 2) Art 5 para 87; Joachim Vogl, ‘§ 20a: Verbot der Marktmanipulation’ in Heinz-Dieter Assmann and Uwe H.
Schneider (eds), Wertpapierhandelsgesetz (6th edn, Otto Schmidt 2012) para 276 on the previous law.
31 ESMA (n 4) para 44.
46
F. Stabilisation
certain information, notification to the competent authority of the trading venue, the compli-
ance with price limits and, finally, compliance with certain trading conditions.
The actual duration of the stabilisation and the period of exemption depend both on whether it 5.038
is an initial or secondary placement and which securities or financial instruments are involved,
equity securities or other financial instruments.33
Disclosure: In order to fall within the scope of the stabilisation exception, three disclosure 5.039
obligations must be complied with: Before the start of the initial or secondary offer of the
securities, during the stabilisation period and finally after the end of the stabilisation period.
For the disclosure prior to the initial and secondary placement (pre-stabilisation disclosure)
pursuant to Art 6 Delegated Regulation 1052/2016, it must be stated that the stabilisation
measure may not necessarily occur, that it may cease at any time and that it serves to support the
market price, in which period the measures are carried out, the entities concerned and whether
the possibility of a greenshoe option or overallotment facility exists. Disclosure must follow in
the same manner as for an exemption within the context of buy-back programmes, i.e., in the
same way as an ad hoc disclosure (see para 5.025).
Notification obligation: In addition to the disclosure obligations, issuers, offerors or entities 5.040
undertaking the stabilisation measures are required to notify the competent authority of details
of all stabilisation measures. The competent authority is the authority of the trading venue,
thus in Austria, the FMA. Again, however, in the case of a security or financial instrument
that is not only admitted to trading on one trading venue, the notification pursuant to Art 6
para 4 sent 2 Delegated Regulation 1052/2016 must also be submitted to the other competent
authorities.34 The notification to the competent authority must be submitted no later than the
end of the seventh trading day following the day of execution of the stabilisation (not conclu-
sion). To safeguard this notification obligation, there is also a recording obligation, but this is
not a constitutive condition for the application of the exception.35
Price limit: Depending on the security, the Regulation provides for different maximum limits 5.041
for the stabilisation. In the case of shares and securities equivalent to shares, the stabilisation
measure may not be taken at a price higher than the issue price.36 The price may therefore
not be driven up above the issue price. In the case of debt securities, the limit is the market
price. Further requirements refer solely to individual measures, in particular overallotments or
greenshoe options. According to Art 1 lit e Commission Delegated Regulation 1052/2016, an
oversubscription or the exercise of a greenshoe option is thus the execution of overallotment,
for which detailed individual regulations are created according to Art 8 Delegated Regulation
1052/2016.37
33 See Klöhn (n 2) Art 5 paras 100ff.

34 ESMA (n 4) para 50; Klöhn (n 2) Art 5 para 121.
36 Klöhn (n 2) Art 5 para 124; on the current law Fleischer (n 10) § 20a para 127.
37 Klöhn (n 2) Art 5 paras 129ff; further ESMA (n 4) para 56; on the previous law Fleischer (n 10) § 20a para 134; see also
Kalss, Oppitz and Zollner (n 3) § 22 para 59.
47
5.042 Market making must be distinguished from stabilisation. The task of the market maker is to
provide the market with timely liquidity, i.e., a sufficient volume of tradable securities.38 For this
purpose, a market maker must place binding competitive buy or sell orders and take additional
measures for the management and marketing of securities and other financial instruments.
Market making does not fall under stabilisation measures, but market making is to be qualified
as acceptable practice within the framework of the rules and regulations of the stock exchange.
Among others, the issuance of one-off orders is considered acceptable (see para 13.019).39
G. IMPLEMENTATION
5.043 The introduction of the MAR has required many states to both abolish rules that were con-
flicting with the new set of market abuse rules and adopt new accompanying measures in line
with the MAR.
5.044 In the UK, besides amendments to primary and secondary legislation, the British Financial
Conduct Authority (FCA) had to adopt several notable changes to the Handbook. Most
notably the FCA Handbook no longer contains binding rules, but rather mere guidance on
matters governed by the MAR. The FCA preserved the Code of Market Conduct, now con-
taining guidance on the FCA’s implementation of the MAR, as the industry relies on it for an
indication of the FCA’s expectations. However, most of the CoMC was replaced with refer-
ences to the respective rules of the MAR.40 The same goes for Chapters 1–3 of the Disclosure
Rules and Transparency Rules sourcebook (DTR).
5.045 With regard to the safe harbor rules for stabilisation, previously set out by the FCA in Chapter
2 of the Market Conduct sourcebook, the FCA had to delete them almost altogether. Only two
provisions remain, concerning stabilisation measures in third-country jurisdictions.41
5.046 Regarding PDMR (person discharging managerial responsibilities) transactions, which were
previously ruled by Chapter 3 of the DTR as well as the Model Code, changes have been
in line with what has already been said above. Chapter 3 was changed in a way, that it now
mainly contains references to the MAR; the Model Code on the other hand has been abolished
altogether.
5.047 In Italy, the process of amending the national law in order to comply with the obligations
set out in the MAR ended on 10 August 2018 in a Legislative Decree.42 The Decree set out
a broad array of rules, from the obligation to notify the competent authorities of the disclosure

39 Austrian VwGH 26 May 2014, 2011/17/0235, ZFR 2014, 327; Kalss, Oppitz and Zollner (n 3) § 22 para 63; on market
practice cf Art 13 MAR.
40 FCA, Financial Conduct Authorities Handbook of rules and guidance (available at https://www.handbook.fca.org.uk,
accessed 12 August 2021).
41 See Chapter 2.5.1 and 2.5.2 of the FCA Handbook on the MAR.
42 Legislative Decree no 107 of 10th August 2018, Gazzetta Ufficiale Della Repubblica Italiana n 214 of 14.9.2018.
48
G. Implementation
of inside information, to PDMR transactions, to sanctions for insider dealings and market
manipulation.43
The Italian securities and exchange commission (CONSOB) has reacted accordingly and has 5.048
amended several resolutions to fit the new rules under the MAR.44
In the UK, rules regarding share buy-back programmes can be found in section 5.5. of the 5.049
DTR.45 Furthermore, Annex 1 to the Handbook on Market Conduct (MCH), containing
specific rules to share buy-back programmes, has been mostly superseded by the MAR.46 The
rules regarding stabilisation can be found in section 2 of the MCH. Most of these rules too
have been superseded by the MAR.
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eigener Aktien über die Börse’ (2007) 36/4 ZGR 457
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at https://www.mondaq.com/, accessed 12 August 2021). To the implementation of the MAR in other countries
with special regard to the prohibition of market manipulation see also Klaus U Schmolke, ‘Artikel 15: Verbot der
Marktmanipulation’ in Klöhn (n 2) para 80.
45 See FCA, Disclosure Guidance and Transparency Rules sourcebook (available at https://www.handbook.fca.org.uk/
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50
ARTICLE 6
EXEMPTION FOR MONETARY AND PUBLIC
DEBT MANAGEMENT
ACTIVITIES AND CLIMATE POLICY
ACTIVITIES
Susanne Kalss
1. This Regulation does not apply to transactions, orders or behaviour, in pursuit of mone-
tary, exchange rate or public debt management policy by:
(a) a Member State;
(b) the members of the ESCB;
(c) a ministry, agency or special purpose vehicle of one or several Member States, or by
a person acting on its behalf;
(d) in the case of a Member State that is a federal state, a member making up the
federation.
2. This Regulation does not apply to transactions, orders or behaviour carried out by the
Commission or any other officially designated body or by any person acting on its behalf,
in pursuit of public debt management policy.
This Regulation does not apply to such transactions, orders or behaviour carried out by:
(a) the Union;
(b) a special purpose vehicle of one or several Member States;
(c) the European Investment Bank;
(d) the European Financial Stability Facility;
(e) the European Stability Mechanism;
(f) an international financial institution established by two or more Member States
which has the purpose to mobilise funding and provide financial assistance to the
benefit of its members that are experiencing or threatened by severe financing
problems.
3. This Regulation does not apply to the activity of a Member State, the Commission or any
other officially designated body, or of any person acting on their behalf, which concerns
emission allowances and which is undertaken in pursuit of the Union’s climate policy in
accordance with Directive 2003/87/EC.
4. This Regulation does not apply to the activities of a Member State, the Commission or
any other officially designated body, or of any person acting on their behalf, that are under-
taken in pursuit of the Union’s Common Agricultural Policy or of the Union’s Common
51
Article 6 ACTIVITIES AND CLIMATE POLICY ACTIVITIES
Fisheries Policy in accordance with acts adopted or with international agreements con-
cluded under the TFEU.
5. The Commission shall be empowered to adopt delegated acts in accordance with Article
35 to extend the exemption referred to in paragraph 1 to certain public bodies and central
banks of third countries.
To that end, the Commission shall, by 3 January 2016, prepare and present to the
European Parliament and to the Council a report assessing the international treatment
of public bodies charged with, or intervening in, public debt management and of central
banks in third countries.
The report shall include a comparative analysis of the treatment of those bodies and central
banks within the legal framework of third countries, and the risk management standards
applicable to the transactions entered into by those bodies and central banks in those
jurisdictions. If the report concludes, in particular in regard to the comparative analysis,
that the exemption of the monetary responsibilities of those third-country central banks
from the obligations and prohibitions of this Regulation is necessary the Commission shall
extend the exemption referred to in paragraph 1 also to the central banks of those third
countries.
6. The Commission shall also be empowered to adopt delegated acts in accordance with
Article 35 to extend the exemption set out in paragraph 3 to certain designated public
bodies of third countries that have entered into an agreement with the Union pursuant to
Article 25 of Directive 2003/87/EC.
7. This Article shall not apply to persons working under a contract of employment or other-
wise for the entities referred to in this Article where those persons carry out transactions or
orders, or engage in behaviour, directly or indirectly, on their own account.
OVERVIEW
A. FOUNDATIONS 6.001 FINANCIAL SUPPORT 6.006

B. MONETARY AND EXCHANGE RATE POLICY – E. CLIMATE POLICY, AGRICULTURAL POLICY,
PUBLIC DEBT MANAGEMENT 6.002 FISHERIES POLICY 6.007
C. PUBLIC DEBT MANAGEMENT – COMMISSION 6.004 F. GENERAL QUESTIONS 6.008
D. MOBILISATION OF FINANCIAL RESOURCES AND G. BREXIT 6.010
A. FOUNDATIONS
6.001 Certain clearly listed activities carried out by certain legal entities are excluded from the appli-
cation of the MAR. The provision combines different legal entities with different activities.
The provision provides for far-reaching exemptions from the MAR in order to allow for certain
52
D. Mobilisation of financial resources and financial support
measures in the public interest. Even if these interests are to be recognised as such, the provi-
sion is diametrically opposed to the protective purpose of preventing market abuse.1
B. MONETARY AND EXCHANGE RATE POLICY – PUBLIC DEBT MANAGEMENT
Para 2 exhaustively lists – for the individual activities – the institutions of sovereign authority 6.002
that are permitted to carry out certain activities. These are the Member States, the members
of the European System of Central Banks, ministries and other agencies and special purpose
vehicles of one or several Member States and certain other public authorities and persons acting
on their behalf.
Excluded are (a) measures relating to monetary and exchange rate policy and (b) their public 6.003
debt management policy, provided that they are carried out in the public interest and exclu-
sively in the pursuit of such policy. The Commission may extend the excluded areas by means
of delegated acts.
C. PUBLIC DEBT MANAGEMENT – COMMISSION
The European Commission, any other officially designated body or any person acting on their 6.004
behalf are excluded within the context of public debt management.
Public debt management: Other specific public entities may be excluded from the scope of the 6.005
MAR if they are responsible for or participate in the management of public debt or if this is
delegated to the central banks of third countries. These latter exemptions will be defined by
a delegated act of the Commission.2
D. MOBILISATION OF FINANCIAL RESOURCES AND FINANCIAL SUPPORT
The Union, special purpose vehicles of one or several members, the European Investment Bank 6.006
(EIB), the European Financial Stability Facility (EFSF), the European Stability Mechanism
(ESM) or international financial institutions established by at least two Member States may
carry out transactions, orders or behaviour designed to mobilise financial resources and provide
financial assistance to their members without complying with the MAR.
1 Rüdiger Veil, ‘§ 18: Ausnahmen für Maßnahmen im Rahmen der Geldpolitik, der Staatsschuldenverwaltung und der
Klimapolitik’ in Andreas Meyer, Thomas Rönnau and Rüdiger Veil (eds), Handbuch Marktmissbrauchsrecht (C. H. Beck
2018) § 18 para 1.
2 Recital 13 MAR; Veil (n 1) § 18 para 4.
53
Article 6 ACTIVITIES AND CLIMATE POLICY ACTIVITIES
E. CLIMATE POLICY, AGRICULTURAL POLICY, FISHERIES POLICY
6.007 Sovereign acts which, in the context of the Union’s climate policy, serve to implement the
Union’s common agricultural policy or the Union’s common fisheries policy are also excluded
from the scope of the MAR (Art 6 para 3 MAR).
F. GENERAL QUESTIONS
6.008 It is not clear whether the exemption from the MAR applies only to direct activities such as
public debt management or also to related areas such as information on, and dissemination
of information;3 the purpose of the provision argues against a broad understanding of the
exemption.
6.009 Para 7 clarifies that the exemptions do not apply to persons who work under a contract of
employment or otherwise for the entities referred to in this article and/or carry out transactions
or orders or engage in behaviour on their own account.
G. BREXIT
6.010 Due to Great Britain’s withdrawal from the European Union, the MAR will cease to apply to
Great Britain entirely. Therefore the Bank of England as well as the United Kingdom Debt
Management Office will no longer benefit from the exemption provided by Art 6 MAR.4
Thus, the Commission has issued a Delegated Regulation in accordance with Art 6 para 4
MAR, exempting both the Bank of England and the United Kingdom Debt Management
Office, beginning with the day on which the MAR ceases to apply to and in Great Britain.5
Literature
See Literature on Art 5 MAR.
3 See Veil (n 1) § 18 para 7.

4 See Commission Delegated Regulation (EU) 2019/461 of 30 January 2019 amending Delegated Regulation (EU)
2016/522 as regards the exemption of the Bank of England and the United Kingdom Debt Management Office from
the scope of Regulation (EU) No 596/2014 of the European Parliament and of the Council [2019] OJ L 80/10, Recitals
6ff.
5 See Commission Delegated Regulation (EU) 2019/461.
54
ARTICLE 7
INSIDE INFORMATION
1. For the purposes of this Regulation, inside information shall comprise the following types
of information:
(a) information of a precise nature, which has not been made public, relating, directly or
indirectly, to one or more issuers or to one or more financial instruments, and which,
if it were made public, would be likely to have a significant effect on the prices of those
financial instruments or on the price of related derivative financial instruments;
(b) in relation to commodity derivatives, information of a precise nature, which has not
been made public, relating, directly or indirectly to one or more such derivatives or
relating directly to the related spot commodity contract, and which, if it were made
public, would be likely to have a significant effect on the prices of such derivatives or
related spot commodity contracts, and where this is information which is reasonably
expected to be disclosed or is required to be disclosed in accordance with legal or
regulatory provisions at the Union or national level, market rules, contract, practice
or custom, on the relevant commodity derivatives markets or spot markets;
(c) in relation to emission allowances or auctioned products based thereon, information
of a precise nature, which has not been made public, relating, directly or indirectly, to
one or more such instruments, and which, if it were made public, would be likely to
have a significant effect on the prices of such instruments or on the prices of related
derivative financial instruments;
(d) for persons charged with the execution of orders concerning financial instruments,
it also means information conveyed by a client and relating to the client’s pending
orders in financial instruments, which is of a precise nature, relating, directly or indi-
rectly, to one or more issuers or to one or more financial instruments, and which, if
it were made public, would be likely to have a significant effect on the prices of those
financial instruments, the price of related spot commodity contracts, or on the price
of related derivative financial instruments.
2. For the purposes of paragraph 1, information shall be deemed to be of a precise nature
if it indicates a set of circumstances which exists or which may reasonably be expected to
come into existence, or an event which has occurred or which may reasonably be expected
to occur, where it is specific enough to enable a conclusion to be drawn as to the possible
effect of that set of circumstances or event on the prices of the financial instruments or the
related derivative financial instrument, the related spot commodity contracts, or the auc-
tioned products based on the emission allowances. In this respect in the case of a protracted
55
Mario Hössl-Neumann and Ulrich Torggler - 9781800882249
Article 7 INSIDE INFORMATION
process that is intended to bring about, or that results in, particular circumstances or a par-
ticular event, those future circumstances or that future event, and also the intermediate
steps of that process which are connected with bringing about or resulting in those future
circumstances or that future event, may be deemed to be precise information.
3. An intermediate step in a protracted process shall be deemed to be inside information if, by
itself, it satisfies the criteria of inside information as referred to in this Article.
4. For the purposes of paragraph 1, information which, if it were made public, would be
likely to have a significant effect on the prices of financial instruments, derivative financial
instruments, related spot commodity contracts, or auctioned products based on emission
allowances shall mean information a reasonable investor would be likely to use as part of
the basis of his or her investment decisions.
In the case of participants in the emission allowance market with aggregate emissions or
rated thermal input at or below the threshold set in accordance with the second subpara-
graph of Article 17(2), information about their physical operations shall be deemed not to
have a significant effect on the price of emission allowances, of auctioned products based
thereon, or of derivative financial instruments.
5. ESMA shall issue guidelines to establish a non-exhaustive indicative list of information
which is reasonably expected or is required to be disclosed in accordance with legal or
regulatory provisions in Union or national law, market rules, contract, practice or custom,
on the relevant commodity derivatives markets or spot markets as referred to in point (b)
of paragraph 1. ESMA shall duly take into account specificities of those markets.
OVERVIEW
A. INTRODUCTION 7.001 (b) Scope 7.017

1. Content and purpose 7.001 5. Precision (para 2) 7.020
2. Historical development 7.003 (a) Introduction 7.020
3. Legal (knowledge) sources 7.005 (b) Objectifiability (para 2 sentence 1
B. INFORMATION ON ISSUERS OR FINANCIAL criterion 1) 7.022
INSTRUMENTS (PARA 1 LIT A) 7.009 (c) Price specificity 7.027
1. Introduction 7.009 6. Price significance (para 4) 7.028
2. Information 7.011 (a) Introduction 7.028
(a) Introduction 7.011 (b) Trade incentive test 7.030
(b) Nature of the information (paras 2 f ) 7.012 (c) Point of view 7.033
(c) Intermediate steps in particular (para C. INFORMATION ON COMMODITY DERIVATIVES
3)7.013 (PARA 1 LIT B) 7.036
3. Relation to issuers or financial instruments D. INFORMATION ON EMISSION ALLOWANCES
7.014 (PARA 1 LIT C) 7.040
4. Lack of disclosure 7.015 E. CLIENT ORDERS IN PARTICULAR (PARA 1 LIT D)7.043
(a) Notion 7.015
56
A. Introduction
A. INTRODUCTION
1. Content and purpose
Art 7 defines the term inside information and thus a central element of the MAR, which 7.001
constitutes a common point of reference for the prohibitions of insider dealing (Arts 8 f) and
unlawful disclosure (Arts 10 f; see also Arts 3 f MAD) and the continuous (‘ad hoc’) disclosure
obligation (Art 17 regarding inside information ‘which directly affects the issuer’). The MAR
thus contains a clear commitment to a single notion of relevant information and its uniform
interpretation.1 On this basis, the extent of issuers’ continuous disclosure obligation depends on
their ability to delay publication pursuant to Art 17 paras 4ff.
The teleological background of Art 7 is the postulate of equal access to information: The 7.002
purpose of the MAR is ‘to protect the integrity of the financial market and to enhance investor
confidence, which is based, in turn, on the assurance that investors will be placed on an equal
footing and protected from the misuse of inside information’ (Recital 24).2 In particular, no
one should gain an unfair advantage from non-public information (see in detail, paras 7.015ff
below) to the detriment of those market participants who are unaware of such information
(Recital 23; ‘information asymmetry’, ‘level playing field’).3
1 cf Progress Report of 21 June 2012, no 11535/12, with Presidency compromise of 4 October 2012, no 14601/12; on
this point, see Jesper Hansen, ‘Say when: When must an issuer disclose inside information?’ (2016) 16/3 LSN Research
Paper Series, Nordic & European Company Law Working Paper 25 f; Alain Pietrancosta, ‘A4. Public Disclosure of
Inside Information and Market Abuse’ in Marco Ventoruzzo and Sebastian Mock (eds), MAR (Oxford University Press
2017) A.4.20; Christoph Kumpan and Robin Misterek, ‘Artikel 7 MAR: Insiderinformationen’ in Eberhard Schwark
and Daniel Zimmer (eds), Kapitalmarktrechts-Kommentar (5th edn, C. H. Beck 2020) para 18. However, some Member
States (now most notably Spain) continue to employ two separate categories of relevant information; see Art 227 Ley
del Mercado de Valores, defining ‘información relevante’ as other information of a financial or corporate nature relating
to the issuer itself or to its securities or financial instruments which any legal or regulatory provision requires them to
make public in Spain or which they consider necessary, in view of their special interest, to disseminate among investors.
Vice versa, the Italian CONSOB formulates compliance requirements to control the dissemination of so-called relevant
information (‘informazione rilevanti’) not necessarily captured under Art 7 (‘Linee Guida: Gestione delle informazioni
privilegiate’, no 1/2017, October 2017, 13ff). On the permissibility of super-equivalent implementation under European
law, see below, para 7.005.
2 See also Recital 2; Case C-19/11 Geltl [2012] ECLI:EU:C:2012:397, paras 24, 33; Case C-628/13 Lafonta [2015]
ECLI:EU:C:2015:162, para 21 with further references; cf already Case C-384/02 Grøngaard and Bang [2005] ECR
I-09939, para 33; Case C-391/04 Georgakis [2007] ECR I-03741, para 37. The wording ‘equal footing’ was first used
in Group of experts, The Development of a European Capital Market (‘Segré-Report’ 1966) 249.
3 See Georgakis (n 2) para 38; Case C-45/08 Spector Photo Group [2009] ECR I-12073, paras 48, 52; Geltl (n 2) paras
36, 47; Lafonta (n 2) para 25; cf also Recital 1 Implementing Regulation (EU) 2016/1055 of 29 June 2016 laying down
implementing technical standards with regard to the technical means for appropriate public disclosure of inside informa-
tion and for delaying the public disclosure of inside information [2016] OJ L 173/47.
57
2. Historical development
7.003 Art 7 goes back to Art 1 para 1 IDD, which was based on French and British models.4 Art 1
para 1 MAD clarified that inside information must relate ‘directly or indirectly’5 to financial
instruments (or related derivatives) or their issuer, and introduced two special cases regarding
commodity derivatives and client orders in subparas 2 f (cf para 1 lit b and d; see below paras
7.036ff, 7.043). The elements of precision and price significance were defined in Art 1 paras 1
f Directive 2003/124/EC.
7.004 Art 7 MAR adopts in para 1 the five basic elements and special cases of the MAD; paras 2
and 4 follow in the sense of Directive 2003/124/EC (see also below para 7.026 with n 73, para
7.028 with n 82). Para 1 lit c, para 4 subpara 2 introduce a new and third special case regarding
emission allowances (see also paras 7.040ff below). The clarifications regarding ‘protracted
processes’ (para 2 sentence 2, para 3) codify ECJ jurisprudence (see para 7.013 below).
3. Legal (knowledge) sources
7.005 The direct applicability and primacy of the MAR standardises the concept of inside infor-
mation and undoubtedly eliminates any national scope for implementation, in particular with
regard to stricter regulations.6 In the event of differences between the language versions (all
authentic),7 the ECJ refers to the general system and purpose of the legislative act,8 subject to
‘outliers’.9 However, in the particular case of the MAR, the English version has a certain prior-
ity,10 at least in the case of subjective-historical interpretation, as starting with IDD, legislative
materials have mostly not existed in languages other than English. The European legislator has
also repeatedly adjusted divergences in favour of the English wording (cf paras 7.028).
4 See Economic and Social Committee, Opinion on the proposal for a Council Directive coordinating regulations on insider
trading [1988] OJ C 35/22, under 1.2; on the two approaches, e.g., Takis Tridimas, ‘Insider Trading: European
Harmonisation and National Law Reform (1991) 40 ICLQ 919, 932; Manning G Warren, ‘The Regulation of Insider
Trading in the European Community’ (1991) 48 Wash & Lee L Rev 1037, 1039. For a detailed historical account, see
Mario Hössl-Neumann, Informationsregulierung durch Insiderrecht (Mohr Siebeck 2020) 176ff.
5 Background was the introduction of the continuous (‘ad hoc’) disclosure obligation (Art 6 MAD 2003) for inside infor-
mation with a direct connection to the issuer (Committee on Economic and Monetary Affairs, Report of 27 February
2002 on the proposal for a European Parliament and Council directive on insider dealing and market manipulation
[2002] PE 307.438, 17 f, 27).
6 For maximum harmonisation already by the (not directly applicable) prohibitions contained in MAD 2003, see Case
C-45/08 Spector Photo Group [2009] ECR I-12073, Opinion of AG Kokott, paras 75ff. On the other hand, it has been
argued that the principles-based regulation known in the UK would be compatible with the European regime, see
Rüdiger Veil, ‘§ 14: Insider Dealing’ in Rüdiger Veil (ed), European Capital Markets Law (2nd edn, Hart Publishing
2017) para 59; differently Carsten Gerner-Beuerle, ‘United in Diversity: Maximum Versus Minimum Harmonization in
EU Securities Regulation’ (2012) 7/3 CMLJ 317, 331.
7 See, e.g., Case 283/81 CILFIT [1982] ECR I-03415, para 18; Karl Riesenhuber, ‘§ 10: Die Auslegung’ in Karl
Riesenhuber (ed), Europäische Methodenlehre (3rd edn, de Gruyter 2015) para 14.
8 See, e.g., Case C-230, 231/09 Kurt and Thomas Etling [2011] ECR I-03097 para 60; Case C-215/10 Pacific World
[2011] ECR I-07255 para 48.
9 cf Geltl (n 2) paras 42ff regarding the German text of Art 1 para 1 Directive 2003/124/ EC.
10 This is debated in German literature; arguing for a priorisation of the English text for purposes of historical interpreta-
tion Sebastian Martens, Methodenlehre des Unionsrechts (Mohr Siebeck 2013) 342 f; differently Riesenhuber (n 7) § 10
para 16 (arguing – inter alia – that the working language of the parties involved can be unclear, which is not the case with
respect to the MAR).
58
B. Information on issuers or financial instruments (para 1 lit A)
In the interpretation of Art 7, note should be taken of the (partly new) Recitals 14–18, 28 and 31. 7.006
Also, because of the conceptual and systematic continuity to MAD and IDD (above para 7.003),
legislative materials11 and ECJ case law12 on those earlier legal acts have to be taken into account.13
ESMA may issue legally non-binding14 guidelines for the coordination of supervisory author- 7.007
ities. With regard to inside information, such guidelines currently only exist pursuant to Art 7
para 5 for commodity derivatives (para 7.039 below).15
The extensive guidelines of the supervisory authorities with regard to the national implemen- 7.008
tations of MAD 2003 have at most limited significance due to the direct applicability of the
MAR. Many NCAs have meanwhile adopted non-binding guidelines aiming to help issuers
to comply with the MAR, in particular with regard to continuous disclosure.16 However, some
(like the Austrian FMA) repealed their previous guidelines without replacement when the
MAR entered into force.
B. INFORMATION ON ISSUERS OR FINANCIAL INSTRUMENTS (PARA 1 LIT A)
1. Introduction
Para 1 lit a defines inside information relating to the issuer or financial instruments (on the 7.009
illustrative lit d, see below para 7.043) by means of five cumulative elements. Accordingly,
inside information is:
● information (paras 7.011ff below), which

● relates to a financial instrument or its issuer (para 7.014 below),
11 cf also Lafonta (n 2) with reference to preparatory works of CESR.

12 Esp Geltl (n 2) and Lafonta (n 2).
13 Compare esp Art 3 IDD with Art 3 MAD 2003, Art 8 MAR; for a detailed comparison between IDD and MAD 2003,
see Jesper Hansen and David Moalem, ‘Insider Dealing and Parity of Information – Is Georgakis Still Valid?’ (2008) 19/5
EBLR 949, 957ff; on the genesis of the European market abuse regime, cf also Hössl-Neumann (n 4) 189ff.
14 On the binding effect for NCAs, see Art 16 para 3 Regulation (EU) 1095/2010; Alexander Frank, ‘Die
Level-3-Verlautbarungen der ESMA – ein sicherer Hafen für den Rechtsanwender?’ [2015] ZBB 213, 215. At least
under German law, addressees of the MAR can possibly invoke an excusable error of law if they have relied on guidelines
(see below also n 129). The German Federal Administrative Court has ruled that the Guidelines issued by CESR (cf the
following n) contain a common legal opinion to which a presumption of validity attaches: BVwG 7 C 6.10, ZIP 2011,
1313, 1316; with further references to the German debate Frank, ibid., 218; Martin Hitzer and Patrick Hauser, ‘ESMA
– Ein Statusbericht’ (2015) 2 BKR 52, 55 f; see also Dörte Poelzig, ‘Insider- und Marktmanipulationsverbot im neuen
Marktmissbrauchsrecht’ (2016) 14 NZG 528, 529.
15 But see CESR, ‘MAD Level 3 – second set of CESR guidance and information on the common operation of the
Directive to the market’, CESR/06-562b, July 2007 and ‘MAD Level 3 – Third set of CESR guidance and information
on the common operation of the Directive to the market’, CESR/08-717, October 2008 on inside information pursuant
to MAD 2003.
16 See, e.g., AMF, ‘Position-recommandation: Guide de l’information permanente et de la gestion de l’information
privilégiée’, DOC-2016-08, 26 October 2016 (last amended 29 April 2021); CONSOB (n 1); AFM, ‘Brochure open-
baarmaking van voorwetenschap’ (Update July 2017) (also available in English); BaFin, ‘Emittentenleitfaden Modul
C – Regelungen aufgrund der Marktmissbrauchsverordnung (MAR)’, 25 March 2020 (on the latter, see Alexander
Kiefner, Lutz Krämer and Benedikt Happ, ‘Ad-hoc-Publizität und Insiderrecht nach dem neuen Modul C des
Emittentenleitfadens’ (2020) 26 DB 1386).
59
● has not been made public (paras 7.015ff below),

● is precise in nature (para 2, paras 7.020ff below), and
● would have a significant effect on the price (para 4, paras 7.028ff below).
7.010 The elements must be examined individually; in particular, the ECJ has refused to allow the
criterion of precision to be merged with that of price significance (para 7.026). However, the
criteria of (1) information and (2) its relation to a financial instrument or issuer have little
independent (delimiting) effect (paras 7.014 below; cf also para 7.003 above with n 5).
2. Information
(a) Introduction
7.011 The term ‘information’ primarily serves as a reference point for the other elements and does not
have any independent delimiting effect.17 In particular, it is important to note that the MAR
covers not only ‘facts’ in the sense of verifiable circumstances,18 but also forecasts/assessments
(cf paras 7.025f below) and personal intentions (‘self-generated facts’, problem of the ‘insider
regarding him/herself’; cf also Recital 31, para 10.009).19 Reference is not only made to cir-
cumstances with effects on the assets, liabilities, financial position and course of business of the
issuer,20 but also to other changes in the supply and/or demand for a covered financial instru-
ment (cf para 1 lit d and below para 7.043) as well as mere changes in the market environment
(e.g., an increase in the key interest rate). See also paras 7.014 and 7.035 below.
(b) Nature of the information (paras 2 f)

7.012 The information can be a single ‘event’ or a whole series of circumstances (para 3). Several indi-
vidual pieces of information that are connected with each other must therefore be assessed both
individually and as a whole. Therefore, several pieces of information which, individually, are
17 See Hannam [2014] UKUT 0233 (TCC), para 45; in this sense also Lars Klöhn, ‘Artikel 7: Insiderinformationen’
in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) para 24; Hartmut Krause, ‘§ 6: Begriff der
Insiderinformation’ in Andreas Meyer, Rüdiger Veil and Thomas Rönnau (eds), Handbuch zum Marktmissbrauchsrecht
(C. H. Beck 2018) para 21; Kumpan and Misterek, ‘Artikel 7 MAR’ (n 1) para 25.
18 In contrast, following the wording of Directive 79/279/EEC early insider trading rules in Austria and Germany referred
to ‘Tatsachen’, i.e., objective facts; see § 48a para 1 Austrian Börsegesetz as amended by the BörseG-Novelle 1993, § 13
para 1 German Wertpapierhandelsgesetz as amended by the 2. FFG.
19 On Recital 11 IDD, see Georgakis (n 2) paras 33ff; Italian and French jurisprudence similarly accept the fact that
self-generated information can trigger prohibitions under market abuse law, e.g., Corte di Cassazione, 16 October
2017, no 24310; AMF CDS, 24 October 2018, SAN 2018-13. See also, with further references, Francesco Mucciarelli,
L’insider trading nella rinnovata disciplina UE sugli abusi di mercato’ [2016] Le Società (Digital Edition) 55, 61;
Stefano Lombardo, ‘Some Reflections on the Self-Insider and the Market Abuse Regulation – The Self-insider as
a Monopoly-Square Insider’ (2021) 18/1 ECFR 2, 4ff; Alain Couret and others, Droit financier (3rd edn, DALLOZ
2019) para 1795; Marco Ventoruzzo and Chiara Picciau, ‘Article 7: Inside Information’ in Ventoruzzo and Mock (n 1)
B.7.28. On French case law more generally prohibiting certain transactions in the process of stake-building, cf Alain
Pietrancosta, ‘Brief remarks on the necessary clarification of market abuse prohibitions in times of shareholder activism’
[2019] RTDF 3, 6 f. In contrast, earlier German jurisprudence demanded a so-called ‘third-party element’ (‘Drittbezug’)
of information, see BGH 6.11.2003 1 StR 24/03, Sascha Opel, and similarly Case C-391/04 Georgakis [2007] ECR
I-03741, Opinion of AG Mengozzi, paras 55ff. Literature now universally rejects such requirement; see, e.g., Klöhn,
‘Artikel 7’ (n 17) paras 25 f; Heinz-Dieter Assmann, ‘Artikel 7 MAR: Insiderinformationen’ in Heinz-Dieter Assmann,
Uwe Schneider and Peter Mülbert (eds), Wertpapierhandelsgesetz (7th edn, Otto Schmidt 2019) para 17; Susanne Kalss,
Martin Oppitz and Johannes Zollner (eds), Kapitalmarktrecht (2nd edn, Linde 2015) § 21 para 48.
20 Contrast the limited wording of Schedule C (5) lit a Directive 79/279/EEC.
60
not deemed relevant by the MAR may together form inside information (‘mosaic information’;
e.g., willingness to buy and willingness to sell).21 Also, independent pieces of inside information
may not be ‘netted’: In the case of opposing effects (in particular regarding issuer disclosure),
each individual piece of information remains subject to Art 7 in and of itself,22 even if trading in
possession of such information may in a particular case not constitute ‘use’ because the expected
effects are mutually cancelled (cf para 8.089).
(c) Intermediate steps in particular (para 3)

From the independent assessment of each individual piece of information (above para 7.012), it 7.013
follows that each so-called ‘intermediate step’ in the course of an economically uniform process
(‘protracted or multi-stage process’) can be inside information both in itself and with regard to
the future ‘final’ event (para 7.021 below). This is clarified in para 2 sentence 2 and para 3 fol-
lowing the decision in Geltl23 (see also Recitals 16 f with examples of such processes). According
to Geltl, the classification of information as relating to an ‘intermediate step’ does not expressly
exclude its own precision (see paras 7.021 and 7.023 below). Further, in our opinion, it also
does not exclude price significance of the intermediate step (para 7.029 below). The notion of
‘intermediate steps’ therefore does not lead to any special treatment under Art 7 (para 3 does
not differentiate in this regard) and is as a result dispensable.
3. Relation to issuers or financial instruments
According to para 1 lit a, the information must relate ‘directly or indirectly, to one or more 7.014
issuers or to one or more financial instruments’. The phrase ‘directly or indirectly’ merely clari-
fies that, in contrast to Art 17 (see paras 17.020ff), all potentially price-significant information
(in the sense of para 4) is covered (see also para 7.003 above),24 including information that
affects all issuers or financial instruments (e.g., information on key interest rates; see also para
7.011 above).25
21 This is discussed by Klöhn, ‘Artikel 7’ (n 17) paras 51 f; Krause (n 17) § 6 para 22; cf also Carsten Gerner-Beuerle,
‘Article 7 MAR: Inside information’ in Matthias Lehmann and Christoph Kumpan (eds), European Financial Services
Law (C. H. Beck 2019) para 26. See also the (outdated) issuer guidelines published by BaFin, ‘Emittentenleitfaden’ (4th
edn, 2013) 55, and the Swedish ruling in Hövrätt för Västra Sverige, 20.2.2008, B 2944-07, RH 2009-29 (holding an
agreement in fact regarding a minor transaction to be inside information if viewed together with the concomitant change
in corporate strategy); cf also Sentencia de la Audiencia Nacional, 21 October 2008, no 290/06 (intention to sell and
purchase offer together inside information).
22 See FSA Final Notice of 19 January 2009 to Wolfson Microelectronics, para 4.15; Philipp Koch, ‘§ 19: Disclosure of
Inside Information’ in Veil (n 6) paras 49 f; cf also Klöhn, ‘Artikel 7’ (n 17) para 53; Kumpan and Misterek, ‘Artikel 7
MAR’ (n 1) para 24; BaFin, ‘Emittentenleitfaden Modul C’ (n 16) 21.
23 Geltl (n 2) para 40.
24 A deliberately wide definition was already devised in the Commission, ‘Proposal for a Council Directive coordinating
regulations on insider trading’ COM (87) 111 final 5; see also the extensive examples at CESR/06-562b (n 15), paras 1.15
f. On the clarifying function of the phrase, see e.g., Klöhn, ‘Artikel 7’ (n 17) para 116, Kumpan and Misterek, ‘Artikel 7
MAR’ (n 1) para 90, each with further references; cf also Ventoruzzo and Picciau (n 19) B.7.58 f (broad application also
to so-called market information). Some have argued that the criterion thus acts as a rough check of price-significance;
see Petra Mennicke and Niko Jakovou, ‘§ 13: Insiderinformation’ in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd
edn, C. H. Beck 2016) para 107.
25 In addition to the sources cited in the previous n, cf CESR, ‘CESR’s Advice on Level 2 Implementing Measures for
the proposed Market Abuse Directive’ CESR/02-089d, December 2002 paras 30, 32. This was expressly held by the
German BaFin, ‘Emittentenleitfaden’ 2013 (n 21) 34, and seems to be universally accepted in German and French
literature, see e.g., Krause (n 17) § 6 para 94; Kumpan and Misterek, ‘Artikel 7 MAR’ (n 1) para 91; Couret and others
61
4. Lack of disclosure
(a) Notion
7.015 Together with the element of price significance (paras 7.028ff below), the criterion of lack of
public awareness is of particular importance. It encompasses any deviation from the state of
public knowledge at a particular time (see also para 7.030 below).26 In the case of a ‘protracted
process’, each ‘new’ intermediate step must be assessed separately (para 7.013 above). This also
applies if a result is already publicly known (e.g., amount of upcoming dividend), but not its
causes (e.g., increase in depreciations). Therefore, the contents of the issuer’s financial state-
ments are non-public even if an earnings report is issued ahead of their publication.27
7.016 An objective (availability) standard applies when assessing the inside nature of information
(see also para 7.030 below); the German language version referring to information ‘not publicly
known’ can be disregarded as an outlier.28 Accessibility for the relevant circles (below, paras
7.017ff) is thus sufficient (cf also para 10.010 below).29 Therefore, there is no ‘waiting period’
between accessibility and general perception.30 This opens up the (legally desired)31 possibility
for market participants to be ‘better than the market’ and thus contributes to efficient price
formation,32 namely by analysing/linking ‘publicly available’ information (Recital 28 sentence
(n 19) para 1795, each with further references; but see Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 24 (conflation with
the criterion of price-significance ‘difficult to reconcile with the text of the Regulation’).
26 cf BGH 27.1.2010, 5 StR 224/09, freenet; Klöhn, ‘Artikel 7’ (n 17) paras 146 f; Kumpan and Misterek, ‘Artikel 7 MAR’
(n 1) para 105; Arif Mohammed v FSA UK FSMT, 29 March 2005, para 67. See also CONSOB (n 1) 21 f paras 4.3.2 f
(distinguishing between information published by the issuer itself or with reference to a source in the sphere of an issuer
and other, more speculative reports in the public domain); similarly e.g., CA Paris, 26 November 2008, no 07/14613;
CA Paris, 5 January 2010, no 09/06017; CA Paris, 10 April 2015, no 13/08017; Conseil d’État, 3 February 2016, no
369198. See also Sentencia de la Audiencia Nacional, 4 December 2012 and Auto de Rectificación, 1 January 2013, no
56/2012 (information of success of clinical trial v public knowledge of pre-calculated probability); cf also David Massey
v FSA [2011] UKUT 49 (TCC), para 36 (more specific information about price of planned secondary offering that was
already public knowledge).
27 See, e.g., Klöhn, ‘Artikel 7’ (n 17) para 145; Assmann, ‘Artikel 7 MAR’ (n 19) para 71; Petra Buck-Heeb, ‘§ 8:
Insiderrecht’ in Heinz-Dieter Assmann, Rolf Schütze and Petra Buck-Heeb (eds), Handbuch des Kapitalanlagerechts (5th
edn, C. H. Beck 2020) para 98.
28 See, e.g., Klöhn, ‘Artikel 7’ (n 17) para 133; Klaus Hopt and Christoph Kumpan, ‘§ 107: Insider- und
Ad-hoc-Publizitätsprobleme’ in Herbert Schimansky, Hermann-Josef Bunte and Hans-Jürgen Lwowski (eds),
Bankrechts-Handbuch (5th edn, C. H. Beck 2017) para 53.
29 See CESR/06-562b (n 15) para 1.9, and, on this point, Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 21; Stefan
Grundmann, European Company Law (2nd edn, Intersentia 2011) § 23 para 11. For a detailed analysis, see Lars Klöhn,
‘Wann ist eine Information öffentlich bekannt i.S.v. Art. 7 MAR?’ (2016) 180 ZHR 707, 724; cf also Ventoruzzo and
Picciau (n 19) B.7.53. In this sense also the (now outdated) issuer guidelines published by FMA, ‘Emittentenleitfaden’
(2013) 59, and BaFin, ‘Emittentenleitfaden’ 2013 (n 21) 34.
30 See, e.g., Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 21; Guido Ferrarini, ‘The European Market Abuse Directive’
(2004) 41/3 CML Rev 711, 719 f; Kumpan and Misterek, ‘Artikel 7 MAR’ (n 1) para 104; see also (in the context of
trading on own analysis [n 119]) Couret and others (n 19) para 1795; but see Ventoruzzo and Picciau (n 19) B.7.52 (on
the remaining uncertainty as to what is covered by the test).
31 For a detailed analysis of the European regime, see Hössl-Neumann (n 4) 53ff, 213 f.
32 See, e.g., Veil (n 6) § 14 para 40; Stefan Grundmann in Claus-Wilhelm Canaris, Mathias Habersack and Carsten
Schäfer (eds, established by Hermann Staub), Handelsgesetzbuch - Großkommentar (5th edn, vol 11/1, De Gruyter 2017),
6. Teil Marktregeln Art 7 MAR para 347. On the role of informational arbitrage in the price-formation process under
market abuse law, see also Jesper Hansen, ‘MAD in a Hurry: The Swift and Promising Adoption of the EU Market
62
1)33 or by investing in a search for information which is deemed ‘made public’ but which is
not yet generally perceived.34 Due to teleological similarity, this also, in our opinion, includes
factual circumstances that have not (yet) been disseminated in the media, but which are legally
accessible to any reasonable investor35 and have no direct relation to an issuer (Art 17 para 1).36
(b) Scope
It is controversial which circle of people must have access to information in order to be known 7.017
to the public. Under IDD and MAD 2003, some NCAs37 and even express statements in the
legislative materials (e.g., in Germany and Austria)38 allowed ‘sectoral disclosure’ to suffice:
According to this view, information is already made public if it is accessible to an indefinite
and indeterminable number of market participants39 without disproportionate effort, namely
Abuse Directive’ (2004) 15/2 EBLR 183, 195 f; Mathias Siems, ‘The EU Market Abuse Directive: a case-based analysis’
(2008) 2/1 L & Fin Mkts Rev 39, 41.
33 cf already Recital 13 IDD, Recital 31 MAD 2003. On the functioning of Recital 28 sentence 1, see e.g., Sergio Gilotta,
‘The Regulation of Outsider Trading in EU and the US’ (2016) 13/4 ECFR 631, 659ff, and, from a German perspective,
e.g., Lars Klöhn, ‘Eine neue Insiderfalle für Finanzanalysten? – Zweck, Bedeutung und Auslegung von Erwägungsgrund
Nr. 28 MAR’ (2016) 35 WM 1665; Assmann, ‘Artikel 7 MAR’ (n 19) para 33; Krause (n 17) § 6 paras 38ff; cf also AMF
CDS, 22 July 2014, SAN-2014-16; AMF CDS, 23 July 2015, SAN-2015-15 (privileged nature of information to be
assessed without recourse to the analysing capabilities of the individual possessor). On Recital 28 sentence 2, see n 118.
34 cf BaFin, ‘Emittentenleitfaden Modul C’ (n 16) 24 f (‘collect and appraise’); for a detailed analysis of information search
under the MAR, see Klöhn, ‘Wann ist eine Information öffentlich bekannt i.S.v. Art. 7 MAR?’ (n 29) 707, 713 f, 724
f; cf also the decision by the Swiss Federal Criminal Court, Bundesstrafgericht, 8.6.2017, SK.2017.3, Santhera, where
a trader was acquitted only on appeal for having traded on a release by the issuer which had not yet been picked up by the
market due to lack of analyst coverage (added complexity resulted from the trader having received advance knowledge of
the upcoming release).
35 E.g., by way of on-site visits, product tests, calculation of customer frequency, participation in court hearings; for further
examples, see Lars Klöhn, ‘§ 13: Insiderinformation’ in Heribert Hirte and Thomas Möllers (eds), Kölner Kommentar
zum WpHG (2nd edn, Carl Heymanns Verlag 2014) paras 136ff; on the (undisputedly admissible) latency arbitrage
in high-frequency trading, see Milan Bayram and Dominik Meier, ‘Pinging, Front Running und Quote Matching
– Verbotene Handelspraktiken nach der Marktmissbrauchsverordnung?’ (2018) 28 WM 1295, 1299; Peter Kasiske,
‘Marktmissbräuchliche Strategien im Hochfrequenzhandel’ (2014) 41 WM 1933, 1938 f; Grundmann in Staub (n 32)
para 395.
36 This has always been the position of the UK authorities, cf FCA, Handbook MAR 1.2.12–14; following this approach,
see Hansen, ‘MAD in a Hurry’ (n 32) 183, 195 f, and for a detailed historical analysis Hössl-Neumann (n 4) 209ff,
245ff. Differently, however, most of continental European literature; see below para 7.018 (however mostly disregarding
information outside the issuer) and expressly Klöhn, ‘Artikel 7’ (n 17) para 143, Kumpan and Misterek, ‘Artikel 7 MAR’
(n 1) para 118; see paras 17.026 f below. Regarding issuer-related information, cf the Danish case of BioPorto, Vestre
Landsret 26.8.2014, UfR 2014.3464 V, where a trader was acquitted on appeal for trading on a patent court ruling after
he participated in the public hearings, however only due to lack of conclusive evidence established in the first instance.
37 See, e.g., the (now outdated) issuer guidance published by the FMA, ‘Emittentenleitfaden’ 2013, 59; similarly, AFM,
‘Quick Guide to Price-Sensitive Information’ (2005) 2; cf also freenet (n 26) (referring to the legislative materials, see
following n). The British authorities have also generally regarded sectoral disclosure to be sufficient; § 58 para 3 Criminal
Justice Act 1993 similarly refers to information ‘communicated to a section of the public’. For a discussion of French and
British approaches, see The British Institute of International and Comparative Law, Comparative Implementation of EU
Directives (I) – Insider Dealing and Market Abuse (2005) 10.
38 See ErlRV BörseG-Nov 1993, 1110 BlgNR 18. GP 19 (‘sectoral public’ of persons interested in exchange trading); Begr
RegE 2. FFG, BT-Drs 12/6679, 46 (same).
39 This notion was picked up recently by the Austrian Federal Administrative Court, BVwG 14.2.2019, W210
2195872-1/6E, Wiener Privatbank, in arguing against public disclosure in the course of a shareholders’ meeting; for
a review of German literature, see e.g., Eberhard Schwark and Dominik Kruse, ‘§ 13 WpHG: Insiderinformation’
in Eberhard Schwark and Daniel Zimmer (eds), Kapitalmarktrechts-Kommentar (4th edn, C. H. Beck 2010) para 36;
Mennicke and Jakovou (n 24) § 13 paras 94, 97; Heinz-Dieter Assmann, ‘§ 13: Insiderinformation’ in Heinz-Dieter
63
to professional investors via industry standard information services.40 The teleological basis
is what in German literature is referred to as the ‘Windschattenargument’ (‘slipstream argu-
ment’): Even such limited dissemination usually results in the information being competitively
impounded into the price and thus the impossibility of insider advantages.41
7.018 The opposite view, which has traditionally been advocated in Romanic jurisdictions and is
also shared by the German BaFin (despite its formal commitment to sectoral disclosure),42 and
which is gaining ground also in German legal literature under the MAR,43 further calls for free
access of the general public, in particular through publication on the issuer’s website or (at least)
nationwide in common print or online media.44 This argument is supported by the rules on
continuous disclosure in accordance with Art 17, for which sectoral publication is undoubtedly
insufficient (cf para 17.068 below and Recital 1, Art 2 para 1 lit a and Art 3 lit a Implementing
Regulation 2016/1055).45 The same follows if the wording of the MAR is taken at face value
that information is inside as long as it has not been made public, which seems to indicate that
information has to be actively disseminated.46 Also, the sufficiency of sectoral disclosure (above
para 7.017) would systematically disadvantage private investors and thus run counter to the
objective of a confidence-building level playing field (para 7.002 above).47
Assmann and Uwe Schneider (eds), Wertpapierhandelsgesetz (6th edn, Otto Schmidt 2012) § 13 paras 38 f; cf also
Grundmann, European Company Law (n 29) § 23 para 11.
40 See, e.g., Kalss, Oppitz and Zollner (n 19) § 21 para 25; Assmann, ‘§ 13: Insiderinformation’ (n 39) paras 34 f; Mennicke
and Jakovou (n 24) § 13 paras 81ff with further references.
41 See Lars Klöhn, ‘The European Insider Trading Regulation after the ECJ’s Spector Photo Group-Decision’ (2010)
7/3 ECFR 347, 364; Grundmann in Staub (n 32) para 348; cf also Ventoruzzo and Picciau (n 19) B.7.54 f; Assmann,
‘Artikel 7 MAR’ (n 19) para 65; Hopt and Kumpan (n 28) § 107 paras 52 f.
42 See, e.g., AMF CDS, 14 June 2012, SAN-2012-07 (the market, and not a specific clientele), and with further references
Couret and others (n 19) para 1716 (cf also above n 26); CONSOB (n 1) 21 para 4.3.1; cf also Sentencia de la Audiencia
Nacional, 21 June 2011, no 548/2010 (‘generalidad de los inversores’); Sentencia de la Audiencia Nacional, 20 November
2006, no 217/06 (‘general conocimiento’). Similarly, the wording used by BaFin, ‘Emittentenleitfaden Modul C’ (n 16)
10 (‘breite[s] Anlegerpublikum’, not specific circles); cf also (in the context of issuer disclosure) BaFin, ‘Art. 17 MAR –
Veröffentlichung von Insiderinformation (FAQs)’, 31 January 2019, 9.
43 See Klöhn, ‘Artikel 7’ (n 17) paras 126ff; Krause (n 17) § 6 para 81; Kumpan and Misterek, ‘Artikel 7 MAR’ (n 1)
paras 96ff; Christoph Kumpan, ‘Ad-hoc-Publizität nach der Marktmissbrauchsverordnung’ (2016) 35 DB 2039, 2042;
Buck-Heeb (n 27) § 8 paras 90ff; cf also Grundmann in Staub (n 32) para 348; but see Assmann, ‘Artikel 7 MAR’ (n 19)
paras 65 f (still advocating sectoral disclosure).
44 See AMF CDS, 22 October 2012, SAN-2012-17 (publication abroad not sufficient); compare AMF CDS, 10 April
2008, SAN-2008-15 (multiple articles in national press specifically referring to an imminent takeover bid constitute
disclosure). Similarly, Krause (n 17) § 6 paras 84ff; Kumpan and Misterek, ‘Artikel 7 MAR’ (n 1) para 106 (public access
in country/ies of listing decisive); for a theoretical framework, see Klöhn, ‘Wann ist eine Information öffentlich bekannt
i.S.v. Art. 7 MAR?’ (n 29) 707, 726 (no marginal costs attached to the specific piece of information and no prohibitive
costs of the medium more generally from the perspective of retail investors); Grundmann in Staub (n 32) para 348,
Kumpan and Misterek, ‘Artikel 7 MAR’ (n 1) para 103 (same).
45 See in detail Klöhn, ‘Wann ist eine Information öffentlich bekannt i.S.v. Art. 7 MAR?’ (n 29) 707, 715ff, Kumpan and
Misterek, ‘Artikel 7 MAR’ (n 1) paras 97, 101 f; cf also Geltl (n 2) para 35.
46 The divergence between German and Romanic interpretations might be due to the fact that the German language
version has always been an outlier, not featuring the ‘made public’-test (see above para 7.016).
47 See Klöhn, ‘Wann ist eine Information öffentlich bekannt i.S.v. Art. 7 MAR?’ (n 29) 707, 718 f; Panagiotis Staikouras,
‘Four Years of MADness? – The New Market Abuse Prohibition Revisited’ (2008) 19/4 EBLR 775, 783; cf also Geltl
(n 2) paras 34ff; but see (sceptical of this interpretation of equality) Ventoruzzo and Picciau (n 19) B.7.54 f; Niamh
Moloney, EU Securities and Financial Markets Regulation (3rd edn, Oxford University Press 2014) 721 f; Gerner-Beuerle,
‘Article 7 MAR’ (n 21) paras 20 f; similarly Assmann, ‘Artikel 7 MAR’ (n 19) para 66.
64
Following this line of argument, information that is not widely available, but has (illegally) 7.019
already been fully impounded into the price, is not yet ‘made public’ (but potentially no longer
has a significant effect on the price).48 If, on the other hand, ‘sectoral disclosure’ were sufficient,
such information could at the same time be deemed ‘public’ on the basis of the ‘slipstream
argument’ (para 7.017 above).49
5. Precision (para 2)
(a) Introduction
Information has to be ‘precise’ to qualify as inside information (see already Art 1 para 1 7.020
IDD, Art 1 para 1 MAD 2003). The criterion is intended to exclude speculative and vague
information, in particular from issuers’ obligation of continuous disclosure pursuant to Art
17.50 It is defined by Art 7 para 2 sentence 1 (cf already Art 1 para 1 Directive 2003/124/EC;
see also below para 7.026 with n 74) by two cumulative conditions:51 First, the object of the
information (set of circumstances or event)52 must be objectively given or its (especially: future)
existence must be reasonably expected (‘objectifiability’, also: precision in the narrow sense;
paras 7.022ff below); secondly, the information must be specific enough to allow a conclusion
to be drawn as to its possible effect on prices (‘price specificity’, also: precision in the broader
sense; para 7.027 below).
Pursuant to para 2 sentence 2, para 3 (see also Recitals 16 f), these criteria also apply to 7.021
each intermediate step in the course of a ‘protracted process’ (see already para 7.013 above).
Therefore, each intermediate step (which has occurred or is expected to occur)53 must also be
assessed individually, in addition to its effects on the probability of the future final event (see
also para 7.023 below). The provision is based on the Geltl case, according to which an interme-
diate step can also be precise inside information by itself.54 Therefore, the view that information
about an intermediate step (e.g., resignation plan of a member of the management board)55
only becomes precise and thus inside information when the ‘final’ event (actual end of office)
48 See, e.g., Couret and others (n 19) para 1715; Grundmann in Staub (n 32) para 348.
49 See Ventoruzzo and Picciau (n 19) B.7.54; Klöhn, ‘The European Insider Trading Regulation after the ECJ’s Spector
Photo Group-Decision’ (n 41) 347, 364; similarly Moloney (n 47) 721 f; Konstantinos Sergakis, The Law of Capital
Markets in the EU (Red Globe Press 2018) 159 f; cf also (under Directive 79/279/EEC) Corte di Cassazione, 20 January
2010, no 8588.
50 See Geltl (n 2) para 48: avoidance of ad hoc disclosures that are not specific or unlikely to influence the price; cf also
Lafonta (n 2) para 31: exclusion of ‘vague or general’ information not allowing a conclusion to be drawn regarding the
price.
52 These alternatives aim at the comprehensive inclusion of all conceivable information: CESR, ‘CESR Market Abuse
Consultation Feedback Statement’, CESR/02-287b, December 2002, 6. The Italian text of the MAR is an outlier in that
it features two different, but similar wordings (‘serie di circonstanze’ and ‘detto complesso di circonstanze’); this should
be viewed as a mistake; cf Stefano Lombardo, ‘L’informazione privilegiata’ [2016] Le Società (Digital Edition) 11, 13 fn
20.
55 This was the scenario in Geltl (n 2).
65
can be expected56 is outdated.57 After Geltl, there can be no doubt that the qualification as an
intermediate step does not create such ‘blocking effect’ in terms of the criterion of precision
(see para 7.013 above; cf also para 7.029 below for the parallel question of a ‘blocking effect’
regarding price significance).58
(b) Objectifiability (para 2 sentence 1 criterion 1)

(i) Introduction
7.022 The criterion of occurrence or reasonably expected occurrence shall exclude such information
which does not have a sufficient factual basis to justify qualification as inside information and
the consequences thereof pursuant to Arts 8, 10 and 17.
7.023 Para 2 makes a distinction between information that has occurred in the past and information
that is expected in the future.59 A real life situation can fall into both categories, as para 2 sen-
tence 2 clarifies for ‘intermediate steps’ in the case of a ‘protracted process’ (see also paras 7.013,
7.021 above): Such intermediate steps are both information about events that have occurred
(e.g., Memorandum of Understanding)60 and the decisive element for the current assessment
of the expectability (probability; paras 7.025 f below) of a still uncertain final result (closing of
the transaction).61 In practice, the second dimension plays only a minor role if and because an
intermediate step is by itself inside information and its disclosure will generally be accompanied
by a statement on the prospect of corresponding future events.62
56 See UVS Wien, 22 February 2010, 06/FM/57/7999/2008, following OLG Stuttgart 22 April 2009, 20 Kap 1/08,
Daimler-Chrysler II; in this sense already BGH 25 February 2008, II ZB 9/07 para 20, Daimler-Chrysler I. For
a review of supporting literature, see e.g., Susanne Kalss and Andreas Zahradnik, ‘BörseGNov 2004: Insiderrecht und
Ad-hoc-Publizität bei M&A-Transaktionen’ (2006) 5 ecolex 393, 395; Schwark and Kruse (n 39) § 13 WpHG para 19.
57 There had already been opposition by the authorities and some courts against such limitation before Geltl (n 2): See
FMA, ‘Emittentenleitfaden’ (2006) 5; BaFin, ‘Emittentenleitfaden’ (2009) 31; OLG Frankfurt, 2 Ss-OWi 514/08,
NJW 2009, 1520; cf also Petra Mennicke and Niko Jakovou, ‘§ 13: Insiderinformation’ in Andreas Fuchs (ed),
Wertpapierhandelsgesetz (1st edn, C. H. Beck 2009) para 74 with further references. The preliminary reference to the ECJ
was a product of this split in German jurisprudence. The reason for such limitation in the first place was that Germany
and Austria did not follow other Member States (in particular Italy and the Scandinavian countries, but arguably also
France) in limiting the continuous disclosure obligation pursuant to Art 17 to ‘final’ events (so-called ‘two-step model’);
see, e.g., the decision by the Danish Erhversankenævnet, 11.9.2008, no 2007-0012239, and, for a survey of the two
approaches, Linda Hellstén, Disclosure and delayed disclosure of inside information in the light of the EU Market Abuse
Regulation (University of Helsinki Master Thesis 2015); cf also Hössl-Neumann (n 4) 20ff.
58 E.g., VwGH, 20 April 2016, Ra 2015/02/0152, Verbund I; BGH 10.7.2018, II ZB 24/14, CorealCredit Bank; cf also
the express statement at CONSOB (n 1) 24 para 4.4.1 a.1); always in this sense CESR: CESR/06-562b (n 15) para 1.6,
CESR/02-089d (n 25) para 20 subpara 2: ‘contingencies relating to the actual occurrence of the referred matter or event
do not mitigate the precise nature of the information’.
59 On this differentiation, see below paras 7.025ff; cf generally Schwark and Kruse (n 39) § 13 WpHG para 8; Assmann,
‘§ 13: Insiderinformation’ (n 39) para 12.
60 This was the scenario in VwGH 27 April 2017, Ro 2016/02/0020, Verbund II; Verbund I (n 58). For a similar case, see
Sentencia del Tribunal Supremo, 27.9.2011, no 418/2009 (signing of NDA in preparation of non-binding offer).
61 In this sense Verbund I (n 58) para 19; similarly (on price significance) CorealCredit Bank (n 58) (information on action
and on consequence); for a detailed analysis, see Klöhn, ‘Artikel 7’, (n 17) para 111.
62 See, e.g. Katja Langenbucher, ‘Insider Trading, An exercise in (economic and legal) transplants’ [2013, 2014] RTDF
35, 41, with reference to Holger Fleischer, ‘Ad-hoc-Publizität beim einvernehmlichen vorzeitigen Ausscheiden des
Vorstandsvorsitzenden – Der DaimlerChrysler-Musterentscheid des OLG Stuttgart’ (2007) 11 NZG 401, 404; cf also
Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 14; but see (on the remaining problems for issuers) Gregor Bachmann,
‘Kapitalmarktrechtliche Probleme bei der Zusammenführung von Unternehmen’ (2008) 172 ZHR 597, 604 f. In our
66
(ii) Past circumstances and events

In any case, ‘objectifiable’ in the sense of para 2 sentence 1 criterion 1 is all information about 7.024
circumstances or events that have already occurred63 (verifiably; see following sentence); this
also includes knowledge of the falsity of market expectations (cf para 7.035 below).64 More
difficult to assess is the situation that a circumstance/event has occurred, if at all, in the past,
but this cannot (objectively) be verified at the moment, at least not with reasonable effort.65
In our view, such cases should be treated akin to information about the future (see thus paras
7.025 f):66 Such information is only ‘precise’ in the sense of criterion 1 in para 1 sentence 2 if, ex
ante and objectively, a realistic probability (cf para 7.026 below) of veracity exists.67 Therefore,
mere rumours without an objective factual basis do not constitute ‘inside information’ under
the MAR.68
(iii) Future circumstances and events

Precise within the meaning of criterion 1 of Art 7 para 2 is also information about future 7.025
circumstances/events if their occurrence can already be reasonably expected. According to the
ECJ, this is ‘a criterion based on rules drawn from the common experience’.69 According to
Recital 16, the basis of assessment is ‘an overall assessment of the factors existing at the relevant
time’.70 Therefore, the criterion requires an objective assessment from an ex ante perspective
(see paras 7.033ff below).71
view, the problems attached to mandated disclosure of intermediate steps are by and large a question of the issuer's ability
to defer disclosure under Art 17 para 4.
63 On the preparation of Directive 2003/124/EC, see CESR/02-089d (n 25) para 20: ‘A matter or event is true…’ (in the
Directive: ‘exists…’) ‘when it is based on firm and objective evidence’.
64 See, e.g., Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 10; CA Paris, 2 February 2010, no 09/02623; cf also AMF CDS,
17 December 2009, SAN-2010-07 (sanctioning a director for purchasing shares against the backdrop of misleading
information). Another question is whether the issuer is obliged to correct the information; this depends on the direct
reference of the information to the issuer, see paras 17.020ff below.
65 ‘Present uncertain circumstances’ (‘gegenwärtige unsichere Umstände’): Klöhn, ‘Artikel 7’(n 17) paras 112ff; Mennicke
and Jakovou (n 24) § 13 para 52a; cf also Assmann, ‘Artikel 7 MAR’ (n 19) para 16.
66 Differently Klöhn, ‘Artikel 7’ (n 17) paras 85 f (advocating a probability-magnitude test).
67 See, e.g., Grundmann in Staub (n 32) para 344 (sufficient degree of objective reliability); similarly Mennicke and Jakovou
(n 24) § 13 paras 38, 51 f; Schwark and Kruse (n 39) § 13 WpHG paras 23 f; Kumpan and Misterek, ‘Artikel 7 MAR’
(n 1) paras 57ff (differentiating between past and future events and holding the former to the lower standard of ‘reason-
able expectation’). Such test was already employed (under the criterion of ‘Tatsachen’, n 18) by the Hessian Supreme
Administrative Court in Hessischer VwGH 8 TZ 98/98, Thyssen Krupp, NJW-RR 1999, 120, 121; this approach was
picked up by the (now outdated) issuer guidance published by BaFin, ‘Emittentenleitfaden’ 2013 (n 21) 33 f.
68 In this sense Commission (n 24) COM (87) 111 final 5; on the preparation of Directive 2003/124/EC, see
CESR/02-089d (n 25) para 20: ‘A matter … which can be communicated accurately (as opposed to rumours)’; cf also
(rumours not qualifying as inside information) Krause (n 17) § 6 para 54; Ventoruzzo and Picciau (n 19) B.7.36; sim-
ilarly CONSOB (n 1) 23 para 4.4.1 a.1) (stable and objective evidence, no rumours or conjectures). See also Veil (n 6)
§ 14 paras 38 f, citing the Swedish appellate decision in Svea Hovrätt, 20 December 2006, B 3917-06, Tivox AB, in
which a mere recommendation to sell as part of broader discussions on the issuer was not held to convey negative inside
information; but cf also CA Paris, 31 March 2016, no 15/12351 (irrelevant that document disclosed does not contain
addressee and therefore still leaves room for supposition).
70 See also Geltl (n 2) para 45.
71 Ventoruzzo and Picciau (n 19) B.7.37; Klöhn, ‘Artikel 7’ (n 17) para 99; see also (on the overlap with the reasonable
investor test) Hopt and Kumpan (n 28) § 107 para 45; Christoph Kumpan and Robin Misterek, ‘Der verständige
Anleger in der Marktmissbrauchsverordnung’ (2020) 184 ZHR 180, 185 f.
67
7.026 With regard to the minimum probability of occurrence of the future event or circumstance,
it can be inferred from Recital 16 and the underlying Geltl ruling of the ECJ72 that this is
to be assessed independently of the event’s price significance, i.e., does not depend on the
magnitude of the expected price reaction if the event or circumstance were to materialise
(no ‘probability-magnitude test’ at the level of precision).73 A realistic prospect is required.74
According to the ECJ, this does not require a high probability,75 but does exclude future
circumstances/events ‘the occurrence of which is implausible’.76 This leaves open whether
a predominant probability of occurrence (> 50 per cent) is required. This standard (‘more likely
than not’) is supported by the fact that the ECJ had to discuss three alternative interpretations,
of which two (high probability, probability-magnitude test) were rejected and the third (> 50
per cent) was left unanswered, which could be interpreted as eloquent silence.77 According to
the opposing view, plausibility in terms of concrete, verifiable indications (e.g., start of negoti-
ations) is sufficient.78 The question is mitigated by the independent relevance of intermediate
72 Geltl (n 2) paras 50ff; similarly already (on Directive 2003/124/EC) CESR/02-089d (n 25) para 18; differently Case
C-19/11 Geltl [2012] ECLI:EU:C:2012:153, Opinion of AG Mengozzi, para 70 (greater weight to be attributed to one
condition if ‘neither condition is wholly unsatisfied’).
73 Such test had previously been advocated e.g., in German and Austrian literature; see Lars Klöhn, ‘Der “mehrstufige
Geschehensablauf” vor dem EuGH – zum DaimlerChrysler-Vorlagebeschluss des BGH’ (2011) 5 NZG 166, 168
f; Bachmann, ‘Kapitalmarktrechtliche Probleme bei der Zusammenführung von Unternehmen’ (n 62) 605; Florian
Schuhmacher, ‘Zur Auslegung des neu gefaßten Tatbestands des Mißbrauchs einer Insider-Information’ [2005] ÖBA
533, 540 f.
74 Geltl (n 2) para 49; differently, the German language version of the ruling (as an outlier, n 9) requires that the event/
circumstance ‘can actually be expected’ (‘tatsächlich erwartet werden kann’).
75 Geltl (n 2) paras 42ff, deciding against an argument based on the German language version of MAD 2003 (‘hin-
reichende Wahrscheinlichkeit’, i.e., sufficient probability; see already above para 7.005). Differently, prior to Geltl,
the Administrative Tribunal for Vienna in UVS Wien (n 56) 06/FM/57/7999/2008, following Kalss and Zahradnik
(n 56) 395 (‘kein vernünftiger Grund … zu zweifeln’, no reasonable doubt); OLG Stuttgart 15.2.2007, 901 Kap
1/06, Daimler-Chrysler I (‘deutlich mehr als überwiegende Wahrscheinlichkeit’, significantly more than predominant
probability).
76 Geltl (n 2) para 48; cf also CESR/02-089d (n 25) para 23.
77 In this sense BGH 23 April 2013, II ZB 7/09 para 29, Daimler-Chrysler II (however stating that no pure analysis of
probability should be made); BaFin, ‘Art. 17 MAR’ (n 42) 7; BaFin, ‘Emittentenleitfaden Modul C’ (n 16) 10; cf also the
(now outdated) issuer guidance published by the FMA, ‘Emittentenleitfaden’ 2013, 60 (‘eher wahrscheinlich, als nicht’,
more likely than not); the Austrian Supreme Administrative Court failed to specify a standard in VwGH 29 April 2014,
2012/17/0554, RBI. For a review of legal literature, see e.g., Klöhn, ‘Artikel 7’ (n 17) para 97; Assmann, ‘Artikel 7 MAR’
(n 19) paras 47 f; Kumpan and Misterek, ‘Artikel 7 MAR’ (n 1) para 48; Ventoruzzo and Picciau (n 19) B.7.38; Krause
(n 17) § 6 para 62; cf also (lamenting an increasingly wide notion of precision, especially when viewed together with the
ECJ’s ruling in Lafonta [n 79]) Couret and others (n 19) para 1714. On this debate, see Langenbucher, ‘Insider Trading’
(n 62) 40 f.
78 See, e.g., Alexander Hellgardt, ‘The Notion of Inside Information in the Market Abuse Directive: Geltl’ (2013) 50/3
CML Rev 861, 873 (‘real indication’, not ‘pure fantasy’); Hannam (n 17) paras 61, 76 (real, not fanciful prospect); Geltl
(n 72), Opinion of AG Mengozzi, para 73 fn 16: ‘where reason dictates that the event be regarded as impossible or
improbable, the necessary element of reasonableness being absent, for example, where it is no more than rumour, or
where the information is so vague as to make it impossible to draw inferences’; cf also Gerner-Beuerle, ‘Article 7 MAR’
(n 21) para 12 (probability can be less than 50 per cent, ‘provided it is not so low that the occurrence … can be effectively
excluded’); Dirk Zetzsche, ‘§ 7: Europäisches Kapitalmarktrecht’ in Martin Gebauer and Christoph Teichmann (eds),
Enzyklopädie Europarecht Band 6 - Europäisches Privat- und Unternehmensrecht (Nomos 2014) § 7.C para 111: exemption
of wishful thinking, unsubstantiated hopes and prognoses. Similarly, the French courts typically look at whether there
is a ‘reasonable chance of conclusion’ of a project, which is regularly assessed from the perspective of the affected issuer;
see, e.g., CA Paris, 22 January 2015, no 13/18202; CA Paris, 14 January 2016, no 14/13986; Cass. Com. 1 March 2017,
nos 14-26225, 14-26892, 15-12362; cf also CA Paris, 27 November 2014, no 13/16393 (certainty not required). For
the equally wide interpretation in Italy, see Lombardo (n 52) 11, 15 fn 22 with further references; a lower standard was
68
steps (paras 7.013, 7.021, 7.029) with regard to ‘final events’, but remains relevant for uncertain
intermediate steps (para 7.024 above).
(c) Price specificity

According to criterion 2 of Art 7 para 2 sentence 1, the information must also be specific 7.027
enough to allow a conclusion about possible effects on prices. This excludes information that
is so vague or general that it does not allow any inference on a possible impact on price.79
However, the requirement has no independent delimiting effect in addition to the criterion
of price significance (paras 7.028ff) and consequently only serves as a preliminary check to
exclude such information which, due to uncertainty, obviously has no price relevance (e.g.,
mere informal talks, considerations, opinions).80 For the assessment see therefore below, at
paras 7.030ff. It is not necessary that the direction of the price effect is foreseeable.81 Also, it
is immaterial whether information (especially if it relates to an entire industry or market) is
relevant for several instruments at the same time (cf also above para 7.014 relating to issuers
and financial instruments).82
6. Price significance (para 4)
(a) Introduction
According to para 1, inside information must be suitable for having a ‘significant’83 effect on 7.028
the price of financial instruments or related derivatives (paras 2.007 f above) if it were made
also employed in some German decisions prior to Geltl, i.e., BGH Daimler-Chrysler I (n 56) para 25; OLG Düsseldorf
4.3.2010, I-6 U 94/09, IKB.
79 See Lafonta (n 2) paras 31, 34ff; differently CESR/02-089d (n 25) para 20 subpara 3, requiring that information ‘would
enable a reasonable investor to take an investment decision without (or at very low) risk or when it is likely to be exploited
immediately on the market’.
80 Klöhn, ‘Artikel 7’ (n 17) paras 82, 84, 91; Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 10; cf also Couret and others (n
19) para 1715; Kumpan and Misterek, ‘Der verständige Anleger’ (n 71) 184 f, Ventoruzzo and Picciau (n 19) B.7.69ff
(each pointing out the overlap with the reasonable investor test). See, e.g., AMF CDS, 29 May 2017, SAN-2017-05
(subjective appraisals generally not inside information); AMF CDS, 5 June 2013, SAN-2013-14 (information suf-
ficiently defined and intelligible to an investor). It is thus deemed to be irrelevant even if major aspects of an actual
proposed transaction of sufficient magnitude are still uncertain: Conseil d’État no 369198 (n 26); Sentencia de la
Audiencia Nacional, 12 February 2019, no 731/2017, 4 March 2019, no 673/2017; cf also AMF CDS, 3 March 2015,
SAN-2015-04 (uncertainty regarding exact figures irrelevant if picture is sufficiently clear); Sentencia de la Audiencia
Nacional, 17 June 2008, no 346/05 (irrelevance of uncertain price of takeover bid).
81 Lafonta (n 2) paras 31, 34ff; see also Verbund I (n 58); cf also Case C-628/13, Lafonta [2015] ECLI:EU:C:2014:2472,
Opinion of AG Wathelet, paras 47ff, citing the unambiguous legislative materials (CESR/02-287b (n 52) 6 f paras 22
f). This is particularly important if the price of an offer has not yet been set and therefore investors are not in a position
to evaluate the impact of the deal; see, e.g., CA Paris, no 13/18202 (n 78) (price not decisive for precision); differently
before Lafonta VwGH 24 March 2014, 2012/17/0118, OMV; cf also David Massey v FSA (n 26) paras 38 f. On the
inconclusive French case law prior to Lafonta, see Léon del Forno and Quentin de Margerie, ‘Commentaire de l’arrêt de
la CJUE du 11 mars 2015 dans l’affaire C-628/13 (Jean-Bernard Lafonta c/ AMF): vers une information privilégiée sans
“privilege”?’ [2015] RTDF 44, 45 f.
82 See, e.g., Klöhn, ‘Artikel 7’ (n 17) para 91; Schwark and Kruse (n 39) § 13 WpHG para 14; Mennicke and Jakovou (n
24) § 13 para 28a; differently Assmann, ‘Artikel 7 MAR’ (n 19) para 61 (issuer specificity required); cf also Buck-Heeb
(n 27) § 8 para 80.
83 The exact wording differs between the language versions of the MAR; e.g., while the Italian and French versions closely
follow the English version (‘avere un effetto significativo’, ‘influencer de façon sensible’), the German version of para 1
uses the term substantial (‘erheblich’; similarly under IDD: ‘beträchtlich’). The Italian text of the MAR also diverges
69
public.84 This implies an influence on supply of and/or demand for the financial instrument. To
this effect, according to the (de facto solely relevant, para 7.032 below) statutory definition of
para 4, it is sufficient, but also necessary, that a reasonable investor (paras 7.033ff below) would
‘likely’ use the information as a basis for an investment decision (paras 7.030ff below; cf already
Art 1 para 2 Directive 2003/124/EC).
7.029 Since the ECJ has rejected a special treatment of ‘intermediate steps’ in terms of precision
(see paras 7.013, 7.021, 7.023 above), it has remained unclear whether the same is true with
regard to price significance. This is sometimes answered in the negative based on the argument
(already dubious in itself; see para 7.034 below) that intermediate steps are generally irrelevant
for a reasonable investor.85 However, the opposite view,86 now shared by many courts87 and
(although reluctantly) supported by the German BaFin,88 which rejects such a ‘blocking effect’
also in terms of price significance, should be followed: While para 2 sentence 2 refers only
to precision, para 3 more generally rejects any special treatment of ‘intermediate steps’. As
examples of inside information, Recital 17 further mentions intermediate steps whose price
from that of MAD 2003 (‘potrebbo influire in modo sensibile’); this is, however, not regarded as a material change, cf
Lombardo (n 52) 11, 13 with further references.
84 The probability of detection by market participants is irrelevant; see Lars Klöhn, ‘Kursrelevanz und
Aufdeckungswahrscheinlichkeit’ in Stefan Grundmann, Hanno Merkt and Peter O. Mülbert (eds) Festschrift für Klaus J.
Hopt zum 80. Geburtstag (De Gruyter 2020) 513, 517ff.
85 See, e.g., Ventoruzzo and Picciau (n 19) B.7.74; Zetzsche (n 78) § 7.C paras 115 f; Krause (n 17) § 6 para 74; Stéphane
Torck, ‘Information privilégiée: les étapes d’un processus s’étalant dans le temps peuvent-elles constituer une information
precise, indépendamment ou au même titre que l‘événement future auquel elles se rapportent? À propos de CJUE, 28
Juin 2012’ (2012) 10 BJB 398, 400 f; cf also Christoph Kumpan, ‘Gestreckte Vorgänge und Insiderrecht’ in VGR (ed),
Gesellschaftsrecht in der Diskussion 2018 (Otto Schmidt 2019) 109, 121ff, 125 f (arguing that intermediate steps are regu-
larly not affecting fundamental values); to the same effect Hartmut Krause and Michael Brellochs, ‘Insider Trading and
the Disclosure of Inside Information after Geltl v Daimler—A comparative analysis of the ECJ decision in the Geltl v
Daimler case with a view to the future European Market Abuse Regulation’ (2013) 8/3 CMLJ 283, 293 f; cf also Mathias
Habersack, ‘Non-Compliance, Kursspezifität und Kursrelevanz’ [2020] AG 697, 699ff.
86 See already Lars Klöhn, ‘Das deutsche und europäische Insiderrecht nach dem Geltl-Urteil des EuGH’ [2012] ZIP
1885, 1891; Alexander Schall, ‘Anmerkung zum Urteil des EuGH vom 28.6.2012, Rs C-19/11 – Insiderinformationen
und Publizitätspflichten in gestreckten Entscheidungsprozessen’ [2012] ZIP 1282, 1288; similarly Alexander Schopper
and Mathias Walch, ‘Ad-hoc-Publizität bei zeitlich gestreckten Sachverhalten’ [2014] ZFR 255, 259; cf also Gregor
Bachmann, ‘Ad-hoc-Mitteilung auch über Zwischenschritte eines kursrelevanten Vorgangs als Insider-Information’
[2012] EWiR 467, 468 (but see also (2012) 39 DB 2206, 2209).
87 This is particularly relevant for jurisdictions formerly relying on a ‘one-step model’ and employing a narrow interpre-
tation of inside information; BGH Daimler-Chrysler II (n 77); Verbund II (n 60); Wiener Privatbank (n 39); but see
also Sentencia de la Audiencia Nacional, 12 February 2019, no 482/2017, 13 November 2019, no 1082/2018 (expressly
rejecting any special treatment of intermediate steps); Corte di Cassazione, 15 April 2019, no 39999 (dismissing the
claim made by the defence that a takeover was not yet certain enough for the information about pending due diligence
to be price significant); similarly already Rechtbank Rotterdam 22.7.2010, AWB 09/498 BC-T2, Numico. Differently,
the ruling by the Greek State Council, Συμβούλιο της Επικρατείας 317/2014, Χρηματοπιστωτικό Δίκαιο 2014, 147,
NBG, summarised in Panagiotis Staikouras, ‘Dismantling the EU insider dealing regime: the Supreme Court of Greece’s
muddled interpretation of “inside information” (2015) 9/3 L & Fin Mkts Rev 210, 210 f (rejecting price significance of
an intermediate step based on the unclear effects of the future ‘final event’); see also (now outdated) OMV (also due to
lack of price specificity, n 81); RBI (n 77).
88 BaFin, ‘Art. 17 MAR’ (n 42) 10; BaFin, ‘Emittentenleitfaden Modul C’ (n 16) 13 f (relevance of intermediate steps
to be assessed based on the probability and magnitude of the final result); but see the examples in ibid., 14, excluding
intermediate steps based on the reasonable investor test if the final event is ‘not yet probable’.
70
relevance is usually based solely on the increased probability of the final result.89 Therefore, the
remaining uncertainty of the final result does not exclude the qualification of an intermediate
step as inside information (such uncertainties are discounted for in making investment deci-
sions; see below para 7.034). In addition, the arguments of the ECJ against a special treatment
in terms of precision (see above para 7.021) also apply to the context of price significance. In
particular, a definition of a mere intermediate step (or indeed any reliable criterion to this end)
is lacking (cf para 7.013 above).90 Furthermore, it is the purpose of para 2 sentence 2, para 3 to
exclude all limitations of the central (cf para 7.002 above) prohibition of insider trading (Art
8) which would result from a privileged treatment of intermediate steps, regardless of the level
of examination.91 The resulting increase of events that are encompassed by the obligation of
continuous disclosure (e.g., in the course of ongoing negotiations; see Art 17 para 4 subpara 2
in conjunction with Recital 17) is not a counter-argument, but rather a concomitant side effect
that is accepted by the MAR and mitigated by the possibilities to delay disclosure on the issuer's
responsibility under Art 17 paras 4ff.92
(b) Trade incentive test

Whether a reasonable investor (see paras 7.033ff below) would probably base investment deci- 7.030
sion on information depends on whether the information constitutes an incentive to trade (cf
also Recitals 14 and 23). This is the case when the information, if added to the overall current
pool of public information93 (cf also Recital 14), would lead to a change in valuation – and
therefore to purchase or sale decisions by reasonable investors (see also para 7.031 below) in
the financial instruments (including related derivatives) covered (‘total mix test’).94 According
89 See Lars Klöhn, ‘Ad-hoc-Publizität und Insiderverbot im neuen Marktmissbrauchsrecht’ [2016] AG 423, 429; cf also
Katja Langenbucher, ‘Zum Begriff der Insiderinformation nach dem Entwurf für eine Marktmissbrauchsverordnung’
(2013) 36 NZG 1401, 1404; Geltl (n 2) para 32 (arguing for the relevance of intermediate steps based on those examples,
formerly contained in Art 3 Directive 2003/124/EC). On Recital 17 and its non-exhaustive nature, see also Corte di
Cassazione, no 39999 (n 87).
90 Geltl (n 2) para 37; see also Hellgardt (n 78) 870 f; Veil (n 6) § 14 paras 42 f; Staikouras, ‘Dismantling the EU insider
dealing regime’ (n 87) 211 f; Sebastian Mock, ‘Gestreckte Verfahrensabläufe im Europäischen Insiderhandelsrecht’
[2012] ZBB 286, 287 f. On the problems associated with such differentiation, see also Ventoruzzo and Picciau (n 19)
B.7.45ff (the authors nevertheless favour a narrow delimitation, see n 85).
91 See, e.g., Klöhn, ‘Artikel 7’ (n 17) paras 106, 109; Veil (n 6) § 14 para 23; Kumpan and Misterek, ‘Artikel 7 MAR’ (n
1) para 53. See also CONSOB (n 1) 27 para 4.6.5.1 (inherent relevance of intermediate steps; not decisive that final
decision is still months away). On this point, see also Corte di Cassazione, no 39999 (n 87).
92 See in particular Art 17 para 4 subpara 2, which has been introduced by the MAR alongside Art 7 para 3; Jesper Hansen,
‘Issuers’ duty to Disclose Inside Information’ in ERA (ed), ERA Forum (vol 18, Springer 2017) 21, 32 f; Pietrancosta
in Ventoruzzo and Mock (n 1) B.17.84; Koch (n 22) § 19 para 67; Mario Hössl-Neumann and Andreas Baumgartner,
‘Dealing with Corporate Scandal under European Market Abuse Law: The Case of VW’ (2019) 16/4 ECFR 484, 502ff;
cf also Moloney (n 47) 734 with further references. The courts also stress that issuers can avert premature disclosure by
deciding for delay; see Verbund II (n 60) para 27; BGH Daimler-Chrysler II (n 77) para 26.
93 CESR/02-089d (n 25) para 22; Klöhn, ‘Artikel 7’ (n 17) paras 169, 177 f; Gerner-Beuerle, ‘Article 7 MAR’ (n 21)
para 26; BaFin, ‘Emittentenleitfaden Modul C’ (n 16) 10. See also Verbund I (n 58) para 31, VwGH 30 January 2015,
2011/17/0267, Skylink.
94 See e.g., Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 25; Klöhn, ‘Artikel 7’(n 17) paras 177 f; Zetzsche (n 78) § 7.C
para 118; Couret and others (n 19) para 1715; cf also BaFin, ‘Art. 17 MAR’ (n 42) 7; Central Bank of Ireland, ‘Guidance
on Market Abuse Regulatory Framework’, 22 July 2019, 5 f (recent developments, information previously disclosed and
market sentiment relevant); CA Paris, no 13/16393 (n 78); AMF CDS, 29 September 2017, SAN-2017-08; CONSOB
(n 1) 22 f paras 4.3.5ff (same). But see Sentencia de la Audiencia Nacional, no 731/2017, no 673/2017 (n 80) (on the
irrelevance of contemporaneous speculation on the market).
71
to the ECJ’s ruling in Lafonta, the direction of the change does not have to be predictable.95
However, the basis of this view is the possible effect of such information on (potential) associ-
ated derivatives, for which mere volatility of the underlying financial instrument is relevant to
the price.96 Therefore, the ruling in Lafonta does not conflict with the decisiveness of the trade
incentive.97
7.031 Following the above, in order to qualify as inside information, non-public information must
(positively or negatively) influence the ex ante expected value of the financial instrument
(Recital 14), namely due to changes in future returns (including those in the event of sale; see
also below para 7.035) or risks of the financial instrument.98 Market expectations that have
already been factored in exclude price significance.99 A price reaction in the event of later dis-
closure is only indicative (Recital 15);100 the same applies in our view to the absence of a price
reaction.101
7.032 The criterion of price significance according to para 1 (para 7.028 above) is specified by the
statutory definition of para 4 to the effect that a probable influence on (reasonable; paras
7.033ff below) investment decisions is sufficient. Therefore, the requirement of a significant
effect on prices (para 1) does not work as a quantitative threshold in the sense of an antici-
pated minimum price reaction.102 Following this interpretation, only information that has no
influence whatsoever on the investment decision103 (in which case the information will not
be price-specific either; see para 7.027 above) or whose expected value (see para 7.031 above)
is so miniscule that it generally falls short of transaction costs is excluded due to lack of a
‘likely’ influence on the behaviour of a reasonable investor.104 Para 4 subpara 1 thus also covers
95 Lafonta (n 2) paras 31, 34ff.

96 See also Lafonta (n 81), Opinion AG Wathelet, paras 49 f; for a detailed analysis, see Lars Klöhn, ‘Inside Information
Without an Incentive to Trade? What’s at Stake in “Lafonta v AMF”’ (2015) 10/2 CMLJ 162, 177ff.
97 See also Klöhn, ‘Artikel 7’ (n 17) para 213; Krause (n 17) § 6 para 123. But see del Forno and de Margerie (n 81) 48 f
(critical because the existance of such derivatives should not be generally assumed); Federico Consulich and Francesco
Mucciarelli, ‘Informazione e tutela penale die mercati finanziari nello specchio della normativa eurounitaria sugli abusi
di mercato’ [2016] Le Società (Digital Edition) 42, 49 f with further references.
98 See in detail Klöhn, ‘Artikel 7’ (n 17) paras 160ff; on the ex ante perspective, see above n 93.
99 See n 48, 93; cf also Klöhn, ‘Artikel 7’(n 17) paras 179ff.
100 See Klöhn, ‘Artikel 7’ (n 17) paras 249ff; Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 26; Grundmann in Staub (n 32)
para 353. It is indeed irrelevant for the purposes of Art 7 whether information has ex post become public at all, cf Kumpan
and Misterek, ‘Artikel 7 MAR’ (n 1) para 143.
101 cf also CA Paris, 28 January 2009, no 08/02002; no 13/16393 (n 78) (no requirement of actual influence); in this sense
also Couret and others (n 19) para 1715. Differently Zetzsche (n 78) § 7.C para 122.
102 See CESR/02-089d (n 25) para 24; European Commission, ‘Working Document ESC 12/2003’, 3 f; Commission
Proposal for Directive 2003/124/EC, 3; cf also CESR/02-287b (n 52) 7 para 27. See also Assmann, ‘Artikel 7 MAR’ (n
19) para 79; Staikouras, ‘Four Years of MADness?’ (n 47) 787; Hannam (n 17) paras 100, 119 f; David Massey v FSA (n
26) para 41; Sergakis (n 49) 160; CONSOB (n 1) 26 para 4.5.3, 27 para 4.6.4; Hoge Raad 5.7.2011, 08/04981 E, Veer
Palthe Voûte; cf also Mennicke and Jakovou (n 24) § 13 para 159 with further references. Similarly the now outdated
issuer guidances published by the German and Austrian authorities: BaFin, ‘Emittentenleitfaden’ 2013 (n 21) 35; FMA,
‘Emittentenleitfaden’ 2013, 64; cf also case law on the (far less clear) Austrian implementation of MAD 2003, Verbund
II (n 60); VwGH 23 May 2014, 2014/02/0032, Miba; Skylink (n 93). Differently e.g., Krause (n 17) § 6 paras 117, 120ff;
Ventoruzzo and Picciau (n 19) B.7.72. On this controversy, see also Gerner-Beuerle, ‘Article 7 MAR’ (n 21) paras 27 f.
103 cf Georgakis (n 2) para 38; Spector Photo Group (n 3) para 52; Geltl (n 2) paras 36, 47; Lafonta (n 2) para 25; see also
Ventoruzzo and Picciau (n 19) B.7.43; Klöhn, ‘Artikel 7’ (n 17) para 64; Mennicke and Jakovou (n 24) § 13 para 35.
104 See n 107; on the lower bound of transaction costs (including, for the sake of clarity, opportunity costs), e.g., BaFin,
‘Emittentenleitfaden Modul C’ (n 16) 12; Klöhn, ‘Artikel 7’ (n 17) paras 175, 214; Assmann, ‘Artikel 7 MAR’ (n 19)
72
small-scale arbitrages (as generated in high frequency trading).105 A higher general threshold
applies only in the context of emission allowances (para 4 subpara 2; para 7.042 below).
(c) Point of view

According to para 4, the perspective of a reasonable investor is decisive in assessing the incen- 7.033
tive to trade (change in the expected value; para 7.031 above). This is a normative (objective)
model106 focusing on the point of view of a homo oeconomicus, i.e., a rational utility maximiser.107
It follows from this alone that uncertainty about past or future events (paras 7.024ff above) 7.034
does not rule out an incentive to trade, but – through discounting – merely influences the mag-
nitude of the change in the expected value (para 7.031 above).108 This follows from standard
valuation methodology.109 Therefore, the premise of the opposing view110 that a reasonable
investor does not speculate and that improbable information (cf paras 7.025 f above) thus is not
price significant is erroneous de facto.111 Also, this view would amount to a ‘blocking effect’ at
paras 82 f; Kumpan and Misterek, ‘Der verständige Anleger’ (n 71) 216 f; cf also CONSOB (n 1) 27 paras 4.6.4 f, 28
para 4.6.5.2 (possibility to exploit information decisive, even if recourse to sophisticated trading strategy or structured
derivatives necessary).
105 See Grundmann in Staub (n 32) paras 353, 395 with further references; cf also Bayram and Meier (n 35) 1301 f; Kasiske
(n 35) 1938 f; differently Ventoruzzo and Picciau (n 19) B.7.68. However, HFT typically is based on public information
(see above, para 7.016 with n 35).
106 See, e.g., Klöhn, ‘Artikel 7’ (n 17) para 268; Assmann, ‘Artikel 7 MAR’ (n 19) para 81; Kalss, Oppitz and Zollner (n
19) § 21 para 35; Couret and others (n 19) para 1715; cf also Langenbucher, ‘Insider Trading’ (n 62) 42; del Forno and
de Margerie (n 81) 49; Stefano Vincenzi in Stefano Vincenzi, Mario Zanchetti and Andrea Zoppini (eds), Market abuse
regulation: le nuove regole sugli abusi di mercato (Amaranta 2016) 142ff.
107 See Klöhn, ‘Artikel 7’ (n 17) paras 271, 274; Ventoruzzo and Picciau (n 19) B.7.67; cf already BGH Daimler-Chrysler
II (n 77); CESR/02-089d (n 25) 10 (fn 1): ‘A reasonable investor is a person who thinks and behaves in a rational way.’
A more specific definition was deliberately omitted (CESR/02-287b (n 52) 7 f paras 28 f). See also Central Bank of
Ireland (n 94) 5 (maximization of economic self-interest); CONSOB (n 1) 27 para 4.6.3 (quantitative models of mate-
riality as indication for qualitative reasonable investor test). Not differently Arnaud Félix, ‘Dans la peau de l’investisseur
raisonnable: comment apprécier la sensibilité?’ (2017) 3 BJB 213 (assessment not ‘purely speculative’, but based on
‘objective information’); Vincenzi (n 106) 142ff (‘diligent investor’ carefully evaluating investment opportunities); cf also
n 114. But see BaFin, ‘Emittentenleitfaden Modul C’ (n 16) 11 (average investor without particular sophistication);
for a critical analysis of this approach, which does not seem entirely compatible with the BaFin’s view that all available
information is accounted for in an objective manner (nn 114, 116), see Kumpan and Misterek, ‘Der verständige Anleger’
(n 71) 188, 203ff.
108 In this respect, a probability-magnitude test must be carried out (in detail Klöhn, ‘Artikel 7’ (n 17) paras 198ff; Kumpan
and Misterek, ‘Der verständige Anleger’ (n 71) 214 f); specifically with regards to accounting for ‘detection risk’ upon
compliance violations, see Habersack, ‘Non-Compliance, Kursspezifität und Kursrelevanz’ (n 85) 702ff. See also BaFin,
‘Art. 17 MAR’ (n 42) 8; CONSOB (n 1) 26 f para 4.5.4; cf also (citing Recital 14) Central Bank of Ireland (n 94) 5;
Sentencia de la Audiencia Nacional, no 217/06 (n 42). However, in the absence of an effective significance threshold
(para 7.032 above), discounting only has an impact if it pushes the expected value below transaction costs, in particular if
alternative scenarios cancel each other out (cf the example in BaFin, ‘Emittentenleitfaden Modul C’ (n 16) 12).
109 In this sense also Klöhn, ‘Artikel 7’ (n 17) paras 160ff; cf also (deliberate disregard for uncertain events as speculative)
Klöhn, ‘Das deutsche und europäische Insiderrecht nach dem Geltl-Urteil des EuGH’ (n 86) 1887.
110 See e.g., para 17.048 below; Krause (n 17) § 6 para 109; cf also Zetzsche (n 78) § 7.C para 121: trading on information
about volatility (see para 7.027 above) no ‘investment’.
111 Rather, the calculated taking of risks is the very essence of the capital market on which ‘the future is traded’. The ten-
dency to contrast reasonable investors and speculators is therefore fundamentally mistaken; cf already SEC v Texas Gulf
Sulphur Co, 401 F.2d (2d Cir 1968) 833, 849 (‘The speculators and chartists of Wall and Bay Streets are also “reason-
able” investors entitled to the same legal protection afforded conservative traders’); for a historical analysis of the impact
of Keynesian and neoliberal concepts of price formation on insider trading regulation, see Hössl-Neumann (n 4) 106ff,
73
the level of price relevance, colliding with the purpose of para 2 sentence 2, and in our view is
therefore to be rejected de iure, too (para 7.029 above).112
7.035 From the model of homo oeconomicus (para 7.033 above) also follows the significance of
a predictable (even irrational) market reaction, e.g., stemming from the need for action for
index funds in the case of imminent index restructuring (Recital 17) or from psychological
effects leading to price fluctuation113.114 We do not follow the contrary view, which, in order
to promote allocative market efficiency, only wants to include ‘reasonable’ trading incentives
based on a change in the ‘fundamental value’ of the financial instrument (in particular, future
dividends and risks of the financial instrument).115 The MAR provides no indication of such
a narrowing (cf para 1 lit d and below para 7.043; Recitals 14, 23; cf also paras 7.011, 7.014
above),116 which disregards the financial instrument’s ‘liquidation value’ (sale/purchase value)
in the valuation (cf already para 7.031 above). A further argument against such a limitation
is found in the (new) Recital 28 sentence 2,117 according to which analyses and valuations are
inside information if only a market reaction is foreseeable.118 The factoring in of foreseeable
124ff; cf also Corte di Cassazione, no 39999 (n 87): Remaining risk irrelevant. In this context, the Dutch authorities
stress that issuers are in the best position to determine which information would be important for their investors and
that in case of doubt, inside information should be presumed: AFM, ‘Public disclosure of inside information’ (Update:
July 2017) 9.
112 Similarly now Assmann, ‘Artikel 7 MAR’ (n 19) para 87 (spectrum of the reasonable investor expanded by Lafonta to
also cover speculative investors).
113 cf the example of the (price-increasing) inclusion of the suffix ‘.com’ in the company in the middle of the dot-com bubble
at Klöhn, ‘Artikel 7’ (n 17) para 285; more generally, such effects can be caused by herding or other systemic biases that
are not dispelled due to limits to arbitrage.
114 Explicitly BGH 13.12.2011, XI ZR 51/10 para 44, IKB; BaFin, ‘Art. 17 MAR’ (n 42) 8; see also with further references
Couret and others (n 19) para 1715 (on the sole decisiveness of the market reaction in establishing the relevance for
the reasonable investor); similarly Kumpan and Misterek, ‘Der verständige Anleger’ (n 71) 188, 205 f (but see n 115);
Mennicke and Jakovou (n 24) § 13 para 142a; Peter O. Mülbert and Alexander Sajnovits, ‘The Inside Information
Regime of the MAR and the Rise of the ESG Era’ (2021) 18/2 ECFR 256, 284ff; cf also the critical analysis at
Consulich and Mucciarelli (n 97) 48. On this discussion, see also Katja Langenbucher, ‘In Brüssel nichts Neues? – Der
“verständige Anleger” in der Marktmissbrauchsverordnung’ [2016] AG 417, 419 f.
115 This view is a widespread reaction in German literature to the ECJ's rulings in Geltl and Lafonta, which limited recourse
by issuers to lack of precision: See, in particular Klöhn, ‘Artikel 7’ (n 17) paras 271ff; Krause (n 17) § 6 paras 115 f;
Hopt and Kumpan (n 27) § 107 para 55; Kumpan and Misterek, ‘Der verständige Anleger’ (n 71) 212ff; Patrick Leyens,
‘Ad-hoc-Information der Anleger: Zwischenschritte und Compliance-Vorfälle als Insiderinformation’ (2020) 49/2-3
ZGR 256, 265ff; Lutz Krämer, ‘“Nach fest kommt ab” – Zur Kursrelevanz von Zwischenschritten, verständigen und
irrationalen Anlegern’ in Stefan Grundmann, Hanno Merkt and Peter O. Mülbert (n 84) 585, 592ff. But see similarly
Ventoruzzo and Picciau (n 19) B.7.63 f.
116 cf already CESR/02-089d (n 25) para 25; CESR/06-562b (n 15) para 1.13; see also BaFin, ‘Emittentenleitfaden Modul
C’ (n 16) 12, 14 f (on the price relevance of rumours ‘based on the constitution of the market’); below n 118. Similarly
e.g., Gerner-Beuerle, ‘Article 7 MAR’ (n 21) paras 7, 10, 17; Consulich and Mucciarelli (n 97) 47 f; cf also Kumpan and
Misterek, ‘Der verständige Anleger’ (n 71) 207, 218 f (following Klöhn, ‘Artikel 7’ (n 17) para 283 in acknowledging that
the stochastic element of Art 7 para 4 [‘would likely use’, n 104] could become obsolete if only changes in fundamental
value are deemed relevant, but still emphasising a legislative purpose to this effect; n 115).
117 This is acknowledged also by Klöhn, ‘Eine neue Insiderfalle für Finanzanalysten?’ (n 33) 1665, 1666; Kumpan and
Misterek, ‘Der verständige Anleger’ (n 71) 188, 207; Hopt and Kumpan (n 27) § 107 para 60a; but see n 115.
118 For a detailed discussion, see Krause (n 17) § 6 paras 42ff; Conseil d’État, 30 January 2019, no 412789. Viewing Recital
28 as the application of a general principle also Consulich and Mucciarelli (n 97) 48, 51; cf already Mennicke and
Jakovou (n 24) § 13 para 178, with further references from German literature. See also AMF CDS, 29 March 2007,
SAN-2007-13; AMF CDS, 18 December 2017, SAN-2017-12 (on the significance of third-party purchases above
previous market price); Corte di Cassazione, 5 July 2016, no 13662 (inside character of information about upcoming
74
C. Information on commodity derivatives (para 1 lit b)
market reactions is of importance, inter alia, in the context of so-called scalping: Use of the
knowledge (of the scalper and accomplices) of the imminent disclosure of false information
that will drive the share price (cf para 12.037) is generally covered by the prohibition on insider
trading.119
C. INFORMATION ON COMMODITY DERIVATIVES (PARA 1 LIT B)
Para 1 lit b120 is lex specialis121 to lit a if the information122 directly or indirectly relates to com- 7.036
modity derivatives (Art 3 (24); see para 3.053 above). Because of the interconnectedness of the
markets, information on directly related spot commodity contracts (Art 3 (15); see paras 3.039
f above) is treated in the same way. This serves as a clarification that information related to the
spot market (if such market exists at all) is also (directly) related to all derivatives based on it.123
In addition, the general criteria of lack of disclosure (cf paras 7.015ff above), precision (paras 7.037
7.020ff above) and price significance124 (paras 7.028ff above; Recital 20) apply, whereby price
significance on either the derivatives or (if applicable) spot market is sufficient.
As an additional (cumulative) criterion, para 1 lit b introduces the requirement of a pre-existing 7.038
disclosure obligation or practice: To be qualified as inside information, disclosure of the infor-
mation must be obligatory or at least reasonably expected pursuant to regulations (including
private law) or trading practices on the derivatives or spot market. This is an offsetting for the
fact that, compared to lit a, there is usually no direct relation to the issuer and therefore no dis-
closure by the issuer (Art 17), which means that market participants’ autonomous investment
in the search for price-relevant information is necessary to a greater extent.125
In this context, para 5 empowers ESMA to issue guidelines. The relevant MAR guidelines 7.039
shall contain an indicative list of information captured by lit b.126 They define information
‘which is reasonably expected or is required to be disclosed’ (above para 7.038) rather vaguely in
publication of price-relevant analyst recommendation). For further references on the phenomenon of ‘opinions treated as
facts’, see Assmann, ‘Artikel 7 MAR’ (n 19) paras 19, 31; Pietrancosta, ‘Brief remarks’ (n 19) 10 f.
119 See Petra Mennicke, ‘§ 13: Insiderinformation’ in Fuchs (ed) (n 24) § 14 paras 161 f; Buck-Heeb (n 27) § 8 para 87;
differently (due to lack of change in fundamental value) Klöhn, ‘Artikel 7’ (n 17) para 27; Sascha Opel (n 19) (on the basis
of the outdated requirement of a ‘third-party element’ [above, para 7.011 with n 19]). In the case of bona fide exploitation
of own valuations prior to their disclosure, there may also be inside information (cf Recital 28 sentence 2), but such trades
should regularly not constitute use under Art 8 (or at least be covered by the exemption of Art 9 para 5; Lombardo,
'Some Reflections' (n 19) 19ff), see Mennicke and Jakovou (n 24) § 13 para 180 fn 545, § 14 para 162; Assmann, ‘§ 13:
Insiderinformation’ (n 39) para 77; cf also Pietrancosta, ‘Brief remarks’ (n 19) 11. But see Couret and others (n 19) para
1795 (lack of legal certainty).
120 Previously Art 1 para 1 subpara 2 MAD 2003, Art 4 Directive 2004/72/EC.
121 See Grundmann in Staub (n 32) para 357; Klöhn, ‘Artikel 7’ (n 17) para 307; cf also Assmann, ‘Artikel 7 MAR’ (n 19)
paras 96 f.
122 cf also para 1 lit d, below para 7.046.
123 See Klöhn, ‘Artikel 7’ (n 17) paras 315ff; Zetzsche (n 78) § 7.C paras 16ff.
124 Differently the former wording of Art 1 para 1 subpara 2 MAD 2003; cf Lombardo (n 52) 11, 14.
125 cf Klöhn, ‘§ 13: Insiderinformation’ (n 35) para 286; Frank Schäfer, ‘§ 13 WpHG’ in Frank Schäfer and Uwe Hamann
(eds), Kapitalmarktgesetze (Kohlhammer 2013) para 29.
126 ESMA, ‘MAR Guidelines on commodity derivatives’, ESMA/2016/1480, 17 January 2017, 5ff paras 12–26.
75
the sense of official, non-speculative statements made widely accessible in a non-discriminatory

way.127 Therefore, apart from the examples mentioned therein, the requirement of nulla poena
sine lege certa (Art 7 ECHR, Art 48 para 1 CFR) could constitute a boundary for criminal
liability (cf also para 7.007 above).128
D. INFORMATION ON EMISSION ALLOWANCES (PARA 1 LIT C)
7.040 Para 1 lit c introduces an autonomous definition for information on emission allowances
and auctioned products based thereon (paras 3.019 and 3.044) (cf para 7.004 above). This is
needed as, contrary to the unfortunate German language version of the MAR,129 the latter
are not always financial instruments (cf Art 2 para 1 subpara 2);130 in the case of an overlap,
lit c is lex specialis to lit a. The parallel regime for auctions of emission allowances under Arts
36-43 Regulation 1031/2010 has been repealed by Commission Delegated Regulation (EU)
2019/1868 (cf also Recital 37). For wholesale energy markets, the MAR also takes precedence
over Regulation 1227/2011 (see Art 1 para 2 thereof) in its scope of application.131 However,
according to Recital 20 para 2 MAR, special features of this market must nevertheless be taken
into account (see, in particular, Art 2 para 1 Regulation 1227/2011).
7.041 Under lit c, information must be directly or indirectly related to emission allowances or auc-
tioned objects based thereon. The general criteria of lack of disclosure (paras 7.015ff above)
and precision (see paras 7.020ff above) also apply.
7.042 As with para 1 lit a, the information must be price significant (paras 7.028ff above) for the
instruments or related derivatives mentioned. In order to compensate for the absence of an
issuer (cf para 7.038 above),132 Art 7 para 4 subpara 2 establishes a safe harbour in the form of
an irrefutable presumption: The information on individual greenhouse gas emitters is not price
significant if these emitters do not exceed certain thresholds for aggregated emissions or rated
thermal input. These thresholds are determined in accordance with Art 17 para 2 subpara 3 by
the Commission (cf paras 17.113ff below); currently they amount (at group level) to 6 million
tonnes of carbon dioxide equivalent per year and/or 2,430 megawatts of rated thermal input
(Art 5 Regulation 2016/522).
E. CLIENT ORDERS IN PARTICULAR (PARA 1 LIT D)
7.043 Para 1 lit d (cf Art 1 para 1 subpara 3 MAD) aims at front-running, in which the broker uses
knowledge about the price-relevant order of a client through own transactions (cf para 9.073
127 ESMA (n 126) 5 para 10.

128 See Grundmann in Staub (n 32) para 357; Lombardo (n 52) 11, 15 fn 30, with further references.
129 ‘Finanzinstrumente dieser Art’; contrast the English and French versions (‘such instruments’, ‘instruments de ce type’).
130 See Gerner-Beuerle, ‘Article 7 MAR’ (n 21) para 32; Zetzsche (n 78) § 7.C para 28; apparently different Ventoruzzo and
Picciau (n 19) B.7.07 (requiring that such products are classified as financial instruments under MiFID II).
131 cf Zetzsche (n 78) § 7.C paras 12, 20.
132 cf Grundmann in Staub (n 32) para 358.
76
E. Client orders in particular (para 1 lit d)
below).133 Included is all information conveyed by a client to a broker that has not been ‘made
public’,134 is precise, and price-significant in connection with orders concerning financial
instruments that have not yet been executed. Since the criteria are thus identical to those in lit
a and b, lit d has more of an illustrative character (‘rule example’; see also paras 7.011, 7.035
above).135 However, it clarifies the relevance of insider trading prohibitions with regard to acts
which do not primarily harm market competitors, but own clients.
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Marsch-Barner R and Schäfer A (eds), Handbuch börsennotierte AG (4th edn, Otto Schmidt 2018);
Martens S, Methodenlehre des Unionsrechts (Mohr Siebeck 2013)
Mennicke P and Jakovou N, ‘§ 13: Insiderinformation’ in Fuchs A (ed), Wertpapierhandelsgesetz (1st edn,
C. H. Beck 2009 | 2nd edn, C. H. Beck 2016)
Mock S, ‘Gestreckte Verfahrensabläufe im Europäischen Insiderhandelsrecht’ [2012] ZBB 286
Mucciarelli F, ‘L’insider trading nella rinnovata disciplina UE sugli abusi di mercato’ [2016] Le Società
(Digital Edition) 55
Pietrancosta A, ‘Brief Remarks on the Necessary Clarification of Market Abuse Prohibitions in Times of
Shareholder Activism’ [2019] RTDF 3
528
Riesenhuber K, ‘§ 10: Die Auslegung’ in Riesenhuber K (ed), Europäische Methodenlehre (3rd edn, de
Gruyter 2015)
Schäfer F, ‘§ 13 WpHG’ in Schäfer F and Hamann U (eds), Kapitalmarktgesetze (Kohlhammer 2013)
Schall A, ‘Anmerkung zum Urteil des EuGH vom 28.6.2012, Rs C-19/11 – Insiderinformationen und
Publizitätspflichten in gestreckten Entscheidungsprozessen’ [2012] ZIP 1282
Schopper A and Walch M, ‘Ad-hoc-Publizität bei zeitlich gestreckten Sachverhalten’ [2014] ZFR 255
Schuhmacher F, ‘Zur Auslegung des neu gefaßten Tatbestands des Mißbrauchs einer Insider-Information’
[2005] ÖBA 533
Schwark E and Kruse D, ‘§ 13 WpHG: Insiderinformation’ in Eberhard Schwark and Daniel Zimmer
(eds), Kapitalmarktrechts-Kommentar (4th edn, C. H. Beck 2010)
Sergakis K, The Law of Capital Markets in the EU (Red Globe Press 2018)
Siems M, ‘The EU Market Abuse Directive: a case-based analysis’ (2008) 2/1 L & Fin Mkts Rev 39
Staikouras P, ‘Dismantling the EU Insider Dealing Regime: the Supreme Court of Greece‘s muddled
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Torck S, ‘Information privilégiée: les étapes d’un processus s’étalant dans le temps peuvent-elles constituer
une information precise, indépendamment ou au même titre que l’événement future auquel elles se
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2017)
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Abuse Regulation (Oxford University Press 2017)
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ARTICLE 8
INSIDER DEALING
Martin Winner
1. For the purposes of this Regulation, insider dealing arises where a person possesses inside
information and uses that information by acquiring or disposing of, for its own account or
for the account of a third party, directly or indirectly, financial instruments to which that
information relates. The use of inside information by cancelling or amending an order
concerning a financial instrument to which the information relates where the order was
placed before the person concerned possessed the inside information, shall also be consid-
ered to be insider dealing. In relation to auctions of emission allowances or other auctioned
products based thereon that are held pursuant to Regulation (EU) No 1031/2010, the use
of inside information shall also comprise submitting, modifying or withdrawing a bid by
a person for its own account or for the account of a third party.
2. For the purposes of this Regulation, recommending that another person engage in insider
dealing, or inducing another person to engage in insider dealing, arises where the person
possesses inside information and:
(a) recommends, on the basis of that information, that another person acquire or dispose
of financial instruments to which that information relates, or induces that person to
make such an acquisition or disposal, or
(b) recommends, on the basis of that information, that another person cancel or amend
an order concerning a financial instrument to which that information relates, or
induces that person to make such a cancellation or amendment.
3. The use of the recommendations or inducements referred to in paragraph 2 amounts to

insider dealing within the meaning of this Article where the person using the recommen-
dation or inducement knows or ought to know that it is based upon inside information.
4. This Article applies to any person who possesses inside information as a result of:
(a) being a member of the administrative, management or supervisory bodies of the
issuer or emission allowance market participant;
(b) having a holding in the capital of the issuer or emission allowance market participant;
(c) having access to the information through the exercise of an employment, profession
or duties; or
(d) being involved in criminal activities.
This Article also applies to any person who possesses inside information under circum-
stances other than those referred to in the first subparagraph where that person knows or
ought to know that it is inside information.
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Martin Winner - 9781800882249
Article 8 INSIDER DEALING
5. Where the person is a legal person, this Article shall also apply, in accordance with national
law, to the natural persons who participate in the decision to carry out the acquisition,
disposal, cancellation or amendment of an order for the account of the legal person
concerned.
OVERVIEW
A. INTRODUCTION 8.001 (g) Actions of legal persons 8.063

B. INSIDERS (PARAS 4 AND 5) 8.006 3. Use of inside information 8.066
1. General 8.006 (a) Introduction 8.066
2. Legal persons 8.008 (b) Use in decision-making, not in
3. Primary insiders 8.012 behaviour 8.067
4. Secondary insiders 8.021 (c) Advantage for the trader? 8.079
5. Participation in decisions by legal persons (d) ‘Presumption’ of use 8.083
(para 5) 8.025 (e) Absence of use 8.088
C. INSIDER DEALING (PARA 1) 8.028 (f ) Legal persons 8.095
1. Knowledge of inside information 8.029 D. TIPPING (PARA 2) 8.097
(a) Natural persons 8.029 1. General 8.097
(b) Legal persons 8.034 2. Knowledge 8.101
2. Transactions covered 8.042 3. Recommend or induce 8.102
(a) General 8.042 4. On the basis of inside information 8.110
(b) Acquisition and disposal 8.044 5. Legal persons 8.113
(c) For their own account or for the E. LIABILITY OF THE TIPPEE (PARA 3) 8.115
account of others 8.053 1. General 8.115
(d) Direct or indirect 8.054 2. Use 8.116
(e) Cancellation or amendment of orders 3. Knowledge 8.119
8.057 4. Legal persons 8.123
(f ) Emission allowances 8.062
A. INTRODUCTION
8.001 The definition of insider dealing in Art 8 covers both trading and recommendations; Art 14
contains the corresponding prohibition. Art 8 is supplemented by the prohibition of the disclo-
sure of inside information according to Art 10 in conjunction with Art 14. Art 7 defines what
inside information is. Art 9 in turn limits the scope of the prohibition by so-called legitimate
behaviour.
8.002 Art 8 is structured as follows: Para 1 contains the basic definition of insider dealing covering
acquisitions, disposals and now also the cancellation of orders (trading prohibition; see paras
8.028ff). Para 2 includes corresponding recommendations to third parties (recommendation
prohibition – tipping; paras 8.097ff); para 3 takes this up by prohibiting the third party from
using the recommendation under certain circumstances (liability of tippees; paras 8.115ff). Para
4 distinguishes between primary and secondary insiders and thus regulates the personal scope
of application of paras 1 and 2 (paras 8.006ff). Para 5 regulates individual aspects in the case of
insider dealing by legal persons (paras 8.024ff).
82
A. Introduction
The prohibition of insider dealing aims to ensure equal access for all market participants to 8.003
price-relevant information.1 This is intended to safeguard the information efficiency of the
capital market since, without such a prohibition, there is a risk that non-insiders will be sys-
tematically forced out of the market, even though they fulfil the important function of pricing
in publicly available information; in that case, new information will only be priced in via
comparatively inefficient insider dealing.2 Moreover, the prohibition also protects expectations
that non-insiders will be treated fairly in the capital market.3 In substance, however, the pro-
hibitions serve not only to protect the functioning of the market as such but also the affected
investors individually;4 see paras 14.003ff and paras 14.014ff for details.
Development: Art 8 para 1 is in principle based on Art 2 para 1 of the Market Abuse Directive 8.004
2003, which in turn was based on Art 2 of the Insider Directive 1989. However, para 1 now
also covers the cancellation of orders. The definition of the recommendation in para 2 was
previously found in Art 3 lit b MAD 2003. Para 3 has no direct predecessor, while para 4 cor-
responds to Art 4 Market Abuse Directive 2003 and – at least partly – Art 4 Insider Directive
1989. Para 5 was previously found in Art 2 para 2 Market Abuse Directive 2003 and Art 2 para
2 Insider Directive 1989. At least some language versions have been subject to corrigenda.5
Essential guidance for the interpretation of Art 8 can be found in Recitals 23 to 27. There are 8.005
neither implementing acts nor guidelines or recommendations within the meaning of Art 16
ESMA Regulation for Art 8. However, ESMA has issued Q&A on the MAR,6 which also deal
with an aspect of insider dealing, namely the blanket order cancellation policy. In some legal
systems, national authorities have issued additional guidance.7
1 See e.g., John Armour and others, Principles of Financial Regulation (Oxford University Press 2016) 183 f; Paul Davies
and Sarah Worthington, Gower: Principles of Modern Company Law (10th edn, Sweet & Maxwell 2016) paras 30–1ff;
Luca Enriques and others, ‘Corporate Law and Securities Markets’, in John Armour and others (eds), The Anatomy of
Corporate Law (3rd edn, Oxford University Press 2017); Carsten Gerner-Beuerle, ‘Article 8 MAR: Insider Dealing’ in
Matthias Lehmann and Christoph Kumpan (eds), European Financial Services Law (Beck – Hart – Nomos 2019) 257
f; Gregor Bachmann, Das Europäische Insiderhandelsverbot (De Gruyter 2015) 18ff; Ana Taleska, ‘European Insider
Trading Theory Revisited: The Limits of the Parity-of-Information Theory and the Application of the Property Rights
in Information Theory to Activist Investment Strategies’ (2020) 17/5 ECFR 558.
2 Jesper Lau Hansen, ‘Article 8: Insider dealing’ in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse
Regulation (Oxford University Press 2017) para B.8.02; Klaus J Hopt and Christoph Kumpan, ‘§ 107: Insider-
und Ad-hoc-Publizitätsprobleme’ in Herbert Schimansky, Hermann-Josef Bunte and Hans-Jürgen Lwowski (eds),
Bankrechts-Handbuch (5th edn, C. H. Beck 2017) § 107 para 3; Lars Klöhn, ‘Vorbemerkungen zu Artikel 7’ in Lars
Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) paras 108ff; Lars Klöhn, ‘Artikel 8: Insidergeschäfte’ in
Klöhn (n 2) paras 43 f.
3 Bachmann (n 1) 20 f; Rüdiger Veil, ‘§ 7: Insiderhandelsverbot’ in Andreas Meyer, Thomas Rönnau and Rüdiger Veil
(eds), Handbuch zum Marktmissbrauchsrecht (C. H. Beck 2018) para 4.
4 Hopt and Kumpan, ‘§ 107’ (n 2) para 4.
5 See OJ L 287/320 of 21 October 2016, for the German version, in which in paras 2 and 3, the terms ‘anstiften’ and
‘Anstiftung’ (respectively ‘incite’ and ‘incitement’) were replaced by ‘verleiten’ and ‘Verleitung’ (respectively, ‘induce’ and
‘inducement’).
6 ESMA, ‘Questions and Answers On the Market Abuse Regulation (MAR)’, ESMA70–145–111 Version 14, 29 March
2019, https://www.esma.europa.eu/sites/default/files/library/esma70–145–111_qa_on_mar.pdf, accessed 30 October
2020.
7 See the German BaFin’s ‘Emittentenleitfaden’, which includes guidance on the MAR in its ‘Modul C’ https://www
.bafin.de/SharedDocs/Downloads/DE/Leitfaden/WA/dl_emittentenleitfaden_modul_C.pdf?__blob=publicationFile&
v=4, accessed 27 January 2021.
83
B. INSIDERS (PARAS 4 AND 5)
1. General
8.006 Para 4 determines who can engage in insider dealing; the provision is also relevant for Art 10
para 1. Contrary to its wording, the provision does not apply to para 3, which contains its own
element of attribution (see below para 8.117).8 The two groups are commonly referred to by
the terms primary insider (first sentence of para 4) and secondary insider (second sentence of
para 4). Those who are neither primary nor secondary insiders are therefore not subject to the
prohibitions of Art 14 in conjunction with Art 8 paras 1 and 2.
8.007 Primary insiders become insiders due to their position, while secondary insiders are subject
of the prohibition as a result of a subjective element, namely that they know or ought to have
known that the information is inside information. This knowledge or culpable lack of it is
the main justification for the criminal liability resulting from the MAD, as is made clear by
Recital 26. However, para 4 takes for granted that primary insiders ought to know about the
information’s nature because of their privileged access to inside information.9 For details see
paras 8.029ff.
2. Legal persons
8.008 Art 8 covers both natural persons and legal persons10 – see the definition of ‘person’ in Art
3 para 1 (13), but also para 5. This corresponds to the situation under the Market Abuse
Directive 2003.11 For special issues of insider dealing in the case of legal entities see especially
paras 8.034ff, 8.063ff, 8.095 f, 8.113 f and 8.123ff.
8.009 Whether partnerships are covered is unclear.12 From a systematic point of view, the fact
that Art 3 para 1 (26) lit d distinguishes legal persons from partnerships (albeit in a different
context) could be taken to indicate that partnerships are not covered. However, a purposive
interpretation, in my opinion, favours the interpretation that the prohibition covers all entities
with legal capacity, irrespective of whether they are legal persons in the narrower sense of the
word. This is an important issue as under some continental legal systems partnerships are not
legal persons, but still can acquire rights or incur obligations (e.g., Germany, Austria). Such
partnerships are subject to the insider dealing prohibition while partnerships without legal
personality, as in other legal systems, are not.
8.010 However, the legal person must also be a primary or secondary insider to be covered by the
prohibition. Presumably, the status of the legal person has to be separated from the question of
whether the natural person whose actions are attributed to the legal person is such an insider.

9 Hansen, ‘Article 8’ (n 2) para B.8.127; Klöhn, ‘Artikel 8’ (n 2) para 16.
10 Klöhn, ‘Artikel 8’ (n 2) para 11; Dirk Zetzsche, ‘§ 7: Europäisches Kapitalmarktrecht’ in Martin Gebauer and Christoph
Teichmann (eds), Enzyklopädie Europarecht Band 6 - Europäisches Privat- und Unternehmensrecht (Nomos 2016) § 7C
para 133.
11 See Art 2 para 2 MAD 2003.
12 See Klöhn, ‘Artikel 8’ (n 2) paras 12ff.
84
B. Insiders (paras 4 and 5)
In other words, if a member of the management board concludes an insider deal for the legal
person, that manager’s knowledge and actions are attributed to the legal person, but not auto-
matically the fact that the manager is a primary insider. Hence, the legal person is a primary
insider only if it fulfils the requirements of para 4 lit b to d, while under many legal systems
it cannot be a board member according to lit a in the normal course of business according.
Additionally, the legal person can be a secondary insider as knowledge of its employees will
typically be attributed to it (as in the case of the manager).
It is a separate issue whether legal persons can also be fined under administrative law or pros- 8.011
ecuted under (judicial) criminal law. Art 30 MAR stipulates that legal persons can be subject
to administrative sanctions, while Art 8 CRIM-MAD contains rules on the criminal liability
of legal persons. This is essential, because if one employee has inside knowledge but another
acts, no natural person violates the prohibition on inside dealing. However, since the provisions
address the legal person itself, it must be determined whether the knowledge of one person
and the behaviour of another person are both attributable to the legal entity (see below paras
8.034ff). As such attribution is possible, the legal person can become criminally liable.
3. Primary insiders
The definition of primary insider in sentence 1 of para 4 is conclusive due to the prohibition 8.012
of analogy under criminal law.13 It also applies to legal persons, which can be primary insiders
under lit b, c and d, but under most legal systems not pursuant to lit a as directors. Equally, the
issuer itself is not a primary insider, not even under lit c, because it does not have ‘access’ to the
information, but creates it, at least in the case of company-related information. However, the
issuer is frequently a secondary insider because it at least had to know the inside quality of the
information.
Knowledge or reproachable ignorance that the information is inside information is not nec- 8.013
essary for this group of persons.14 Many authors assume that a primary insider cannot even
successfully argue that it did not recognise (and did not have to) the inside quality of the infor-
mation,15 e.g., because it assumed that the information had already been made public. This may
be correct for the qualification as primary insider but can be of importance for criminal liability.
A primary insider is someone who has the inside information because he/she holds a certain 8.014
position or performs a certain activity. The position, e.g., as a member of the board of directors,
is therefore not sufficient in itself; the position on the board must also have been causal for the
fact that this person has knowledge of the inside information.16 Thus, private knowledge of
13 Different, however, Sebastian Sieder, ‘Legitime Handlungen nach der Marktmissbrauchsverordnung (MAR)’ (2017]
ZFR 171, 172.
14 See Bachmann (n 1) 28, 31, 39; Veil, ‘§ 7’ (n 3) para 15.
15 Hopt and Kumpan, ‘§ 107’ (n 2) para 68, 121; Klöhn, ‘Artikel 8’ (n 2) para 30; Zetzsche (n 10) § 7C para 129; differ-
ent, however, Stefan Grundmann, ‘Band 11 Bankvertragsrecht - Teilband 1 Investmentbanking I’ in Claus-Wilhelm
Canaris, Mathias Habersack and Carsten Schäfer (eds), Staub Handelsgesetzbuch Großkommentar (5th edn, De Gruyter
2017) Part 6 para 376.
16 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 16; Hansen, ‘Article 8’ (n 2) para B.8.129; Petra Buck-Heeb, ‘§ 8:
Insiderrecht’ in Heinz-Dieter Assmann, Rolf Schütze and Petra Buck-Heeb (eds), Handbuch des Kapitalanlagerechts (5th
edn, C. H. Beck 2020) para 139; Hopt and Kumpan, ‘§ 107’ (n 2) para 121.
85
inside information by a board member does not make him/her a primary insider;17 however,
he/she will usually be a secondary insider with regard to the information and hence be covered
by the prohibitions in Art 8.18
8.015 The characteristic as primary insider must be present at the time when the offender obtains the
inside information. If the characteristic is later lost, i.e., before the action prohibited by Art 8 is
undertaken, this does not change the fact that the person is a primary insider.19 As a result, the
privileged access to information triggers certain behavioural obligations.
8.016 A primary insider is first of all someone who belongs to the administrative, management or
supervisory bodies of the issuer or is an emission allowance market participant (para 4 sent 1
lit a). The term ‘issuer’ is defined in Art 3 para 1 (21) and covers the issuer to whom the inside
information relates,20 but not other companies in the issuer’s group;21 however, members of
bodies of group companies are usually also included because and to the extent that they have
gained access to the information by performing their duties (lit c).22 The bodies covered in
companies subject to the two-tier model are the management and the supervisory board, for
companies under the one-tier model it is the board of directors.23 If the management function
is divided, e.g., between an administrative board and managing directors, any person pertaining
to one of these categories is included.24 More generally, persons are included who are members
of bodies which perform the functions of administration/management or supervision, irre-
spective of terminology. Likewise, voluntarily appointed executive bodies with management,
administrative or supervisory functions suffice.25 The persons covered include deputy members
and any employee representatives on the board. Members of executive bodies who have been
incorrectly appointed are also covered because of their privileged access to information,26 but
contrary to prevailing opinion, because of the prohibition of analogy, not de facto managing
directors or shadow directors.27
8.017 Second, a primary insider is a party that has a holding in the capital of the issuer or of the
emission allowance market participant (para 4 sent 1 lit b), i.e., the shareholders28 and also
other equity providers, but not providers of debt finance29 who nevertheless may be professional
17 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 18; for the UK Criminal Justice Act see Davies and Worthington (n 1) para
30–22.
18 Hansen, ‘Article 8’ (n 2) para B.8.131.
19 For the UK see Davies and Worthington (n 1) paras 30–25.
20 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 17; Hansen, ‘Article 8’ (n 2) para B.8.128; Klöhn, ‘Artikel 8’ (n 2) para 19.
21 Hopt and Kumpan, ‘§ 107’ (n 2) para 122; Klöhn, ‘Artikel 8’ (n 2) para 20. Different, however, Grundmann (n 15) Part
6 para 371.
23 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 17.
24 Stephan Semrau, ‘Artikel 19: Eigengeschäfte von Führungskräften‘ in Lars Klöhn (n 2) paras 22 f.
25 Grundmann (n 15) Part 6 para 371; Hopt and Kumpan, ‘§ 107’ (n 2) para 122; Veil, ‘§ 7’ (n 3) para 17.
27 Veil, ‘§ 7’ (n 3) para 17. Different, however, Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 17 (for de facto directors); Hopt
and Kumpan, ‘§ 107’ (n 2) para 122.
29 See Hopt and Kumpan, ‘§ 107’ (n 2) para 124.
86
insiders pursuant to lit c. Art 8 does not require a minimum holding.30 As a rule, however, small
investors do not receive the inside information because of their shareholding in the company.31
Since the causality required for primary insiders (see above para 8.014) is thus lacking, they
can at best be secondary insiders.32 According to the correct, if not predominant, scholarly
view, indirect shareholders are covered, since they too have privileged access to information.33
This applies in particular to the ultimate parent company, but not to fellow subsidiaries. This
presumably also applies to beneficial owners.34 In the case of shareholdings by a private foun-
dation, which under some legal systems can still be controlled by their founders, such founders
are not covered even though the factual situation may be quite similar to a shareholding: Since
a founder does not have a holding in the capital interest this would require an analogous appli-
cation, which is impossible due to fact that the wording limits interpretation under criminal
law. For the same reason, the bidder is not a primary insider if it does not yet hold any shares.
Third, in order to qualify as a primary insider, it is sufficient that access to the information 8.018
results from the exercise of an employment, profession or the fulfilment of duties (para 4 sent
1 lit c; ‘professional insider’). An employment relationship is often present, but is not required;
thus, not only employees of the issuer are covered, but also its external advisers (e.g., auditors,
investment bankers or lawyers).35 For lit c, however, no legal relationship with the issuer is
required at all.36 Hence, the definition covers employees of supervisory authorities,37 ministry
officials, elected officials or journalists38 as well as market intermediaries.39
It is irrelevant whether the original disclosure was unlawful in relation to the professional 8.019
insider,40 as is whether the information was obtained in accordance with its intended purpose,41
or whether the person had a managerial position or decision-making power. The only require-
ments are that the performance of the task was causal for the fact that the insider obtained the
information, and that the performance of the assigned task facilitates obtaining knowledge
of the inside information. An unduly wide interpretation42 argues that it should not matter
whether access to the information is directly connected with the type of activity performed, but
rather that it should be sufficient if the information was obtained by chance during the exercise
30 Hopt and Kumpan, ‘§ 107’ (n 2) para 123; Martin Oppitz, ‘Das Effektengeschäft’, in Peter Apathy, Michael Iro and
Helmut Koziol (eds), Österreichisches Bankvertragsrecht – Band VI: Kapitalmarkt (2nd edn, Springer 2007) para 2/106.
31 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 19; Grundmann (n 15) Part 6 para 372; Veil, ‘§ 7’ (n 3) para 18; Buck-Heeb
(n 16) para 141.
32 Niamh Moloney, EU Securities and Financial Market Regulation (3rd edn, Oxford University Press 2014) 723; Klöhn,
‘Artikel 8’ (n 2) para 23.
33 Klöhn, ‘Artikel 8’ (n 2) para 24; Veil, ‘§ 7’ (n 3) para 18; different, however, Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para
19; Hopt and Kumpan, ‘§ 107’ (n 2) para 124.
34 See Zetzsche (n 10) § 7C para 126 in fn 1295; different, however, Hopt and Kumpan, ‘§ 107’ (n 2) para 123.
35 See Grundmann (n 15) Part 6 para 373.
36 Moloney (n 32) 723 f; Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 20; Buck-Heeb (n 16) para 143; Hopt and Kumpan,
‘§ 107’ (n 2) para 127; Susanne Kalss, Martin Oppitz and Johannes Zollner, Kapitalmarktrecht (2nd edn, Linde 2015) §
21 para 15.
37 Veil, ‘§ 7’ (n 3) para 19.
38 Hopt and Kumpan, ‘§ 107’ (n 2) para 129; Klöhn, ‘Artikel 8’ (n 2) para 28.
41 Grundmann (n 15) Part 6 para 374.
42 Moloney (n 32) 724; Hopt and Kumpan (n 2) § 107 para 126; Klöhn, ‘Artikel 8’ (n 2) para 27; for the UK see Davies
and Worthington (n 1) para 30–22.
87
of any profession (files are found by a cleaner). As in this case the professional position under
normal circumstances does not give rise to privileged access to information,43 such persons can
at best be secondary insiders.44
8.020 Finally, also those who obtain the information because they are involved in criminal activities
are primary insiders (para 4 sent 1 lit d). Criminal activities are judicial, but also administrative
offences.45 The offence must be causal for the knowledge of the information.46 The offence can
either lead to the inside information being created (e.g., attack on a football team, which can
lead to a fall in share price, coupled with going short), or to the inside information becoming
known (e.g., hacker attacks or theft of documents).47 In any case, criminal activities are viola-
tions of national legal norms, not of internal company regulations.48
4. Secondary insiders
8.021 Anyone who is not a primary insider must know, or at least ought to have known, that the
information he/she possesses is inside information, so that the prohibition of insider dealing
covers the transaction he/she makes. The burden of proof lies with the party claiming the
existence of insider dealing.49 The source of the information is irrelevant.50
8.022 ‘Knowledge’ is positive knowledge, not just mere acceptance that the information can be inside
information. Hence, the person must be aware that the information fulfils the essential char-
acteristics of inside information, for which, in particular, the price significance and the lack of
public disclosure are important.51 A correct legal assessment is not required. The indications
of positive knowledge correspond to the indications of knowledge of the information; see para
8.029.
8.023 Alternatively, negligent ignorance of the fact that the information is inside information makes
the actor a secondary insider. For this, according to the correct view, any degree of negligence52
is sufficient. The diligence requirements are objective53 and depend on the position of the
offender, i.e., in particular on the proximity to the capital market and the circumstances under
43 See Gerner-Beuerle, ‘Article 8 MAR’ (n 1) paras 20 f (employment, etc. typically involves dealing with inside informa-
tion, contrasted to the US approach requiring a fiduciary duty towards the issuer); similar Florian Schuhmacher, ‘Zur
Auslegung des neu gefassten Tatbestands des Mißbrauchs einer Insiderinformation’ [2005] ÖBA 533, 535; Veil, ‘§ 7’ (n
3) para 19.
44 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 20; Grundmann (n 15) Part 6 para 373; Zetzsche (n 10) § 7C para 131;
Kalss, Oppitz and Zollner (n 36) § 21 para 16.
45 Klöhn, ‘Artikel 8‘ (n 2) para 29.
46 Hansen, ‘Article 8’ (n 2) para B.8.130. Some authors require more than mere causality in that the crime’s goal must be
the acquisition of inside information; see Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 22.
47 Grundmann (n 15) Part 6 para 375; Schuhmacher (n 43) 535.
50 Hopt and Kumpan, ‘§ 107’ (n 2) para 132; Veil, ‘§ 7’ (n 3) para 21.
52 Klöhn, ‘Artikel 8’ (n 2) para 34; Veil, ‘§ 7’ (n 3) para 22; cf, however, Grundmann (n 15) Part 6 para 376; Zetzsche (n
10) § 7C para 130 (gross negligence required).
88
which he/she obtained the information.54 Recital 26 is based on ‘what a normal and reasonable
person knows or should have known in the circumstances’. Merely negligent violations of the
prohibition must not be punished as a criminal offence (see Art 3 para 1 MAD), an option
many national legislators have made use of.
Legal entities may also be secondary insiders.55 For the attribution of knowledge of the inside 8.024
information to legal persons, see below paras 8.034ff. These principles also apply to the attribu-
tion of knowledge or negligent ignorance of the fact that the information is inside information.
5. Participation in decisions by legal persons (para 5)
According to para 5, Art 8 also applies to any natural person that participates in or influences 8.025
the decision of a legal person to carry out the acquisition, disposal, cancellation or amendment
of an order for the account of that person. This is clearly intended to extend the responsibility
to this natural person. The provision does not address the preceding question under which
conditions the behaviour of the natural person can be attributed to a legal person.56
The wording is ambiguous. On the one hand, the whole article is to apply, on the other hand, 8.026
the text merely refers to the forms of behaviour in para 1, but not to paras 2 and 3.57 Likewise,
it remains unclear whether the term ‘participate’ also covers actors who are not primary or
secondary insiders.58 If this is answered in the affirmative, the justification is difficult to recog-
nise. If this is answered in the negative, the provision is superfluous, because the behaviour of
secondary insiders for the account of others is already covered by para 1 anyway.59 Finally, dif-
ferent language versions of para 5 contain different prohibitions: While in the English version
the prohibition only covers the participation in the decision of a legal person to carry out the
acquisition, etc., according to the German version, it is prohibited to ‘influence’ that decision as
well. However, the German text seems to be an outlier.60
Finally, the reference in para 5, according to which the standard applies only ‘in accordance with 8.027
national law’, is to be understood as a reference to national attribution rules.61 Administrative
and/or criminal liability is thus based on principles of administrative and/or criminal law.
However, one has to carefully determine whether the case is one of ‘participation’ or the actor
is a direct offender for the account of a third party, which is directly covered by para 1. In sum,
the practical importance of para 5 should probably not be overestimated.
54 For details see Klöhn, ‘Artikel 8’ (n 2) paras 35 f.

60 See e.g., the French, Italian, Portuguese and Spanish versions, which do not mention ‘influence’.
61 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 24; Klöhn, ‘Artikel 8’ (n 2) para 39; cf, however, Hansen, ‘Article 8’ (n 2)
para B.8.135, who understands this as a mere reference to national rules on representation and management.
89
C. INSIDER DEALING (PARA 1)
8.028 Para 1 sent 1 defines insider dealing as a transaction in which a person possesses inside informa-
tion and uses that information by acquiring or disposing of financial instruments. This applies
equally to primary and secondary insiders.
1. Knowledge of inside information
(a) Natural persons

8.029 First of all, the person must ‘possess’62 the inside information, in other words have knowledge of
it.63 The regulator or the Public Prosecutor is responsible for providing the necessary evidence.
Knowledge is not presumed, and the Spector ruling64 of the CJEU does not indicate otherwise.65
In the case of natural persons, knowledge presupposes positive knowledge; negligent ignorance
does not suffice.66
8.030 However, it is an indication of actual knowledge if, in a specific circumstance, a person typically
knows the inside information in the normal course of events. In any case, proof of knowledge
can only be provided by circumstantial evidence.67 It is, of course, important to note that this
circumstantial evidence must not be subject to too lenient requirements. Otherwise, instances
of insider trading will increase markedly, because once actual knowledge is proven the use of
the inside information is presumed (see below paras 8.083ff). An indication (not more!) of
knowledge lies in a trading behaviour which deviates from the usual and which is in line with
the presumption that the inside knowledge is also used – at least if there are no alternative
explanations for the behaviour. In this context it has to be taken into account how easily the
insider could gain access to the inside information.
8.031 The insider must have had knowledge of the information at the time of the last relevant
decision, otherwise a ‘use’ would not be possible.68 Acquisition of knowledge at a later stage is
irrelevant. Thus, it is not prejudicial if knowledge is obtained after the order has been placed
but before it is executed; the insider does not have to cancel an order.69 Similarly, a trade is not
an insider deal if the obligation to execute it arose before the information was known; see paras
9.041ff. On the question of whether acquiring knowledge is prejudicial after the decision but
before the acquisition or disposal transaction itself, see below paras 8.067ff.
62 The German language version uses different verbs (‘verfügen’ in Art 8 paras 1, 2 and first sentence of para 4, but ‘besitzen’
in second sentence of Art 8 para 4 sent 2 and Art 9 para 1) without any discernible different meaning.
63 Bachmann (n 1) 38; Lars Klöhn, ‘Die (Ir-)Relevanz der Wissenszurechnung im neuen Recht der Ad-hoc-Publizität
und des Insiderhandelsverbots’ (2017) 33 NZG 1285, 1289 f; Klöhn, ‘Artikel 8’ (n 2) paras 96ff. Different, however,
Grundmann (n 15) Part 6 para 383: distinction between ‘possession’ and ‘knowledge’ of the inside information.
64 Case C-45/08 Spector Photo Group [2009] ECR I-12073.
65 Klöhn, ‘Artikel 8’ (n 2) para 101; Sieder (n 13) 173. Probably different Hansen, ‘Article 8’ (n 2) para B.8.162;
Grundmann (n 15) Part 6 para 383; Zetzsche (n 10) § 7C para 144.
67 Hansen, ‘Article 8’ (n 2) para B.8.147; for more issues of circumstantial evidence see Klöhn, ‘Artikel 8’ (n 2) paras
102ff and CESR, ‘Level 3 – first set of CESR guidance and information on the common operation of the Directive’,
CESR/04–505b, May 2005, paras 5.8 und 5.9.
68 Klöhn, ‘Artikel 8’ (n 2) Art 8 para 99.
90
C. Insider dealing (para 1)
Art 9 para 1 uses the wording ‘is or was in possession of inside information’. Hence, the argu- 8.032
ment that inside information that was once acquired was forgotten is irrelevant to the question
of knowledge. Thus, positive knowledge at any point in time prior to the conclusion of a trans-
action suffices. However, forgetting can be relevant as regards fault.70
On the other hand, it is not necessary for the person acting to know that the information is 8.033
inside information;71 sentence 2 of para 4 makes it clear that the possession, that is the knowl-
edge, is different from the legal classification of the information. However, Recital 26 shows
that a prohibited insider deal normally requires that the insider knows or ought to have known
that the information constitutes inside information, which is certainly true for secondary
insiders, but not necessarily the case for primary insiders (for further details see paras 8.021 f).
However, even for primary insiders, doctrines under criminal law, such as mistake of fact or
error in law, may result in exemptions as far as sanctions are concerned. Thus, it is rightly stated
that it depends less on the prohibition under the MAR, but rather on the sanctions under
national law whether negligent legal errors are prejudicial.72
(b) Legal persons

Prior to the MAR, most national transpositions of the prohibition of insider dealing did not 8.034
focus on the circumstances under which a legal person has knowledge of inside information.
This is especially true as in many Member States legal persons are not responsible under crimi-
nal law, even though Art 2 para 2 MAD 2003 indicated that legal persons were covered. This is
different under the new legal situation; in particular, the administrative sanctions must also be
directed against legal persons according to Art 30 MAR. A preliminary question is, however,
whether the legal person had knowledge of the violation at all, or more generally the question
of attribution of knowledge. The MAR and its implementing acts do not contain any direct
statements in this regard.73
In the regulatory context of the MAR, there is much to be said for a broad imputation of 8.035
knowledge. For, unlike in the context of ad hoc disclosure, knowledge alone does not trigger
any positive obligations. Rather, the information must not be used for a specific transaction;
although such use is presumed, the presumption can be refuted, e.g., because the knowledge is
attributed to the legal person, but the natural person acting did not have the information. In
this respect, the attribution of knowledge to the legal persons is above all of procedural impor-
tance, because it gives rise to a presumption that the information was also used.
The legal person has knowledge of the information of (inside) members of the board of 8.036
directors. This is also supported by Art 8 CRIM-MAD, according to which insider offences
committed by members of the board (Art 8 para 1 lit a CRIM-MAD) or of the supervisory
board (Art 8 para 1 lit c CRIM-MAD) must lead to criminal sanctions for the legal person if
the offence was committed for the benefit of the legal person. It is not clear, however, whether

71 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 5; Hansen, ‘Article 8’ (n 2) para B.8.150; Klöhn, ‘Artikel 8’ (n 2) Art 8 para
96.
72 Hansen, ‘Article 8’ (n 2) paras B.8.142 and B.8.145.
73 Hansen, ‘Article 8’ (n 2) para B.8.136; Klöhn, ‘Artikel 8’ (n 2) Art 8 para 87.
91
private knowledge of members of the board is also to be attributed.74 This is to be affirmed in

principle, but, in my opinion, it should be denied for circumstances that reach deep into the
private sphere (e.g., serious illness).
8.037 It is more difficult to determine whether knowledge of members of the supervisory board under
some continental European systems can be attributed to the company.75 One has to bear in
mind that such members are outside directors with obligations against other market partici-
pants as well. Similar arguments can be brought forward for outside directors in the one-tier
system. One solution for attribution of knowledge could hinge on whether the member of the
supervisory board is under an obligation to communicate the information to the management
board. Such an obligation may founder due to confidentiality obligations towards other legal
entities. In addition, inside information in many cases of Art 8 does not concern the company
itself, but other issuers; here, there is usually no obligation on the member of the supervisory
board to disclose this knowledge to the management board of a company, which prima facie
is not affected by the information, but subsequently trades in the shares of the company the
information refers to. As a result, the issue of attribution of knowledge of members of boards
with a supervisory function is probably an issue of national law.
8.038 The knowledge of its employees is attributed to the company.76 This results from Art 9 para 1
and the measures required for legitimate behaviour according to this provision, which clearly
presuppose that the knowledge of all employees is attributed to the company in principle; for
more details, see paras 9.007ff. Furthermore, the knowledge of former employees who have left
the company is also to be attributed;77 Art 9 para 1 states that it is sufficient if a legal entity ‘is
or has been in possession of inside information’. Whether a distinction must be made between
‘private’ and ‘official’ knowledge of employees and only the latter is to be attributed, is a diffi-
cult question.78 The fact that private knowledge usually is not covered by company compliance
regulations argues in favour of a distinction. On the other hand, the origin is difficult to prove.
It could be discussed whether private knowledge should be attributed to the company if the
employee providing the information also makes the prohibited transaction. If, on the other
hand, one employee knows from a private source and another acts, the attribution seems to be
excessive.
8.039 It is not clear whether the knowledge of independent service providers, such as M&A advisers
or lawyers, is also attributed to legal entities.79 If these service providers have access to inside
information due to their duties, the fact that they are to be included in the insider list pursuant
to Art 18 para 1 lit a speaks for attribution and also shows that they are under the organisational
control of the legal entity concerned. In any case, the legal person will not become liable if the
adviser acts for his/her own account or if there is an exemption according to Art 9. The knowl-
74 See, for instance, Petra Buck, Wissen und juristische Person (Mohr Siebeck 2001) 244 f.
75 See, for instance, Thomas Barth, ‘Zur Wissenszurechnung von Aufsichtsratswissen’ (2016) 5 GesRZ 319, 320ff.
76 Klöhn, ‘Die (Ir-)Relevanz der Wissenszurechnung im neuen Recht der Ad-hoc-Publizität und des Insiderhandelsverbots’
(n 63) 1290 f; Klöhn, ‘Artikel 8’ (n 2) para 89.
78 Klöhn, ‘Die (Ir-)Relevanz der Wissenszurechnung im neuen Recht der Ad-hoc-Publizität und des Insiderhandelsverbots’
(n 63) 1291 f.
79 cf, however, Klöhn, ‘Die (Ir-)Relevanz der Wissenszurechnung im neuen Recht der Ad-hoc-Publizität und des
Insiderhandelsverbots’ (n 63) 1291.
92
edge of other consultants without such privileged access is, in my opinion, not attributable to
the company.
There has been little discussion so far as to whether the knowledge of subsidiaries is to be 8.040
attributed to the parent company. The separation of the different legal entities under company
law suggests otherwise. On the other hand, on that basis the scope of the prohibition of insider
dealing is determined by structures which need not coincide with the separation of operational
processes in fully integrated groups. In my opinion, the question must be solved on the basis
of the parent company’s powers of intervention and is therefore dependent on the facts of the
individual case. Insofar as employees or board members of the parent company also hold board
positions in subsidiary companies, complicated questions arise regarding the delimitation of
spheres of knowledge based on confidentiality obligations.80
On the question of when the legal person acts, see below paras 8.063ff; on the question of 8.041
when it exploits its knowledge, in particular whether it is prejudicial if the knowledge of inside
information is available to one person in the company structure while another acts, see below
paras 8.095 f.
2. Transactions covered
(a) General
Para 1 first prohibits the acquiring and disposing of financial instruments to which the 8.042
inside information relates, but also the cancelling or modifying of orders. The transfer must
be the consequence of a decision of the insider.81 In addition to on-exchange transactions,
off-exchange transactions and transactions on other marketplaces are also included in accord-
ance with Art 2 para 3.82
‘Financial instruments’ are those within the meaning of Art 2 para 1, i.e., in addition to finan- 8.043
cial instruments listed on a regulated market also those listed on an MTF or OTF – whereby
it is always sufficient that an application for admission to trading has been made – but also the
derivatives mentioned in Art 2 para 1 lit d; see paras 2.002ff.
(b) Acquisition and disposal

Neither acquisition nor disposal is defined in the MAR.83 Acquisition is any legal transaction 8.044
aimed at obtaining legal ownership of the financial instrument and disposal is any legal trans-
action aimed at transferring legal ownership to another party.84 This includes purchase and sale,
but also, for example, repurchase agreements or securities loans85 and the acquisition of newly
80 See, e.g., Barth (n 75) 319.

82 Klöhn, ‘Artikel 8’ (n 2) para 40; Veil, ‘§ 7’ (n 3) para 14.
83 Art 10 para 2 Commission Delegated Regulation 2016/522 is not applicable; Veil, ‘§ 7’ (n 3) para 25.
84 Hopt and Kumpan, ‘§ 107’ (n 2) para 63; Zetzsche (n 10) § 7C para 139.
85 Hopt and Kumpan, ‘§ 107’ (n 2) para 66; Klöhn, ‘Artikel 8’ (n 2) para 60; Kalss, Oppitz and Zollner (n 36) § 21 para 39.
93
issued shares.86 Legal transactions that are not aimed at changing the legal ownership, such as
pledging or granting a power of disposal, are outside the provision’s scope.87
8.045 Whether ownership in the financial instrument has been transferred to the acquiror, is not the
decisive factor. Rather, it is sufficient that a secure legal position is created, from which a claim
to this transfer results;88 at this point in time arbitrage (e.g., through day trading transactions) is
already possible, even if the transaction has not been settled. Thus, in principle, concluding the
transaction under the law of obligations constitutes insider dealing.89 This covers, for example,
the execution of the order, but not the submission of the same. The latter, however, marks the
start of the execution and, hence, is indicative of an attempt.90 The offer to buy or sell is now
no longer91 the completed offence, but merely an attempt. Since entering into the transaction
is sufficient, short sales are also covered.92
8.046 If neither the acquiror nor the seller has a contractual claim in this sense (or none that is
unconditional in the case of conditionally concluded contracts; below para 8.049), the actual
transfer of ownership is decisive.93 In this case, however, the information must still be inside
information at the time of such transfer.
8.047 In principle, it is not necessary to make a profit or to have such opportunity from the transac-
tion.94 However, the absence of an advantage may be an indication that the inside information
has not been used; for further details see para 8.089. In any case, insider dealing does not
encompass transactions without remuneration.95 The justification for this understanding is not
that the insider does not gain an advantage from these transactions, probably to the detriment
of the other party;96 however, insider law shall only cover market behaviour which presupposes
remuneration. For the same reason, transfer by inheritance cannot constitute insider dealing.97
8.048 The legal nature of the acquisition under the applicable national system is not significant in
the context of the MAR. Hence, not only acquisition by individual legal succession is covered
but also by universal succession, such as in the case of a merger according to Art 105 para 1 lit
a Directive 2017/1132.98 The fact that mergers are covered is also shown by Art 9 para 4, which
86 Veil, ‘§ 7’ (n 3) para 28.

87 Klöhn, ‘Artikel 8’ (n 2) para 59; Veil, ‘§ 7’ (n 3) para 31; Kalss, Oppitz and Zollner (n 36) § 21 para 39.
88 Prevailing opinion: Hopt and Kumpan, ‘§ 107’ (n 2) para 63; Klöhn, ‘Artikel 8’ (n 2) paras 48ff; Veil, ‘§ 7’ (n 3) para
27; Wolfgang Sindelar, ‘Art 8 MAR: Insidergeschäfte’ in Michael Gruber (ed), Börsegesetz. Marktmissbrauchsverordnung
(Manz 2020) paras 28ff. Different Zetzsche (n 10) § 7C para 139.
89 Buck-Heeb (n 16) para 150. For the UK Davies and Worthington (n 1) paras 30–25.
90 Veil, ‘§ 7’ (n 3) para 27; Buck-Heeb (n 16) para 207. A distinction must be made between this and the question of
whether it is prejudicial if the insider becomes aware of the inside information when the order is placed and executed,
which is to be answered in the negative, because in this case the information is no longer used (see para 8.066).
91 See Art 2 para 1 MAD 2003.
92 Buck-Heeb (n 16) para 151.
93 Klöhn, ‘Artikel 8’ (n 2) paras 62 f.
94 Hansen, ‘Article 8’ (n 2) para B.8.81; Hopt and Kumpan, ‘§ 107’ (n 2) para 63; Klöhn, ‘Artikel 8’ (n 2) paras 51, 58.
95 Hansen, ‘Article 8’ (n 2) para B.8.84; Klöhn, ‘Artikel 8’ (n 2) para 57; Buck-Heeb (n 16) para 153; Kalss, Oppitz and
Zollner (n 36) § 21 para 39; different, however, Hopt and Kumpan, ‘§ 107’ (n 2) para 65; Veil, ‘§ 7’ (n 3) para 29.
96 E.g., if the owner donates shares to the insider in the mistaken belief that these shares have no value.
97 Klöhn, ‘Artikel 8’ (n 2) para 53; see also Hopt and Kumpan, ‘§ 107’ (n 2) para 63 (in n 6) and para 8.067.
98 Hansen, ‘Article 8’ (n 2) para B.8.82; Hopt and Kumpan, ‘§ 107’ (n 2) para 64; Klöhn, ‘Artikel 8’ (n 2) paras 54ff; Veil, ‘§
7’ (n 3) para 30; cf, however, Frank A Schäfer, ‘Kapitalmarktbezogene Verhaltenspflichten’ in Reinhard Marsch-Barner
94
expressly exempts the pursuit of a merger plan in certain constellations from the prohibition of
insider dealing; see also para 9.056.
Conditionally concluded transactions are covered by para 1 if the occurrence of the (suspensive 8.049
or resolutory) condition is at the insider’s discretion.99 Conversely, it does not constitute insider
dealing if the occurrence of the condition is at the discretion of the other contracting party or
if that party has a right of rescission.100 However, insider dealing occurs in such cases once the
financial instruments are actually transferred (above para 8.046), provided that the information
is then still inside information. A right of rescission of the other party that may still exist after
a transfer of financial instruments does not change this.101 Having said this, the treatment of
conditions that are not at the discretion of either party (e.g., development of an index) remains
unclear. The fact that the parties have done everything possible to ensure the transfer of the
financial instrument speaks in favour of inclusion; whether the condition is fulfilled depends on
external circumstances. However, an advantage can usually only be exploited if the condition is
likely to be fulfilled. Therefore, in my view, such conditional transactions do not automatically
meet the criteria of Art 8, but the issue must be resolved on the basis of a case-by-case analysis
of whether the condition is likely to occur under normal circumstances.102
If the insider buys an option, this is insider dealing, if only because of the fact that the option 8.050
itself is a financial instrument according to Art 2 para 1 lit d.103 However, if the insider did not
yet know when buying an option that the option would come into the money through inside
information, it is unclear whether the exercise of the right in knowledge of the information
is insider dealing.104 One has to consider that the insider would, as a rule, have exercised an
option that was already in the money even without the inside information; hence, the insider is
not obliged to let a legal position acquired without knowledge of the information to lapse. Of
course, this does not apply if the option is out of the money at the time it is exercised; then the
insider only exercises the option because he/she knows the inside information.
If, on the other hand, the insider is the seller of the option (writer), this is covered by the 8.051
wording of the definition of financial instrument. However, the proscribed pecuniary advan-
tage does not arise until the beneficiary exercises the option, insofar as the information is not
publicly known at that time. Therefore, in this case (as with all conditional transactions),
the exercise of the option by the third party and not the conclusion of the option agreement
consummates the insider transaction,105 whereby, however, the prerequisite for the existence
and Frank A Schäfer (eds), Handbuch börsennotierte AG (4th edn, Otto Schmidt 2018) para 14.40; Buck-Heeb (n 16)
para 154.
100 See the German decision OLG Karlsruhe 4.2.2004 – 3 Ws 195/03, NZG 2004, 377; Hopt and Kumpan, ‘§ 107’ (n 2)
para 63; Klöhn, ‘Artikel 8’ (n 2) para 61; cf, however, Buck-Heeb (n 16) paras 155ff.
102 Zetzsche (n 10) § 7C para 139; similar Veil, ‘§ 7’ (n 3) para 32. Different, however, Hopt and Kumpan, ‘§ 107’ (n 2) para
67.
103 Hopt and Kumpan, ‘§ 107’ (n 2) para 67; Veil, ‘§ 7’ (n 3) para 32; see also Hansen, ‘Article 8’ (n 2) para B.8.82; Jesper
Lau Hansen, ‘Article 9: Legitimate behaviour’ in Ventoruzzo and Mock (n 2) para B.9.57.
104 Against this Hansen, ‘Article 9’ (n 103) paras B.9.51ff; Carsten Gerner-Beuerle, ‘Article 9 MAR: Legitimate behaviour’
in Lehmann and Kumpan (n 1) para 9; Sindelar (n 88) para 39. In favour of this Veil, ‘§ 7’ (n 3) para 32; Buck-Heeb (n
16) para 158 f.
105 Different, however Hopt and Kumpan, ‘§ 107’ (n 2) para 67.
95
of insider dealing is that the insider already knew the information when the option agreement
was concluded.
8.052 Art 5 contains an exemption for buy-back programmes or stabilisation. Insofar as such meas-
ures do not comply with the requirements of Art 5, they may constitute insider dealing. In this
case, whether the information was used is to be examined according to general principles (paras
8.066ff).106
(c) For their own account or for the account of others

8.053 According to the wording of the law, not only transactions for one’s own account (proprie-
tary trading) are covered, but also those concluded in one’s own name but for the account of
third parties (e.g., as a commission agent or through other forms of indirect representation).
However, anyone who acts solely for the benefit of a third party without any contractual obli-
gation to that party acts on his/her own account.107
(d) Direct or indirect

8.054 The significance of the words ‘directly or indirectly’ acquiring/disposing is not clear and has
led to considerable discussion, at least in the German literature, where the words are translated
differently in different provisions of the MAR.108 The provision is considered by some to be
merely clarifying in character,109 while others110 understand it to include acquisition by interme-
diaries (who are not themselves violating the prohibition of insider dealing).
8.055 The word ‘indirectly’ in Art 8 para 1 certainly covers actions undertaken in the name of another
person (on the actor’s own account or for the account of that other person).111 This already
follows from Art 8 para 5 for legal persons, but also applies to natural persons.112 Therefore, the
asset manager’s actions on behalf of the client can constitute insider dealing even if the manager
directly represents the client.113
8.056 However, it is not correct to extend the concept of indirect acquisitions or disposals to the
incitement or inducement of third parties who themselves do not engage in insider dealing
because they are not aware of the inside information.114 Such an interpretation is contradicted
by the fact that this is specifically regulated in Art 8 para 2 and that Art 6 para 1 CRIM-MAD
clearly presupposes that incitement is not already covered by the definition of insider dealing in
Art 8 para 1. Thus, cases in which another is induced to act for his/her own account are covered
by Art 8 para 2 (see below paras 8.097ff). On the other hand, inciting an unaware third party
to act for the account of the inciter is not covered, but left to the regulatory sovereignty of the
Member States by Art 6 para 1 CRIM-MAD.
106 Klöhn, ‘Artikel 8’ (n 2) paras 202ff and 208ff.

107 Different, however, Hansen, ‘Article 8’ (n 2) para B.8.81.
108 Art 8 para 1 MAR reads ‘direkt or indirekt’, but Art 3 para 2 CRIM-MAD reads ‘mittelbar oder unmittelbar’, while the
respective English language versions use the words ‘directly or indirectly’ in both cases.
109 Klöhn, ‘Artikel 8’ (n 2) paras 71ff; Buck-Heeb (n 16) para 148.
110 Grundmann (n 15) Part 6 para 381; Zetzsche (n 10) § 7C para 137.
111 Veil, ‘§ 7’ (n 3) para 33. Similar for the UK Davies and Worthington (n 1) para 30–25.
96
(e) Cancellation or amendment of orders

It is not insider dealing if the insider does not carry out an already planned transaction due to 8.057
inside information.115 This includes not exercising a call or put option.116 However, according
to Art 8 para 1, second sentence, it constitutes insider dealing if an existing order for a financial
instrument to which the inside information relates is cancelled or amended in the knowledge of
this information. This rule was first introduced by the MAR and sanctions one specific case in
which the insider does not enter into a market transaction.
The prohibition covers any order which has been validly placed – i.e., which, as a general rule, 8.058
has been received by the agent117 – but which has not yet been executed. If, on the other hand,
an order which has already been executed is economically offset by a new transaction, this con-
stitutes a new acquisition or a new disposal. The complete or partial cancellation of the order is
prohibited; that is any declaration by which the execution of the order is stopped.
Likewise, any amendment of the order is prohibited.118 Arguably, this is superfluous since an 8.059
amendment results in a new acquisition anyway, which would be covered by Art 8 para 1, first
sentence, MAR.119 Such an amendment may concern, for example, the scope, the execution
price, but also the time of execution.120 If the order is amended, according to some authors
insider dealing only arises once the order is executed.121 Considering that an amended order is
in fact a new order and that according to Art 8 para 1, first sentence, such an original order has
to be executed (see para 8.045), this seems to be the correct interpretation. However, placing
the amended order may be an attempt to commit insider dealing.
Art 8 para 1, second sentence, requires that the original order had been placed ‘before the 8.060
person concerned possessed’ the inside information, i.e., before the insider had the informa-
tion at its disposal. However, for the cancellation or amendment of the order to be covered
by the prohibition the insider must be aware of the information at the time of amendment or
cancellation. If the insider did not know of the inside information when placing the original
order, the subsequent execution of the order without modification is not insider dealing (below
para 8.067).122 If the insider already knew the information before the original order was placed,
withdrawing the order is not an offence; rather a withdrawal from the attempt may exist under
the applicable national provisions of criminal law.
If these two conditions are met Recital 25 stipulates a rebuttable presumption (below para 8.061
8.085) that the inside information is used for the cancellation or amendment. The presumption
can be rebutted by proving that the actual cancellation (or amendment) of the order is detri-
mental to the insider. For that reason, in the opinion of ESMA,123 a so-called blanket order
115 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 9; Grundmann (n 15) Part 6 para 382; Veil, ‘§ 7’ (n 3) para 35; Kalss, Oppitz
and Zollner (n 36) § 21 para 47.
119 Hansen, ‘Article 8’ (n 2) paras B.8.95 f.
122 See Recital 25; Hansen, ‘Article 8’ (n 2) paras B.8.87ff.
123 ESMA (n 6).
97
cancellation policy, under which all orders are automatically cancelled upon knowledge of the
inside information, is not sufficient as a general justification.124
(f) Emission allowances

8.062 The MAR covers not only financial instruments, but also certain emission allowances; see
paras 2.009 f and paras 3.044 f. Under the auction system introduced by the Greenhouse Gas
Regulation 1031/2010, these allowances are auctioned on auction platforms authorised as
regulated markets. For such auctions, Art 8 para 1, third sentence, also covers the transmission,
modification or withdrawal of a bid by a person for his/her own account or for the account of
a third party; this follows in principle from Art 2 para 1, second sentence.125
(g) Actions of legal persons

8.063 For the question as to which actions are to be attributed to legal persons, the same applies as
for the attribution of knowledge (above paras 8.034ff). Therefore, in principle, the actions of
board members, of employees, but also of external persons who have been or are to be included
in insider lists are included.126
8.064 In principle, therefore, acts which such a natural person carries out for his/her own account
or for the account of third parties would also be attributed to the legal person. However, the
purpose of the MAR requires some limitation. One can conclude this from Art 9 para 1, which
presupposes in lit a and b that the natural person acts on behalf of the legal person, without
clarifying what exactly is meant by the expression ‘on its behalf’. Art 8 CRIM-MAD does not
permit any more detailed conclusions if it states as a prerequisite (only) for the criminal liability
of legal persons that the offence is committed ‘for their benefit’.127
8.065 Some authors propose a sufficient connection to the activity of the legal person as a limiting
element for attribution; such a connection could result from the fact that the transaction is
advantageous for the legal person, but also, for example, that the transaction is carried out on
marketplaces to which only the legal person has access.128 Such broad but ultimately vague
boundaries are not convincing. It seems to be better to attribute actions only to a legal person
insofar as trading is carried out on behalf of the legal person or that person receives any
other advantage from the transaction. Such an advantage can also be present indirectly if, for
example, the performance of the client portfolio has exceeded the benchmark due to the insider
dealing for the account of the client, thus increasing the attractiveness of the asset manager.129

127 Different, however, Klöhn, ‘Artikel 8’ (n 2) para 92.
128 Klöhn, ‘Artikel 8’ (n 2) paras 93ff. Similar Sindelar (n 88) paras 52ff.
129 Similar Klöhn, ‘Artikel 8’ (n 2) para 95.
98
3. Use of inside information
(a) Introduction
The mere knowledge of inside information is not sufficient for insider dealing, according to the 8.066
MAR; the insider must also use it when concluding a transaction. Hence, the information, in
principle, must be causal for the transaction.130 In any case, it does not have to have been the
sole reason for the transaction, contributory causality suffices.131 The following presents the
foundations of ‘use’ of the inside information and (without a complete casuistry132) deals with
cases important in practice in the given context. See for the fulfilment of obligations, paras
9.041ff, for the execution of own purchase decisions, paras 9.068ff and for M&A transactions,
paras 8.077 f.
(b) Use in decision-making, not in behaviour

It is irrelevant if the insider only becomes aware of the inside information after he/she has 8.067
entered into the contract leading to an acquisition or a disposal, because then the information
was not the cause of the action. Therefore, it is irrelevant if the insider gains knowledge of the
inside information between placing the order and its execution. This is also suggested by Art
9 para 3 lit a dealing with the insider’s obligations;133 Recital 25, first sentence, also clearly
shows that the execution of such orders is unproblematic. Thus, there is no obligation to
cancel favourable orders, which have been place already, after the inside information becomes
known.134
However, it is unclear what applies if the information is obtained after the decision to enter 8.068
into a transaction has been made, but before the corresponding action (such as placing an order
or accepting an offer) is taken.135 In other words, the question is whether the ‘use’ of the inside
information is making the decision on the acquisition or only, often at a later stage, making the
acquisition itself. This is important in different contexts, for example, when a person decides
on an investment plan, but the order has not yet been placed,136 or when she decides on an
acquisition of a controlling interest in a listed company and positive information comes to light
during the subsequent due diligence process.137
The question is highly controversial. On the one hand, some authors argue that the moment 8.069
at which the transaction is concluded matters in the case of face-to-face transactions138 or the
moment at which an order is placed.139 Such an interpretation would result in the obligation
to refrain from further pursuit of a decision already made if inside information has emerged
130 Grundmann (n 15) Part 6 para 383; Buck-Heeb (n 16) para 168. Different, however, Bachmann (n 1) 43ff.
131 Hopt and Kumpan, ‘§ 107’ (n 2) para 69; similar Klöhn, ‘Artikel 8’ (n 2) para 119.
132 See e.g., Klöhn, ‘Artikel 8’ (n 2) paras 150ff.
133 Hansen, ‘Article 8’ (n 2) para B.8.90, ‘Article 9’ (n 103)..
135 It is a different issue whether one’s own plan can be inside information; see paras 9.068ff.
137 Klaus J Hopt and Christoph Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (2017) 46/6 ZGR 766, 798 f.
138 Ulrich Wackerbarth, ‘§ 3 WpÜG: Allgemeine Grundsätze’ in Wulf Goette and Mathias Habersack (eds), Münchener
Kommentar zum Aktiengesetz – Volume 6 (4th edn, C. H. Beck 2017) para 37.
99
in the meantime.140 This could also be in line with the legal opinion of ESMA on so-called
blanket order cancellation policies.141 Such policies stipulate ex ante that all orders are to be
automatically cancelled if inside information becomes known. ESMA, however, assumes that
such a policy is not sufficient to rebut the presumption of use of the inside information as each
cancellation must be checked individually to determine whether it was carried out without
using that information. According to ESMA, this must depend on whether the information
was available at the time of the cancellation itself, since the prior decision to cancel the order
was already taken when issuing the policy and thus at a time when the inside information was
not known to the company.
8.070 The opposing view, shared by what is a majority of authors at least in the German language
literature,142 holds that once the decision has been taken, it may be carried out (albeit without
change) even if the insider, in the meantime, becomes aware of information which makes the
planned transaction (even) more attractive. According to that view, it is not necessary that the
information has become public before the transaction is entered into. However, a change in
the terms of the transaction, such as, above all, the purchase of additional shares if positive
information becomes known, constitutes prohibited insider dealing.143
8.071 The wording is open; ‘uses … by acquiring or disposing of’ can refer to both the decision and
the conclusion of the contract. There is little to be gained from systematic considerations as
well; although Art 9 para 4 could indicate that the conclusion of the transaction is decisive, it is
better to understand the provision as a specific exception for public takeover bids (see also paras
9.065ff).144 Additionally, there are few indicators as to the legislators’ intentions. Rather, the
last sentence of Recital 30, which contradicts Art 9 para 4,145 shows that, as regards the question
of use, the legislator may not have had a very clear picture.
8.072 Under a purposive approach, however, there are better reasons to take the decision as the
pivotal moment. Prohibited insider dealing is not to act when one is in possession of inside
information, but rather to act because one is in possession of it; the latter is, in my view, the
required causality. However, once the decision has been made, this specific causality for action
is lacking.
8.073 It follows that a decision only excludes ‘use’ for the purposes of Art 8 para 1 if it does not allow
any relevant margin of discretion when it is implemented at a later stage.146 At most it can be
linked to conditions, which are not at the discretion of the insider. Hence, the decision has to
encompass all relevant factors, such as price, number and date of entering into the transaction.
If, on the other hand, a more flexible plan seems to be desirable, one must entrust its execution
to an independent third party who cannot come into possession of the inside information;
a credit institution may thus be entrusted with the discretionary acquisition within certain
parameters and can go ahead even if its principal gets to know inside information.
140 Such a change of mind does not constitute insider dealing as long as no order has been placed (above para 8.057).
141 ESMA (n 6).
142 Hopt and Kumpan, ‘§ 107’ (n 2) para 98; Klöhn, ‘Artikel 8’ (n 2) paras 119, 150, 175ff; Sindelar (n 88) paras 75ff.
145 See Klöhn, ‘Artikel 8’ (n 2) para 114.
146 Klöhn, ‘Artikel 8’ (n 2) para 180; Veil, ‘§ 7’ (n 3) para 93.
100
Furthermore, in order to avoid insider dealing the measure must also be implemented in 8.074
accordance with the requirements of the decision. If the insider deviates from the plan in the
knowledge of the inside information, he/she thus uses it.147 However, it is not prejudicial if the
insider revises his/her decision in knowledge of the inside information and refrains from the
transaction,148 because the non-execution of a transaction is not an offence as long as an order
has not been placed.
In this context, the insider must pay special attention to the verifiability of both the decision 8.075
and the moment it has been taken. This is due to the fact that Recital 24 stipulates a presump-
tion of the use of the information if an acquisition or disposal is carried out by a person with
knowledge (see also paras 8.083ff); this wording clearly refers to the moment the transaction is
entered into (or the order is made). Hence, it is highly advisable for the acting party to docu-
ment its decision carefully.149 When a natural person makes a decision this usually requires that
the decision has been communicated somehow, for example, by informing the employer in the
case of employee participation programmes. In the case of legal persons, a corresponding doc-
umentation of the decision is necessary. This can refer to both resolutions of the representative
body and decisions of employees.
Once the decision to participate in investment plans, employee participation programmes150 8.076
or similar has been made, it does not constitute insider dealing if such a plan is subsequently
implemented151 as it is not prejudicial if the acquirer still makes legal declarations although she
is in possession of insider information.152 It is essential that the programme is precisely deter-
mined with regard to object and time and that it is then implemented in this way. The mere
non-execution (not: postponement) of planned transactions is in principle unobjectionable.
If a prospective buyer has, in principle – without being aware of the inside information – made 8.077
the decision to acquire shares (so-called master plan), he may subsequently carry out a due
diligence review. If negative findings come to light, the buyer will refrain from the acquisition
plan, which is, pursuant to insider law, unobjectionable as long as no order is cancelled.153
However, if the buyer receives positive inside information, a distinction between three different
situations must be made: If it subsequently buys off-exchange from a blockholder with the same
access to information, it does not use the information (below para 8.093).154 If it subsequently
makes a public takeover bid to gain control, Art 9 para 4 is relevant; for further details, see paras
9.049ff.
If, however, the insider buys the shares on the stock exchange or otherwise from shareholders 8.078
who do not know of the inside information, the legal situation is disputed. On the one hand,

149 Klöhn, ‘Artikel 8’ (n 2) para 180; Veil, ‘§ 7’ (n 3) para 94; Kalss, Oppitz and Zollner (n 36) § 21 para 50.
150 So called phantom stocks are financial instruments as well; Schäfer (n 98) para 14.75.
151 Klöhn, ‘Artikel 8’ (n 2) para 152; Buck-Heeb (n 16) para 186.
152 Different, however, Hopt and Kumpan, ‘§ 107’ (n 2) para 72; Veil, ‘§ 7’ (n 3) para 43.
153 Sieder (n 13) 171; Lars Bühren, ‘Auswirkungen des Insiderhandelsverbots der EU-Marktmissbrauchsverordnung auf
M&A-Transaktionen’ (2017) 30 NZG 1172, 1175.
154 Rüdiger Veil, ‘§ 13: Insiderrecht’ in Rüdiger Veil (ed), Europäisches Kapitalmarktrecht (2nd edn, Mohr Siebeck 2014) para
94; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 137) 799 f; Bühren (n 153) 1175.
101
some authors argue that this in any case constitutes insider dealing,155 which means that the
plan may only be implemented (or the acceptance may only take place) when the information
obtained through the due diligence has become public.156 On the other hand, according to
prevailing opinion, the implementation of the original plan is no violation of Art 8 because the
newly acquired information was not causal for the decision to buy.157 Ultimately, the question
is related to whether Art 9 para 4 is the expression of a general principle, according to which
information obtained in the course of a takeover may only be exploited once it has been made
public.158 This is not the case; the provision is a special provision for takeover bids and mergers,
which leads to a tightening in relation to the general provisions for these (see para 9.051).
Therefore, the general rule applies to stake-building via the stock exchange: If the acquirer
becomes aware of the inside information after it has made the decision on stake-building
(including the core conditions for such an acquisition) this is not prejudicial. Then the acquirer
can carry out the transaction in accordance with the decision taken (but not differently159).
Similarly, the execution of the decision is also permitted if the inside information is disclosed to
the bidder by third parties.160 However, alongside purchases, surpassing the original decision or
made by other persons than the acquirer (such as its managers), are a use of the information.161
(c) Advantage for the trader?

8.079 It is questionable whether this use also requires an advantage (usually present anyway) for
the trader or a third party for whose account the transaction is carried out and/or whether
it is important that another investor has suffered a disadvantage.162 The text itself does not
expressly call for such an advantage or disadvantage, but – as already in the MAD 2003 – only
speaks of ‘use’; that is a striking difference to the Insider Directive 1989, which required ‘taking
advantage of that information’. Hence, it is clear that an intention to enrich is not a necessary
subjective element of insider dealing.163 On the other hand, the term ‘use’ suggests that some
type of benefit must accrue.164 Additionally, in the case law of the CJEU, the advantage of the
trader is an essential element of insider dealing.165
8.080 In accordance with this, insider trading in principle needs an advantage to the trader. Recital
23 clearly refers to such an (unfair) advantage, coupled with a disadvantage for third parties.
Recital 24 also emphasises that the issue should be examined in the light of the purpose of the
MAR, ‘which is to protect the integrity of the financial market and to enhance investor confi-
155 Wackerbarth (n 138) para 37.

156 Grundmann (n 15) Part 6 para 397; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 137) 798
f on the one hand, but 812 on the other hand; similar also Schäfer (n 98) para 14.86.
157 Klöhn, ‘Artikel 8’ (n 2) paras 176ff; Bühren (n 153) 1175; Buck-Heeb (n 16) para 190; Kalss, Oppitz and Zollner (n 36)
§ 21 para 50; Oppitz (n 36) para 2/10.
158 cf Grundmann (n 15) Part 6 para 397.
159 Schuhmacher (n 43) 537; Bühren (n 153) 1175 f.
160 See Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 137) 793.
161 Klöhn, ‘Artikel 8’ (n 2) para 183; Veil, ‘§ 13’ (n 154) para 93; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität
bei M&A’ (n 137) 799 f; Dörte Poelzig, ‘Insider- und Marktmanipulationsverbot im neuen Insiderrecht’ (2016) 14 NZG
528, 533; Kalss, Oppitz and Zollner (n 36) § 21 para 51.
162 Hansen, ‘Article 8’ (n 2) para B.8.71 requires a disadvantage to a market participant.
163 See Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 5; Hopt and Kumpan, ‘§ 107’ (n 2) para 69.
164 See also, albeit from a different starting point, Bachmann (n 1) 50.
165 Case C-391/04 Georgakis [2007] ECR I-03741; see also Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 6; Grundmann (n
15) Part 6 para 383.
102
dence, which is based, in turn, on the assurance that investors will be placed on an equal footing
and protected from the misuse of inside information’.166 The point here is that information
should be factored in by disclosing it and allowing non-insiders to use it as a basis for their deci-
sions, but not by insiders taking advantage of it unilaterally to the detriment of competitors or
other market participants. Non-insiders acting on the basis of new information could otherwise
be forced out of the market (for the purpose see above para 8.03).167
However, this advantage does not have to be proven.168 This already results from the decision 8.081
of the CJEU in the Spector case169 (see below para 8.083). In any case, the proof of such an
advantage is a strong indication that inside information was used. However, if the insider suc-
ceeds in proving that an advantage is lacking, there remains no justification for the prohibition
and hence the presumption of use can be rebutted (see also para 8.089).
Such an advantage need not be accompanied by a concrete disadvantage of the respective 8.082
contractual partner. On the one hand, such a disadvantage would be lacking in many cases
as the contracting party of the insider would often have concluded the contract with someone
else if the insider had not appeared on the market. This is not the point, however, as insider
law wishes to protect the trust in equal access to information; the disadvantaged parties are
therefore not (necessarily) the contractual partners, but other market participants who are not
granted the opportunity to act on the basis of publicly disclosed information. Likewise, the
prohibition of the cancellation of orders (above paras 8.057ff) shows that the issue does not
concern the damage of a specific contractual partner, because this does not exist in the case of
cancellation.
(d) ‘Presumption’ of use

According to the decision of the European Court of Justice in the Spector case170 on the MAD 8.083
2003, use is indicated if the insider has knowledge of the inside information and carries out
a corresponding transaction.171 This has not changed as a result of the MAR, which is sub-
stantiated by Recitals 24 and 25 as well as by Art 9; Recitals 24 and 25 expressly refer to a pre-
sumption, while the MAR otherwise states that the use is ‘implied’ (Recital 24) or under certain
circumstances ‘not deemed’ (Art 9). Anyone who knows, for example, about price-sensitive
client orders and carries out proprietary trading before executing the order is assumed to have
used this knowledge (illegal frontrunning172). The presumption also applies to secondary insid-
ers within the meaning of Art 8 para 4.173
166 See already Spector Photo Group (n 64) para 62.

167 For details see Klöhn, ‘Vorbemerkungen zu Art 7’ (n 2) paras 110ff.
168 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 6; Hopt and Kumpan, ‘§ 107’ (n 2) para 71; Klöhn, ‘Artikel 8’ (n 2) para 119
(in fn 111); Bühren (n 153) 1175.
169 Spector Photo Group (n 64); Hansen, ‘Article 8’ (n 2) para B.8.53.
170 Spector Photo Group (n 64). See e.g., Lars Klöhn, ’The European Insider Trading Regulation after Spector Photo Group’
(2010) 7/2 ECFR 347.
171 See Kalss, Oppitz and Zollner (n 36) § 21 para 37.
172 See Recital 30 and (Austrian) OGH 17.4.2014 – 4 Ob 73/14k [2014].
173 Hansen, ‘Article 8’ (n 2) para B.8.157; Hopt and Kumpan, ‘§ 107’ (n 2) para 69; Klöhn, ‘Artikel 8’ (n 2) para 126; Poelzig
(n 161) 532. Different, however, Bachmann (n 1) 31.
103
8.084 In the correct, albeit controversial, view, this presumption does not concern fault, but causali-
ty.174 This results, among others, from the fact that information only becomes inside informa-
tion if a reasonable investor would probably have used it for an investment decision (Art 7 para
4); hence, one must also expect the insider itself to make use of such information.175 Art 9 on
exemptions from the presumption of use also indicates that the issue is one of causality.
8.085 The exact consequences are disputed. First of all, it is (almost176) undisputed that the presump-
tion must be rebuttable, which already results from the Spector decision and also from Recitals
24, 25 and Art 9.177 If, on the other hand, this were to lead to a genuine reversal of the burden
of proof, this would be questionable, at least in the context of criminal law,178 because it is clear
from Art 3 para 8 CRIM-MAD that the presumption also applies in that context.179 It is true
that, according to the case law of the ECtHR,180 presumptions of guilt are not per se incom-
patible with Art 6 para 2 ECHR, but they must not unduly restrict the possibilities of defence.
However, it is extremely difficult to provide strict proof of the lack of co(!)-causation.
8.086 In my opinion, therefore, one must regard the ‘presumption’ in the sense of the terminology
of the Spector judgment as an easing of the burden of proof and not as a complete reversal:181
It is an empirical proposition that whoever has inside information will normally use it as any
other rational market participant would. However, to bar reliance on this empirical proposition,
it is sufficient to raise justified doubts about the causal relationship even if strict proof is not
available.182
8.087 What is correct for criminal law purposes, however, should also apply within the context of
administrative sanctions.183 First, a diverging interpretation according to the type of sanctions
should be avoided if possible. Secondly, the consequences under administrative law pursuant
to Art 30 are of such weight that the application of criminal law principles seems appropriate.
(e) Absence of use

8.088 According to the CJEU’s Spector ruling,184 the presumption of use is rebuttable (above para
8.086). Art 9 contains various possibilities for such a rebuttal. However, these are not con-
clusive, and any other proof that the inside information was not causal for the transaction is
sufficient (see para 9.002).185 This follows already from the fact that otherwise the presumption
of ‘use’ could not be sufficiently rebutted for the purposes of Art 6 para 2 ECHR. In addition
174 See Bachmann (n 1) 30ff; Klöhn, ‘Artikel 8’ (n 2) para 126; Zetzsche (n 10) § 7C para 143; Hopt and Kumpan,
‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 137) 777; different, however, Hansen, ‘Article 8’ (n 2) para
B.8.157.
175 Hansen, ‘Article 8’ (n 2) paras B.8.156 f; Bachmann (n 1) 34.
176 Different, however, Bachmann (n 1) 34; 33ff.
177 See e.g., Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 6.
178 See e.g., OLG Wien 12.1.2012 – 23 Bs 192/11w [2012].
179 See Poelzig (n 161) 532.
180 Salabiaku v France, App no 10519/83 (ECtHR, 7 October 1988) paras 28 f; Janosevic v Sweden, App no 34619/97
(ECtHR, 23 July 2002) paras 101, 104.
181 Klöhn, ‘Artikel 8’ (n 2) para 147; Buck-Heeb (n 16) para 170; Sindelar (n 88) para 82.
183 Klöhn, ‘Artikel 8’ (n 2) para 148 (but see also para 146).
184 Spector Photo Group (n 64).
185 Hansen, ‘Article 9’ (n 103) para B.9.25; Klöhn, ‘Artikel 8’ (n 2) para 133; Veil, ‘§ 7’ (n 3) para 50.
104
to a ‘rebuttal’ as such, proof that the trader was not aware of the inside information at the time
of the decision on the transaction is sufficient (above paras 8.029ff).
The rebuttal as such is above all possible by credibly showing that no advantage was gained 8.089
from the inside information,186 because then the information was not used, i.e., taken advantage
of. Thus there is no insider dealing if the insider disposes of its shares at the market price in
the knowledge of information that would increase the value,187 or if the information can drive
the price down but the insider buys at market prices.188 Similarly, it is not insider dealing if the
insider buys shares without disclosure, but at conditions where the information is priced in, for
example, by pricing in positive news about the target company in a takeover bid in favour of the
addressees.189 This can also be done via price adjustment clauses.190 All this also applies when
an order is cancelled or modified.191 However, it is of course of no use if the inside information
does not indicate the direction of the price movement (see para 7.027).
In addition to this, some authors hold that insider dealing cannot exist if the conditions of the 8.090
transaction are subject to judicial or administrative control.192 In some jurisdictions, such as
Germany or Austria, this is the case for squeeze-outs or mergers/divisions, where the adequacy
of the remuneration received is subject to court review in specialised proceedings; inter alia,
this review is designed to avoid unequal treatment. However, such reviews only operate ex post,
if triggered at all, and lead to payments only once considerable time has passed. Hence, they
cannot be relied upon to actually deter insider trading and cannot be a proper substitute for its
prohibition. Instead, inside information must be disclosed before such transactions are carried
out.
But even if the insider obtains an advantage, it still can credibly demonstrate that the inside 8.091
information was not used. Generally speaking, there is no insider dealing if knowledge of the
inside information did not cause the transaction to be concluded in its concrete form (in terms
of time, scope and conditions).193 On legal persons, below paras 8.095 f.
Hence, it is sufficient for the insider to present alternative business reasons which attest that 8.092
the transaction was motivated other than by the exploitation of an advantage due to possession
of the information. Hedging against potentially adverse price developments that may result
from the inside information is not a general justification; however, hedging transactions may
be privileged within the framework of an overall plan for a transaction or on the basis of other
considerations.194 The realisation of collateral in the knowledge of negative inside information
is not insider dealing if the timing for such realisation follows legal or business reasons (e.g.,
186 Different, however, Klöhn, ‘Artikel 8’ (n 2) paras 134ff: disadvantage to information traders necessary.
187 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 7; Hopt and Kumpan, ‘§ 107’ (n 2) para 96; Klöhn, ‘Artikel 8’ (n 2) para 151;
Zetzsche (n 10) § 7C para 143.
188 Such were the facts in Georgakis (n 165).
189 See also Georgakis (n 165).
192 Klöhn, ‘Artikel 8’ (n 2) paras 56, 141 f.
193 Klöhn, ‘Artikel 8’ (n 2) paras 139ff.
194 Klöhn, ‘Artikel 8’ (n 2) paras 158ff. See also Hansen, ‘Article 9’ (n 103) para B.9.54.
105
urgent liquidity requirements of the creditor).195 However, in my opinion, the inside informa-
tion must be accordingly priced into the transaction.196
8.093 Similarly, it must suffice for rebuttal to prove that, even though the transaction was concluded
on the basis of inside information advantageous for the insider (or the person for whose account
the transaction was concluded), this inside information did not have any effect on the terms of
the transaction. Because of this, transactions between two parties who both know the inside
information are not insider dealing197 – there is no information asymmetry between the parties
that could influence the conditions of the transaction. In most cases, this concerns face-to-face
transactions outside the stock exchange;198 here, informational parity can also be established by
disclosing the inside information, which disclosure, however, must still be justified in accord-
ance with Art 10. The same must apply if both parties have access to the information, even if
one party has not made use of it.199 Because of this, information obtained by the buyer in the
course of a due diligence review does not lead to insider dealing if it was known to the seller or
if the seller had at least the same access to the information.
8.094 However, such an isolated consideration merely of the other party is not always expedient.
For example, a shareholder can acquire new shares cheaply with knowledge of positive inside
information without this being prohibited vis-à-vis the company because of the same level
of information; however, the other shareholders suffer a dilution.200 Recital 23 allows it to
suffice that ‘third parties’ are affected without limiting this to the contractual partner. This also
corresponds best to the telos of the provision (above para 8.003). Hence, transactions between
parties with the same level of information are a use of inside information if they detrimentally
affect third parties. Because of this, such transactions between parties in possession of the inside
information should not be privileged if they are (exceptionally) executed via the stock exchange
and therefore also influence the stock exchange price.201 In this respect, the CJEU’s Georgakis
decision is not convincing in its reasoning because, although the parties had the same level of
information, the transactions were executed via the stock exchange. The judgment’s result is,
however, in my opinion, correct because the inside information in that case would have driven
the price down, but the parties bought at high prices – therefore, from today's perspective,202
there was at best market manipulation, but not insider dealing.
(f) Legal persons

8.095 In the case of legal persons, it is also questionable whether it is a use of inside information if
one person in the company has knowledge of the inside information while another person
195 See Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 7; Klöhn, ‘Artikel 8’ (n 2) paras 163 f. For a broader exemption Hopt
and Kumpan, ‘§ 107’ (n 2) para 97; Veil, ‘§ 7’ (n 3) paras 95 f.
196 See Zetzsche (n 10) § 7C para 145.
197 Georgakis (n 165) para 38; Spector Photo Group (n 64) para 48; Hansen, ‘Article 8’ (n 2) paras B.8.41ff; Hopt and Kumpan,
‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 137) 778; Klöhn, ‘Artikel 8’ (n 2) paras 143 f, 171 f; Veil, ‘§ 7’ (n
3) paras 45 f; Poelzig (n 161) 533; Kalss, Oppitz and Zollner (n 36) § 21 para 31.
198 Which are covered by the prohibition; see Art 2 para 3.
202 Market manipulation was not prohibited under European law at the time; see Georgakis (n 165) paras 41 f.
106
D. Tipping (para 2)
acts for the legal person or for its account.203 This must be answered in the affirmative.204 Art
9 para 1 shows that in such situations, under certain conditions, there is an exemption to the
presumption that the person has used the inside information. However, such an exemption is
not required unless the knowledge of the one and the actions of the other natural person are
jointly qualified as use of the inside information by the legal person.
Due to the exemption from the presumption of causality for legal persons in Art 9 para 1 this 8.096
does not necessarily constitute prohibited insider dealing on the part of the legal person; see
paras 9.007ff. Additionally, the exemptions in Art 9 are not conclusive, which is why any other
proof that the acting natural person was not aware of the information is sufficient.205 In this
case, even an advantage gained is not prejudicial. Finally, the natural person acting does not
commit insider trading due to the lack of knowledge of the inside information.
D. TIPPING (PARA 2)
1. General
Art 8 para 2 in conjunction with Art 14 lit b extends the prohibition of insider dealing: It is not 8.097
permissible to recommend, on the basis of inside information, that another person buy or sell
the financial instrument concerned or to induce another person to do so206 (so-called ‘tipping’);
cancellation and modification of orders are also covered.207 Para 2 is intended to prevent the
third party from behaving as if it knew the inside information. The provision is of particular
importance for investment advice. It applies to primary insiders and secondary insiders in
accordance with para 4 (see paras 8.012ff).208
It is not required for either the recommendation or inducement that the third party actually 8.098
executes the transaction,209 nor does it have to make a decision to do so.210 The prohibition is
thus intended to prevent the recommendation/inducement itself.211 However, third parties
must at least know of the recommendation or inducement; without such knowledge tipping is
only attempted.212 Nor is it necessary for the insider to gain an advantage from its own recom-
mendation/inducement; altruistic actions are also covered.213
203 See also Hansen, ‘Article 9’ (n 103) paras B.9.24, B.9.30.

204 Klöhn, ‘Artikel 8’ (n 2) para 111; Sindelar (n 88) paras 63 f.
206 The original German language version of Art 8 para 2 incorrectly translated ‘to induce’ to ‘anstiften’, which was remedied
by OJ L 287/320 of 21 October 2016 (‘verleiten’). Unfortunately, the corresponding change in Art 9 para 1 lit b was not
made, which still refers to ‘anstiften’ (see Art 9 para 9.006).
207 This was different under Art 3 lit b MAD 2003.
209 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 12; Jesper Lau Hansen, ‘Article 14: Prohibition of Insider Dealing and of
Unlawful Disclosure of Inside Information’ in Ventoruzzo and Mock (n 2) para B.14.17; Hopt and Kumpan, ‘§ 107’ (n
2) para 74; Kalss, Oppitz and Zollner (n 36) § 21 para 40.
210 Joachim Schelm, ‘§ 9: Empfehlungs- und Verleitungsverbot’ in Meyer, Rönnau and Veil (n 3) paras 23ff.
213 Grundmann (n 15) Part 6 para 386; Hopt and Kumpan, ‘§ 107’ (n 2) paras 74 f.
107
8.099 The passing on of a recommendation is not covered if the party who does so knows that the
recommendation is based on inside information but does not know this inside information.214
This applies in any case as long as the insider is not a primary insider, because secondary insid-
ers are only included if they themselves know the inside information.215
8.100 In investment consulting, the prohibition of recommending is in a tense relationship to con-

tractual and pre-contractual obligations between an adviser and its client. The prohibition
pursuant to para 2 shall take precedence.216
2. Knowledge
8.101 The recommender/inducer has to be in possession of the inside information (para 2). This
means knowledge of the information at the time of the recommendation/inducement and
corresponds to the element of the offence in para 1; see paras 8.029ff.
3. Recommend or induce
8.102 The recommendation or inducement must be addressed to another person.217 The term ‘another
person’ includes natural persons and legal persons, also companies in the same group.218 Above
all, these other persons are non-insiders,219 but also secondary insiders who negligently do not
know that they have inside information. If an employee induces another employee of the same
company, who then acts, a distinction must be made: The inducing employee violates para 2,220
but at the company level, the knowledge of one is aggregated with the actions of the other (para
8.095 above), which is why the company directly violates para 1.
8.103 It does not constitute insider dealing if the recommendation/inducement is made publicly;221
in this case, the privileged treatment of individual recipients is lacking. This must be different,
however, if only individual recipients are aware that the party publicly recommending/inducing
has inside information; under such circumstances, undesirable information asymmetry on the
market exists.
8.104 The party recommending/inducing does not have to point out that it has inside information,222
just as it does not have to disclose the inside information to the tippee.223 Even if it so discloses
in the course of a recommendation/inducement, the elements of the offence of para 2 are
fulfilled,224 although this is also an unlawful disclosure for the purposes of Art 10. This may be
214 See also Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 14.

215 Grundmann (n 15) Part 6 para 377, 383, 387.
216 Kalss, Oppitz and Zollner (n 36) § 21 para 58; see also (Austrian) OGH 24.1.2002 – 8 Ob 284/01z [2002].
217 The German language version uses the plural ‘Dritte’. As the English language version shows, however, it is also suffi-
cient to induce just one person.
218 Schelm (n 210) para 8; Buck-Heeb (n 16) para 213.
219 Schelm (n 210) para 8; Zetzsche (n 10) § 7C para 147.
220 Schelm (n 210) para 8.
222 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 12; Hopt and Kumpan, ‘§ 107’ (n 2) para 75.
223 Kalss, Oppitz and Zollner (n 36) § 21 para 40; Buck-Heeb (n 16) para 214.
108
D. Tipping (para 2)
important if national law stipulates different sanctions for tipping and for disclosure; presuma-
bly, the more stringent sanctions will apply.
The recommendation/inducement must be aimed at the third party engaging in insider dealing 8.105
as defined in para 1;225 see above paras 8.042ff. The mere recommendation/inducement not to
acquire or not to dispose of a financial instrument is therefore not covered,226 even if it is dis-
closed that the person recommending or inducing has inside information,227 unless this involves
the cancellation of an order. Normally, the recommendation by an investment adviser to its
client not to sell does not constitute a hidden recommendation to buy, unless the circumstances
indicate otherwise, especially if the client does not hold any shares.228 The text of Art 3 lit b of
the MAD 2003, unlike the text of the MAR, also covered the recommendation/inducement
to have financial instruments acquired or disposed of by a third party; nevertheless, in my
opinion, this is still covered, because it is also a recommendation for an (indirect) acquisition
and a corresponding disposal.
According to the wording of para 2 lit a and b, the recommendation/inducement must be 8.106
directed at financial instruments, while emission allowances are not mentioned. Nevertheless,
some authors argue that, according to the provision’s telos, emission allowances are also includ-
ed.229 However, for the purposes of criminal law and the considerable administrative fines
foreseen in Art 30, the statutory wording cannot be exceeded by interpretation. There are few
arguments for a different interpretation in other regulatory contexts. Hence, recommendations
for the acquisition or disposal of emission allowances are, in my opinion, not covered.
‘Recommendation’ means a recommendation to engage in insider dealing, with which the exe- 8.107
cution is presented as advantageous for the tippee.230 This does not include cases in which the
insider uses a third party to the insider’s own advantage;231 this is acquiring or disposing indi-
rectly. The recommendation must be accessible to the tippee without significant difficulties.232
It must be the insider’s own recommendation. The passing on of a third-party recommendation
(where that third party is not an insider) by the insider is not an offence; this is not covered by
Art 10 para 2 either, because such a recommendation is not based on inside information. The
situation is different if the insider adopts the third-party recommendation as its own. However,
if the insider passes on a third-party recommendation or if there is no recommendation because
the insider, for example, only generally represents a company as positive, there may still be
inducement.233 For this reason, a precise definition of the term recommendation and a more
detailed discussion of indirect recommendations is probably not necessary.
225 Naturally apart from the use of the information which it does not have.
226 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 11; Schelm (n 210) para 15; Kalss, Oppitz and Zollner (n 36) § 21 paras 40,
59.
228 Schelm (n 210) para 15; see also Grundmann (n 15) Part 6 para 386; Buck-Heeb (n 16) para 218; more demanding Kalss,
Oppitz and Zollner (n 36) § 21 para 60; Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 11.
230 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 12; Hopt and Kumpan, ‘§ 107’ (n 2) para 75; Klöhn, ‘Artikel 8’ (n 2) para
225.
231 Different, however, Buck-Heeb (n 18) para 357.
109
8.108 ‘Induce’ is the broader term and includes all actions that are intended to influence another
person to acquire or dispose of financial instruments or to cancel or modify an order.234
Inducement can occur by contact with the third party, but also, for example, by deliberately
leaving order confirmations lying around so that the third party can take note of them.235
Actual perusal is, in my opinion, necessary; it is not sufficient that perusal is merely possible.236
However, this may constitute an attempt at inducement.
8.109 Admittedly, not every evaluative statement about an issuer by an insider is inducement within
the meaning of para 2. The basic postulate must always be that the ultimate objective of the
person acting is decisive:237 Is the statement meant to induce the third party to engage in insider
dealing? This can only be assessed by considering the overall circumstances under which the
statement was made.
4. On the basis of inside information
8.110 According to para 2 lit a and b, the recommendation/inducement must be based on inside
information. As with insider dealing under para 1, this is to be understood as a causality crite-
rion.238 The recommendation/inducement must therefore, in my opinion, be in line with the
inside information. Anyone with knowledge of value-enhancing information who recommends
selling is not acting illegally, because the recommendation/inducement is not based on the
inside information but runs counter to it. This must also apply if the recommendation/induce-
ment in this situation is intended to provide a pecuniary advantage to a known buyer as this is
not covered by the purpose of the norm.
8.111 As in the case of the prohibition of acquisition or disclosure (above paras 8.083ff), some authors
also argue for para 2 that it is presumed that the person who is aware of inside information
has made the recommendation on its basis; the burden of proof should therefore shift.239 If one
understands this as an easing of the burden of proof and not as a complete reversal (according to
para 8.086), this is a correct understanding.240 It is true that the person recommending, unlike
in the case of transactions for his/her own account, does not derive any direct advantage from
the insider dealing; however, when making the recommendation, the person recommending
will, as a rule, take into account inside information that he/she knows. To refute the empirical
proposition that whoever has inside information will normally use it, however, it is sufficient to
raise plausible doubts as to the causality of the inside information.
8.112 Pursuant to Art 9 para 5, a person who merely executes his/her own purchase decision does not
act illegally; see paras 9.068ff. This does not change the fact that the purchase decision itself
234 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 12; Hopt and Kumpan, ‘§ 107’ (n 2) para 74; Klöhn, ‘Artikel 8’ (n 2) para
220; Buck-Heeb (n 16) para 221.
235 Klöhn, ‘Artikel 8’ (n 2) para 222; Schelm (n 210) para 21.
236 Different, however, Schelm (n 210) paras 27 f.
237 Schelm (n 210) para 17.
238 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 13; Buck-Heeb (n 16) para 212; also Klöhn, ‘Artikel 8’ (n 2) para 236.
239 Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 13; Hopt and Kumpan, ‘§ 107’ (n 2) para 76; Klöhn, ‘Artikel 8’ (n 2) paras
237ff.
240 See also Schelm (n 210) paras 11ff.
110
E. Liability of the tippee (para 3)
can be inside information. Those who recommend transactions to third parties on the basis
of their own purchase decision is, in accordance with the provisions of para 2, acting illegally.
5. Legal persons
As in the case of insider dealing pursuant to para 1, legal persons can also recommend or 8.113
induce. This requires that the legal person has knowledge of the inside information; see above
paras 8.034ff. The actions of a natural person must also be attributed to the legal person; see
above paras 8.063ff.
For legal persons, the causality criterion (‘on the basis of that information’) raises the question 8.114
of what applies if one employee or other agent of the company knows the inside information
but another one recommends/induces. For the prohibition of insider dealing pursuant to para
1, attribution follows due to Art 9 para 1 (above para 8.095); Art 9 para 1, however, does not
apply to the recommendation prohibition pursuant to para 2 (also not analogously).241 This is
a decisive argument and, as a result, the recommendation prohibition can only be violated by
legal persons if the person making the recommendation also knows the inside information.242
However, if natural persons, with knowledge of the inside information, induce an employee
of a legal person who does not know the inside information to make a recommendation, the
instigator may be an accessory according to the applicable national criminal law.
E. LIABILITY OF THE TIPPEE (PARA 3)
1. General
Insider dealing in the sense of para 3 is the use of a recommendation or inducement if the 8.115
recipient of the tip (or tippee) knows or must have known that it is based on inside information.
Such use is prohibited under Art 14 lit a. This prohibition of exploitation was newly introduced
by the MAR and is supplemented by the disclosure prohibition in accordance with Art 10 para
2 (see paras 10.032ff). It is also intended to prevent the tippee from behaving as if it knew the
inside information regularly, this is preceded by a prohibited recommendation or inducement.
2. Use
The use of a recommendation or inducement is prohibited but not further described in para 3. 8.116
In accordance with para 1, this use can only consist of the acquisition or disposal of a financial
instrument or the cancellation or modification of an order;243 see above paras 8.042ff.
A recommendation or inducement in the sense of para 2 must be used, which must have inside 8.117
information as its basis; see above paras 8.110ff. For use, the person acting must also be aware
of the recommendation/inducement. Generally, a recommendation not to sell is not in and of

243 Hansen, ‘Article 8’ (n 2) para B.8.116; Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 14; Klöhn, ‘Artikel 8’ (n 2) para 248.
111
itself an inducement to buy (see above para 8.105); the circumstances may indicate otherwise.
Similarly, in most situations a recommendation not to sell is not used if the tippee decides to
buy.244
8.118 Use also means that the recommendation/inducement must be causal for the transaction.245 It
is unclear whether there is a presumption of causality246 as in the case of insider dealing in the
sense of para 1 and the recommendations/inducements in the sense of para 2. In my opinion,
this is to be answered in the affirmative.247 If the tippee knows that the tip is based on inside
information, there is a strong case for a presumption that this knowledge was causal for the
transaction;248 the tippee must then raise plausible doubts about this causality. However, if the
tippee does not know this (negligently), it is still in line with life experience that every recom-
mendation for a transaction has at least partially contributed to the conclusion of the transac-
tion, even though it may not be the only factor. Since contributory causation is sufficient (above
para 8.066), there is a corresponding presumption, even in the case of negligent ignorance of
the fact that the recommendation/inducement is based on inside information.
3. Knowledge
8.119 Para 4 does not apply to the liability of the tippee, although the provision’s wording suggests
that it regulates the personal scope of application for the whole of Art 8. Rather, para 3 itself
regulates its scope of application; the recipient of the tip does not have to know the inside
information, but only knows or ought to know that the recommendation is based on such.249
8.120 The recipient of the tip knows that the recommendation/inducement is based on inside
information if it has understood that the recommendation/inducement is the result of special
knowledge relevant to the share price. A more detailed legal understanding is not required.250
8.121 Negligent ignorance is also covered, which is important because the recommendation/induce-
ment does not necessarily disclose that it is based on inside information (above para 8.104).
Para 4 only covers knowledge of the basis of the recommendation; a person who possesses the
information when trading but negligently does not know that it is inside information, commits
the offence of insider dealing pursuant to para 1 as a secondary insider.
8.122 Slight negligence251 is sufficient. Recital 26 focuses – albeit in a different context – on what
a normal, reasonable person should have known under the given circumstances. This indicates
that the requirements of due diligence are objective and depend on the position of the offender,
in particular taking into account special knowledge. The more likely it is that the recommenda-
tion/inducement is based on inside information, the higher the due diligence requirements.252
244 cf, however, Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 15.

246 Against this, however, Klöhn, ‘Artikel 8’ (n 2) para 253.
247 See Gerner-Beuerle, ‘Article 8 MAR’ (n 1) para 14.
249 See Klöhn, ‘Artikel 8’ (n 2) paras 245 f.
252 For details see Klöhn, ‘Artikel 8’ (n 2) paras 259 f.
112
E. Liability of the tippee (para 3)
4. Legal persons
The definition and prohibition according to Art 14 lit a also applies to legal persons. For 8.123
this purpose, the actions of a natural person must be attributed to it; see above paras 8.063ff.
This necessity of attribution also applies to the knowledge (or negligence in not knowing) of
a natural person (above paras 8.034ff).
However, as with the prohibition pursuant to para 2 (above para 8.114), it is required that 8.124
the person acting also knows or ought to have known that the recommendation is based on
inside information. An aggregation of the knowledge of one person with the actions of another
natural person does not take place.253 This is due to the fact that the rebuttal possibility pursuant
to Art 9 para 1 does not apply to liability for recommendations. That provision addresses the
presumption that the acquirer/seller has used the inside information, while the case in question
requires knowledge that inside information was the basis of a recommendation/inducement,
which is not a topic of Art 9 para 1 at all. If, however, a natural person with such knowledge
should induce a non-knowing employee of the legal person to acquire or dispose of financial
instruments, the inducer can be an accessory if so foreseen under national criminal law.
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Bachmann G, Das Europäische Insiderhandelsverbot (De Gruyter 2015)
Barth T, ‘Zur Wissenszurechnung von Aufsichtsratswissen’ (2016) GesRZ 319
Buck P, Wissen und juristische Person (Mohr Siebeck 2001)
Bühren L, ‘Auswirkungen des Insiderhandelsverbots der EU-Marktmissbrauchsverordnung auf
M&A-Transaktionen’ (2017) 30 NZG 1172
Davies P and Worthington S, Gower: Principles of Modern Company Law (10th edn, Sweet & Maxwell
2016)
Enriques L and others, ‘Corporate Law and Securities Markets’, in Armour J and others, The Anatomy of
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Market Abuse Regulation (Oxford University Press 2017)
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H-J and Lwowski H-J (eds), Bankrechts-Handbuch (5th edn, C. H. Beck 2017)
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Klöhn L, ‘The European Insider Trading Regulation after Spector Photo Group’ (2010) 7/2 ECFR 347
Klöhn L, ‘Die (Ir-)Relevanz der Wissenszurechnung im neuen Recht der Ad-hoc-Publizität und des
Insiderhandelsverbots’ (2017) 33 NZG 1285
253 Klöhn, ‘Artikel 8’ (n 2) paras 255, 261.
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114
ARTICLE 9
LEGITIMATE BEHAVIOUR
Martin Winner
1. For the purposes of Articles 8 and 14, it shall not be deemed from the mere fact that
a legal person is or has been in possession of inside information that that person has used
that information and has thus engaged in insider dealing on the basis of an acquisition or
disposal, where that legal person:
(a) has established, implemented and maintained adequate and effective internal
arrangements and procedures that effectively ensure that neither the natural person
who made the decision on its behalf to acquire or dispose of financial instruments
to which the information relates, nor another natural person who may have had an
influence on that decision, was in possession of the inside information; and
(b) has not encouraged, made a recommendation to, induced or otherwise influenced the
natural person who, on behalf of the legal person, acquired or disposed of financial
instruments to which the information relates.
a person is in possession of inside information that that person has used that information
and has thus engaged in insider dealing on the basis of an acquisition or disposal where that
person:
(a) for the financial instrument to which that information relates, is a market maker or
a person authorised to act as a counterparty, and the acquisition or disposal of finan-
cial instruments to which that information relates is made legitimately in the normal
course of the exercise of its function as a market maker or as a counterparty for that
financial instrument; or
(b) is authorised to execute orders on behalf of third parties, and the acquisition or dis-
posal of financial instruments to which the order relates, is made to carry out such an
order legitimately in the normal course of the exercise of that person’s employment,
profession or duties.
a person is in possession of inside information that that person has used that information
and has thus engaged in insider dealing on the basis of an acquisition or disposal where
that person conducts a transaction to acquire or dispose of financial instruments and that
transaction is carried out in the discharge of an obligation that has become due in good
faith and not to circumvent the prohibition against insider dealing and:
(a) that obligation results from an order placed or an agreement concluded before the
person concerned possessed inside information; or
115
Article 9 LEGITIMATE BEHAVIOUR
(b) that transaction is carried out to satisfy a legal or regulatory obligation that arose,
before the person concerned possessed inside information.
4. For the purposes of Article 8 and 14, it shall not be deemed from the mere fact that a person
is in possession of inside information that that person has used that information and has
thus engaged in insider dealing, where such person has obtained that inside information
in the conduct of a public takeover or merger with a company and uses that inside infor-
mation solely for the purpose of proceeding with that merger or public takeover, provided
that at the point of approval of the merger or acceptance of the offer by the shareholders
of that company, any inside information has been made public or has otherwise ceased to
constitute inside information.
This paragraph shall not apply to stake-building.
5. For the purposes of Articles 8 and 14, the mere fact that a person uses its own knowledge
that it has decided to acquire or dispose of financial instruments in the acquisition or dis-
posal of those financial instruments shall not of itself constitute use of inside information.
6. Notwithstanding paragraphs 1 to 5 of this Article, an infringement of the prohibition of
insider dealing set out in Article 14 may still be deemed to have occurred if the competent
authority establishes that there was an illegitimate reason for the orders to trade, transac-
tions or behaviours concerned.
OVERVIEW
A. INTRODUCTION 9.001 F. TAKEOVER BIDS (PARA 4) 9.049

B. COMPLIANCE OF LEGAL PERSONS (PARA 1) 9.007 1. General 9.049
1. General 9.007 2. Takeovers, mergers 9.053
2. Genuine exemption 9.011 3. Making information public 9.058
3. Knowledge 9.013 4. Consequences 9.061
4. Compliance organisation 9.014 5. Limitations 9.065
5. No influence 9.020 G. USE OF OWN DECISION (PARA 5) 9.068
6. Consequences 9.025 1. General 9.068
C. MARKET MAKER AND COUNTERPARTIES (PARA 2. Permitted transactions 9.070
2 LIT A) 9.029 3. Acquisition by third parties 9.073
D. EXECUTION OF ORDERS (PARA 2 LIT B) 9.034 H. COUNTER-EXEMPTION (PARA 6) 9.075
E. DISCHARGE OF OBLIGATIONS (PARA 3) 9.041
A. INTRODUCTION
9.001 For the purposes of Art 8 para 1, it is assumed that the person who knows inside information
also uses it when acquiring or disposing of shares, or when cancelling or modifying orders (see
paras 8.083ff). However, this presumption is rebuttable. Art 9 contains instances of legitimate
behaviour, by which the insider can rebut that presumption. These exceptions only apply to
the prohibition of insider dealing in accordance with Art 8 para 1 but do not apply to the pro-
116
A. Introduction
hibitions of recommendations/inducements pursuant to Art 8 para 2 and of onward disclosure

in accordance with Art 10 para 1.1
However, Art 9 does not contain a conclusive enumeration of the possibilities for rebuttal.2 Any 9.002
other form of rebuttal is possible (see paras 8.087ff). The prerequisite of Art 9 is that the person
acting knows the inside information.3
On the one hand, the provision aims to clarify the exemptions to the presumption of use which 9.003
already exist according to general principles and thus is designed to increase legal certainty.4
These cases include para 2 lit b (paras 9.034ff), para 3 (paras 9.041ff) and para 5 (paras 9.068ff).
However, if a transaction is covered by the wording of these provisions, this does not mean that
there is no insider dealing under any circumstances; the authority can still provide evidence
that the inside information was used in the individual case.5 On the other hand, paras 1 (paras
9.007ff) and 2 lit a (paras 9.029ff) have more normative content, as they contain genuine
exemptions where an exemption applies even though the information is used. Finally, in my
understanding, para 4 restricts the general possibility to rebut the presumption of use for public
takeover bids (paras 9.049ff).6 Para 6 contains an unclear counter-exception (para 9.075).
The provision does not contain an exemption to the prohibition of insider dealing in Art 14.7 9.004
Rather, it concerns one of the elements of insider dealing, namely the use of inside informa-
tion. Unlike a genuine exemption,8 it is therefore not to be interpreted restrictively.9 Essential
guidance for the interpretation of Art 9 is contained in Recitals 29 to 31.
The burden of proving that the conditions for the exemption are met is an issue of national law. 9.005
Under most systems of civil procedure, it rests with the person who invokes it.10 Of course, this
1 Stefan Grundmann, ‘Band 11 Bankvertragsrecht - Teilband 1 Investmentbanking I’ in Claus-Wilhelm Canaris, Mathias

Habersack and Carsten Schäfer (eds), Staub Handelsgesetzbuch Großkommentar (5th edn, De Gruyter 2017) Part 6 para
400.
2 Petra Buck-Heeb, ‘§ 8: Insiderrecht’ in Heinz-Dieter Assmann, Rolf Schütze and Petra Buck-Heeb (eds), Handbuch
des Kapitalanlagerechts (5th edn, C. H. Beck 2020) para 348; Klaus J Hopt and Christoph Kumpan, ‘§ 107: Insider-
und Ad-hoc-Publizitätsprobleme’ in Herbert Schimansky, Hermann-Josef Bunte and Hans-Jürgen Lwowski (eds),
Bankrechts-Handbuch (5th edn, C. H. Beck 2017) para 78; Lars Klöhn, ‘Ad-hoc-Publizität und Insiderverbot im
neuen Marktmissbrauchsrecht’ [2016] AG 423, 433; Lars Bühren, ‘Auswirkungen des Insiderhandelsverbots der
EU-Marktmissbrauchsverordnung auf M&A-Transaktionen’ (2017) 30 NZG 1172, 1175; Dörte Poelzig, ‘Insider- und
Marktmanipulationsverbot im neuen Insiderrecht’ (2016) 14 NZG 528, 533.
3 Jesper Lau Hansen, ‘Article 9: Legitmate Behaviour’ in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse
Regulation (Oxford University Press 2017) para B.9.03.
4 Carsten Gerner-Beuerle, ‘Article 9 MAR: Legitimate Behaviour’ in Matthias Lehmann and Christoph Kumpan (eds),
European Financial Services Law (Beck – Hart – Nomos 2019) paras 1, 4.
5 Frank A Schäfer, ‘Kapitalmarktbezogene Verhaltenspflichten’ in Reinhard Marsch-Barner and Frank A Schäfer
(eds), Handbuch börsennotierte AG (4th edn, Otto Schmidt 2018) para 14.49; cf, however, Sebastian Sieder, ‘Legitime
Handlungen nach der Marktmissbrauchsverordnung (MAR)’ [2017] ZFR 171, 174: If Art 9 applies, a transaction does
not constitute insider dealing, which does not sit well with Art 9 para 6.
6 Similar Lars Klöhn, ‘Artikel 9: Legitime Handlungen’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck
2018) para 2.
7 See Hansen, ‘Article 9’ (n 3) paras B.9.06ff, especially para B.9.12.
8 See Case C-384/02 Grøngaard and Bang [2005] ECR I-09939 para 27.
117
does not apply in criminal law, where that burden typically rests with the prosecutor. Overall,
proper documentation is advisable in order to ensure that Art 9 can be invoked in a reliable
manner.11
9.006 Development: Art 9 is, for the most part, a new provision; only para 3 had a parallel provision
in Art 3 para 3 of MAD 2003. However, Recitals 18, 24, 29 and 30 of MAD 2003 contained
interpretative guidance in the sense of Art 9 paras 2, 4 and 5 MAR. Art 9 is in the original
version without subsequent changes.12
B. COMPLIANCE OF LEGAL PERSONS (PARA 1)
1. General
9.007 Para 1 contains a rebuttal of the presumption of use for all legal persons, not only for credit
institutions or securities dealers or for the issuers themselves.13 A prerequisite for the rebuttal
is both that the compliance organisation meets certain requirements (lit a) and that ‘the legal
person’ does not influence the natural person in the individual case (lit b). The provision offers
a balance for the fact that the behaviour of the natural person is often attributed to the legal
person (see paras 8.063ff) and is especially important for, albeit not limited to, financial insti-
tutions.14 In addition, insider dealing can also exist if not the acting natural person, but another
natural person, attributable to the legal person, has knowledge of the inside information,15
because knowledge and behaviour are aggregated in the case of legal persons (see para 8.095).
For natural persons, the exemption under Art 9 para 1 does not apply.16
9.008 According to its wording, Art 9 para 1 does not apply to prohibitions other than those under
Art 8 para 1; for details on these prohibitions see paras 8.113ff and 8.123ff. On the one hand,
this is due to the fact that the violation of the prohibition on recommendations does not (as
Art 9 para 1 requires) concern the acquisition or disposal of financial instruments; on the
other hand, the liability of the tippee does not involve the tippee’s knowledge of the inside
information, which is required under Art 9 para 1, but rather the knowledge that the recom-
mendation received is based on such information. Neither can one apply Art 9 para 1 to such
cases by analogy. Rather, in those contexts, there is no aggregation of knowledge and behaviour
of different natural persons in one legal person in the first place, which is why the analogous
application of para 1 is superfluous.
11 Klaus J Hopt and Christoph Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (2017) 46/6 ZGR 766, 791.
12 In particular, the wording of Art 9 para 1 lit b of the German language version was not changed parallel to Art 8 paras
2 and 3, which is why Art 9 still refers to ‘anstiften’ (incite); this is an editorial mistake and must be read as ‘verleiten’
(induce) in accordance with Art 8.
13 Grundmann (n 1) Part 6 para 401; Dirk Zetzsche, ‘§ 7: Europäisches Kaptialmarktrecht – C. Marktintegrität /
Marktmissbrauchsrecht’ in Martin Gebauer and Christoph Teichmann (eds), Enzyklopädie Europarecht Band 6 -
Europäisches Privat- und Unternehmensrecht (Nomos 2016) § 7C para 150.
14 Gerner-Beuerle (n 4) para 5; Sieder (n 5) 174.
118
B. Compliance of legal persons (para 1)
Art 9 para 1 does not oblige legal persons to introduce a compliance organisation, but such an 9.009
organisation can help (all) legal persons not to engage in insider dealing. Such an obligation
to take appropriate organisational measures may attach, however, to listed entities according
to national listing rules. Comparable compliance obligations for investment firms result from
Art 16 para 2 MiFID II in conjunction with Arts 28ff Implementing Regulation 565/2017,
but also from Art 16 para 3 MiFID II in conjunction with Arts 33ff Implementing Regulation
565/2017.
The fulfilment of these or similar rules is not a prerequisite for the rebuttal under Art 9 para 1. 9.010
Neither is the fulfilment of other compliance obligations under the MAR (e.g., control of the
prohibition of onward disclosure or recommendation, but also Art 16 and Art 18) by the legal
person a prerequisite for the applicability of Art 9 para 1.17 This has nothing to do with the
prohibition of insider dealing as regulated here.
2. Genuine exemption
This ‘compliance defence’ helps the legal person even if, in individual cases, the inside informa- 9.011
tion did have an influence on the transaction.18 This is shown beyond doubt by sentence 3 of
Recital 30 when it states that market abuse by natural persons on behalf of a legal person should
not be attributed to the legal person if the legal person has taken all reasonable measures to
prevent such market abuse. This shows that, under para 1, even if a natural person, who is aware
of the inside information, acts, the action cannot be attributed to the legal person;19 nothing
else can apply if one natural person with knowledge of the inside information influences
another (see also paras 9.020ff).20 In such a case, the acting natural person at most violates Art
8 in connection with Art 14. The legal person itself is only liable for organisational negligence,
i.e., for not fulfilling the requirements of para 1.
Thus, in order to avail itself of the rebuttal, the legal person does not have to prove that the 9.012
knowledge did not have any concrete effects on the transaction attributable to it. Proof of rea-
sonable precautions is sufficient even if they have failed in the individual case.21 This, of course,
provides strong incentives for the establishment of a compliance organisation. In practice, this
means, amongst other things, that credit institutions can continue trading even if, for example,
the investment department is working on a transaction which concerns the corresponding
financial instrument.22

18 See Gerner-Beuerle (n 4) para 5; Gregor Bachmann, Das Europäische Insiderhandelsverbot (De Gruyter 2015) 52;
Rüdiger Veil, ‘§ 7: Insiderhandelsverbot’ in Andreas Meyer, Thomas Rönnau and Rüdiger Veil (eds), Handbuch zum
Marktmissbrauchsrecht (C. H. Beck 2018) para 57.
19 See also Art 8 para 2 CRIM-MAD; Klöhn, ‘Artikel 9’ (n 6) paras 10, 74. Different, however, Jesper Lau Hansen, ‘Article
8: Insider Dealing’ in Ventoruzzo and Mock (n 3) para B.8.138; Hansen, ‘Article 9’ (n 3) B.9.31.
20 Probably different Hopt and Kumpan, ‘§ 107’ (n 2) para 80 and Zetzsche (n 13) § 7C para 150.
119
3. Knowledge
9.013 Para 1 states that ‘the mere fact that a legal person is or has been in possession of inside
information’ does not imply, under certain conditions, that the information is used. Thus, it is
a preliminary question under which circumstances knowledge of a natural person is attributed
to a legal person; see paras 8.034ff.23 Furthermore, it follows from para 1 that it is irrelevant
if knowledge was available in a legal person but was lost again at the relevant time of action.
It is apparently sufficient for attribution that the legal person ‘has been’ in possession of the
information, which also applies to natural persons (see para 8.032).
4. Compliance organisation
9.014 A prerequisite according to para 1 lit a is that the legal person has established a compliance
organisation. First, this organisation has to ensure that a natural person acting on behalf of
a legal person is not in possession of inside information;24 private trading activities of employees
are, as a rule, not attributable to the legal person (see paras 8.063ff) and therefore do not have
to be covered.25 Secondly, the compliance organisation must prevent that natural persons with
such knowledge can influence the decision of the acting natural person; here, too, it is only
a question of influencing natural persons that can be attributed to the organisation.26 Thus, on
the one hand, it is a matter of the prevention of information flows, on the other hand, of the
prevention of influence.27 Hence, para 1 lit a lays down the objectives to be pursued, while the
concrete measures are left to the discretion of the company.28 However, lit a still provides some
further pointers:
9.015 The compliance organisation must consist of ‘arrangements and procedures’. ‘Arrangements’
refers to formalised, general and abstract requirements, namely in the form of compliance
guidelines; a mere informal organisation with which the objectives in lit a are to be achieved
is not sufficient. Typically, and at least in the case of legal persons that frequently come into
contact with inside knowledge, these arrangements include organisational measures such as
the creation of ‘Chinese walls’, which aim at ensuring that the inside information remains in
separate sub-areas (legal department, M&A teams, credit department) and that this informa-
tion is not disclosed to those who buy or sell financial instruments (e.g., trading department or
asset management).29 Special attention should be paid to staff turnover between such separate
confidentiality areas. Since inside information can also emerge within the trading department
(e.g., large customer orders), such arrangements must also prohibit onward disclosure within
confidentiality areas, especially in light of the fact that the organisational separation may be
effective only to a limited extent.30 Similarly, it is necessary to establish prohibitions and pro-
cedural rules to prevent persons with inside information from influencing trading decisions.
23 This is not covered by Art para 1; cf, however, Veil (n 18) § 7 para 54.
24 i.e., having knowledge of this information.
25 Grundmann (n 1) Part 6 para 404; Klöhn, ‘Artikel 9’ (n 6) para 32.
28 Grundmann (n 1) Part 6 para 404; Veil (n 18) § 7 para 55.
29 See Gerner-Beuerle (n 4) para 5; Hopt and Kumpan, ‘§ 107’ (n 2) para 80.
120
B. Compliance of legal persons (para 1)
‘Procedures’ addresses the (equally necessary) issue of enforcement of these arrangements.31 9.016
Therefore, the measures must also define responsibility for the fulfilment of compliance
obligations. This can happen through an independent compliance department,32 which must
be decoupled from business success and adequately funded.33 Whether this is a mandatory
requirement depends on the size and exposure of the legal person. These procedures must
not only include the prevention of future violations, but also the clarification, analysis and
sanctioning of violations that have occurred. For this reason, it will, as a rule, also be necessary
for the Compliance Officers to collect inside information (watch lists) and align it with trading
activities or to prohibit certain transactions (restricted/stop lists).34
The planned measures must be ‘adequate’ in accordance with lit a. Thus, the requirements 9.017
depend on the specific circumstances, for example, the size of the company, its area of activity,
but also on past events.35 It should be noted that Art 9 para 1 covers not only securities dealers
or listed companies, but all legal persons; this results in very different requirements. Thus,
smaller companies will not have to set up confidentiality areas or their own compliance depart-
ment but will be allowed to restrict themselves to procedural rules.
Arrangements and procedures must be ‘effective’ and prevent the use of inside information 9.018
‘effectively’ (lit a). This does not mean that each individual case must be prevented, because
para 1 is precisely about the exclusion of liability for such individual cases.36 Rather, the view ex
ante is decisive, which means that the unsuitability of the system may not be inferred from the
infringement that has occurred during the ex post judicial review (problem of hindsight bias).37
The compliance system must be established, implemented and maintained (lit a). Compliance 9.019
guidelines that are not put into practice are therefore not sufficient. The implementation
of confidentiality areas may for example, require spatial measures or limited access to server
content.38 In any case it is also necessary to inform the employees of the legal person (regu-
larly) about the compliance organisation, its purpose and the resulting obligations. Since the
compliance system has to be adequate and effective at the respective time of action, it has to be
regularly adapted to changing requirements.39
5. No influence
Pursuant to lit b, the legal person may not, in a specific case, encourage, make a recommenda- 9.020
tion to, induce, or otherwise influence the natural person that has acted. It is obvious that the
provision does not relate to organisational requirements, but to the concrete individual case.

34 Grundmann (n 1) Part 6 paras 405ff.
37 Klöhn, ‘Artikel 9’ (n 6) paras 59ff.
121
9.021 ‘Recommend’ and ‘induce’ are to be understood as in Art 8 para 2 (paras 8.106ff), ‘encourage’ is
an instruction for action and ‘influence’ probably covers cases in which the inside information
becomes causal for the transaction, although the influencing party had no intention of induc-
ing the person to execute the transaction.40 It is not necessary for the acting natural person to
understand that the influence is due to the fact that inside information is present.41
9.022 The encouragement, or similar, may not originate from the legal person. What this means in
concrete terms is unclear. Under a broad interpretation all employees or all persons under the
legal person’s control could be attributed to the legal person. But then, the provision would be
practically meaningless, because it would only apply if there is no influence by employees, etc.,
with knowledge of inside information and under such circumstances the presumption of use
is already disproved according to general principles (see paras 8.088ff). Art 9 para 1 would at
best be superfluous and at worst, due to the additional requirements in lit a, even counterpro-
ductive.42 This would also have the curious consequence that, due to the lack of influence by
another person, the exemption could be applied if the acting employee himself had knowledge
of the inside information (above para 9.011), but it could not be, if he/she was induced to the
transaction by another employee with knowledge.43 This cannot be correct.
9.023 A narrow understanding is therefore imperative: Influence can only be attributed to the legal
person if it is exerted directly by organs in the sense of Art 8 para 1 CRIM-MAD (but not in
the case of mere supervisory negligence in the sense of Art 8 para 2 CRIM-MAD).44 This is
because these persons are typically not part of any specific confidentiality area but have or can
have overall knowledge of corporate affairs and can exert influence on subordinate employees of
the company. Hence, the legal person cannot rely on para 1 if such an executive body has influ-
enced the transaction. It is questionable, however, why the same does not apply if such a board
member directly conducts the insider dealing for the benefit of the legal person. According
to the wording, the legal person can invoke the exception under para 1 in this case. Although
this is unsatisfactory, at least in the context of criminal law the provision must be interpreted
according to its wording.
9.024 The burden of proof for the existence of the exemption pursuant to para 1 rests with the legal
person outside criminal law or administrative sanctions (above para 9.005). However, it is not
possible to prove the negative element of the offence in para 1 lit b. Hence, probably the admin-
istrative authority or the prosecution must prove that influence was exerted.45
6. Consequences
9.025 If the compliance organisation is adequate, the presumption of use is rebutted. More precisely,
it is irrelevant whether the inside information was actually used (above para 9.005). According
40 Similar Klöhn, ‘Artikel 9’ (n 6) para 68.

43 See for details Klöhn, ‘Artikel 9’ (n 6) paras 71 f.
44 Klöhn, ‘Artikel 9’ (n 6) para 73; implicitly also Veil (n 18) § 7 para 56.
122
C. Market maker and counterparties (para 2 lit a)
to the wording of para 1, this rebuttal applies to the acquisition and disposal of financial
instruments.
In addition to the provision’s wording, the cancellation or modification of an order is also 9.026
covered. The fact that this is not mentioned in the text is probably an oversight. This is also
indicated by the fact that Recital 30 to para 2 makes an explicit reference to the cancellation,
which was, however, not included in the text of para 2. The legislator forgot to adapt the
passages largely taken from the text and the Recital of the MAD 2003 to the extension of the
definition of insider dealing by sentence 2 of Art 8 para 1 MAR.
The rebuttal does not mean that the legal person has not carried out insider dealing under any 9.027
circumstances.46 If the authority can prove that ‘an illegitimate reason’ is behind the act, the
counter-exception pursuant to para 6 applies.47 However, the illegitimacy of the reason must
refer to the legal person, not the person acting. This may be the case if the legal person has
established a basically effective compliance organisation, but this is not put into practice in
a certain situation, for example, by tolerating suggestions for transactions by an insider. This
could certainly be deduced from general principles as well, which is why the content of para 6
remains unclear. In my opinion, for the purposes of para 6 it is not sufficient for the legal person
to have derived benefits from the insider dealing; this is a mere consequence of the transaction,
but not necessarily its reason.
Failure to prove that the compliance organisation is adequate will lead to the presumption that 9.028
the inside information was used.48 This will typically have consequences as far as administrative
fines and criminal liability are concerned. But even if the legal person has not established an
adequate compliance organisation, it is, according to general principles, open to prove that
the knowledge about the inside information did not influence the transaction:49 The general
rebuttal possibilities are not ruled out by Art 9.
C. MARKET MAKER AND COUNTERPARTIES (PARA 2 LIT A)
Para 2 lit a contains an exemption for market makers and counterparties. This is intended to 9.029
promote the activity of (efficiency-enhancing) liquidity providers on the financial markets,
which is expressly recognised by Recital 29.50 Market makers create a continuous order flow by
concluding an equal number of purchases and sales and finance themselves from the bid/ask
spread; they are usually contractually obliged to do so vis-à-vis the marketplace operator. They
contribute to efficient pricing on securities markets.
46 Similar Hansen, ‘Article 9’ (n 3) para B.9.31, but with the erroneous view that proof of actual use of the inside informa-
tion by the acting natural person is sufficient.
47 Sieder (n 5) 175.
48 For a further differentiation according to the possibility of contact between the different natural persons Hansen, ‘Article
9’ (n 3) para B.9.30.
49 Grundmann (n 1) Part 6 para 401; Hansen, ‘Article 9’ (n 3) paras B.9.25, B.9.30; Klöhn, ‘Artikel 9’ (n 6) paras 9, 19;
Wolfgang Sindelar, ‘Art 9 MAR: Legitime Handlungen’ in Michael Gruber (ed), Börsegesetz. Marktmissbrauchsverordnung
(Manz 2020) para 12.
50 Hansen, ‘Article 9’ (n 3) para B.9.35; Hopt and Kumpan, ‘§ 107’ (n 2) para 81; Klöhn, ‘Artikel 9’ (n 6) para 76; Veil (n
18) § 7 para 61. See also Recital 18 MAD 2003.
123
9.030 The market maker is defined in Art 3 para 1 (30) by a reference to Art 4 para 1 (7) MiFID
II as a ‘person who holds himself out on the financial markets on a continuous basis as being
willing to deal on own account by buying and selling financial instruments against that person’s
proprietary capital at prices defined by that person’. The names in practice vary (e.g., specialist,
lead broker, designated sponsor), as does the exact scope of the obligation towards the oper-
ator of the trading venue. A market maker can be a natural person or a legal person.51 Unlike
normal trading participants, market makers usually have access to trading-related information
(e.g., order book)52 and can therefore have knowledge of inside information.53 The exemption
allows market makers to take this information into account when setting quotes (which they
are obliged to do), thus maintaining market depth and keeping the bid/ask spread low. Para 2
lit a thus contains a true exemption to the insider dealing prohibition.54
9.031 The MAR does not define what is meant by the second instance, namely ‘a person authorised
to act as a counterparty’ for the financial instrument. According to prevailing opinion,55 this
only refers to the central counterparty (CCP) on (OTC) markets for derivatives in the sense of
Art 2 (1) EMIR, i.e., ‘a legal person that interposes itself between the counterparties to the con-
tracts traded on one or more financial markets, becoming the buyer to every seller and the seller
to every buyer’. In this case, the inside knowledge may result from the necessary aggregation
of individual transactions at the CCP. Of course, the CCP has a clearing obligation anyway,
which is why the inside information is not actually used.
9.032 The market maker (and the counterparty) must be authorised for the financial instrument to
which the inside information relates; it is therefore not generally exempted from the prohi-
bition on insider dealing, but only for certain financial instruments.56 Privileged are both the
acquisition and the disposal of these financial instruments, but also, going beyond the wording
of the provision, the cancellation or modification of orders (see already para 9.026).57
9.033 Additionally, the transaction is only exempted if it is legitimately carried out in the normal
course of the exercise of the function. Because of this, it is permissible for the market maker to
use trading-related inside information that comes to its knowledge58 on the basis of its privi-
leged access to the trading information agreed with the marketplace operator.59 However, the
transaction is not privileged if inside information is used which does not come to the market
maker’s knowledge in the normal course of the exercise of its function, but rather, for example,
from the investment area of the bank.60 Nor are orders that cannot be explained by normal
51 Zetzsche (n 13) § 7C para 151. If the market maker is a legal person, the exemption under Art 9 para 1 may also apply;
see Hansen, ‘Article 9’ (n 3) para B.9.37.
52 Access to the order book is, at least in Germany, also granted to participants in high-frequency trading, but no exemption
from the presumption of use applies to them; Grundmann (n 1) Part 6 para 395.
53 See Zetzsche (n 13) § 7C paras 151 f.
54 Klöhn, ‘Artikel 9’ (n 6) para 79. However, some authors read this as a mere rebuttal of the presumption; see Grundmann
(n 1) Part 6 paras 408 f; Hansen, ‘Article 9’ (n 3) paras B.9.38ff; Sieder (n 5) 175.
55 Klöhn, ‘Artikel 9’ (n 6) para 82; Zetzsche (n 13) § 7C para 151; for a broader approach see Schäfer (n 5) para 14.51
(‘especially’ CCP); cf also Veil (n 18) § 7 para 59.
57 Schäfer (n 5) para 14.51.
58 Thus, the extent of the privilege depends on the agreement with the marketplace operator.
60 See Hansen, ‘Article 9’ (n 3) paras B.9.35ff. In this case, however, applying para 1 may be considered.
124
D. Execution of orders (para 2 lit b)
market making privileged.61 There is no scope of application for the counter-exemption pursu-
ant to para 6 (see below paras 9.075ff), as the market maker must in any case act legitimately
for the exemption to apply, i.e., it must act within the contractual obligations and in the course
of the normal exercise of its function. In other words, it must be possible to explain its actions
with the function as market maker according to usual industry practices.62
D. EXECUTION OF ORDERS (PARA 2 LIT B)
Para 2 lit b exempts the execution of client orders in securities transactions under certain 9.034
circumstances from the presumption of the use of inside information. This adds nothing
new to the basic rule under Art 8 para 1 (see paras 8.088ff):63 If the insider merely executes
a third-party order, its knowledge of the inside information was not causal for the transaction;
if it influences the placement of the order, it is in breach of Art 8 para 2.64 The agent can rely
on the presumption even if it had knowledge of the inside information when the order was
placed.65 More detailed information is provided in sentences 1 and 2 of Recital 30. Para 2 lit b
does not imply a general exemption from the prohibition of insider trading for intermediaries.
The privilege only covers a legal person or a natural person that is ‘authorised to execute orders 9.035
on behalf of third parties’. This refers to the authorisation to execute orders as an investment
service pursuant to Art 5 para 1 in conjunction with Annex I Section A (2) MiFID II.66
Typically, this covers credit institutions and brokers.
For other market participants, the execution of an order is privileged pursuant to para 3 if the 9.036
order was placed before receipt of the inside information and a corresponding obligation arose
therefrom (paras 9.041ff), which is not required within the scope of para 2 lit b. However, even
if an order is placed at a later date, there is normally no use within the meaning of Art 8 para 1,
because and to the extent that the inside information is not causal for the placing of the order
(to the person who has inside knowledge, not by the person!).67
Of course, only the transaction in the financial instrument to which the order refers is privi- 9.037
leged. However, this privilege applies only to execution ‘in the normal course of the exercise of
that person’s employment, profession or duties’. For this reason alone, only the fulfilment of
the order is covered; additional transactions without an order are insider transactions. Sentence
2 of Recital 30 also expressly states that so-called ‘front-running’, in which knowledge of
a price-relevant client order is used for own transactions, is prohibited by the MAR and is
therefore not covered by para 2 lit a.68
61 Hansen, ‘Article 9’ (n 3) paras B.9.39 f; Veil (n 18) § 7 para 62.

62 Gerner-Beuerle (n 4) para 6.
63 Klöhn, ‘Artikel 9’ (n 6) paras 87, 94. See also Recital 18 MAD 2003.
66 Klöhn, ‘Artikel 9’ (n 6) para 91; Zetzsche (n 13) § 7C para 151.
67 Similar Hansen, ‘Article 9’ (n 3) para B.9.43; Klöhn, ‘Artikel 9’ (n 6) paras 88 f, 91.
68 See Gerner-Beuerle (n 4) para 6.
125
9.038 Para 2 lit b clearly covers fixed-price orders or orders at the respective market price (fixed-price
or commission business, execution only).69 In any case, the agent would be well advised to
have comprehensible documentation of the order placement at hand. However, it is at least
problematic if the intermediary itself has discretionary powers when executing the order.70 This
applies in particular to discretionary orders, which, although covered by the wording of para 2
lit b, can nevertheless lead to the order being executed on the basis of inside information; in this
case the order must be transferred to another intermediary or rejected.71
9.039 Again, the wording in the text covers only the acquisition and disposal of financial instruments.
However, the rebuttal is applicable to the cancellation and modification of an order on the
instructions of the client as well (see above para 9.026), especially when one considers that
sentence 1 of Recital 30 only covers this case. That this is not reflected in the provision’s text is
probably due to an oversight and is not problematic. This result is also based on the fact that,
according to general principles under Art 8, the presumption of use can be rebutted for all types
of transactions; Art 9 does not rule this out.
9.040 However, the order itself may also be based on inside information; para 2 lit b does not cover
this issue.72 Executing such an order is prejudicial if the intermediary knows of this, which
under many legal systems will make the intermediary an accessory;73 however, the intermediary
does not directly commit the offence itself due to lack of knowledge of the inside information.
In any case, the MAR itself does not contain an obligation to investigate as long as there are
no tangible suspicious facts.74
E. DISCHARGE OF OBLIGATIONS (PARA 3)
9.041 Art 9 para 3 excludes from the presumption of use those cases in which an obligation to acquire
or dispose of the financial instrument results from the conclusion of an agreement or where
there is another legal obligation; this must be ‘in the discharge of a prior obligation that has
become due’,75 i.e., the obligation must originate from a time before the inside information was
known.76 This provision serves the purpose of transaction security, because otherwise existing
obligations could not be discharged once one party comes into possession of inside informa-
tion.77 The wording covers acquisitions or disposals of financial instruments. The cancellation
of an order is also covered according to general principles (see para 9.026), but will, as a rule,
not play a role in the context of para 3. The provision replaces Art 2 para 3 MAD 2003.
69 Schäfer (n 5) para 14.51. See also Hansen, ‘Article 9’ (n 3) para B.9.43.

70 Klöhn, ‘Artikel 9’ (n 6) para 92; Grundmann (n 1) Part 6 para 392; Veil (n 18) § 7 para 64; cf, however, Gerner-Beuerle
(n 4) para 6: issue of little practical relevance.
71 Grundmann (n 1) Part 6 para 394; Hopt and Kumpan, ‘§ 107’ (n 2) para 85.
73 For Germany see Grundmann (n 1) Part 6 paras 392, 410; Hopt and Kumpan, ‘§ 107’ (n 2) para 84.
75 Sentence 4 of Recital 30.
126
E. Discharge of obligations (para 3)
In the cases of para 3, the transaction is not based on the inside information. Thus, the 9.042
provision merely specifies the lack of use for a special case and does not contain any further
privileges. The guiding question for the provision’s application is therefore whether the inside
information was a contributory cause of the transaction. For that reason, discretionary powers
in the discharge of the obligation can constitute ‘use’ and result in the inapplicability of the
provision. Even if the conditions of para 3 are not met, one still has to examine whether the
presumption of use can be rebutted under general rules (see paras 8.088ff), because Art 9 does
not supersede these principles (above para 9.002).
The obligation may result from an order that was given before the inside information was 9.043
received (lit a). However, an order placed after this time is also privileged – at least from the
perspective of the agent. If it was given to a person who is authorised to execute orders, para
2 lit b (above paras 9.034ff) applies. But even in other cases, there is no causality between the
inside knowledge and the transaction, which is sufficient to rebut the presumption of use.
In addition, the obligation must ‘result’ from an agreement (lit a) or must be carried out 9.044
to ‘satisfy’ a legal obligation (lit b, which, however, also covers regulatory obligations – see
para 9.047). It is very difficult to find a difference in meaning.78 In any case, this covers all
transactions with which obligations, for example, from transactions in futures or as writer of
an option,79 are directly discharged,80 at least to the extent that there is no relevant margin of
discretion for such discharge. Because of Art 10 para 1, the insider is under no obligation to
inform the counterparty (e.g., if that party exercises an unfavourable option).81
According to the wording, it is questionable, however, whether transactions that only indirectly 9.045
serve to discharge such an obligation are also exempted. This may be the case because the
insider buys financial instruments in order to meet a delivery obligation on securities in the case
of short selling, as seller in the case of futures transactions, as writer of a call option, as borrower
in the case of securities lending or as investor in repos. Such an acquisition does not directly
serve the purpose of discharge but creates the prerequisites for it. The purpose of the norm
covers such transactions.82 The inside information is not causal for the acquisition in such cases;
apart from this, any ‘use’ typically does not result in an advantage to the insider.83 According
to the wording, the obligation to be discharged must be due. Thus, anyone who purchases
securities to fulfil an obligation that is not yet due under a securities loan cannot rely on para
3; however, at least in the case of purchases made only shortly before the due date, there is, in
my opinion, no (co-)causality, which argues for a rebuttal of the presumption of use according
to general principles.
It is generally assumed, however, that Art 9 para 3 does not cover instances in which the insider 9.046
sells financial instruments in order to discharge a monetary debt (tax debts, social security
78 Hansen, ‘Article 9’ (n 3) para B.9.59 understands as ‘legal obligations’ such that were entered into outside securities
transactions.
79 The exercise of the option by the beneficiary is not covered; Hansen, ‘Article 9’ (n 3) paras B.9.51, B.9.53.
82 See Grundmann (n 1) Part 6 para 392, 411; Klöhn, ‘Artikel 9’ (n 6) paras 98, 106; Veil (n 18) § 7 para 44; Zetzsche (n
13) § 7C para 153; cf, however, Sindelar (n 49) para 53.
127
arrears, but also obligations under private law). In such cases the presumption of use can be
rebutted according to general principles.84 However, an exemption from the prohibition of
insider dealing is only justified if the inside information is not even a contributory cause of the
sale. This will only be the case in the given context if the insider has no other possibility of
obtaining liquid funds.85
9.047 As the use of the term ‘regulatory obligation’ in lit b shows, public law obligations may also lead
to an exemption under para 3.86 An obligation to sell may, for example, result from require-
ments in merger control proceedings.87 In this context, however, it is ultimately not relevant
whether this obligation arose before or after knowledge of the inside information.88 Due to the
lack of causality, this can also be dealt with by applying general principles.
9.048 Finally, the transaction must be carried out ‘in good faith and not to circumvent the prohibition
against insider dealing’.89 Whether this criterion has any additional significance, is unclear.90
According to some authors, it refers to causality,91 which is, however, already reflected in the
remaining text of para 3.
F. TAKEOVER BIDS (PARA 4)
1. General
9.049 Para 4 contains a rebuttal of the presumption of use for public takeover offers or mergers. In
these cases, the acquirer is, as a rule, granted access to internal company information in the
course of a due diligence process if the intention is to carry out the transaction (often set out in
a letter of intent or similar). In this due diligence, the acquirer is typically especially interested
in being able to identify facts negatively affecting the business, but it can also obtain positive
information. In the latter case, it is questionable whether it may proceed with the transaction or
whether this is inside dealing.92 Terminating the transaction in the case of negative information
(without order cancellation; Art 8 para 1) is unproblematic in any case.93
9.050 It certainly is not insider dealing if the bidder adjusts the consideration in such a way (upwards)
that it reflects the positive inside information, because then the inside information is not used
(see para 8.088).94 However, para 4 also provides the offeror with an alternative: It may submit
84 Klöhn, ‘Artikel 9’ (n 6) paras 104 f; Veil (n 18) § 7 para 67.

88 Hopt and Kumpan, ‘§ 107’ (n 2) para 86. Similar Hansen, ‘Article 9’ (n 3) para B.9.59.
89 The English language version could be read to suggest that good faith refers to the maturity of the obligation, which
makes little sense. See Hansen, ‘Article 9’ (n 3) para B.9.47.
90 See Veil (n 18) § 7 para 70.
92 See also Gerner-Beuerle (n 4) para 10.
93 Bühren (n 2) 1176; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 11) 791.
128
F. Takeover bids (para 4)
the offer without adjustment95 if at the time of acceptance the information has ceased to be
inside information. In this case, the addressees of the offer can, with the knowledge of the new
information, assess the adequacy of the offer properly.96 Such disclosure has the advantage that
the bidder does not bear the risk of incorrectly pricing in the information and thus of engaging
in insider dealing.
Under the reading of Art 8 proposed here (paras 8.067ff), paragraph 4 does not contain 9.051
a genuine exemption.97 According to prevailing opinion, for Art 8 to apply, the inside informa-
tion must be causal for the decision on the transaction; if this decision was already made prior
to the due diligence process (under the condition that no negative information comes to light
in the course of the due diligence review), the execution of the transaction would, according to
general principles, not be insider dealing (‘master plan exception’). However, para 4 requires
that the information be disclosed and hence is stricter than Art 8 itself. One could argue that
the provision offers the advantage that, unlike the master plan exemption, it does not require
that the bidder has already made the decision on the takeover. But also in this respect, para 4
is not more favourable to the bidder than the general framework for insider dealing98 because
the disclosure of the inside information results in the parties having informational parity, which
already excludes use under Art 8 para 1. Hence, in order for the provision to make sense, it must
be understood not as an exemption but as a tightening of the general principles, which must be
explained by the increased transparency desired for takeover bids. For this reason, recourse to
the master plan exemption is not permitted for the transactions covered by para 4.99
The last sentence of Recital 30 does not contain the requirement that the inside information 9.052
must be disclosed. This is, in view of the clear wording of para 4, irrelevant100 but it does show
that the legislator only had a weak grasp of the issue. This is an argument against an extensive
interpretation of the provision (below paras 9.065ff). In any case, para 4 has clarified an impor-
tant doubt about the application of the insider dealing prohibition in the context of takeovers
under the MAD 2003, as at least some supervisors required disclosure,101 while (German) legal
doctrine predominantly did not.102
2. Takeovers, mergers
Para 4 covers information obtained ‘in the conduct of a public takeover or merger with 9.053
a company’. Hence, the provision deals (only) with information about the target company or
the other company in a merger.
95 cf, however, Hansen, ‘Article 9’ (n 3) paras B.9.68 f, who wrongly demands that the information be priced in under all
circumstances.
97 See also Paul Davies and Sarah Worthington, Gower: Principles of Modern Company Law (10th edn, Sweet & Maxwell
2016) paras 30–38.
98 Differently, however, Klöhn, ‘Artikel 9’ (n 6) para 110.
99 cf, however, Klöhn, ‘Artikel 9’ (n 6) para 115.
100 Bühren (n 2) 1176; Hopt and Kumpan, ‘§ 107’ (n 2) para 87 in fn 1; Klöhn, ‘Artikel 9’ (n 6) paras 111, 114.
101 See the 4th edition of the so-called ‘Emittentenleitfaden of German BaFin from 2013.
102 Klöhn, ‘Ad-hoc-Publizität und Insiderverbot im neuen Marktmissbrauchsrecht’ (n 2) 433. See also Case C-45/08 Spector
Photo Group [2009] ECR I-12073 para 60.
129
9.054 Unfortunately, the English and German language versions differ considerably (see also para
9.056). The German language version suggests that takeovers and ‘concentrations’ are covered
if they are accompanied by a public offer,103 while the English language version104 speaks of
‘inside information [obtained] in the conduct of a public takeover or merger with a company’,
which indicates that ‘mergers’ are covered, even if there is no public offer. The English wording
is correct, which is also supported by the fact that all versions refer to acceptance of the offer
or approval of the merger; this obviously refers to collective decision-making in the general
meeting in the latter case.
9.055 ‘Public takeover’ refers to offers as defined in the Takeover Directive and thus to a bid made to
acquire all or some of the voting stocks of a company, which follows or has as its objective the
acquisition of control of the offeree company in accordance with national law (see Art 2 para 1
lit a Takeover Directive 2004/25/EC). According to sentence 2 of para 4, the exemption does
not apply to stake-building, which is defined in Art 3 para 1 (31) as an acquisition of shares
which does not result in an obligation to make an offer. Therefore, voluntary public takeover
offers to gain control105 and mandatory offers are covered, but not other voluntary offers to buy
shares.106 There is some doubt whether other mandatory bids for the acquisition of control, in
particular in market segments not covered by the Takeover Directive, are a ‘public takeover’ for
the purposes of para 4; this seems to be the case as there is an obligation on a regulatory basis
to make an offer as a result of a change in control and as this seems to be decisive according
to Art 3 para 1 (31) in connection with Art 9 para 4. However, an obligation to launch a bid
triggered by other instances, such as in the case of a delisting according to the legislation in
some Member States, is not a public takeover for the purposes of para 4.
9.056 As the phrase ‘approval of the merger’ indicates, corporate mergers involve collective
decision-making. This refers, above all, to mergers within the meaning of Arts 87ff Directive
2017/1132 relating to certain aspects of company law, but not to ‘concentrations’ in the
sense of the EC Merger Regulation, although the German language version using the term
‘Unternehmenszusammenschlüsse’, that is ‘concentrations’, could be read to imply that. Also
included are comparable techniques, such as schemes of arrangement.107
9.057 The inside information must have been acquired ‘in the conduct’ of the takeover or merger.108
This is any information obtained in the course of the preparation109 or execution of the offer.
Hence, it is not sufficient that the information is obtained during this preparation or execu-
tion, but there needs to be an element of causality.110 This refers, in particular, to information
discovered during the due diligence review, but also lege non distinguente to information which
103 cf therefore Klöhn, ‘Artikel 9’ (n 6) para 117; probably similar Hopt and Kumpan, ‘§ 107’ (n 2) para 87.
104 Likewise, the French and Italian versions while the Spanish version largely corresponds to the German.
105 Veil (n 18) § 7 para 75; see also last sentence of Recital 30.
107 Veil (n 18) § 7 para 75.
108 In any event, the words ‘on the basis of a public offer’ do not refer to the origin of the information; Klöhn, ‘Artikel 9’ (n
6) para 121; Veil (n 18) § 7 para 75; cf, however, Grundmann (n 1) Part 6 para 412.
109 cf, however, Grundmann (n 1) Part 6 para 412 with a completely different reading of the regulation.
110 cf, however, Klöhn, ‘Artikel 9’ (n 6) para 122, who only considers the time component.
130
F. Takeover bids (para 4)
originates from third parties.111 It is irrelevant whether the offeree company has legitimately not
made the information public.112
3. Making information public
The positive legal consequences for the offeror arising from para 4 are conditional upon ‘that 9.058
at the point of the approval of the merger or acceptance of the offer by the shareholders of that
company, any inside information has been made public or has otherwise ceased to constitute
inside information’. In the case of offers, this refers to its acceptance, even if the offer or the
acceptance is conditional; the decision by the addressees should be made with knowledge of
the value-enhancing information. As a result, the inside information must be made public at
the beginning of the acceptance period if the offeror wishes to ensure that it does not engage
in insider dealing.113 Under the general rules contained in Art 8, it does not constitute insider
dealing if the offer is made public at a time when the information is publicly known; hence,
given the fact that the offer is normally only made public immediately prior to the beginning
of the acceptance period, para 4 provides the offeror only with a very modest time advantage.
In the case of corporate mergers, the approval by the shareholders in the general meeting is the
decisive moment.
According to the wording, all inside information must be made public; however, this only refers 9.059
to inside information that is value-adding and which the offeror learned about in the course
of the due diligence review or otherwise in the conduct of the offer or merger. Furthermore,
information loses its character as inside information if it turns out to be incorrect or if it is
eclipsed by other negative information.114
The MAR does not settle whether the bidder may make the information public, whether it 9.060
can demand this from the target company or whether there has to be a contractual agreement
between the parties on the issue.115 In any case, reaching such an agreement is advisable before
the offer is placed. If the bidder cannot enforce a public disclosure,116 it must price in the posi-
tive information correctly (see para 9.050).
4. Consequences
Subject to this condition, the acquisition or merger may be continued.117 The party making the 9.061
offer and, if applicable, the members of a bid consortium are privileged. Legal entities acting
in concert without the status of bidders may not buy shares.118 Generally, transactions outside
the offer are not privileged. For that reason alone, acquisitions by members of the bidder’s
111 cf, however, Hansen, ‘Article 9’ (n 3) paras B.9.63 f.

113 See Bühren (n 2) 1177.
114 Klöhn, ‘Artikel 9’ (n 6) para 125 considers the case that the inside information is priced in by bidders to be covered; see,
however, Hansen, ‘Article 9’ (n 3) paras B.9.72ff. In any case, the use of inside information can be disproved, according
to general rules; see paras 8.087ff.
116 Bühren (n 2) 1177.
117 See Veil (n 18) § 7 para 76.
118 cf, however Klöhn, ‘Artikel 9’ (n 6) para 116.
131
corporate bodies lie outside the scope of para 4.119 It is not required that the bidder had already
decided for the takeover before it learns of the inside information. Likewise, it may change
a decision already taken before the offer is made120 – the later public disclosure will in any case
ensure equal opportunities.
9.062 Other transactions are not covered by para 4. This concerns, first of all, the disposal of shares,
which is, as a rule, not permitted after the bidder has refrained from pursuing the plan due
to negative inside information which has come into its possession.121 Nor does the provision
cover purchases made during the preparation of the takeover offer (alongside purchases)122 or
irrevocable undertakings obtained without disclosure of the information.123 If, however, the
inside information has already been made public at the time of the transaction, it is no longer
inside information; similarly, if the contracting party is already aware of the information at the
moment the contract is entered into or if it is disclosed to it by the seller,124 it is not used for
the purposes of Art 8 para 1 due to the equal information basis. In such cases, the insider does
not engage in insider dealing.
9.063 The counter-exemption pursuant to para 6 does not seem to be applicable within the scope
of para 4. If the inside information has been disclosed, the transaction cannot be prohibited
insider dealing under Art 8 para 1.
9.064 If the inside information is not publicly disclosed, it is assumed that it has been used. This
presumption is rebuttable (paras 8.088ff), in particular because the positive inside information
is priced in in the offer.125
5. Limitations
9.065 Para 4 does not apply, according to its sentence 2, to stake-building, i.e., ‘an acquisition of
securities in a company which does not trigger a legal or regulatory obligation to make an
announcement of a takeover bid in relation to that company’ (Art 3 para 1 (31)). This refers to
purchases via the stock exchange, to privately negotiated transactions and to offers not aimed
at acquiring a controlling interest.
9.066 The provision’s significance is unclear. Some argue that for stake-building recourse to the
general master plan exemption (see paras 8.077ff) is to be made,126 because if para 4 does not
apply, then the decision on the transaction is relevant for ‘use’ of the information within the
meaning of Art 8 para 1; if this has already been taken, it will no longer be influenced by the
result of a subsequent due diligence review. Others argue that para 4 shows that the master plan

120 Bühren (n ) 1176.
121 Hopt and Kumpan, ‘§ 107’ (n 2) para 92; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 11)
785 f.
122 See Hopt and Kumpan, ‘§ 107’ (n 2) para 91; Klöhn, ‘Artikel 9’ (n 6) para 128.
124 Another question is whether the bidder thereby infringes the prohibition of disclosure under Art 10 para 1; see paras
11.010ff.
126 Veil (n 18) § 7 para 91; see also Zetzsche (n 13) § 7C para 154.
132
G. Use of own decision (para 5)
exemption should no longer hold after the introduction of the MAR, which must then also
apply to other types of transactions and especially stake building.127 In any case, it is undisputed
that there is no insider dealing if the seller has the same access to information as the buyer in
the case of a block acquisition (para 8.093).128 The different approaches thus only are significant
for cases of unequal levels of information.
The first view is correct. For, as the inappropriate Recital 30 shows (above para 9.052), it is 9.067
not clear even in the core area of application of para 4 what the legislature actually wanted to
achieve; there, the wording of the law is the decisive factor compared with the recital. However,
this lack of clarity argues against seeing in para 4 a conclusive provision which is intended to
exclude the so-called master plan exemption not only in the provision’s own area of application,
but for all types of transactions. For this reason, the obligation to disclose any inside informa-
tion gained exists only in the case of public bids and mergers, but not in the case of transactions
not explicitly covered by para 4 (see more generally paras 8.067ff).
G. USE OF OWN DECISION (PARA 5)
1. General
If a person merely knows that it wants to acquire or dispose of financial instruments itself, then, 9.068
according to para 5, the corresponding acquisition or disposal does not constitute use of inside
information. This is because the action is based on the decision, not on information about the
decision.129 In substance and not surprisingly, it is therefore possible to implement one’s own
decisions, which would also be the case without para 5.130 The provision is further explained by
sentences 1 and 2 of Recital 31 and corresponds in substance to Recital 30 MAD 2003. The
provision only covers the execution of the decision; if the decision itself was taken on the basis
of inside information, this is insider dealing.131
It follows from para 5 that the decision itself is inside information132 which is, however, not 9.069
used if the decision is merely executed. Admittedly, sentence 3 of Recital 54 holds that ‘infor-
mation regarding the market participant’s own plans and strategies for trading should not be
considered to be inside information, although information regarding a third party’s plans and
strategies for trading may amount to inside information’. Given the clear content of para 5 this
is probably due to an editorial error and is not to be taken into account.133 Of course, inside
information only exists if the decision covers enough financial instruments to be relevant to
127 Grundmann (n 1) Part 6 para 397; Hopt and Kumpan, ‘§ 107’ (n 2) paras 89, 100.
128 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 11) 778, 811.
129 Similar Hopt and Kumpan, ‘§ 107’ (n 2) para 94.
131 Grundmann (n 1) Part 6 para 398; Schäfer (n 5) para 14.82.
132 Gerner-Beuerle (n 4) para 13; Bachmann (n 18) 26 f; Grundmann (n 1) Part 6 para 384; Hopt and Kumpan, ‘§ 107’ (n
2) para 93.
133 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 11) 777 f; Klöhn, ‘Ad-hoc-Publizität und
Insiderverbot im neuen Marktmissbrauchsrecht’ (n 2) 433.
133
the share price.134 Such a decision to acquire financial instruments can relate to a takeover bid,
a planned block transfer135 or the purchase of shares on the stock exchange.
2. Permitted transactions
9.070 Both acquisition and disposal are permitted. This also applies to the acquisition of individual
shares in the knowledge that a takeover bid will subsequently be submitted (acquisition of
a launching pad).136 Disclosure obligations may result from national takeover legislation. In
general, the staged implementation of an overall plan is an unproblematic implementation of
an own decision.
9.071 There is some discussion on whether this also applies if notification thresholds pursuant to the
national implementation of Arts 9ff Transparency Directive are affected but the corresponding
notification to the issuer is not made. According to some authors,137 the inside information in
this case is not the purchase decision itself, but rather that the notification threshold has been
exceeded. This makes violations of the transparency provisions subject to criminal sanctions,
which is not required by the Transparency Directive. Additionally, the insider does not use
the fact that a notification threshold has been exceeded for its acquisition; it is the result of its
acquisition and, specifically, part of the acquisition decision pursuant to para 5. Hence, further
acquisitions following after the end of the reporting period do not use inside information even
if the pertinent disclosure is made. This may be different if the number of shares acquired
changes the fundamental value of the issuer (e.g., due to improved control or new business
models to be introduced).138 In such cases, such future changes may be inside information and
acquiring further shares at a favourable price, in knowledge of such factors may constitute the
use of such information. However, this, at best, only loosely corresponds to thresholds accord-
ing to transparency rules. On a similar track, it is insider dealing if the control threshold pur-
suant to the applicable mandatory bid rules is exceeded and the shares continue to be acquired
without public disclosure if the price to be offered is above the market price.139
9.072 Beyond the wording of the provision, the cancellation or modification of an order in execution
of one’s own decision to do so is not insider dealing.140 An adaptation corresponding to sen-
tence 2 of Art 8 para 1 was apparently forgotten. The recommendation or inducement of third
parties in the knowledge of one’s own decision141 is not covered, nor is the onward disclosure
of information.142

135 Whereby the seller has this information anyway; Schäfer (n 5) para 14.82.
136 Gerner-Beuerle (n 4) para 12; Hopt and Kumpan, ‘§ 107’ (n 2) para 94; Schäfer (n 5) para 14.81.
137 See also Davies and Worthington (n 97) paras 30–38.
138 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 11) 793 f.
140 Klöhn, ‘Artikel 9’ (n 6) para 132; Veil (n 18) § 7 para 81.
134
H. Counter-exemption (para 6)
3. Acquisition by third parties
Only the person who has taken the decision may execute it subsequently, whereas the use of 9.073
the knowledge about the intention by others is a use of the inside information and constitutes
prohibited insider dealing.143 This applies, for example, to proprietary trading by employees,
board members or advisers 144 but also to trading for one’s own account in the knowledge of
price-relevant client orders (front-running). This prohibition, however, does not apply if the
third party is acting for the account of the person who made the decision to acquire or dispose145
because the justification from para 5, i.e., not to hinder the implementation of the decision,
applies equally in this case. Similarly, warehousing by parties acting in concert with the bidder
in the context of the joint acquisition plan is permitted.146
The offer by a white knight in a hostile takeover is not generally exempted from the prohibi- 9.074
tion. However, the management of the target company is not prohibited to search for a rescuer,
which may also prepare the competing takeover bid, but only submit it after the intention of
the original bidder becomes public. This is not an excessive restriction and is consistent with
the objective of promoting competing bids (Art 9 para 2 Takeover Directive). Some authors
argue that the acquisition of own shares by the target company, in knowledge of the prepa-
ration of a hostile takeover bid – to the extent that this is permissible under takeover law – is
unproblematic under insider law;147 in my opinion, this requires the target company to make
the forthcoming takeover bid public in the first place.
H. COUNTER-EXEMPTION (PARA 6)
Para 6 contains a counter-exemption: It ‘may’148 be ‘deemed’ as an infringement of the prohi- 9.075

bition of insider dealing ‘if the competent authority establishes that there was an illegitimate
reason for the orders to trade, transactions or behaviours concerned’. The provision is exceed-
ingly vague, in particular with regard to the issue of an ‘illegitimate reason’.149 In particular in
view of the significance under criminal law, this ambiguity is disconcerting.150
If one correctly understands para 2 lit b, para 3 and para 5 not as genuine privileges but as a clar- 9.076
ification of the circumstances under which use of inside information is not presumed, para 6,
143 Grundmann (n 1) Part 6 para 384; Hansen, ‘Article 9’ (n 3) para B.9.7; Hopt and Kumpan, ‘Insidergeschäfte und
Ad-hoc-Publizität bei M&A’ (n 11) 787; Klöhn, ‘Artikel 9’ (n 6) para 133.
144 Who are all primary insiders; Grundmann (n 1) Part 6 para 396.
145 Gerner-Beuerle (n 4) para 11; Hopt and Kumpan, ‘§ 107’ (n 2) para 94; Klöhn, ‘Artikel 9’ (n 6) para 134; Veil (n 18) §
7 para 80.
146 Grundmann (n 1) Part 6 para 398; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 11) 791 f;
Schäfer (n 5) para 14.90.
147 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 11) 801. A privilege according to Art 5 is out
of the question due to the pursued purpose.
148 This does not confer any discretion: If the conditions are met, it is a violation; Klöhn, ‘Artikel 9’ (n 6) paras 135, 137;
Veil (n 18) § 7 para 86.
149 Zetzsche (n 13) § 7C para 156 wants to see any legally disapproved motive as a reason not to apply the exemption.
150 Klöhn, ‘Artikel 9’ (n 6) para 135. More lenient Zetzsche (n 13) § 7C para 156.
135
in my opinion, has no meaning in these contexts.151 More specifically, if there is an exemption

under these provisions, this does not mean that there is no insider dealing, but only that the use
is not presumed but has to be proven by the supervisory authority.152 If that authority succeeds
in proving such use, there is insider dealing (see also the last sentence of Recital 31). If it does
not succeed, the lack of use cannot be substituted by means of para 6.153 The same applies to
para 4 (above para 9.051).
9.077 The situation is different for the genuine exemptions pursuant to para 1 and para 2 lit a. In
these cases, even if the insider uses inside information, this does not constitute insider dealing
(see paras 9.011 and 9.030). Hence, proof of use cannot justify a counter-exception under para
6.154 In these contexts, it must be asked whether the transaction is based on an unlawful reason,
which, obviously, must be interpreted quite narrowly. The concrete meaning can only be deter-
mined by evaluating the facts of each individual case; see paras 9.027 and 9.033.
9.078 The wording of the provision only authorises the ‘competent authority’ to make such a deter-
mination. However, a court also has this right.155
Literature
Bachmann G, Das Europäische Insiderhandelsverbot (De Gruyter 2015)

Davies P and Worthington S, Gower: Principles of Modern Company Law (10th edn, Sweet & Maxwell
2016)
Gerner-Beuerle C, ‘Article 9: Legitimate Behaviour’ in Lehmann M and Kumpan C (eds), European
Financial Services Law (Beck – Hart – Nomos 2019)
2017)
Hansen J L, ‘Article 8: Insider Dealing’ | ‘Article 9: Legitimate Behaviour’ in Ventoruzzo M and Mock S
(eds), Market Abuse Regulation (Oxford University Press 2017)
Klöhn L, ‘Artikel 9: Legitime Handlungen’ in Klöhn L (ed), Marktmissbrauchsverordnung (C. H. Beck
2018)
Poelzig D, ‘Insider- und Marktmanipulationsverbot im neuen Insiderrecht’ (2016) 14 NZG 528
Sieder S, ‘Legitime Handlungen nach der Marktmissbrauchsverordnung (MAR)’ [2017] ZFR 171

152 See Hansen, ‘Article 9’ (n 3) paras B.9.16, B.9.80 f; Hopt and Kumpan, ‘§ 107’ (n 2) para 79; Schäfer (n 5) para 14.49.
154 cf, however, Klöhn, ‘Artikel 9’ (n 6) para 137.
155 Veil (n 18) § 7 para 83.
136
H. Counter-exemption (para 6)
Sindelar W, ‘Art 9 MAR: Legitime Handlungen’ in Gruber M (ed), Börsegesetz. Marktmissbrauchsverordnung

(Manz 2020)
Veil R, ‘§ 7: Insiderhandelsverbot’ in Meyer A, Rönnau T and Veil R, Handbuch zum Marktmissbrauchsrecht
(C. H. Beck 2018)
Zetzsche D, ‘7: Europäisches Kaptialmarktrecht – C. Marktintegrität / Marktmissbrauchsrecht’ in
Gebauer M and Teichmann C (eds), Enzyklopädie Europarecht Band 6 - Europäisches Privat- und
137
ARTICLE 10
UNLAWFUL DISCLOSURE OF INSIDE
INFORMATION
1. For the purposes of this Regulation, unlawful disclosure of inside information arises where
a person possesses inside information and discloses that information to any other person,
except where the disclosure is made in the normal exercise of an employment, a profession
or duties.
This paragraph applies to any natural or legal person in the situations or circumstances
referred to in Article 8(4).
2. For the purposes of this Regulation the onward disclosure of recommendations or induce-
ments referred to in Article 8(2) amounts to unlawful disclosure of inside information
under this Article where the person disclosing the recommendation or inducement knows
or ought to know that it was based on inside information.
OVERVIEW
A. INTRODUCTION 10.001 (a) Introduction 10.014

1. Content and purpose 10.001 (b) Purpose of disclosure 10.017
2. Historical development 10.004 (c) ‘Normal’ exercise of employment, etc.
B. DISCLOSURE OF INSIDE INFORMATION (PARA 1) 10.018
10.006 (d) Accompanying measures 10.022
1. Introduction 10.006 (e) Groups of cases 10.024
2. Possession of inside information 10.007 C. ONWARD DISCLOSURE OF
3. Disclosure 10.010 RECOMMENDATIONS OR INDUCEMENTS
4. Exemption: normal exercise of (PARA 2) 10.032
employment, etc. (para 1 subpara 1) 10.014
138
A. Introduction
A. INTRODUCTION
Since insider dealing is based on the selective availability of inside information (cf Recital 24), 10.001
Art 10 para 1 restricts its discriminatory dissemination, except for within the course of the
‘normal’ exercise of an employment (paras 10.014ff). Para 2 equates the onward disclosure of
tips based on inside information (paras 10.032ff). The prohibition of disclosure thus contains
flanking provisions to Art 8.1
Art 10 only establishes the objective offence. Art 14 lit c emphasises the prohibitive character. 10.002
Administrative and criminal sanctions have to be implemented by the Member States (Art
30 para 1 lit a MAR, Arts 3 f CRIM-MAD). Unlike many Member State implementations
of MAD 2003, the prohibition under Art 10 MAR does not require a pecuniary advantage
of the disclosing party.2 MAR does not require Member States to punish attempted unlawful
disclosures (differently Art 14 lit a MAR with respect to insider dealing).
For legal persons, Art 30 para 2 lit j foresees direct administrative sanctions. According to 10.003
Recital 30, legal persons shall not be liable for violations by natural persons within their
employment acting on behalf of them if they have taken all reasonable preventative measures.
Other than that, MAR does not prescribe a specific method of attribution of liability to legal
persons (Recital 40).
Art 10 goes back to Art 3 IDD (prohibition of selective disclosure and recommendation), 10.004
which (contrary to the original draft)3 was only addressed to primary insiders (i.e., persons with
privileged access to information; cf now Art 8 para 4 subpara 1). The MAD 2003 adopted the
prohibition of selective disclosure, equated recommendation with inducement4 and extended
the prohibitions to secondary insiders (i.e., other insiders, in particular as a result of selective
disclosure outwith employment; cf now Art 8 para 4 subpara 2).
The MAR partly adapted the divergent language versions to the (unchanged) English wording 10.005
(see below para 10.012).5 At the same time, the more severe recommendation or inducement
by an insider was shifted to Art 8 (therefore, see above, para 8.002). The onward disclosure
of recommendations and inducements by mere tippees is now regulated in Art 10 para 2 as
a separate offence (see below paras 10.032ff).
1 See Case C-384/02 Grøngaard and Bang [2005] ECR I-09939, paras 36ff; Lars Klöhn, ‘Artikel 10: Unrechtmäßige
Offenlegung von Insiderinformation’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) para 13.
2 cf already under MAD 2003 AMF CDS, 4 December 2008, SAN-2009–11.
3 See Commission, ‘Proposal for a Council Directive coordinating regulations on insider trading’ COM (1987) 111 final
6; the reason behind the restriction was to delimit the personal scope of the accompanying organisational duties (paras
10.012 f).
4 cf ‘recommending or inducing’ instead of ‘recommending or procuring’ under IDD.
5 See, e.g., ‘Offenlegung’ instead of ‘Weitergabe’ (transmission), ‘divulgation’ instead of ‘communiquer’; but see also
the unchanged Italian ‘comunicazione’ and, to the contrary (narrowing) effect, the Spanish ‘comunicación’ instead of
‘revelación’.
139
Article 10 UNLAWFUL DISCLOSURE OF INSIDE INFORMATION
B. DISCLOSURE OF INSIDE INFORMATION (PARA 1)
1. Introduction
10.006 As a general principle, Art 10 para 1 subpara 1 holds that persons in possession of inside infor-
mation (paras 10.007ff) may not (selectively) disclose it to any other person (paras 10.010ff
below). For the exemption regarding ‘normal’ exercise (para 1 subpara 1), including market
soundings (Art 11), see paras 10.014ff below. The prohibition of selective disclosure does not
require that the disclosing party obtains a pecuniary advantage (para 10.002 above).
2. Possession of inside information
10.007 Like the prohibitions of Art 8 (regarding insider trading), Art 10 para 1 subpara 1 takes up the
concept of inside information (Art 7).
10.008 According to subpara 2, addressees of para 1 are all insiders in the sense of Art 8 para 4 (on its
genesis see para 10.004 above; with respect to mere tippees see para 2 and below para 10.032).
Thus, primary insiders are captured without further qualification. In contrast, in the case of
secondary insiders, it is necessary that they at least ought to have known the inside character
of the information. In both cases it is irrelevant whether the disclosing party itself received the
information in an admissible or inadmissible manner.6
10.009 According to the English wording of para 1 subpara 1, the disclosing party must ‘possess’ the
inside information.7 In our view, (even unconscious) custody of the information (e.g., by means
of access to its documentation) is sufficient (cf below paras 10.012ff regarding disclosure by
omission).8 The origin of the information is irrelevant: Even persons who themselves created
the inside information through a decision (‘self-generated facts’, ‘insider of him/herself’, see
above para 7.011 with n 19) ‘possess’ it; a ‘third-party element’ is not required.9
6 AMF CDS, 25 April 2019, SAN-2017–18 (on inside information received by inadmissible disclosure on a train ride).
See also Petra Mennicke, ‘§ 14 Verbot von Insidergeschäften’ in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd edn,
C. H. Beck 2016) para 216.
7 Slightly different the German version: ‘verfügen’. However, this term has been translated by the ECJ in Case C-45/08
Spector Photo Group [2009] ECR I-12073, para 53 (concerning insider trading; cf Art 8), into ‘Besitz’ (‘possession’).
The French wording has been adapted to mirror the English version (‘detention’ in Art 4 MAD 2003 vs ‘possession’
under the MAR).
8 See also CONSOB, ‘Linee Guida: Gestione delle informazioni privilegiate’, no 1/2017, October 2017, 35 para 5.2.4
(actual knowledge not required); similarly Karsten Altenhain, ‘§ 39: Bußgeldvorschriften’ in Heribert Hirte and Thomas
Möllers (eds), Kölner Kommentar zum WpHG (2nd edn, Carl Heymanns Verlag 2014) para 28. Differently Klöhn,
‘Artikel 10’ (n 1) para 103 (actual knowledge required).
9 See, e.g., Klaus Hopt and Christoph Kumpan, ‘§ 107: Insider- und Ad-hoc-Publizitätsprobleme’ in Herbert
Schimansky, Hermann-Josef Bunte and Hans-Jürgen Lwowski (eds), Bankrechts-Handbuch (5th edn, C. H. Beck 2017)
para 102; Klöhn, ‘Artikel 10’ (n 1) para 19; Petra Buck-Heeb, ‘§8: Insiderrecht’ in Heinz-Dieter Assmann, Rolf A.
Schütze and Petra Buck-Heeb (eds), Handbuch des Kapitalanlagerechts (5th edn, C. H. Beck 2020) para 81.
140
B. Disclosure of inside information (para 1)
3. Disclosure
Disclosure within the meaning of para 1 (see also above para 10.005) is any selective (see at the 10.010
end of this para) extension of the group of persons who ‘possess’ the inside information (above
para 10.007ff). This means that at least one (natural or legal)10 person must be granted access
(below para 10.011) who previously had no such access (see also para 10.012 below),11 even if
this takes place within one and the same company (for disclosure within a group of companies,
see para 10.028 below).12 It is irrelevant whether the disclosing party knows the recipient(s) or
at least their number.13 The passing of information into the public domain (see paras 7.017 f
above and para 10.022 below) is not disclosure within the meaning of Art 10 para 114 (or is at
least covered by the exemption at the end of the para regarding ‘normal division of labour’; see
para 10.014 below),15 even if the modalities pursuant to Art 17 are not complied with (see also
para 10.022 below).16
The object of disclosure in the sense of para 1 must be the inside information itself. When 10.011
assessing whether the information has been disclosed, the understanding of the specific recipi-
ents is decisive, even if only because of their ‘special knowledge’ (case of ‘coded information’, see
also para 7.012 above).17 If an insider (cf para 10.008 above) merely disseminates a conclusion
(buy/sell) based on inside information, para 2 is the relevant provision (para 10.032 below).18
10 Mennicke (n 6) § 14 para 184 with further references.

11 See BaFin, ‘Emittentenleitfaden Modul C – Regelungen aufgrund der Marktmissbrauchsverordnung (MAR)’, 25
March 2020, 62; Klöhn, ‘Artikel 10’ (n 1) paras 13, 17, 29; Hopt and Kumpan (n 9) § 107 para 101; but see also FSA
Final Notice of 15 February 2012 to Andrew Jon Osborne 14 para 6.3 (on information being new to the recipient based
on the fact that the source is different); differently Carsten Gerner-Beuerle, ‘Article 10 MAR: Unlawful disclosure of
inside information’ in Matthias Lehmann and Christoph Kumpan (eds), European Financial Services Law (C. H. Beck
2019) para 6; Buck-Heeb (n 9) § 8 para 240; Mennicke (n 6) § 14 para 195; cf also Frank Schäfer, ‘§ 14 WpHG’ in
Frank Schäfer and Uwe Hamann (eds), Kapitalmarktgesetze (Kohlhammer 2013) para 22 (harm to investor confidence
regardless of success).
12 See Chiara Mosca, ‘Article 10: Unlawful Disclosure of Inside Information’ in Marco Ventoruzzo and Sebastian Mock
(eds), Market Abuse Regulation (Oxford University Press 2017) B.10.78; Klöhn, ‘Artikel 10’ (n 1) para 21; Klaus Hopt,
‘§ 107: Insider- und Ad-hoc-Publizitätsprobleme’ in Herbert Schimansky, Hermann-Josef Bunte and Hans-Jürgen
Lwowski (eds), Bankrechts-Handbuch (4th edn, C. H. Beck 2011) para 59.
13 See, e.g., Gerner-Beuerle (n 11) Art 10 MAR para 5; cf also Heinz-Dieter Assmann, ‘Artikel 10 MAR: Unrechtmäßige
Offenlegung von Insiderinformationen’ in Heinz-Dieter Assmann, Uwe Schneider and Peter Mülbert (eds),
Wertpapierhandelsgesetz (7th edn, Otto Schmidt 2019) paras 12, 15.
14 Klöhn, ‘Artikel 10’ (n 1) paras 23 f; Hopt and Kumpan (n 9) § 107 para 102; Assmann, ‘Artikel 10 MAR’ (n 13)
para 12; cf Christoph Kumpan and Ronny Grütze, ‘Art 10 MAR’ in Eberhard Schwark and Daniel Zimmer (eds),
Kapitalmarktrechts-Kommentar (5th edn, C. H. Beck 2020) paras 9, 21.
15 See Stefan Grundmann in Claus-Wilhelm Canaris, Mathias Habersack and Carsten Schäfer (eds, established by
Hermann Staub), Handelsgesetzbuch - Großkommentar (5th edn, vol 11/1, De Gruyter 2017), 6. Teil Marktregeln Arts
10, 11 MAR para 420; Dirk Zetzsche, ‘Normaler Geschäftsgang und Verschwiegenheit als Kriterien für die Weitergabe
transaktionsbezogener Insiderinformationen an Arbeitnehmer’ (2015) 21 NZG 817, 818; cf also Andreas Meyer, ‘§ 8:
Offenlegungsverbot’ in Andreas Meyer, Thomas Rönnau and Rüdiger Veil (eds), Handbuch Marktmissbrauchsrecht (C.
H. Beck 2018) paras 55 f.
16 See BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 62; Hopt and Kumpan (n 9) § 107 para 102; Mennicke (n 6) § 14 para
221. Differently Buck-Heeb (n 9) § 8 paras 234ff.
17 cf Holgar Fleischer, ‘Investor Relations und informationelle Gleichbehandlung im Aktien-, Konzern- und
Kapitalmarktrecht’ (2009) 38/4 ZGR 505, 512 f; Lars Klöhn, ‘Artikel 7: Insiderinformationen’ in Klöhn (n 1) paras 186
f with further references; cf also (communication of password) Gerner-Beuerle, ‘Art 10 MAR’ (n 11) para 5.
18 See also Dirk Zetzsche, ‘§ 7: Europäisches Kapitalmarktrecht’ in Martin Gebauer and Christoph Teichmann (eds),
Enzyklopädie Europarecht Band 6 - Europäisches Privat- und Unternehmensrecht (Nomos 2014) § 7.C para 158.
141
10.012 The adaptation of the German and French wording (‘disclosure’ instead of ‘passing on’; cf para
10.005 above) in our view makes it clear that it is sufficient that the information enters the
sphere of the recipient, even without his/her actual knowledge.19 Whether the recipient recog-
nises or is able to recognise it as inside information is irrelevant.20 Therefore, sufficient modes
of disclosure include not only (explicit or implied)21 communication,22 but also the granting of
access (physical access or [IT] authorisation), even by omission.23
10.013 Insiders are therefore obliged to actively restrict24 access to inside information as far as possi-
ble (cf paras 10.020, 10.023 below). However, these organisational duties are limited to the
control of legal access, for example, by means of physical or technical entry barriers as well as by
corresponding contractual prohibitions, esp in employment contracts. In our view, the actual
(de facto) dissemination does not have to be monitored (but see further organisational require-
ments, for example, for investment firms under Art 16 MiFID II).25 Also, the MAR does not
require persons in possession of inside information to actively set up precautions against illegal
dissemination.26 Rather, it provides for such measures only for issuers (cf para 10.022 below).27
19 See also BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 62; Klöhn, ‘Artikel 10’ (n 1) para 28; Grundmann (n 15) para 418;
Hopt and Kumpan (n 9) § 107 para 103; similarly Meyer (n 15) § 8 paras 4 f (enabling cognition).
20 BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 62; with further references Klöhn, ‘Artikel 10’ (n 1) para 26; Assmann,
‘Artikel 10 MAR’ (n 13) para 14; cf also Meyer (n 15) § 8 para 5.
21 With further references Klöhn, ‘Artikel 10’ (n 1) para 31; Kumpan and Grütze, Art 10 MAR (n 14) para 17; cf also
Sentencia de la Audiencia Nacional, 17 July 2008, no 176/2005 (on possible implied communication of inside informa-
tion by cancellation of a transaction).
22 Communication also comprising informal settings; cf Recitals 2 f Commission Implementing Regulation (EU) 2016/959
of 17 May 2016 laying down implementing technical standards for market soundings with regard to the systems and
notification templates to be used by disclosing market participants and the format of the records in accordance with
Regulation (EU) No 596/2014 of the European Parliament and of the Council [2016] OJ L 160/23; Art 2 para 1 subpara
2 Commission Delegated Regulation (EU) 2016/960 of 17 May 2016 supplementing Regulation (EU) No 596/2014 of
the European Parliament and of the Council with regard to regulatory technical standards for the appropriate arrange-
ments, systems and procedures for disclosing market participants conducting market soundings [2016] OJ L 160/29.
23 This scenario is explicitly picked up by BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 62; AFM, ‘Handling inside
information by listed companies – Best Practices (Update May 2021)’, 5 https:// www .afm.nl/
~/
profmedia/files/
onderwerpen/marktmisbruik/best-practices-handling-inside-information-listed-companies-may-2021.pdf?la=en
accessed 23 September 2021; cf also CONSOB (n 8) 35 para 5.2.4; FCA, ‘Market Watch: Newsletter on market conduct
and transaction reporting issues’ (August 2019) 60, 2ff (on possession by access to a database) https://www.fca.org.uk/
publication/newsletters/market-watch-60.pdf accessed 15 October 2020. See also Chiara Mosca, ‘Director-Shareholder
Dialogues Behind the Scenes: Searching for a Balance Between Freedom of Expression and Market Fairness’ (2018)
15/4 ECFR 805, 823 f; Klöhn, ‘Artikel 10’ (n 1) para 30; Meyer (n 15) § 8 para 4; Gerner-Beuerle, Art 10 MAR (n 11)
para 5; Assmann, ‘Artikel 10 MAR’ (n 13) para 13.
24 Klöhn, ‘Artikel 10’ (n 1) para 30; Hopt (n 12) § 107 para 57; cf also Mosca, ‘Article 10’ (n 12) B.10.17.
25 cf also Buck-Heeb (n 9) § 8 paras 102 f; Assmann, ‘Artikel 10 MAR’ (n 13) paras 38 f.
26 See e.g., Mennicke (n 6) § 14 para 194; Assmann, ‘Artikel 7 MAR: Insiderinformation’ in Assmann, Schneider and
Mülbert (n 13) para 22; Buck-Heeb (n 9) § 8 para 238; Hopt (n 12) § 107 para 57. Differently Lars Klöhn, ‘§ 14: Verbot
von Insidergeschäften’ in Hirte and Möllers (n 8) para 283; see also following n.
27 See, e.g., Hopt and Kumpan (n 9) § 107 para 107; similarly Grundmann (n 15) para 418. But see also Klöhn, ‘Artikel 10’
(n 1) para 28; Meyer (n 15) § 8 para 14 (requiring adequate safeguards). On requirements for issuers, see also CONSOB
(n 8) 33 note 5.1.2.
142
4. Exemption: normal exercise of employment, etc. (para 1 subpara 1)
(a) Introduction
Para 1 (end of) subpara 1 excludes from the prohibition all disclosures in the course of the 10.014
‘normal’ exercise of an employment, a profession or duties of the disclosing party. For this
purpose, German and Austrian scholarship initially established a rather generous doctrine
under the parallel provision of Art 3 lit a MAD 2003.28 In contrast to this view, the ECJ
emphasised the exceptional character and narrow interpretation of the criterion in the case of
Grøngaard and Bang: In addition to admissibility under Member State law, the disclosure has
to be ‘strictly necessary for the exercise of an employment, profession or duties’ and (cumula-
tively) comply ‘with the principle of proportionality’.29 This is a stricter standard determined by
market abuse law,30 requiring indispensability or ‘strict necessity’ in addition to compliance with
confidentiality obligations under Member State law.31
However, it has remained controversial whether the ECJ requires inevitability even in the strict 10.015
sense that the fulfilment of a specific task would not be possible at all without selective disclo-
sure, not even to a limited extent.32 At any rate, this seems to be too strict under the MAR (see
para 10.021 below),33 whose Recital 35 generally regards selective disclosure for the purpose of
market soundings (Art 11) as an application of the exemption of Art 10 para 1 (see also the
following para 10.016), although the envisaged transactions (Art 11 para 1) will as a general
rule also be possible without transmission of inside information or in some cases even without
28 See, e.g., for Germany Assmann, ‘Artikel 10 MAR’ (n 13) para 19 with further references; for Austria see Susanne Kalss,
Martin Oppitz and Johannes Zollner, Kapitalmarktrecht (2nd edn, Linde 2015) § 21 para 20, even despite the (exces-
sively) narrow implementation in § 48b para 1 (2) Börsegesetz (‘ohne dazu verhalten zu sein’; ‘without being required’
to disclose; see Ulrich Torggler, ‘Entsendung in den Aufsichtsrat einer börsennotierten Aktiengesellschaft’ in Stefan
Perner and others (eds), Festschrift für Attila Fenyves (Verlag Österreich 2013) 1033, 1039ff with further references; cf
also Commission, ‘Proposal for a Council Directive’ (n 3): ‘necessary or appropriate’); cf also Schäfer (n 11) § 14 WpHG
paras 25 f.
29 Grøngaard and Bang (n 1) paras 34ff, 44ff, 52; Gerner-Beuerle, Art 10 MAR (n 11) para 11.
30 See Grøngaard and Bang (n 1) paras 37 f, 48: taking into account the ‘sensitivity of the inside information in question’.
31 See explicitly BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 63, and, on the reactions in German legal literature, Klöhn,
‘Artikel 10’ (n 1) paras 71ff; cf also the detailed account by Torggler, ‘Entsendung in den Aufsichtsrat einer börsennoti-
erten Aktiengesellschaft’ (n 28) 1041ff. Interestingly, the Danish Supreme Court that had submitted the case, even after
the ECJ’s ruling, used a more lenient wording: Højesteret 14 May 2009, 219/2008: ‘sagligt begrundet og et normal led i
hans function’ (factually justified and a normal part of his function).
32 cf, e.g., Heinz-Dieter Assmann, ‘§ 14: Verbot von Insidergeschäften’ in Heinz-Dieter Assmann and Uwe Schneider
(eds), Wertpapierhandelsgesetz (6th edn, Otto Schmidt 2012) paras 74a ff; Klöhn, ‘§ 14: Verbot von Insidergeschäften’ (n
26) paras 325ff; Torggler, ‘Entsendung in den Aufsichtsrat einer börsennotierten Aktiengesellschaft’ (n 28) 1042 f with
further references.
33 Klöhn, ‘Artikel 10’ (n 1) paras 72ff; FCA Handbook MAR 1.4.5 (disclosure must be reasonable for the proper func-
tions), Handbook DTR 2.5.7 (on the wide range of potential recipients); not dissimilarly Kumpan and Grütze, Art 10
MAR (n 14) para 38ff (inevitability for the purpose of disclosure); see also AMF CDS, SAN-2017–18 (n 6) (on inside
information communicated by an investment bank for the purposes of proposing services to a potential takeover bidder
after the information had been picked up by chance). Similarly, e.g., Zetzsche, ‘§ 7: Europäisches Kapitalmarktrecht’ (n
18) § 7.C para 163; but see also, for a stricter view, Hopt and Kumpan (n 9) § 107 para 105. The question is left open
by Mosca, ‘Article 10’ (n 12) MAR B.10.71 and Grundmann (n 15) para 420.
143
any sounding at all.34 The same follows from Art 11 para 2 and Art 4 para 1 lit c Implementing
Regulation (EU) 2016/1055 of 29 June 2016.35
10.016 According to Art 11 para 1a, disclosures to qualified investors in negotiations of private bond
placements are deemed to be made in the ‘normal exercise’ as provided for in Art 10 para 1
(below paras 10.026, 11.010). The remainder of Art 11 formulates (mostly procedural) require-
ments for market soundings, which, if followed by the disclosing party, create the irrefutable
presumption of ‘normal exercise’ in the sense of Art 10 para 1 subpara 1 (‘safe harbour’; see Art
11 para 4; para 11.002 below; cf also Recital 35). This does not mean that non-compliance with
Art 11 per se violates Art 10 para 1; rather, unlawfulness of disclosure depends solely on the
prerequisites of this provision (including the exemption; expressly Recital 35, sentences 4 f; but
see also Recital 5 Delegated Regulation (EU) 2016/960 of 17 May 2016; for further discussion,
see para 11.015 below).
(b) Purpose of disclosure

10.017 According to the ECJ, the exemption requires a ‘close link’ to the (especially professional)
duties of the disclosing party.36 This means, in our opinion, that the disclosure must serve
professional, in particular business purposes.37 This excludes, above all, disclosure for purposes
already frowned upon under market abuse law (especially for trading on the information, cf
Art 8 para 2),38 for example, to analysts,39 as well as, in principle,40 in a private context (friends,
relatives).41 Other than that, the framework is formed by the disclosing party’s legal duties (con-
tractual and statutory) under Member State law,42 whereby it is sufficient that the disclosure
lies within the discretion granted by the relevant norm (in particular by the so-called business
judgement rule concerning managers’ duties).43
34 See Dirk Zetzsche, ‘Die Marktsondierung gem. Art. 11 Marktmissbrauchsverordnung’ [2016] AG 610, 613 f; cf also
Hopt and Kumpan (n 9) § 107 para 113 (but see also previous n). See also below paras 10.030 f.
35 Similarly Klöhn, ‘Artikel 10’ (n 1) para 75.
36 Grøngaard and Bang (n 1) para 48.
37 cf Commission, ‘Proposal for a Council Directive’ (n 3).
38 For an explicit statement to this effect, see the legislative materials on the implementation of IDD in Austria, ErlRV
BörseG-Nov 1993, 1110 BlgNR 18. GP 20: Prohibition of ‘insider advisory contracts’; cf also FCA Handbook MAR
1.4.6 para 1; Andrew Jon Obsborne (n 11) 12 f para 5.7 (on the expectation that the recipient will trade on the information
disclosed).
39 FCA Handbook MAR 1.4.2 para 2; Gerner-Beuerle Art, 10 MAR (n 11) para 10 fn 25. See also Klöhn, ‘Artikel 10’ (n
1) paras 187ff, Mennicke (n 6) § 14 para 263, each with further references.
40 See on exemptions due to higher-ranking interests of the disclosing party, in particular legal defence and medical treat-
ment, Klöhn, ‘Artikel 10’ (n 1) para 55, Kumpan and Grütze, Art 10 MAR (n 14) para 31.
41 FCA Handbook MAR 1.4.2 para 1; Zetzsche, ‘Normaler Geschäftsgang und Verschwiegenheit’ (n 15) 821; Mennicke
(n 6) § 14 para 201.
42 cf Grøngaard and Bang (n 1) paras 39 f, and, following the ECJ, AMF CDS, SAN-2017–18 (n 6). See also Klöhn,
‘Artikel 10’ (n 1) paras 47 f, 61; Meyer (n 15) § 8 para 10; for a detailed analysis, see Torggler, ‘Entsendung in den
Aufsichtsrat einer börsennotierten Aktiengesellschaft’ (n 28) 1041ff.
43 See Torggler, ‘Entsendung in den Aufsichtsrat einer börsennotierten Aktiengesellschaft’ (n 28) 1041 f, and, on the
function of BJR in the context of continuous disclosure, Mario Hössl-Neumann and Andreas Baumgartner, ‘Dealing
with Corporate Scandal under European Market Abuse Law: The Case of VW’ (2019) 16/4 ECFR 484, 527ff; cf also
Klöhn, ‘Artikel 10’ (n 1) para 53 (subjective notion of purpose); Mennicke (n 6) § 14 para 208 (entrepreneurial margin
of discretion).
144
(c) ‘Normal’ exercise of employment, etc.

The disclosure must occur in the course of the ‘normal’ exercise of an employment, a profession 10.018
or duties. This, however, does not refer to what is customary in the specific company or indus-
try. Rather, in light of the function of Art 10 within the framework of market abuse law (above
para 10.001), a normative standard must be applied.44
The initial point of reference for what is ‘normal’ is provided by Member State law (above para 10.019
10.017). Therefore, there is no ‘normal’ exercise if the disclosure violates a statutory or contrac-
tual obligation of confidentiality.
In addition, selective disclosure must be necessary for the performance of the specific task (cf 10.020
also Art 11 para 2).45 As mentioned above (para 10.015), this does not presuppose that the
exercise of the task and/or the disclosure itself is unavoidable; it is sufficient that the disclosure
serves the optimal exercise of the tasks after due consideration (cf Art 11 para 2 lit c; Art 4
para 1 lit c Implementing Regulation (EU) 2016/1055 of 29 June 2016; cf also Recital 33
[‘decided’]). In this context, it must also be examined whether a less severe means is availa-
ble,46 in particular whether the exercise of the task would also be possible with less disclosure
(scope of information, specificity, scope of recipients; ‘need-to-know principle’, cf also Recital
1 and Art 3 para 3 Delegated Regulation (EU) 2016/960 of 17 May 2016; Art 4 para 1 lit c
Implementing Regulation (EU) 2016/1055 of 29 June 2016).47
In addition, according to the ECJ’s decision in Grøngaard and Bang (which was decided under 10.021
the IDD), the principle of proportionality applies, taking into account the specific ‘sensitivity’
of the information.48 The same standard applies under the MAR,49 even though the balancing
of interests referred to by the ECJ (para 10.017 above) is still not explicitly addressed by the
text of the regulation. It reflects, however, general legal principles to be applied when dealing
with conflicting objectives,50 and makes the yardstick of necessity effective and operable by
filtering out alleged/ostensible reasons.51 The (negative) phrasing that the disclosure must not
be disproportionate to the disclosure interest, taking into account the risks of an expansion of
the circle of insiders and the sensitivity of the specific inside information,52 rightly emphasises
44 See, e.g., Grundmann (n 15) para 420; Assmann, ‘Artikel 10 MAR’ (n 13) paras 19, 23.
45 See Grøngaard and Bang (n 1) para 36; Mennicke (n 6) § 14 para 208. The criterion of necessity, in our opinion, includes
the criterion of suitability (‘Geeignetheit’; cf Klöhn, ‘Artikel 10’ (n 1) paras 64 f); cf AMF CDS, 11 January 2016,
SAN-2016–02 (necessary disclosure to complete transaction).
46 See, e.g., Klöhn, ‘Artikel 10’ (n 1) paras 67 f, 77ff; Meyer (n 15) § 8 paras 11, 61ff. See also following n.
47 See BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 63; CONSOB (n 8) 33 para 5.1.2; AFM, ‘Handling inside infor-
mation by listed’ (n 22) 7; FCA, ‘Market Watch’ (n 23) 2ff. See also Klöhn, ‘Artikel 10’ (n 1) paras 123, 141; Mosca,
‘Director-Shareholder Dialogues Behind the Scenes’ (n 23) 836ff; Mennicke (n 6) § 14 paras 228, 245, 259; Kumpan
and Grütze, Art 10 MAR (n 14) paras 27, 34 f.
48 Grøngaard and Bang (n 1) paras 37 f, 48; similarly BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 63. See also
Gerner-Beuerle, Art 10 MAR (n 11) para 11.
49 For a detailed account, see Klöhn, ‘Artikel 10’ (n 1) paras 72, 81ff; Kumpan and Grütze (n 14) Art 10 MAR paras 41ff;
cf also Gerner-Beuerle, Art 10 MAR (n 11) paras 8ff; Buck-Heeb (n 9) § 8 para 244.
50 cf Ulrich Torggler, Gesellschaftsrecht – AT und Personengesellschaften (Verlag Österreich 2013) paras 259ff.
51 See Klöhn, ‘Artikel 10’ (n 1) paras 43ff; cf also (against an independent function of the criterion of unlawfulness)
Gerner-Beuerle, Art 10 MAR (n 11) para 7.
52 cf also Grøngaard and Bang (n 1) para 38 (particular care if information disclosed is manifestly price sensitive).
145
this flanking function.53 In this context, it also becomes relevant if and to what extent accom-
panying measures have been implemented (see paras 10.022 f below). As a result, a duty of
confidentiality (even under professional law, for example, between attorneys and their clients)
on the part of the recipient is not sufficient in itself,54 but has to be included in the considera-
tion (see para 10.023 below). Disclosures required by law are, in our view, always proportionate
provided that reasonable accompanying measures are taken.
(d) Accompanying measures

10.022 In the case of disclosure by or on behalf of an issuer, Art 17 para 8 must be observed (see para
17.079 below). In addition, organisational duties arise pursuant to Art 17 para 4 lit c, para 7 and
Art 18. Disclosure that does not comply with Art 17 but nonetheless makes the information
enter the public domain (para 7.018 above) constitutes a violation of the continuous disclosure
obligation only, not of Art 10 (cf already above, para 10.010).55
10.023 From the criterion of necessity (para 10.020 above) as well as from the purposes of Art 11, Art
17 para 8 follows the obligation to minimise identifiable risks of later use or onward dissemina-
tion of inside information by accompanying measures (cf also Recital 4 Delegated Regulation
(EU) 2016/960 of 17 May 2016). Also, the proportionality of the disclosure (para 10.021
above) may depend on such measures.56 Therefore, confidentiality must generally also be
agreed outside the scope of application of Art 17 para 8, provided that it does not frustrate the
purpose of disclosure (cf also Art 11 para 5 subpara 1 lit d and paras 11.017, 11.023 below).57
Such contractual precautions are not rendered superfluous by the prohibition of Art 10 para 1
itself,58 especially because the exemption of ‘normal exercise of duties’ also applies to the disclo-
sure recipient (cf para 10.014 above). The same is true with regard to duties of confidentiality
under professional law (e.g., attorney-client privilege); however, the safeguards under profes-
sional law will generally be of particular importance in the proportionality test.59 Pursuant to
Art 10 para 1 subpara 2 in conjunction with Art 8 para 4 subpara 2, it may also be necessary to
53 See BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 63; cf also ESMA, ‘Final Report: Draft technical standards on the
Market Abuse Regulation‘, ESMA/2015/1455, 28 September 2015, 23 paras 76 f, 143 para 87; Torggler, ‘Entsendung
in den Aufsichtsrat einer börsennotierten Aktiengesellschaft’ (n 28) 1044 f; Gerner-Beuerle, Art 10 MAR (n 11) para 9.
54 See, e.g., Assmann, ‘Artikel 10 MAR’ (n 13) para 22 with further references; explicitly also the former issuer guidelines
published by the German BaFin, ‘Emittentenleitfaden’ (4th edn, 2013) 41.
56 See Klöhn, ‘Artikel 10’ (n 1) para 96; Mennicke (n 6) § 14 para 214; Schäfer (n 11) § 14 WpHG para 30.
57 See FCA Handbook MAR 1.4.5 para 2; AFM, ‘Handling inside information by listed companies’ (n 47) 2 f, 6; cf
also Andrew Jon Osborne (n 11) 12 f para 5.7; for the context of market soundings, see Holger Fleischer and Dorothea
Bedkowski, ‘Aktien- und kapitalmarktrechtliche Probleme des Pilot Fishing bei Börsengängen und Kapitalerhöhungen’
(2009) 41 DB 2195, 2199; City of London Law Society, ‘Re: Cleansing Announcements’, Letter of 2 March 2012,
2 https://www.citysolicitors.org.uk/storage/2013/06/20120323-Response-from-FSA-re-cleansing-announcements.pdf
accessed 15 October 2020. On duties of confidentiality within the NCA, see BaFin, ‘Emittentenleitfaden Modul C’ (n
11) 64.
58 Differently Case C-348/02 Grøngaard and Bang [2005] ECR I-09939, Opinion of AG Maduro, para 48; see also Eric
Hilgendorf and Carsten Kusche, ‘Kapitel 7: Insiderdelikte’ in Tido Park (ed), Kapitalmarktstrafrecht (5th edn, Nomos
2019) Art 14 MAR para 73; Rolf Sethe, ‘§ 8: Insiderrecht’ in Heinz-Dieter Assmann and Rolf A. Schütze (eds),
Handbuch des Kapitalanlagerechts (4th edn, C. H. Beck 2015) para 126; similarly Assmann, ‘Artikel 10 MAR’ (n 13) para
22.
59 See also Klöhn, ‘Artikel 10’ (n 1) paras 143 f.
146
point out the inside nature of the disclosed information and explain the legal consequences (cf
Art 11 para 1a sentence 3, para 5).
(e) Groups of cases

In abstract terms, the following groups of cases result from the above: (1) At least as a rule, the 10.024
fulfilment of unconditional statutory duties of information and disclosure is a ‘normal exercise
of duties’;60 such duties, regardless of whether they result in public disclosure of information
(e.g., according to Arts 30ff Accounting Directive, 2013/34/EU), in our opinion, themselves
indicate proportionality; therefore, accompanying measures (see paras 10.022 f above) are
normally not required. (2) Insofar as national or European law grants discretion in the exercise
of duties, it determines the outer bounds for the accompanying disclosure of inside informa-
tion; in addition, the criteria of necessity and proportionality apply (see paras 10.020 f above)
and will usually make ‘accompanying measures’ necessary (see paras 10.022 f above).61 (3)
Disclosure that violates statutory or contractual confidentiality obligations is also prohibited
under market abuse law (see para 10.017 above).62
As a part of their fiduciary duties, directors (or – in jurisdictions with a two-tier system – the 10.025
members of the management and of the supervisory board) are obliged to safeguard trade
secrets and keep other internal matters of the company confidential (cf paras 10.014, 10.019
above).63 This includes internal board matters, namely details of discussions and voting. Apart
from such core functions of the board itself, the duty of confidentiality depends on whether the
company has an interest in keeping certain information confidential. Also, a distinction must
be made according to the circle of recipients.
Due to the company’s evident lack of interest, the duty of confidentiality imposed by national 10.026
company law will tend to be most far-reaching in the case of mere gossip, especially in a private
context; also, such disclosure lacks a legitimate business purpose to qualify as ‘normal exercise’
under Art 10 para 1.64 Apart from this special case, in particular in relation to the press, com-
mercial partners and company creditors, the dependency of the duty of confidentiality on the
company’s interest in keeping certain information confidential (para 10.025) implies a margin
of discretion under company law, which at the same time provides the outer bounds for the
disclosure of inside information (paras 10.014, 10.019, 10.025 above). In addition, the criteria
of necessity for the specific (business) purpose of disclosure (paras 10.017, 10.020 above) and
60 See (each with further references) BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 63 f; Gerner-Beuerle, Art 10 MAR para
10 (n 11); Klöhn, ‘Artikel 10’ (n 1) para 98; Kumpan and Grütze, Art 10 MAR (n 14) paras 27, 46; Meyer (n 15) § 8 para
15; cf also FCA Handbook MAR 1.4.3. para 1, MAR 1.4.5 para 2 lit e. On lawful disclosure in the course of drawing
up a prospectus, see Meyer (n 15) § 8 para 49.
61 See, e.g., Klöhn, ‘Artikel 10’ (n 1) para 98 ; Gerner-Beuerle, Art 10 MAR (n 11) para 10; Mennicke (n 6) § 14 para 227;
cf also Sethe (n 58) § 8 para 130; Assmann, ‘Artikel 10 MAR’ (n 13) para 30.
62 cf AMF CDS, SAN-2016–02 (n 45), on former Art 622–1 règlement général de l’autorité des marchés financiers
expressly prohibiting onward disclosure of inside information for purposes other than those for which it was initially
disclosed. The effect under Art 10 of breaches of other obligations not directly aimed at containing dissemination of
information has to be assessed on a case-by-case basis; cf Kumpan and Grütze, Art 10 MAR (n 14) para 44.
63 cf s 8.21 European Model Company Act (Duty of Confidentiality) [2017] https://law.au.dk/fileadmin/Jura/dokumenter/
forskning/projekter/EMCA/2017–03–30_EMCA_withlinks.pdf accessed 15 October 2020.
64 See FCA Handbook MAR 1.4.6 para 1; Gerner-Beuerle, Art 10 MAR (n 11) para 10, and (for the case of personally
motivated disclosures to journalists) ibid., para 13. See also above n 41.
147
proportionality (para 10.021 above) apply. If selective disclosure is necessary, appropriate

‘accompanying measures’ will be required (para 10.022 f above). All of this also applies to
disclosure to potential investors, in particular in the course of a due diligence process (cf Art 11
paras 1 f and Recital 32).65 Subject to management’s due discretion (business judgement rule),
disclosure to significant shareholders planning a block sale may also be permissible (cf also
Recital 33, Art 11 para 1 lit a). As to private bond placements, Art 11 para 1a expressly states
that disclosure to qualified investors for the purpose of negotiations is made in the ‘normal
exercise’, ‘provided that an adequate non-disclosure agreement is in place’ (Recital 6 SME
Regulation, 2019/2115; see para 11.010 below).
10.027 The confidentiality of the board’s consultations and votings (para 10.025 above), in principle,
does not apply between the supervisory and management boards or between members of the
board(s)66 (therefore, see paras 10.017, 10.019 above). Insofar as disclosure between members
of these bodies is required as a result of the division of responsibilities following from statu-
tory law and/or the company’s articles of association (cf para 10.020 above), it will, at least as
a general rule, also be proportionate (para 10.024 above).67
10.028 Most company laws also apply (with certain exceptions; below para 10.029) some form of
confidentiality vis-à-vis shareholders (for special cases, see 10.026 above).68 However, Member
State company laws substantially differ regarding information flows between affiliated compa-
nies. While it is generally accepted that communication is necessary and lawful for the purpose
of (consolidated) financial statements and reports,69 the situation is less clear regarding the
question of whether information may be passed on to a parent entity to facilitate control of
the subsidiary.70 Similar questions arise regarding board members who represent a group of
shareholders.71 In any case, the admissibility of disclosure of inside information requires that
65 See Klöhn, ‘Artikel 10’ (n 1) paras 149, 155; Gerner-Beuerle, Art 10 MAR (n 11) para 12; Kumpan and Grütze, Art 10
MAR (n 14) para 72; Hopt and Kumpan (n 9) § 107 para 108; Buck-Heeb (n 9) § 8 para 245.
66 Gerner-Beuerle, Art 10 MAR (n 11) para 10; Buck-Heeb (n 9) § 8 para 249; Susanne Kalss, ‘Gesellschaftsrechtliche
Informations- und Auskunftsrechte’ in Susanne Kalss and Ulrich Torggler (eds), Big Data – Informationen und
Gesellschaftsrecht (Manz 2017) 7, 14; Ulrich Torggler, ‘Zur Verschwiegenheitspflicht entsendeter Aufsichtsratsmitglieder’
in Hanns Fitz (ed), Festschrift für Hellwig Torggler (Verlag Österreich 2013) 1215, 1218.
67 See, e.g., Klöhn, ‘Artikel 10’ (n 1) paras 105ff; Gerner-Beuerle, Art 10 MAR (n 11) para 10; Kumpan and Grütze, Art
10 MAR (n 14) para 50; Mennicke (n 6) § 14 paras 232, 235. But see also Mosca, ‘Director-Shareholder Dialogues
Behind the Scenes’ (n 23) 837, on differences regarding inspection rights.
68 See also Art 9 para 2 SRD, 2007/36/EC of 11 July 2007 on the exercise of certain rights of shareholders in listed com-
panies [2007] OJ L 184/17 (protection of confidentiality and business interests).
69 See, e.g., Mosca, ‘Director-Shareholder Dialogues Behind the Scenes’ (n 23) 842; cf also Torggler, ‘Zur
Verschwiegenheitspflicht entsendeter Aufsichtsratsmitglieder’ (n 66) 1220 f with further references to the debate in
Austria and Germany.
70 cf Art 11 para 2. On lawful disclosure in preparation of corporate actions, see eg Rüdiger Veil, ‘§ 14: Insider Dealing’
in Rüdiger Veil (ed), European Capital Markets Law (2nd edn, Hart Publishing 2017) para 74, with further references
to German legal literature; Gerner-Beuerle, Art 10 MAR (n 11) para 10. On potentially even broader admissibility of
disclosure in light of group interests, see Mosca, ‘Director-Shareholder Dialogues Behind the Scenes’ (n 23) 842 f, with
reference to generous Belgian group law applicable in the case before the ECJ in Case C-28/99 Verdonck and Everaert
[2001] ECR I-03399; see also Jennifer Payne, ‘Disclosure of Inside Information’ in Vassilios Tountopoulos and Rüdiger
Veil (eds), Transparency of Stock Corporations in Europe (Hart Publishing 2019) 89, 97 fn 34.
71 See Torggler, ‘Entsendung in den Aufsichtsrat einer börsennotierten Aktiengesellschaft’ (n 28) 1038 f, 1041 f; Torggler,
‘Zur Verschwiegenheitspflicht entsendeter Aufsichtsratsmitglieder’ (n 66) 1227 f, 1221ff, with further references.
148
the criteria of necessity and proportionality (including appropriate accompanying measures) are
met (paras 10.020ff).72
The treatment of information provided at the shareholders’ meeting, especially in the course 10.029
of answering questions (Art 9 SRD, 2007/36/EC), remains controversial. Under company law,
the (management) board is usually bound to the interests of the company at its due discretion
(see Art 9 para 2 SRD, 2007/36/EC: protection of confidentiality and business interests);73 this
sets the outer bound in terms of market abuse law (paras 10.019, 10.024 above). Therefore,
a delay of ad hoc disclosure in the legitimate interest of a company (cf Art 17 para 4 lit a) will
in most cases be reason enough that disclosure in the general meeting has to be avoided under
both company and market abuse law (paras 10.017, 10.025 above).74 On the other hand, inside
information cannot be withheld under company law solely on the grounds that shareholders’
information rights do not cover disclosures that are themselves forbidden.75 This is because
such an exemption presupposes an (esp criminal) offence and cannot, together with Art 10,
establish one at the same time.76 As a result, disclosure in the shareholders’ meeting, which is
mandated or at least permissible under company law, is to be regarded as a ‘normal exercise of
duties’ to the extent that it is necessary and proportionate77 (paras 10.020 f above);78 however,
it triggers the disclosure obligation pursuant to Art 17 para 8.79
The division of labour within the company is itself one of the duties of management (see para 10.030
10.017 above); especially at board level, there is usually a broad margin of discretion under
Member States’ company laws, which also acts as a framework for disclosure to employees
under market abuse law.80 In addition, the criteria of necessity and proportionality (paras
10.020 f above) apply; generally, adequate accompanying measures (paras 10.022 f) will be
72 See Assmann, ‘Artikel 10 MAR’ (n 13) para 33; Susanne Kalss, ‘Auskunftsrechte und -pflichten für Vorstand und
Aufsichtsrat im Konzern’ (2010) 3 GesRZ 137, 142; Torggler, ‘Entsendung in den Aufsichtsrat einer börsennotierten
Aktiengesellschaft’ (n 28) 1039ff.
73 See also Art 9 para 2 Directive 2007/36/EC (protection of confidentiality and business interests).
74 See also Klöhn, ‘Artikel 10’ (n 1) para 111; Dirk Kocher and Yanick Sambulski, ‘Insiderinformationen in der
Hauptversammlung’ (2018) 32 DB 1905, 1908; cf Kumpan and Grütze, Art 10 MAR (n 14) para 51.
75 Art 9 para 2 SRD, 2007/36/EC, does not expressly state such an exemption; but see, e.g., § 131 para 3 (5) German
Aktiengesetz.
76 See Klöhn, ‘Artikel 10’ (n 1) para 110; Buck-Heeb (n 9) § 8 para 253; cf also Mathias Siems, ‘§ 131: Auskunftsrecht des
Aktionärs’ in Gerald Spindler and Eberhard Stilz (eds), Aktiengesetz (4th edn, C. H. Beck 2019) para 50 with further
references. Differently, however, some of the German literature, see e.g., Kalss, Oppitz and Zollner (n 28) § 21 para
42; Meyer (n 15) § 8 para 41; Assmann, ‘Artikel 10 MAR’ (n 13) para 35. For an exemption only if there is no duty to
disclose under Art 17, see Kocher and Sambulski (n 74) 1908.
77 Special caution is required as accompanying measures (paras 10.022 f) are usually not possible in these cases; cf
Gerner-Beuerle Art 10 MAR (n 11) para 10.
78 Buck-Heeb (n 9) § 8 para 253; see also Siems (n 76) § 131 para 50; Gerald Spindler, ‘§ 131: Auskunftsrecht des
Aktionärs’ in Karsten Schmidt and Marcus Lutter (eds), Aktiengesetz Kommentar (4th edn, Otto Schmidt 2020) para
84. Differently (selective disclosure prior to publication under Art 17 generally unlawful) e.g., Hopt and Kumpan (n 9)
§ 107 para 106; cf also Mennicke (n 6) § 14 para 279 with further references. On the consequences of false answers
under market abuse law, see Martin Brodey and Jochen Vetter, ‘Zulässigkeit und Grenzen der Kommunikation des
Aufsichtsrats mit Investoren (Teil II): Rechtslage in Deutschland und Österreich’ (2017) 4 ecolex 333, 335.
79 If no exemption is available, selective disclosure in response to shareholders’ questions is, in our view, involuntary and
thus non-intentional under Art 17 para 8; differently Kocher and Sambulski (n 74) 1907 f.
80 See, e.g., Buck-Heeb (n 9) § 8 paras 255ff; Klöhn, ‘Artikel 10’ (n 1) para 123; Assmann, ‘Artikel 10 MAR’ (n 13) para
37; cf also Martin Oppitz, ‘Kapitalmarktrechtliche Schranken der Informationsweitergabe’ in Kalss and Torggler (n 66)
67, 74 f.
149
required. The same applies all the more to disclosure to commercial partners: Such commu-
nications are not unlawful per se; rather, it is a business decision of the management to choose
between internal and external division of labour.81
10.031 Lastly, the above principles also apply to disclosure to obtain external legal advice. Such com-
munication is also the ‘normal exercise of duties’ subject to the criteria of necessity and pro-
portionality (paras 10.020 f above),82 even if an internal legal department exists (paras 10.021,
10.030 above) and even if the external expertise only serves to safeguard internal outcomes.83 In
most cases, proportionality will be met if the usual ‘accompanying measures’ are taken (paras
10.022 f).
C. ONWARD DISCLOSURE OF RECOMMENDATIONS OR INDUCEMENTS (PARA 2)
10.032 Anyone who possesses inside information and not (only) disseminates such information
but (also) recommendations based on it (in particular recommendations to buy/sell) or who
induces others to buy or sell covered financial instruments based on inside information violates
Art 8 para 2 (see para 8.104; cf also para 10.001 above). Supplementary to this, Art 10 para 2
constitutes a sweeping prohibition for cases in which the recommending/inducing party does
not possess the underlying inside information, but was itself a tippee and merely passes on the
recommendation or inducement to others.84 The terms recommending/inducing mirror those
used in Art 8 para 2; therefore, see paras 8.107 f above. Like para 1, para 2 applies irrespective
of whether the person passing on the information achieves a pecuniary advantage (cf para
10.002 above).
10.033 As the offender under Art 10 para 2 is a mere recipient of a recommendation or inducement
within the meaning of Art 8 para 2 (para 10.032), (primary or secondary) insiders are not
potential offenders under Art 10 para 2. In addition, Art 10 para 2 requires that the offender
knows or should know that the tip he or she received is based on inside information (cf Art 8
para 3, para 4 subpara 2 and paras 8.115ff). The latter, in our view, requires grounds for suspi-
cion, especially with regard to the availability to the public.
10.034 Onward ‘disclosure’ in the sense of para 2 corresponds to the notion of ‘disclosure’ under para
1; see paras 10.010ff.85 For the sake of teleological consistency, the prohibition of Art 10 para 2
also applies if a person induced recommends and vice versa. With regard to criminal sanctions
(in the sense of Art 49 CFR, Art 7 ECHR), the principle of nulla poena sine lege (certa) could
81 On possible lawful recipients of selective disclosure, see CONSOB (n 8) 46 para 6.5.6; on the relevance of the mandate
given by the supervisory board to the external service provider for delimiting the ‘normal’ exercise of his profession etc.,
see AMF CDS, SAN-2016–02 (n 45).
82 See Gerner-Beuerle Art 10 MAR (n 11) para 11; Meyer (n 15) § 8 paras 13, 22, 34; Mennicke (n 6) § 14 para 260; Kalss,
Oppitz and Zollner (n 28) § 21 para 52; Assmann, ‘Artikel 10 MAR’ (n 13) paras 45 f; Hilgendorf and Kusche (n 58)
Art 14 MAR para 80; cf also Klöhn, ‘Artikel 10’ (n 1) paras 140 f.
83 See Klöhn, ‘Artikel 10’ (n 1) para 140; Kumpan and Grüte, Art 10 MAR (n 14) para 68; Mennicke (n 6) § 14 para 259.
84 cf Grundmann (n 15) para 387; Zetzsche, ‘§ 7: Europäisches Kapitalmarktrecht’ (n 18) § 7.C para 158; Gerner-Beuerle,
Art 10 MAR (n 11) para 14. Differently Klöhn, ‘Artikel 10’ (n 1) para 233: parallel application of Art 8 para 2 and Art
10 para 2.
85 See also BaFin, ‘Emittentenleitfaden Modul C’ (n 11) 64; Klöhn, ‘Artikel 10’ (n 1) para 238.
150
C. Onward disclosure of recommendations or inducements (para 2)
theoretically preclude this analogy; in practice, this will hardly become relevant due to the
inherent vagueness of both terms.
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Nomos 2019)
Hopt K, ‘§ 107: Insider- und Ad-hoc-Publizitätsprobleme’ in Schimansky H, Bunte H-J and Lwowski
H-J (eds) , Bankrechts-Handbuch (4th edn, C. H. Beck 2011)
Hössl-Neumann M and Baumgartner A, ‘Dealing with Corporate Scandal under European Market
Abuse Law: The Case of VW’ (2019) 16/4 ECFR 2019, 484
Kalss S, ‘Auskunftsrechte und -pflichten für Vorstand und Aufsichtsrat im Konzern’ (2010) 3 GesRZ 137
Kalss S, ‘Gesellschaftsrechtliche Informations- und Auskunftsrechte’ in Kalss S and Torggler U (eds), Big
Data – Informationen und Gesellschaftsrecht (Manz 2017) 7
Klöhn L, ‘§ 14: Verbot von Insidergeschäften’ in Hirte H and Möllers T (eds), Kölner Kommentar zum
WpHG (2nd edn, Carl Heymanns Verlag 2014)
2018)
Klöhn L, ‘Artikel 10: Unrechtmäßige Offenlegung von Insiderinformation’ in Klöhn L (ed),
151
Kocher D and Sambulski Y, ‘Insiderinformationen in der Hauptversammlung’ (2018) 32 DB 1905

Kumpan C and Grütze R, ‘Art 10 MAR’ in Schwark E and Zimmer D (eds), Kapitalmarktrechts-Kommentar
(5th edn, C. H. Beck 2020)
Marhold F, ‘Verschwiegenheitspflichten im Konzern und bei Entsendung’, in Kalss S and Torggler U
(eds), Big Data – Informationen und Gesellschaftsrecht (Manz 2017) 45
Mennicke P, ‘§ 14 Verbot von Insidergeschäften’ in Fuchs A (ed), Wertpapierhandelsgesetz (2nd edn, C.
H. Beck 2016)
Meyer A, ‘§ 8: Offenlegungsverbot’ in Meyer A, Rönnau T and Veil R (eds), Handbuch Marktmissbrauchsrecht
(C. H. Beck 2018)
Mitterlehner P, ‘Zur Verschwiegenheitspflicht entsandter Aufsichtsratsmitglieder (§ 88 AktG) unter
Berücksichtigung der aktienrechtlichen Kompetenzordnung’ (2017) 12 wbl 669
Mosca C, ‘Article 10: Unlawful disclosure of inside information’ in Ventoruzzo M and Mock S (eds),
Mosca C, ‘Director-Shareholder Dialogues Behind the Scenes: Searching for a Balance Between
Freedom of Expression and Market Fairness’ (2018) 15/4 ECFR 805
Oppitz M, ‘Kapitalmarktrechtliche Schranken der Informationsweitergabe’ in Kalss S and Torggler U
(eds), Big Data – Informationen und Gesellschaftsrecht (Manz 2017) 67
Payne J, ‘Disclosure of Inside Information’ in Tountopoulos V and Veil R (eds), Transparency of Stock
Corporations in Europe (Hart Publishing 2019) 89
Schäfer F, ‘§ 14 WpHG’ in Schäfer F and Hamann U (eds), Kapitalmarktgesetze (Kohlhammer 2013)
Schwark E and Kruse D, ‘§ 14: Verbot von Insidergeschäften’ in Schwark E and Zimmer D (eds),
Sethe R, ‘§ 8: Insiderrecht’ in Assmann H-D and Schütze R (eds), Handbuch des Kapitalanlagerechts (4th
edn, C. H. Beck 2015)
Siems M, ‘§ 131: Auskunftsrecht des Aktionärs’ in Spindler G and Stilz E (eds), Aktiengesetz (4th edn,
C. H. Beck 2019)
Spindler G, ‘§ 131: Auskunftsrecht des Aktionärs’ in Schmidt K and Lutter M (eds), Aktiengesetz
Kommentar (4th edn, Otto Schmidt 2020)
Torggler U, ‘Entsendung in den Aufsichtsrat einer börsennotierten Aktiengesellschaft’ in Perner S and
others (eds), Festschrift für Attila Fenyves (Verlag Österreich 2013) 1033
Torggler U, ‘Zur Verschwiegenheitspflicht entsendeter Aufsichtsratsmitglieder’ in Fitz H (ed) Festschrift
für Hellwig Torggler (Verlag Österreich 2013) 1215
Torggler U, Gesellschaftsrecht – AT und Personengesellschaften (Verlag Österreich 2013)
Torggler U, ‘Gesellschaftsrechtliche Informationsrechte und ‑pflichten – Versuch einer Systematisierung’
in Kalss S and Torggler U (eds), Big Data – Informationen und Gesellschaftsrecht (Manz 2017) 1
Veil R, ‘§ 14: Insider Dealing’ in Veil R (ed), European Capital Markets Law (2nd edn, Hart Publishing
2017)
Zetzsche D, ‘Normaler Geschäftsgang und Verschwiegenheit als Kriterien für die Weitergabe transak-
tionsbezogener Insiderinformationen an Arbeitnehmer’ (2015) 21 NZG 817
Zetzsche D, ‘Die Marktsondierung gem. Art. 11 Marktmissbrauchsverordnung’ [2016] AG 610
152
ARTICLE 11
MARKET SOUNDINGS
1. A market sounding comprises the communication of information, prior to the announce-

ment of a transaction, in order to gauge the interest of potential investors in a possible
transaction and the conditions relating to it such as its potential size or pricing, to one or
more potential investors by:
(a) an issuer;
(b) a secondary offeror of a financial instrument, in such quantity or value that the trans-
action is distinct from ordinary trading and involves a selling method based on the
prior assessment of potential interest from potential investors;
(c) an emission allowance market participant; or
(d) a third party acting on behalf or on the account of a person referred to in point (a), (b)
or (c).
1a. Where an offer of securities is addressed solely to qualified investors as defined in point
(e) of Article 2 of Regulation (EU) 2017/1129 of the European Parliament and of the
Council,1 communication of information to those qualified investors for the purposes of
negotiating the contractual terms and conditions of their participation in an issuance of
bonds by an issuer that has financial instruments admitted to trading on a trading venue,
or by any person acting on its behalf or on its account, shall not constitute a market sound-
ing. Such communication shall be deemed to be made in the normal exercise of a person’s
employment, profession or duties as provided for in Article 10(1) of this Regulation, and
therefore shall not constitute unlawful disclosure of inside information. That issuer or any
person acting on its behalf or on its account shall ensure that the qualified investors receiv-
ing the information are aware of, and acknowledge in writing, the legal and regulatory
duties entailed and are aware of the sanctions applicable to insider dealing and unlawful
disclosure of inside information.
2. Without prejudice to Article 23(3), disclosure of inside information by a person intending
to make a takeover bid for the securities of a company or a merger with a company to
parties entitled to the securities, shall also constitute a market sounding, provided that:
(a) the information is necessary to enable the parties entitled to the securities to form an
opinion on their willingness to offer their securities: and
1 Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be
published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive
2003/71/EC (OJ L 168, 30.6.2017, p. 12).
153
Article 11 MARKET SOUNDINGS
(b) the willingness of parties entitled to the securities to offer their securities is reasonably
required for the decision to make the takeover bid or merger.
3. A disclosing market participant shall, prior to conducting a market sounding, specifically
consider whether the market sounding will involve the disclosure of inside information.
The disclosing market participant shall make a written record of its conclusion and the
reasons therefor. It shall provide such written records to the competent authority upon
request. This obligation shall apply to each disclosure of information throughout the
course of the market sounding. The disclosing market participant shall update the written
records referred to in this paragraph accordingly.
4. For the purposes of Article 10(1), disclosure of inside information made in the course
of a market sounding shall be deemed to be made in the normal exercise of a person’s
employment, profession or duties where the disclosing market participant complies with
paragraphs 3 and 5 of this Article.
5. For the purposes of paragraph 4, the disclosing market participant shall, before making the
disclosure:
(a) obtain the consent of the person receiving the market sounding to receive inside
information;
(b) inform the person receiving the market sounding that he is prohibited from using
that information, or attempting to use that information, by acquiring or disposing of,
for his own account or for the account of a third party, directly or indirectly, financial
instruments relating to that information;
(c) inform the person receiving the market sounding that he is prohibited from using that
information, or attempting to use that information, by cancelling or amending an
order which has already been placed concerning a financial instrument to which the
information relates; and
(d) inform the person receiving the market sounding that by agreeing to receive the
information he is obliged to keep the information confidential.
The disclosing market participant shall make and maintain a record of all information
given to the person receiving the market sounding, including the information given in
accordance with points (a) to (d) of the first subparagraph, and the identity of the potential
investors to whom the information has been disclosed, including but not limited to the
legal and natural persons acting on behalf of the potential investor, and the date and time
of each disclosure. The disclosing market participant shall provide that record to the com-
petent authority upon request.
6. Where information that has been disclosed in the course of a market sounding ceases to
be inside information according to the assessment of the disclosing market participant, the
disclosing market participant shall inform the recipient accordingly, as soon as possible.
The disclosing market participant shall maintain a record of the information given
in accordance with this paragraph and shall provide it to the competent authority upon
request.
7. Notwithstanding the provisions of this Article, the person receiving the market sounding
shall assess for itself whether it is in possession of inside information or when it ceases to be
in possession of inside information.
8. The disclosing market participant shall keep the records referred to in this Article for
a period of at least five years.
regulatory technical standards to determine appropriate arrangements, procedures and
154
C. Onward disclosure of recommendations or inducements (para 2)
record keeping requirements for persons to comply with the requirements laid down in
paragraphs 4, 5, 6 and 8.
July 2015.
(EU) No 1095/2010.
draft implementing technical standards to specify the systems and notification templates
to be used by persons to comply with the requirements established by paragraphs 4, 5, 6
and 8 of this Article, particularly the precise format of the records referred to in paragraphs
4 to 8 and the technical means for appropriate communication of the information referred
to in paragraph 6 to the person receiving the market sounding.
by 3 July 2015.
1095/2010.
11. ESMA shall issue guidelines in accordance with Article 16 of Regulation (EU) No
1095/2010, addressed to persons receiving market soundings, regarding:
(a) the factors that such persons are to take into account when information is disclosed to
them as part of a market sounding in order for them to assess whether the information
amounts to inside information;
(b) the steps that such persons are to take if inside information has been disclosed to them
in order to comply with Articles 8 and 10 of this Regulation; and
(c) the records that such persons are to maintain in order to demonstrate that they have
complied with Articles 8 and 10 of this Regulation.
OVERVIEW
A. INTRODUCTION 11.001 1. Conditions for access to the safe harbour

1. Content and purpose 11.001 11.015
2. Historical development 11.007 2. Obligations of the party conducting the
B. SCOPE OF APPLICATION 11.008 market sounding 11.017
1. Issue or sale of financial instruments (a) Procedural (exemption) requirements
(paras 1 f ) 11.008 (paras 3, 5) 11.017
2. Takeover of financial instruments (para 2) (b) Ensuing obligations (paras 6, 8) 11.021
11.011 3. Obligations of the market sounding
C. OBLIGATIONS UNDER ART 11 11.015 recipient (para 7) 11.024
155
A. INTRODUCTION
11.001 Market soundings are interactions to gauge the interest of potential investors in a possible
transaction in a financial instrument (para 1; Recital 32 sentence 1). They are carried out
prior to transactions involving larger volumes outside ordinary trading (Recital 32 sentence
2) and often, if not as a rule, include the disclosure of (at least potential) inside information
(‘wall-crossing’; Recital 34 sentence 1; paras 11.009, 11.014 below).
11.002 The MAR recognises the legitimate need for market soundings, especially in challenging
market environments (Recital 32 sentences 2 f), and therefore creates a ‘safe harbour’ in favour
of the person conducting the market sounding2 in certain primary or secondary offers (Recital
32 sentence 2; see paras 11.008ff below), in order to counteract (Recital 35; see also paras
10.015 f above) uncertainty about the existence of inside information and about compliance
with the requirements of Art 10 para 1 (paras 10.014ff above). Regulatory technique is the
irrebuttable presumption of a ‘normal exercise’ of duties, etc. (Art 10 paras 1 f) provided that
certain procedural precautions are observed (see paras 11.010, 11.017ff below); thus, under
these conditions, the material prerequisites under Art 10 para 1 are irrelevant (para 11.003
below; Recital 35, Art 11 para 4).3 Non-compliance does not per se render the disclosure
of inside information (or, even less, other information) in the course of a market sounding
impermissible under Art 10 para 1; rather, such disclosure must then be assessed according
to this rule (Recital 35; cf also Art 14; misleading, Recital 5 sentence 2 Delegated Regulation
2016/960 [see para 11.016 below]).4 However, non-compliance with elementary precautions
2 On market sounding recipients, see paras 11.024ff.

3 See ESMA, ‘Final Report: Draft technical standards on the Market Abuse Regulation’, ESMA/2015/1455, 28 September
2015, 23 para 74; BaFin, ‘Emittentenleitfaden Modul C – Regelungen aufgrund der Marktmissbrauchsverordnung
(MAR)’, 25 March 2020, 93 (legal fiction), 95 (exemption). But see the reference to the ECJ’s doctrine in Case C-384/02
Grøngaard and Bang [2005] ECR I-09939 (para 10.014 above) ibid., 23 paras 76 f, 143 para 87: ‘necessary and appro-
priate’. See also Carsten Gerner-Beuerle, ‘Article 11 MAR: Market Soundings’ in Matthias Lehmann and Christoph
Kumpan (eds), European Financial Services Law (C. H. Beck 2019) para 11; Lars Klöhn, ‘Artikel 10: Unrechtmäßige
Offenlegung von Insiderinformation’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) para 147;
Michael Brellochs, ‘Artikel 11: Marktsondierungen’ in Klöhn ibid., paras 15ff; Heinz-Dieter Assmann, ‘Artikel 11
MAR: Marktsondierungen’ in Heinz-Dieter Assmann, Uwe Schneider and Peter Mülbert (eds), Wertpapierhandelsgesetz
(7th edn, Otto Schmidt 2019) para 7; City of London Law Society and Law Society Company Law Committee,
Market Abuse Regulation (EU MAR) Q&A (Updated 30 October 2017) 11 f (para A5) https://www.citysolicitors
.org.uk/storage/2017/11/Market-Abuse-Regulation-EU-MAR-QA-Oct-17-update.pdf accessed 22 October 2020; in
detail Ben W Fuhrmann, ‘Kapitalmarktrechtliche Anforderungen an Marktsondierungen vor Kapitalmaßnahmen und
öffentlichen Übernahmen – Teil II’ (2018) 14 WM 645, 646ff; cf also Arad Reisberg, ‘Article 11: Market Soundings’
in Marco Ventoruzzo and Sebastian Mock (eds), Market abuse regulation (Oxford University Press 2017) B.11.15;
Filippo Annunziata, ‘Riflessi organizzativi della rinnovata disciplina in materia di market abuse’ [2016] Le Società 33,
38 f. Differently (relevance of both Art 10 and Art 11) Andreas Meyer, ‘§ 8: Offenlegungsverbot’ in Andreas Meyer,
Thomas Rönnau and Rüdiger Veil (eds), Handbuch Marktmissbrauchsrecht (C. H. Beck 2018) paras 88ff; Rüdiger Veil,
‘Europäisches Insiderrecht 2.0 – Konzeption und Grundsatzfragen der Reform durch MAR und CRIM-MAD’ [2014]
ZBB 85, 92; Dörte Poelzig, ‘Insider- und Marktmanipulationsverbot im neuen Marktmissbrauchsrecht’ (2016) 14 NZG
528, 535; cf also Chiara Mosca, ‘Article 10: Unlawful Disclosure of Inside Information’ in Ventoruzzo and Mock (n 3)
B.10.63.
4 City of London Law Society and Law Society Company Law Committee (n 3) 11 f para A5; BaFin (n 32) 94 f;
Klöhn (n 3) Art 10 para 148; Brellochs (n 3) Art 11 paras 20 f, 148, 152; Reisberg (n 3) B.11.15; Ben W Fuhrmann,
156
A. Introduction
(see e.g., para 1a sentence 3, para 5 subpara 1) will in practice never be a ‘normal exercise’ under
Art 10 para 1 (see paras 10.014ff, especially 10.023).
Thus, in our view, compliance with Art 11 is voluntary in the sense that the party conducting 11.003
the sounding or intending to make a takeover bid (disclosing market participant, DMP; Art 3
para 1 (32)) does not necessarily have to comply with it in the cases of paras 1, 1a and 2, in par-
ticular if it can rule out any disclosure of inside information and thus an infringement of Art 10;
however, in doing so, it acts ‘at its own risk’.5 This view, however, does not seem to be shared by
ESMA,6 and indeed para 3 seems to imply that its obligations of preliminary examination and
documentation with regard to the inside character of planned ‘market sounding information’
(para 11.009 below) constitute self-standing obligations (cf also Recital 35). Nevertheless,
a breach of duty can only occur in the context of Art 10 para 1, if and when inside information
is actually disclosed, as viewed on its own, para 3 (as well as paras 6–8) is a lex imperfecta under
European law (cf Art 14). Therefore, sanctions would have to be implemented by Member
States (cf Art 4 para 2 CRIM-MAD).7 Accordingly, ESMA has voiced its expectation that
administrative sanctions under Art 11 are established.8
Accordingly, the procedural requirements to be complied with pursuant to paras 1a (para 11.004
11.010 below) and 4 (paras 11.017ff) aim to provide a safe harbour, i.e., legal certainty as to
when disclosure for market sounding purposes is deemed necessary and proportionate within
the meaning of Art 10 para 1 (cf also Recital 1 Delegated Regulation 2016/960). At the same
time, to limit risks to market integrity, they ensure that all recipients fall under Art 8 para 4
subpara 2 and Art 10 para 1 subpara 2 and are made aware of their resulting obligations. They
are supplemented by the ensuing obligations of the DMP (para 11.003 above) pursuant to paras
6 and 8 and of the persons receiving the market sounding (market sounding recipients, MSRs)
under paras 7 f.
For further harmonisation, paras 9 f provide for the Commission to draw up technical stand- 11.005
ards which ‘can’ (para 9 subpara 1; Delegated Regulation 2016/960 with the excessively worded
‘Kapitalmarktrechtliche Anforderungen an Marktsondierungen vor Kapitalmaßnahmen und öffentlichen Übernahmen

– Teil I’ (2018) 13 WM 593, 603; Gabriele Apfelbacher, ‘Insiderrecht im M&A-Kontext: (Nicht) viel Neues nach
der Marktmissbrauchsverordnung?’ in VGR (ed), Gesellschaftsrecht in der Diskussion 2017 (Otto Schmidt 2018)
57, 72 f. See also Christoph Seibt and Bernward Wollenschläger, ‘Revision des Marktmissbrauchsrechts durch
Marktmissbrauchsverordnung und Richtlinie über strafrechtliche Sanktionen für Marktmanipulation’ [2014] AG 593,
599 (codification of accepted market practice, para 11.007). Similarly, wall crossings in the UK were formerly regulated
by way of an evidentiary provision. But see Michael Gruber, ‘Marktsondierung und Insiderverbot’ (2016) 7 RdW 460,
462; Dirk Zetzsche, ‘Die Marktsondierung nach Art. 11 MAR’ [2016] AG 610, 619: Market soundings generally only
permissible under Art 10 when carried out under Art 11.
5 Klöhn (n 3) Art 10 para 117; Brellochs (n 3) Art 11 paras 20 f; Assmann (n 3) Art 11 MAR para 7; Gerner-Beuerle (n
3) Art 11 MAR para 1; Meyer (n 3) § 8 paras 93ff, 128.
6 ESMA, ‘Consultation Paper: MAR review report’, ESMA70–156–1459, 3 October 2019, 44 f paras 142ff; see
also Christoph Kumpan and Ronny Grütze, ‘Art 11 MAR’ in Eberhard Schwark and Daniel Zimmer (eds),
Kapitalmarktrechts-Kommentar (5th edn, C. H. Beck 2020) para 132 (Art 11 as specification of requirements under Art
10); cf further n 3.
7 See also ESMA, ‘Consultation Paper’ (n 6) 45 paras 145 f. Differently the French regime under MAD 2003, which
included sanctions for objective failure to comply with the sounding regime; cf AMF CDS, 23 November 2006,
SAN-2007–02; AMF CDS, 7 June 2007, SAN-2007–19.
8 ESMA, ‘Consultation Paper’ (n 6) 44 f paras 142ff.
157
Recital 5 sentence 2 [see para 11.016 below]) or must (para 10 subpara 1; Implementing
Regulation 2016/959; see also para 11.015 below) be observed by DMPs (para 11.003 above).
On the other hand, the ESMA Guidelines foreseen in Art 11 para 11 serve as a (better accessi-
ble) orientation for recipients of market soundings (MSRs; Recital 36; see para 11.024 below).
11.006 A similar exemption from the prohibition of market manipulation under Art 12 does not
exist according to the wording and purpose of the regulation (para 4, Recital 35; paras 11.002
f above; misleadingly, Recital 32);9 however, there is no infringement in the case of bona fide
market sounding.10
11.007 MAD 2003 did not foresee a special regime regarding market soundings; only the prohibition
of unlawful disclosure according to Art 3 lit a was relevant, with its exemption for ‘normal
exercise’ of duties etc. (now Art 10 para 1; see paras 10.014ff).11 The French AMF together
with AMAFI subsequently endeavoured to further specify the resulting yardstick of ‘strict
necessity’.12 Art 11 MAR is a further development of these ‘best practices’.13 Para 1a has been
inserted by SME Regulation 2019/2115 to facilitate bond issuance practices (Recital 6 para 2
SME Regulation, 2019/2115).
B. SCOPE OF APPLICATION
1. Issue or sale of financial instruments (paras 1 f)
11.008 Para 1 concerns contacts with potential investors in financial instruments to gauge demand
in the course of book building or to prepare block sales.14 Therefore, Art 11 does not apply
if the (non-)existence of such demand is already clear to the DMP (para 11.003 above).15 In
ESMA’s understanding, the reference in para 1 to communications ‘prior to the announcement
of a transaction’ further limits its application to contexts where such announcement is planned
in advance.16 Possible DMPs are issuers on the primary market (para 1 lit a; see Art 3 para 1
9 Differently Stefan Grundmann in Claus-Wilhelm Canaris, Mathias Habersack and Carsten Schäfer (eds, established by
Hermann Staub), Handelsgesetzbuch - Großkommentar (5th edn, vol 11/1, De Gruyter 2017), 6. Teil Marktregeln Arts
10, 11 MAR para 425; Kumpan and Grütze (n 6) Art 11 MAR para 131.
10 Klaus Schmolke, ‘Vorbemerkungen zu Artikel 12’ in Klöhn (n 3) para 148; cf also Zetzsche (n 4) 620; Brellochs (n 3) Art
11 para 147.
11 With further references on the European discussion under MAD 2003, see Grundmann (n 9) para 425.
12 See AMAFI, ‘Norme Professionnelle AMAFI Relative aux Sondages de Marché et aux Tests Investisseur’,
AMAFI/12–30a, 11 July 2012 https://www.amf-france.org/sites/default/files/contenu_simple/regles_professionnelles
_approuvees/Norme%20professionnelle%20relative%20aux%20sondages%20de%20marche%20et%20aux%20tests
%20investisseur.pdf accessed 22 October 2020, which was approved by the AMF as an industry code of conduct under
former Art 216–1 règlement général de l’autorité des marchés financiers on market soundings (see also n 18 below).
13 cf Reisberg (n 3) B.11.02; Zetzsche (n 4) 610.
14 For a detailed review of potential scenarios, see Brellochs (n 3) Art 11 paras 26ff.
15 cf Meyer (n 3) § 8 para 74; Assmann (n 3) Art 11 MAR para 10.
16 ESMA, ‘Consultation Paper’ (n 6) 47 para 156; see also Kumpan and Grütze (n 6) Art 11 MAR para 29.
158
B. Scope of application
(21)),17 secondary offerors of a financial instrument (lit b; secondary market), emission allow-
ance market participants (lit c), and all persons acting on behalf of or on the account of the
aforementioned (lit d).18 The subject of the transaction are listed financial instruments (Art 2,
Art 3 para 1 (1)) including derivatives and debt instruments.19 Regarding the secondary market,
lit b requires that, due to its size, the planned transaction cannot be carried out in ‘ordinary’
trading (trading venue or OTC), at least not at comparable conditions (expected price dis-
counts; cf also Recital 32).20 It is therefore irrelevant whether the block is sold as a whole or
in tranches. No such restriction applies to transactions on the primary market (lit a)21 or the
market for emission allowances (lit d).22 Issuers must also comply with Art 17 paras 4, 7 and 8
(see paras 17.079ff).
The aforementioned scenarios are, at least in most cases, already relevant under insider trading 11.009
rules because the planned issuance or intention to sell, or even the market sounding itself (as an
‘intermediate step’)23 constitute inside information (see paras 7.011, 7.013 above).24 However,
it is also possible that further inside information is disclosed in the course of the market sound-
ing, for example, current financial data of the issuer concerned. Art 11 para 1 does not make
a distinction in this respect. Also, the purpose of Art 11 is to make the necessity test pursuant to
Art 10 para 1 (see paras 10.020 f) superfluous (above para 11.002 with n 2). Therefore, it is suf-
ficient that the disclosure, from the perspective of the DMP (para 11.003 above), subjectively
17 Therefore, disposal of already issued own shares is only covered by (the stricter) lit b; Brellochs (n 3) Art 11 para 45;
Assmann (n 3) Art 11 MAR para 19.
18 See ESMA, ‘Final Report: Draft technical standards’ (n 1) 21 f paras 66 f; on the underlying legal relationships, see
Zetzsche (n 4) 612; Bernd Singhof, ‘“Market Sounding” nach der Marktmissbrauchsverordnung’ [2017] ZBB 193, 198;
cf also Gerner-Beuerle (n 3) Art 11 MAR para 5 (onward mandatation of additional parties not covered). Being an
industry code of conduct, the former French regime (see para 11.007 above) only applied to financial intermediaries.
19 See ESMA, ‘Final Report: Draft technical standards’ (n 3) 17 para 72; Zetzsche (n 4) 611.
20 cf ESMA, ‘Final Report: Draft technical standards’ (n 3) 22 para 69: order execution within the average trading day
impeded or information about the trade likely to have a significant effect on the price of the financial instrument;
Brellochs (n 3) Art 11 para 45; see also Zetzsche (n 4) 612 (liquidity discounts); similarly already under MAD 2003 Petra
Mennicke, ‘§ 14 Verbot von Insidergeschäften’ in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd edn, C. H. Beck
2016) paras 299ff. The former French standard (see para 11.007 above) did not explicitly contain such a requirement;
similarly FCA, Handbook MAR 1.4.5 para 2 lit c (lawful disclosure ‘for the purpose of facilitating a commercial, finan-
cial or investment transaction’).
21 The reason is typical insecurity regarding pricing; see Meyer (n 3) § 8 paras 81ff.
22 The reason is low liquidity; see Zetzsche (n 4) 611 fn 13; differently, Fuhrmann, ‘Kapitalmarktrechtliche Anforderungen
an Marktsondierungen vor Kapitalmaßnahmen und öffentlichen Übernahmen – Teil I’ (n 4) 596 f: gratuituous allocation
as decisive factor.
23 cf FCA, ‘Market Watch: Newsletter on market conduct and transaction reporting issues’ (December 2018) 58, 3 f (on
inside information conveyed even though wall-crossing is denied) https:// www .fca
.org.uk/
publication/
newsletters/
market-watch-58.pdf accessed on 22 October 2020. See also Alain Couret and others, Droit financier (3rd edn,
DALLOZ 2019) para 1714, and, on precautions, AMAFI (n 12) 7 para 20. Differently, Brellochs (n 3) Art 11 para 24
(no relevance). For a detailed review of the effects of a broad notion of inside information in cases of market soundings,
see Stefano Lombardo, ‘I sondaggi di mercato: prime riflessioni’ [2016] Le Società (Digital Edition) 23, 25ff.
24 See, e.g., Grundmann (n 9) para 426; cf already above paras 11.007, 11.008 n 19; cf also FSA Final Notice of 6 October
2009 to Darren Morton (finding unreasonable the view widely held on the UK market that preliminary information about
transactions in debt is generally not inside information). The most important application is with regards to listed target
companies; however, the wording also includes information that is price-relevant for the seller or the MSR (para 11.004
above).
159
serves the purpose of gauging interest in the sense of para 1 and objectively is not obviously
irrelevant therefor.25
11.010 In order to increase the attractiveness of private placements of bonds (Recital 6 para 2 SME
Regulation, 2019/2115) para 1a as inserted by Art 1 SME Regulation creates an exemption
regarding communication for the purpose of negotiating bond sales to qualified investors.
According to para 1a, such negotiations between a listed issuer (or any person acting on
its behalf or account; cf para 11.008 above) and qualified investors as defined in Art 2 lit e
Prospectus Regulation, 2017/1129,26 are not deemed market soundings in the sense of paras
1 and 2, if (1) the intended offer of securities is addressed solely to such investors and (2)
the communication concerns contractual terms and conditions of the investors’ participation
(and not just their acceptance of a pre-defined transaction: Recital 6 para 2 SME Regulation,
2019/2115). The legal consequence is that compliance with Art 11 paras 3ff, the Implementing
Regulation 2016/959, and the Delegated Regulation 2016/960 (paras 11.015ff below) is not
necessary for access to the safe harbour regarding unlawful disclosure of inside information,
i.e., for the irrebuttable presumption of a ‘normal exercise’ of duties in the sense of Art 10 para
1 subpara 1 (cf para 11.002 above). However, similar to para 5, para 1a sentence 3 lays down
that the issuer or third party conducting the placement shall ensure that recipients acknowledge
in writing the responsibilities and sanctions as to insider dealing and unlawful disclosure of
inside information (cf paras 11.019, 11.025 below). According to the wording of sentence 3,
compliance with this obligation does not seem to be a prerequisite of the safe harbour of sen-
tence 2 (in connection with Art 10 para 1 subpara 1; see para 11.002 above). However, Recital
6 para 2 SME Regulation, 2019/2115 (‘provided that an adequate non-disclosure agreement
is in place’), together with the parallel obligation under para 5, and the purpose of para 1a to
substitute the material criterion of Art 10 para 1 by a procedural requirement (cf para 11.002,
11.004 above) are, in our view, sufficient reasons to take the opposite view.
2. Takeover of financial instruments (para 2)
11.011 Para 2, according to its wording, relates to market soundings prior to takeover bids and mergers.
However, the determination of the exact scope of application is made difficult by the diverging
language versions, the misleading German one referring instead of mergers to business combi-
25 cf Brellochs (n 2) Art 11 paras 18, 87 f; Assmann (n 3) Art 11 MAR para 35; Fuhrmann, ‘Kapitalmarktrechtliche
Anforderungen an Marktsondierungen vor Kapitalmaßnahmen und öffentlichen Übernahmen – Teil II’ (n 3) 648 f;
Zetzsche (n 4) 619. See also ESMA, ‘Final Report: Draft technical standards’ (n 3) 23 para 76; differently, Meyer (n 3)
§ 8 paras 90 f. Perhaps most importantly, the approach of a potential counterparty with a binding offer is not covered by
Art 11, see Kumpan and Grütze (n 6) Art 11 MAR para 42; cf also n 30.
26 i.e.,
persons or entities that are listed in points (1) to (4) of Section I of Annex II to Directive 2014/65/EU, and persons or
entities who are, on request, treated as professional clients in accordance with Section II of that Annex, or recognised as
eligible counterparties in accordance with Article 30 of Directive 2014/65/EU unless they have entered into an agree-
ment to be treated as non-professional clients in accordance with the fourth paragraph of Section I of that Annex. …’
Annex II Section 1 (1) – (4) lists professional clients, inter alia, certain institutional investors, large companies (in terms
of balance sheet total, net turnover and own funds), goverments and international institutions. Section II covers other
experienced investors as defined therein. According to Art 30, Member States have to recognise certain professional
investors etc. as eligible counterparties.
160
nations (‘Unternehmenszusammenschluss’),27 the English28 and (especially) French29 versions

on the other hand containing teleologically questionable restrictions and therefore suggesting
extensive interpretation and/or analogous application (see para 11.012 below). For the parties
involved that seek a safe harbour (para 11.002 above), this results in counterproductive uncer-
tainty and the risk that the effort associated with Art 11 paras 3ff and the Regulations pursuant
to Art 11 paras 9 f (paras 11.015ff below) is made in vain. However, even if a sounding is
wrongly conducted under Art 11, it at least has an increased chance of being recognised as
‘normal execution’ of duties, etc. in the sense of Art 10 para 1 (see para 10.016 above).
Variant 1 of para 2 concerns a market sounding of the willingness of shareholders of the target 11.012
company to accept a public takeover bid which the DMP or its principal (para 11.003 above)
considers making.30 Neither the wording nor the purpose require a limitation to offers to acquire
control or subsequent thereto (cf Art 2 para 1 lit a Takeover Directive, 2004/25/EC); also, the
reference to Art 23 para 3 in Art 11 para 2 is only intended to ensure the full application of
takeover law within its scope (cf also Recital 27; however, for a caveat, see also para 11.011
above).31 Variant 2 of para 2 concerns a market sounding of the willingness of the shareholders
of a target company to approve a merger. Firstly, all mergers in the meaning of corporate law
are captured,32 (despite the wording of para 2 lit a and b) regardless of the direction of the
merger which does not affect the object of the sounding (basic willingness and acceptance of
exchange ratio; for a caveat, again see para 11.011 above).33 Secondly, also mergers in a wider
sense, i.e., by means of an exchange of shares or the contribution of shares as an investment in
kind in the company conducting the market sounding, fall under Art 11 para 2 Variant 2, as
they are similar in teleological terms and covered by the provision’s wording (caveat: para 1.011
above).34 The even wider German wording, which would also include an acquisition of control
within the meaning of Art 3 para 1 lit b EU Merger Regulation, 139/2004, is likely to be a mere
translation error and, therefore, irrelevant in our view.
In both variants, the initiator, i.e., potential bidder or ‘merger partner’ of the target company, 11.013
is the party permitted to conduct a market sounding under Art 11 (DMP; see para 11.003
27 ‘Offenlegung von Insiderinformationen durch eine Person, die beabsichtigt, ein Übernahmeangebot für die Anteile eines
Unternehmens oder für einen Unternehmenszusammenschluss an Dritte zu richten, die Anspruch auf die Anteile des
Unternehmens haben’; cf also Zetzsche (n 4) 612.
28 ‘disclosure of inside information by a person intending to make a takeover bid for the securities of a company or a merger
with a company to parties entitled to the securities’.
29 ‘la communication d’informations privilégiées par une personne ayant l’intention de faire une offre publique d’achat sur
les titres d’une société ou de proposer une fusion avec une société, aux parties ayant des droits sur les titres’.
30 As in Variant 1, the goal has to be to gauge interest (cf para 11.001 above); hence, the negotiation of ‘irrevocable under-
takings’ is generally not covered by para 2: Apfelbacher (n 4) 73; cf also Zetzsche (n 4) 620; Singhof (n 18) 197.
31 Zetzsche (n 4) 612 f; Brellochs (n 3) Art 11 paras 65 f; similarly FCA Handbook MAR 1.4.5 para 2 lit d (referring
to all offers subject to the UK Takeover Code); differently, Fuhrmann, ‘Kapitalmarktrechtliche Anforderungen an
Marktsondierungen vor Kapitalmaßnahmen und öffentlichen Übernahmen – Teil I’ (n 4) 597ff; Poelzig (n 3) 534;
Kumpan and Grütze (n 6) Art 11 MAR paras 51ff; Meyer (n 3) § 8 para 78; Klaus Hopt and Christoph Kumpan, ‘§ 107:
Insider- und Ad-hoc-Publizitätsprobleme’ in Herbert Schimansky, Hermann-Josef Bunte and Hans-Jürgen Lwowski
(eds), Bankrechts-Handbuch (5th edn, C. H. Beck 2017) para 112. The former French standard (see para 11.007 above)
was even wider, applying to any investment, acquisition or disposal of financial instruments; cf AMF CDS, 14 June 2012,
SAN-2012–07.
32 cf Arts 87ff Company Law Directive, 2017/1132.
33 cf also Meyer (n 3) § 8 para 79 (fallback provision); differently Brellochs (n 3) Art 11 para 69.
34 See also Brellochs (n 3) Art 11 paras 68 f; Assmann (n 3) Art 11 MAR para 28.
161
above). Third persons acting on behalf or on the account of such an initiator should, in our
view, be permitted in analogy to para 1 lit d (however, for a caveat see para 11.011 above).35
Admissible addressees of the market sounding and thus MSRs (para 11.004 above) are all
persons who hold shares in the target company or are entitled to acquire them (e.g., because
of a call option or conversion right; cf also Recital 27),36 but not the management of the target
company37 or the shareholders of the DMP (or of the DMP’s principal).38 Para 2 lit b further
restricts the group of potential MSRs to such (key) persons whose consent, according to an
ex ante assessment of the DMP, is ‘reasonably required’ for the decision to pursue the bid or
merger project. The wording is aligned to the Grøngaard and Bang ruling,39 but does not require
strict necessity (including proportionality; see end of this para; cf paras 10.014ff above). It is, in
our view, necessary and sufficient that the further approach of the DMP, according to its rea-
sonable ex ante assessment, depends on the willingness of the MSR (para 11.004 above) to give
its consent (cf also para 10.020 above).40 Proportionality (para 10.021) is irrefutably presumed
under the conditions of para 4 (para 11.002 above).
11.014 According to para 2 lit a, only such inside information may be disclosed which is ‘necessary’ for
the formation of opinion of the MSR (para 11.004 above), which, in our opinion, includes all
information relevant for this purpose (cf also para 11.013 above). This is a question of a reason-
able ex ante assessment of the DMP (para 11.003 above),41 like the reasonability requirement
under lit b (para 11.013 above). The intention of the DMP to carry out the acquistion or merger
is always relevant for the MSR (see para 11.009 above), whereas closer scrutiny is required if
further inside information on the operations of the DMP is to be disclosed.42 It is irrelevant
whether the information is price-relevant (Art 7 para 1 lit a) with respect to the DMP or the
target company (especially due to a change of demand for the financial instruments issued by
them).43 Art 11 para 2 may therefore also become relevant for takeovers or mergers between
listed and non-listed companies.44 Issuers must additionally comply with Art 17.
35 See Brellochs (n 3) Art 11 para 59; City of London Law Society and Law Society Company Law Committee (n 3)
10 para A4; Fuhrmann, ‘Kapitalmarktrechtliche Anforderungen an Marktsondierungen vor Kapitalmaßnahmen und
öffentlichen Übernahmen – Teil I’ (n 3) 598; Zetzsche (n 4) 612; but see, for a critical perspective, Kumpan and Grütze
(n 6) Art 11 MAR para 26.
36 For example as convertible bondholder: Brellochs (n 43) Art 11 para 61.
37 On this point, see City of London Law Society and Law Society Company Law Committee (n 3) 9 f (paras A1–3); cf
also Reisberg (n 3) B.11.12ff.
38 See, e.g., Brellochs (n 3) Art 11 para 62.
39 Grøngaard and Bang (n 3) para 34.
40 Similarly Brellochs (n 3) Art 11 paras 73 f; Gerner-Beuerle (n 3) Art 11 MAR para 8 ; cf Kumpan and Grütze (n 6) Art
11 MAR paras 19, 24. For a stricter approach, see Assmann (n 3) Art 11 MAR para 39; cf also below para 11.018 on the
recipient’s consent.
41 cf also Brellochs (n 3) Art 11 paras 71 f.
42 For details, see Brellochs (n 3) Art 11 paras 85ff.
43 See, e.g., Simon Tissen, ‘Die Investorensuche im Lichte der EU-Marktmissbrauchsverordnung’ (2015) 32 NZG 1254,
1255; Hopt and Kumpan (n 31) § 107 para 112.
44 cf also para 11.009 n 25 above.
162
C. Obligations under Art 11
C. OBLIGATIONS UNDER ART 11
1. Conditions for access to the safe harbour
According to para 4, the exemption under the disclosure prohibition of Art 10 para 1 (safe 11.015
harbour; paras 11.002 f above) depends on compliance with paras 3 and 5, which leaves
open whether the provisions according to paras 9 f (Implementing Regulation 2016/959,
Delegated Regulation 2016/960) are also covered. Recital 35 sentence 4 rather argues against
this view,45 whereas Art 11 para 10 subpara 1 supports the necessity of compliance in relation
to the Implementing Regulation 2016/959,46 which, in our opinion, according to para 4, is
to be limited to those provisions that implement Art 11 paras 3 and 5 (cf also Art 15 para
1 ESMA Regulation, 1095/2010).47 On the other hand, para 9 subpara 1 (above all in the
German version, according to which persons ‘can’ comply with paras 4, 5, 6 and 8 by adhering
to ESMA’s Technical Standards) gives the impression that compliance with the Delegated
Regulation 2016/960 is merely a ‘safe option’ to comply with paras 4, 5, 6 and 8 and thus is not
necessarily required for the safe harbour of para 4.48
For practical purposes, however, the expressly contrary position of the Delegated Regulation 11.016
2016/960 itself (even if only expressed in its Recital 5 sentence 2) should be decisive, according
to which compliance with all of its provisions is a prerequisite for access to the safe harbour
under Art 11 para 449 and even for the ‘normal execution of duties’ in the sense of Art 10 para
1.50 However, the former (Art 11 para 4) can, in our opinion, not be true at least regarding those
provisions of the Regulation 2016/960 which are assignable to neither para 3 nor para 5 (see
para 4).51 The latter (Art 10 para 1) is incompatible with para 4 and Recital 32 (see also Art 10
para 1 subpara 2 ESMA Regulation, 1095/2010).52
2. Obligations of the party conducting the market sounding
(a) Procedural (exemption) requirements (paras 3, 5)

General remarks: If there is more than one DMP (para 11.003 above), the requirements pursu- 11.017
ant to paras 3 and 5 in conjunction with Implementing Regulation 2016/959 and – at least in
45 cf ‘this Regulation’, in our view referring to MAR.

46 cf ‘to be used … to comply with the requirements established by paragraphs 4, 5, 6 and 8 of this Article’; German: ‘zur
Einhaltung … zu nutzen’; French: ‘à utiliser … pour respecter’; differently Brellochs (n 3) Art 11 para 146.
47 cf also para 11.016 n 49 below.
48 cf also the French wording: ‘mesures … adéquates pour permettre aux personnes de respecter’.
49 For a similar view, see Meyer (n 3) § 8 para 89; cf also BaFin (n 3) 94 (‘substantive and formal obligations’); but see
Brellochs (n 3) Art 11 para 146; Assmann (n 3) Art 11 MAR para 34; Kumpan and Grütze (n 6) Art 11 MAR para 135
(rejecting the position of Recital 5 Delegated Regulation 2016/960).
50 In any case, this is excessive insofar (1) as Arts 5 f Delegated Regulation 2016/960 pertain to Art 11 paras 6 and 8 and,
therefore, in our opinion, cannot be subsumed under Art 11 para 4, (2) as according to Art 11 para 4 and Recital 35
sentence 4 a ‘normal exercise’ of duties in the sense of Art 10 para 1 may exist despite non-fulfilment of Art 11 (see para
11.003 above), and as (3) the (political, cf Art 10 para 1 subpara 2 ESMA Regulation 1095/2010) provisions aiming at
equal treatment of MSRs (Recital 1 Delegated Regulation 2016/960) are obviously not aligned with the prohibition of
selective disclosure under Art 10 para 1 and the exemption thereto.
51 With further references Brellochs (n 3) Art 11 paras 145 f.
52 See also para 11.016 n 49 above.
163
practice (para 11.016 above) – with Delegated Regulation 2016/960 must be fulfilled by each
individual DMP.53 Compliance must be documented electronically and remain permanently
legible (Art 1 Implementing Regulation 2016/959, Art 6 Delegated Regulation 2016/960;
on the retention and disclosure of records, see para 11.022 below). In addition, DMPs have
to maintain a complete list of all persons who have previously indicated that they do not wish
to receive market soundings in relation to either all or particular types of potential transac-
tions (Art 3 para 1 Implementing Regulation 2016/959, Art 4 para 1 Delegated Regulation
2016/960; see also para 11.024 below).
11.018 In the preparation of the market sounding, according to para 3, all information to be disclosed
must already be recorded, including a reasoned assessment of the DMP (para 11.003 above)
as to whether inside information will be dislosed in the course of the sounding (for the con-
sequences of this assessment, see also para 11.019 below).54 These records must subsequently
be updated. In our opinion, a negligent incorrect assessment is not prejudicial under Art 11.55
The market sounding has to be directed to the addressee’s contact person (para 11.024 below)
or, if no contact person has been designated, as directly as possible to persons responsible for
the decision-making process.56 Due to the MSR’s (para 11.004 above) duties resulting from
the market sounding (paras 11.024ff below), the recipient’s prior consent is required (para 5
subpara 1 lit a, Art 4 para 2 sentence 2 Delegated Regulation 2016/960).57
11.019 The market sounding can take place in writing or orally, whereby telephone calls are to be
recorded if possible (Art 2 paras 1 f Delegated Regulation 2016/960).58 In the uniform dis-
closure procedure envisaged by Art 11, the same set of information is, in principle, to be pro-
vided to all recipients of a market sounding (MSRs; Art 3 paras 1, 2, 5 Delegated Regulation
2016/960).59 In doing so, the MSRs must be informed of the assessment of the DMP (para
11.003 above) as to the inside character of the information (para 11.018 above) and of the
potential consequences under market abuse law (Arts 8 and 10); in the case of affirmation,
an estimation must also be given as to when the information is likely to become public (para
53 See ESMA, ‘Final Report: Draft technical standards’ (n 3) 23 para 73; cf also the following n.
54 A uniform assessment should be made in consortium; Brellochs (n 3) Art 11 para 80; Meyer (n 3) § 8 para 77; Zetzsche
(n 4) 614; Singhof (n 18) 201; cf also the former French standard (see para 11.007 above), AMAFI (n 12) 5 f paras 8 f
(information to be deemed inside in case of disagreement).
55 Zetzsche (n 4) 620; similarly Gerner-Beuerle (n 3) Art 11 MAR para 13. Differently Grundmann (n 9) para 428 (pro-
cedural requirements include objectively correct evaluation); to the same effect Brellochs (n 3) Art 11 para 84; see also
(under MAD 2003) AMF CDS, November 24, 2011, SAN-2012–02; cf also para 11.007 on sanctions under the former
French standard.
56 cf Zetzsche (n 4) 616.
57 See under MAD 2003 AMF CDS, SAN-2007–19 (n 7); AMF CDS, 30 October 2008, SAN-2009–05; AMF CDS,
17 March 2011, SAN-2011–05; AMF CDS, 24 November 2011, SAN-2012–02; Conseil d’État, 12 June 2013, nos
359245 and 359477; nos 349185 and 350064; cf also FSA Final Notice of 15 February 2012 to Andrew Jon Osborne,
12 f para 5.7 (on special caution to be applied if transmission of inside information has been refused by the sounding
recipient).
58 According to Art 2 para 3 Delegated Regulation 2016/960, only equipment provided by the DMP may be used (no
private telephones, etc.); cf also para 11.008 n 17 above (no onward mandatation).
59 See also ESMA, ‘Final Report: Draft technical standards’ (n 3) 23 para 77; cf also the former French standard (see para
11.007 above), AMAFI (n 12) 7 para 20. This applies at least to all information directly relevant to the transaction;
Zetzsche (n 4) 614.
164
5 subpara 1; Art 3 paras 3 f Delegated Regulation 2016/960; see also para 11.021 below).60
In addition, the DMP’s assessment determines whether the schema for taking minutes from
Annex I or Annex II of Implementing Regulation 2016/959 shall be used (Art 2 Implementing
Regulation).
After the market sounding, the written minutes must be completed and submitted to the MSR 11.020
(para 11.004 above) to be signed within five working days (Art 6 para 3 Delegated Regulation
2016/960);61 in the case of a disagreement on the protocol, both versions must be kept by the
DMP (para 11.003 above).62 In any case, the DMP must create detailed records (1) of the
information transmitted in the specific market sounding (including the information pursuant
to para 5 subpara 1), and (2) of all recipients including the individual representatives (para 5
subpara 2, Art 3 para 1 Implementing Regulation 2016/959, Art 4 para 1 Delegated Regulation
2016/960).63
(b) Ensuing obligations (paras 6, 8)

The DMP (para 11.003 above) is responsible for informing in writing all MSRs (para 11.004 11.021
above) – without thereby disclosing further inside information64 – as soon as disclosed infor-
mation has ceased to be inside information (cleansing; para 6; Art 4 Implementing Regulation
2016/959);65 this has to be documented according to Annex III Implementing Regulation
2016/959 (Art 5 Delegated Regulation 2016/960, Art 4 para 2 Implementing Regulation
2016/959).
In addition, the DMP (para 11.003 above)66 must retain all documents drawn up pursuant to 11.022
Art 11 for five years and disclose them upon request of the NCA pursuant to Art 22 (Art 11
paras 3, 5, 8, Art 6 paras 1 f Delegated Regulation 2016/960).
Violations of these obligations have no (retroactive) effect on the safe harbour (para 4 e con- 11.023
trario; to the contrary, though, Recital 5 sentence 2 Delegated Regulation 2016/960; see para
11.016 above).67 However, retention will generally be in the interest of the DMP (para 11.003
above) anyway;68 also, the DMP may be contractually obliged to inform the MSR (para 11.004
above) when disclosed information has lost its inside character (cf para 11.021 above).69
60 This is usually dealt with by determining a short timespan for the transaction to either materialise or to be cancelled; in
the latter case, a cooling-off period follows if no separate press release is issued.
61 Refusal to sign does not affect the further procedure; cf Art 6 para 3 subpara 3 Delegated Regulation 2016/960.
62 Art 6 para 3 subpara 2 Delegated Regulation 2016/960; similarly ESMA, ‘MAR Guidelines: Persons receiving market
soundings’, ESMA/2016/1477, 10 November 2016, 6 para 15.
63 This serves to distinguish the spheres; the MSR is responsible in case of further dissemination (see para 11.025 below);
see also Zetzsche (n 4) 615.
64 cf Zetzsche (n 4) 615: Risk of disclosing additional inside information.
65 The British FSA previously did not strictly require a cleansing announcement in case the inside character is lost; see
FSA, ‘Re: Cleansing Announcements’, Letter of 23 March 2012 to The City of London Law Society Regulatory
Law Committee https://www.citysolicitors.org.uk/storage/2013/06/20120323-Response-from-FSA-re-cleansing
-announcements.pdf accessed 22 October 2020. MAR indiscriminately foresees a cleansing; see BaFin (n 3) 95; cf also
FCA, ‘Market Watch 58’ (n 23) 4 (public vs private cleansing).
66 MSRs are not obliged to assist in this regard; Gerner-Beuerle (n 3) Art 11 MAR para 22.
67 See, e.g., Grundmann (n 9) para 430; Singhof (n 18) 204; Zetzsche (n 4) 615; Poelzig (n 3) 535; Tissen (n 43) 1258.
68 cf also ESMA, ‘Final Report: Draft technical standards’ (n 3) 25 para 88.
69 Grundmann (n 9) para 430.
165
3. Obligations of the market sounding recipient (para 7)
11.024 Pursuant to para 11, ESMA has formulated guidelines for MSRs (para 11.004 above) on how
to comply with Arts 8 and 10 in the case of market soundings. Accordingly, potential MSRs
should publicly designate a specific person or other point of initial contact (cf also para 11.018
above),70 set up internal rules to manage the flow of information, establish reporting channels,71
and train staff accordingly.72 When contacted, the MSR should inform the DMP (para 11.003
above) whether future market soundings are generally or in certain cases (un)desired (see also
para 11.017 above).73
11.025 In accordance with this obligation to establish compliance structures, the MSR (para 11.004
above) itself is generally held to be responsible under Arts 8 and 10 for appropriate precautions
in dealing with disclosed information.74 According to para 7, it may not rely on the assessment
of the DMP (para 11.003 above) as to whether the disclosed information is (still)75 inside
information.76 In ESMA’s view, if the addressee reaches a contrary assessment, it may not
communicate this to the DMP.77 For issuers directly affected (cf para 11.014), Arts 17 f must
also be observed.
11.026 According to ESMA, records of compliance with para 7 are to be retained for five years (cf para
11.022 above).78
Literature
AMAFI, ‘Norme Professionnelle AMAFI Relative aux Sondages de Marché et aux Tests Investisseur’,
AMAFI/1230a, 11 July 2012 https://www.amffrance.org/sites/default/files/contenu_simple/regles
_professionnelles_approuvees/Norme%20professionnelle%20relative%20aux%20sondages%20de
%20marche%20et%20aux%20tests%20investisseur.pdf accessed 22 October 2020
70 ESMA, ‘MAR Guidelines’ (n 62) 5 para 9 lit a.

71 ESMA, ‘MAR Guidelines’ (n 62) 5 para 9 lit b, d. This includes the recording of affected financial instruments (ibid, 6
para 14) and the establishment of internal Chinese walls if the information could become relevant for own investment
decisions; on the latter point, see Zetzsche (n 4) 618 f; cf also Brellochs (n 2) Art 11 para 116, and, on good compliance
practices, FCA, ‘Asset management firms and the risk of market abuse’, TR15/1, February 2015, 4, 8 https://www.fca
.org.uk/publication/thematic-reviews/tr15–01.pdf accessed 22 October 2020.
72 ESMA, ‘MAR Guidelines’ (n 62) 5 paras 9 lit c, 10.
73 ESMA, ‘MAR Guidelines’ (n 62) 5 para 11.
74 See Meyer (n 3) § 8 paras 121ff; Zetzsche (n 4) 619 f; Poelzig (n 3) 535; Tissen (n 43) 1257; cf also Assmann (n 3) Art
11 MAR para 76 (compliance with ESMA Guidelines as possible rebuttal to presumption of causality under Art 8).
75 On the consequences of a false cleansing announcement, see ESMA, ‘MAR Guidelines’ (n 62) 6 para 13; Zetzsche (n 4)
615; Poelzig (n 3) 535.
76 On this point, see also ESMA, ‘MAR Guidelines’ (n 62) 5 f para 12: Assessment using own information, but taking into
account Chinese walls within the company; in detail Brellochs (n 3) Art 11 para 116. On good compliance practices for
wall crossings, see also FCA, ‘Asset management firms’ (n 71) 4 (independent assessment of any information received).
77 See ESMA, ‘Final Report: Guidelines on the Market Abuse Regulation – market soundings and delay of dis-
closure of inside information’, ESMA/2016/1130, 13 July 2016, 8 f paras 24 f; Brellochs (n 3) Art 11 para 125;
Gerner-Beuerle (n 3) Art 11 MAR para 20; Fuhrmann, ‘Kapitalmarktrechtliche Anforderungen an Marktsondierungen
vor Kapitalmaßnahmen und öffentlichen Übernahmen – Teil II’ (n 3) 650; Zetzsche (n 4) 618 (risk of disclosure of own
prior knowledge; cf para 7.012 above); differently, however, Grundmann (n 9) para 430.
78 ESMA, ‘MAR Guidelines’ (n 62) 6 f para 16.
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Financial Services Law (C. H. Beck 2019)
Gruber M, ‘Marktsondierung und Insiderverbot’ (2016) 7 RdW 460
Grundmann S, ‘Arts 10, 11 MAR’ in Canaris C-W, Habersack M and Schäfer C (eds, established by
Klöhn L, ‘Artikel 10: Unrechtmäßige Offenlegung von Insiderinformation’ in Klöhn L (ed),
Kumpan C and Grütze R, ‘Art 11 MAR’ in Schwark E and Zimmer D (eds), Kapitalmarktrechts-Kommentar
Lombardo S, ‘I sondaggi di mercato: prime riflessioni’ [2016] Le Società (Digital Edition) 23
Mennicke P, ‘§ 14 Verbot von Insidergeschäften’ in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd
Meyer A, ‘§ 8: Offenlegungsverbot’ in Meyer A, Rönnau T and Veil R (eds), Handbuch Marktmissbrauchsrecht
(C. H. Beck 2018)
Mosca C, ‘Article 10: Unlawful Disclosure of Inside Information’ in Ventoruzzo M and Mock S (eds),
528
Reisberg A, ‘Article 11: Market Soundings’ in Ventoruzzo M and Mock S (eds), Market Abuse Regulation
(Oxford University Press 2017)
Schmolke K, ‘Vorbemerkungen zu Artikel 12’ in Klöhn L (ed), Marktmissbrauchsverordnung (C. H. Beck
2018)
Seibt C and Wollenschläger B, ‘Revision des Marktmissbrauchsrechts durch Marktmissbrauchsverordnung
und Richtlinie über strafrechtliche Sanktionen für Marktmanipulation’ [2014] AG 593
Singhof B, ‘“Market Sounding” nach der Marktmissbrauchsverordnung’ [2017] ZBB 193
Tissen S, ‘Die Investorensuche im Lichte der EU-Marktmissbrauchsverordnung’ (2015) 32 NZG 1254
Veil R, ‘Europäisches Insiderrecht 2.0 – Konzeption und Grundsatzfragen der Reform durch MAR und
CRIM-MAD’ [2014] ZBB 85
Zetzsche D, ‘Die Marktsondierung nach Art. 11 MAR’ [2016] AG 610
167
ARTICLE 12
MARKET MANIPULATION
Susanne Kalss
1. For the purposes of this Regulation, market manipulation shall comprise the following
activities:
(a) entering into a transaction, placing an order to trade or any other behaviour which:
(i) gives, or is likely to give, false or misleading signals as to the supply of, demand
for, or price of, a financial instrument, a related spot commodity contract or an
auctioned product based on emission allowances; or
(ii) secures, or is likely to secure, the price of one or several financial instruments,
a related spot commodity contract or an auctioned product based on emission
allowances at an abnormal or artificial level;
unless the person entering into a transaction, placing an order to trade or engag-
ing in any other behaviour establishes that such transaction, order or behaviour
have been carried out for legitimate reasons, and conform with an accepted
market practice as established in accordance with Article 13;
(b) entering into a transaction, placing an order to trade or any other activity or behaviour
which affects or is likely to affect the price of one or several financial instruments,
a related spot commodity contract or an auctioned product based on emission allow-
ances, which employs a fictitious device or any other form of deception or contrivance;
(c) disseminating information through the media, including the internet, or by any other
means, which gives, or is likely to give, false or misleading signals as to the supply of,
demand for, or price of, a financial instrument, a related spot commodity contract or
an auctioned product based on emission allowances or secures, or is likely to secure,
the price of one or several financial instruments, a related spot commodity contract or
an auctioned product based on emission allowances at an abnormal or artificial level,
including the dissemination of rumours, where the person who made the dissemina-
tion knew, or ought to have known, that the information was false or misleading;
(d) transmitting false or misleading information or providing false or misleading inputs
in relation to a benchmark where the person who made the transmission or provided
the input knew or ought to have known that it was false or misleading, or any other
behaviour which manipulates the calculation of a benchmark.
2. The following behaviour shall, inter alia, be considered as market manipulation:
(a) the conduct by a person, or persons acting in collaboration, to secure a dominant
position over the supply of or demand for a financial instrument, related spot com-
modity contracts or auctioned products based on emission allowances which has, or
168
Article 12 MARKET MANIPULATION
is likely to have, the effect of fixing, directly or indirectly, purchase or sale prices or
creates, or is likely to create, other unfair trading conditions;
(b) the buying or selling of financial instruments, at the opening or closing of the market,
which has or is likely to have the effect of misleading investors acting on the basis of
the prices displayed, including the opening or closing prices;
(c) the placing of orders to a trading venue, including any cancellation or modification
thereof, by any available means of trading, including by electronic means, such as
algorithmic and high-frequency trading strategies, and which has one of the effects
referred to in paragraph 1(a) or (b), by:
(i) disrupting or delaying the functioning of the trading system of the trading venue
or being likely to do so;
(ii) making it more difficult for other persons to identify genuine orders on the trading
system of the trading venue or being likely to do so, including by entering orders
which result in the overloading or destabilisation of the order book; or
(iii) creating or being likely to create a false or misleading signal about the supply of,
or demand for, or price of, a financial instrument, in particular by entering orders
to initiate or exacerbate a trend;
(d) the taking advantage of occasional or regular access to the traditional or electronic
media by voicing an opinion about a financial instrument, related spot commodity
contract or an auctioned product based on emission allowances (or indirectly about its
issuer) while having previously taken positions on that financial instrument, a related
spot commodity contract or an auctioned product based on emission allowances and
profiting subsequently from the impact of the opinions voiced on the price of that
instrument, related spot commodity contract or an auctioned product based on emis-
sion allowances, without having simultaneously disclosed that conflict of interest to
the public in a proper and effective way;
(e) the buying or selling on the secondary market of emission allowances or related deriv-
atives prior to the auction held pursuant to Regulation (EU) No 1031/2010 with the
effect of fixing the auction clearing price for the auctioned products at an abnormal or
artificial level or misleading bidders bidding in the auctions.
3. For the purposes of applying paragraph 1(a) and (b), and without prejudice to the forms
of behaviour set out in paragraph 2, Annex I defines non-exhaustive indicators relating to
the employment of a fictitious device or any other form of deception or contrivance, and
non-exhaustive indicators related to false or misleading signals and to price securing.
4. Where the person referred to in this Article is a legal person, this Article shall also apply,
in accordance with national law, to the natural persons who participate in the decision to
carry out activities for the account of the legal person concerned.
35 specifying the indicators laid down in Annex I, in order to clarify their elements and to
take into account technical developments on financial markets.

169
OVERVIEW
A. INTRODUCTION 12.001 D. INFORMATION-BASED PRICE MANIPULATION

1. Subject of the regulation 12.001 12.022
2. Purpose of the norm 12.003 E. MANIPULATION OF BENCHMARKS 12.030
3. History of origins 12.004 F. SUBJECTIVE REQUIREMENTS – FAULT 12.031
4. Significant changes to existing law 12.005 1. Natural person – legal person relationship
5. Practical significance 12.006 12.033
B. TRADE AND BEHAVIOUR-BASED MARKET G. COMPELLING EXAMPLES OF MARKET
MANIPULATION 12.007 MANIPULATION (ART 12 PARA 2) 12.034
1. Trade and other deceptive manipulation H. INDICATORS AND EXAMPLES (PARA 3, PARA 5)
12.007 12.037
2. Other acts of deception 12.017 I. IMPLEMENTATION 12.038
C. TRADE-BASED PRICE MANIPULATION 12.020
A. INTRODUCTION
1. Subject of the regulation
12.001 Art 12 MAR defines the concept of market manipulation. This definition is similar to that of
Art 5 para 2 of the Directive on Market Manipulation (CRIM-MAD). The concept of market
manipulation is comprehensively and exemplarily regulated. Para 1 describes four variants of
the offence, which are explained in para 2 by means of concrete examples. Para 3 in turn refers
to an illustrative list of indicators, which is set out in Annex I of the MAR. These indicators
are further elaborated in Annex II by manipulative practices. The indicators are also specified in
a Delegated Regulation (EU) 522/2016. Para 4 extends the responsibility for the commission of
offences from natural persons to legal persons as well, in accordance with national regulations.
12.002 Para 1 essentially describes trade-based manipulation, but extends it far beyond the previous
scope of application. Para 1 covers manipulation on the basis of certain trading or other decep-
tive behaviour.1 It is a matter of an effects-based description of the acts of manipulation (para
1 lit a and lit b). Para 1 lit c describes manipulation by means of dissemination of information.
Finally, para 1 lit d describes the manipulation of benchmarks. It deals with the transmission of
misleading inputs and supplementary other behaviour.2 The description is again illustrative and
typological. A general, abstract definition of the prohibition of market manipulation is lacking
at both European and national level.3
1 Klaus U Schmolke, ‘Artikel 12: Marktmanipulation’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018)
para 8.
2 Dirk Zetzsche, ‘§ 7: Europäisches Kapitalmarktrecht’ in Martin Gebauer and Christoph Teichmann (eds), Enzyklopädie
Europarecht Band 6 - Europäisches Privat- und Unternehmensrecht (Nomos 2016) § 7C para 65; Schmolke, ‘Artikel 12’ (n
1) para 6; Matthias Kiesewetter and Miriam Parmentier, ‘Verschärfung des Marktmissbrauchsrechts – Ein Überblick
über die neue EU-Verordnung über Insidergeschäfte und Marktmanipulation’ (2013) 40 BB 2371; Gernot Wilfling,
Praxishandbuch Börserecht (Linde 2017) paras 527ff.
3 Susanne Kalss, Martin Oppitz and Johannes Zollner, Kapitalmarktrecht (2nd edn, Linde 2005) § 22 para 4; Wilfling (n
2) para 526.
170
A. Introduction
2. Purpose of the norm
The normative purpose of the definition of the term first serves to define and concretise the acts 12.003
of prohibition. The regulations of market manipulation as such serve the protection of inves-
tors, since they are intended to ensure that transactions at prices not in line with the market are
prevented.4 In addition to safeguarding the individual market participants in terms of investor
protection, the functioning of the capital market as a whole is ensured.
3. History of origins
Art 12 MAR on the definition of market manipulation is not the first regulation on market 12.004
manipulation, but supersedes the previous regulation in Art 1 para 1 (2) of the Market Abuse
Directive 2003; Art 12 extends the scope of application and the definition of market manip-
ulation.5 Benchmark manipulation in Art 12 para 1 lit d MAR has no predecessor regulation;
it was only inserted in 2016 in response to manipulations of LIBOR and EURIBOR. The
provisions are listed by way of example and are spread across several legal sources, which makes
them difficult to read and handle. Until 1 August 2016, the term market manipulation was
provided in § 48a para 1 (2) BörseG (Austrian Stock Exchange Act). The legal regulation
was based on Art 1 para 2 lit a of the Market Abuse Directive 2003/6 and its Implementing
Directive 124/2003/EC. The legal provisions on the prohibition in the BörseG have already
referred to Art 12 MAR since 2016. Now § 154 BörseG 2018 explicitly refers to Art 12 MAR.
4. Significant changes to existing law
The decisive changes to the previous law consist in an objective extension of the definition of 12.005
the term and the inclusion of not only trade-based activities but also other acts of deception
(behaviour). A further significant extension is that benchmark manipulation is also covered.
Until now, market manipulation was only sanctioned under administrative criminal law. One
of the main innovations is that sanctions can also be imposed by means of judicial criminal law.
This sanctioning is carried out by means of the BörseG.6 However, this is not a change in the
definition, but rather in the sanctioning.
5. Practical significance
In recent years, a number of administrative penalties for information-based market manip- 12.006
ulation actions have been imposed and confirmed by the highest court case law.7 In many
cases, they have also been commented on in the media. A closer look, however, shows that, in
practice, the majority of administrative criminal court decisions related to trade-based market
manipulation, i.e., the direct influence of certain actions on the stock exchange price, and not
4 Kalss, Oppitz and Zollner (n 3) § 22 para 3; Valerie Brandl, ‘§ 48a’ in Christian Temmel (ed), Börsegesetz:
Praxiskommentar (LexisNexis 2011) para 54; Wilfling (n 2) para 525.
5 Schmolke, ‘Artikel 12’ (n 1) para 3.
6 Severin Glaser, ‘Vorgaben und Umsetzung der MAR und CS-MAD aus Sicht der Wissenschaft’ in Severin Glaser
and Robert Kert (eds), Marktmanipulation und Insiderhandel, Neue Wege der Bekämpfung (Linde 2017) 47, 55ff; to the
previous law see also Kalss, Oppitz and Zollner (n 3) § 22 paras 64ff.
7 See also Kalss, Oppitz and Zollner (n 3) § 22 paras 40, 64ff.
171
information-driven manipulation.8 An international comparison shows that a very high number

of administrative criminal proceedings for market manipulation were conducted in Austria.9
B. TRADE AND BEHAVIOUR-BASED MARKET MANIPULATION
1. Trade and other deceptive manipulation
12.007 Art 12 MAR refers to the instruments listed in Art 2 paras 1 and 2 MAR, i.e., financial
instruments traded on a regulated market as well as instruments whose price or value depends
on or affects the price of one of the financial instruments admitted to or at least applied for on
a trading venue or MTF. Instruments whose price or value has an impact on the price or value
of a spot commodity contract are also covered. Moreover, the provision also covers auctioned
products based on emission allowances and spot commodity contracts related to a financial
instrument. Finally, Art 12 also refers to benchmarks (benchmark manipulation).10
12.008 So-called trade-based manipulation is not limited to trade-based manipulation practices alone.
Rather, this form of market manipulation pursuant to Art 12 para 1 lit a MAR covers any other
behaviour.11 Trade-based manipulation involves two basic variants, namely (a) giving false or
misleading signals as to the supply of, demand for or exchange or market price of financial
instruments or (b) inducing an artificial price level. The broad definition of the term covered
by Art 12 para 1 lit a MAR is clarified by examples and indicators. In particular, it includes
entering into a transaction, placing an order to trade or any other behaviour with the objects
covered by Art 12, i.e., purchases, sales, but also trust transactions, transfers by way of security,
pledges and other transfers of rights of use.12
12.009 Entering into a contract: It is sufficient to enter into a transaction, execution is not required.
Placing a trade order may constitute market manipulation, also as a brokerage order. Both
on-exchange and off-exchange transactions are covered.13 This includes the initial order as
well as follow-up orders, the cancellation of an order already launched or its modification. It is
sufficient to receive the order. Execution is not required, nor is entry in the order book.
12.010 Failure to act: Despite this exemplary execution, any other behaviour is also covered, in particu-
lar also a failure to act in breach of duty in respect of a specific business transaction or order.14
8 Janine Füssl and David Taborsky, ‘Der Wertpapierhändler als Täter – Besondere Problematiken iZm Marktmanipulation’
[2018] ZFR 114.
9 See also Lars Teigelack, ‘§ 12: Grundlagen’ in Andreas Meyer, Thomas Rönnau and Rüdiger Veil (eds), Handbuch zum
10 Schmolke, ‘Artikel 12’ (n 1) paras 104ff.
12 Schmolke, ‘Artikel 12’ (n 1) para 34; Annika Anschütz and Maximilian Kunzelmann, ‘§ 14: Handels- und handlungs-
gestützte Maßnahmen’ in Meyer, Rönnau and Veil (n 9) para 12; Holger Fleischer, ‘§ 20a: Verbot der Marktmanipulation’
in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016) para 44 (on the previous law). para 12;
Holger Fleischer, ‘§ 20a: Verbot der Marktmanipulation’ in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd edn, C.
H. Beck 2016) para 44 (on the previous law).
13 Anschütz and Kunzelmann (n 12) § 14 para 14.
14 Petra Buck-Heeb, Kapitalmarktrecht (9th edn, C. F. Müller 2017) para 575; Schmolke, ‘Artikel 12’ (n 1) para 40.
172
B. Trade and behaviour-based market manipulation
Each of the aforementioned acts of omission must trigger a certain effect or at least have the
probability of this effect. This effect can occur in two ways:15
Signal: The action, i.e., the transaction, trade order or omission, must send, or in any case 12.011
probably send, a signal relating to the supply of, demand for or price of the items being traded.
The concept of signal effect is to be understood in a broad sense; it is to be assumed if a rea-
sonable market participant would – probably – take the behaviour into account when making
an investment decision, since the behaviour – probably – influences the demand pattern on the
trading instrument or its price. The direction is irrelevant.16 The reasonable investor is guided
by an objective yardstick, thus a rational, informed player on the capital market.17
False: The signal must be false or misleading. A signal is false if it does not correspond to the 12.012
actual conditions of the instrument concerned.18 It is misleading if it is likely to cause a miscon-
ception in a reasonable investor (see para 12.018).19 The misleading signal may be correct when
viewed in isolation, but it leads to a misconception on the part of reasonable market participants
due to the context of the manner of presentation.20
The reasonable market participant is the central standard of European capital market law.21 12.013
The reasonable investor is unanimously considered to be a rational, adequately informed,
attentive, critical and familiar player on the financial markets.22 This refers less to small or
private investors but rather more to institutional, informed market participants. The yardstick
for the probable effect of the transaction or other behaviour as a false or misleading signal is the
prognosis from the perspective of an informed third party familiar with market conditions.23
This fact is specified by several indicators pursuant to Art 12 para 3 in conjunction with Art
12 para 5.24
Artificial price level: The second variant of the effect lies in achieving an abnormal or artificial 12.014
price of one or more financial instruments. It is sufficient that the abnormal price level is
actually achieved or will probably be achieved, there need not actually be any price effect. The
terms abnormal or artificial are synonymous.25 The artificiality or abnormality is substantiated
by the list of indicators in the Delegated Regulation (EU) 522/2016. The attainment or likely
attainment of a price level is already achieved if it is abnormal or artificial for a certain period
15 Kalss, Oppitz and Zollner (n 3) § 22 para 23; Schmolke, ‘Artikel 12’ (n 1) paras 41ff.
17 Fleischer (n 12) § 20a para 26.
18 Kalss, Oppitz and Zollner (n 3) § 22 para 40; Fleischer (n 12) § 20a para 47; Schmolke, ‘Artikel 12’ (n 1) para 47.
19 Kalss, Oppitz and Zollner (n 3) § 22 para 40; Anschütz and Kunzelmann (n 12) § 14 para 18.
21 Katja Langenbucher, ‘In Brüssel nichts Neues? – Der “verständige Anleger” in der Marktmissbrauchsverordnung’
[2016] AG 417; Thomas Barth, Zwischenschritte – Die Ad-hoc-Publizität bei gestreckten Sachverhalten (Linde 2018) 44ff;
Fleischer (n 12) § 20a para 26; Schmolke, ‘Artikel 12’ (n 1) para 44.
22 Fleischer (n 12) § 20a para 26; Schmolke, ‘Artikel 12’ (n 1) para 44; in the broader context of the ad hoc disclosure see
Barth (n 21) 44ff.
23 Fleischer (n 12) § 20a para 46; Schmolke, ‘Artikel 12’ (n 1) para 49.
173
of time.26 Ultimately, a single transaction with an abnormal price level is sufficient.27 Numerous
practices are listed in the Delegated Regulation (EU) 522/2016.28
12.015 Probability: Manipulation must be probable for both types of offences. Despite the wording,
probability refers to the probability of manipulation having an effect on price determination,
whereby the direction is irrelevant.29
12.016 Justification: Trade-based market manipulation is, by way of exception, justified if the person
entering into the transaction, or placing the trade order, or performing any other equivalent
behaviour, can prove that the transaction, order, or action has legitimate reasons and is in
accordance with a permissible market practice pursuant to Art 13 MAR (see para 13.012).30
2. Other acts of deception
12.017 According to Art 12 para 1 lit b MAR, market manipulation may also be carried out by enter-
ing into a transaction, by placing an order to trade order or by any other activity or behaviour,
i.e., which employs a fictitious device or any other form of deception or contrivance which
affects or is likely to affect the price of one or more financial instruments. Thus, any deceptive
action or deceptive behaviour that actually leads to an influence on the price or is at least likely
to influence the price is included. The actual influence on the price and the potential influence
on the price are covered.31 In addition to entering into a transaction or placing an order to trade,
any other active behaviour and also any omission contrary to duty are also included.32
12.018 The acts must be committed by employing a fictitious device, or any other form of deception
or contrivance. Deception means conduct that is objectively capable of misleading a reasonable
investor (see para 12.013) about the true economic circumstances, i.e., in particular about
supply and demand. Thus, a misconception is created (see para 12.012). Success of the decep-
tion, thus actual deception, is not necessary. Suitability, i.e., potential deception, is sufficient.33
The offence is broader than that of information-led market manipulation pursuant to Art 12
para 1 lit c MAR. A communicative act does not have to be carried out; a factual act or a con-
crete omission is sufficient.34
12.019 In Annex I, Section B MAR, indicators of manipulative behaviour relating to the employment
of a fictitious device or any other form of deception or contrivance are formulated.35 Art 12 para
26 Case C-445/09 IMC Securities [2011] ECR I-05917.

27 Lars Klöhn, ‘Marktmanipulation auch bei kurzfristiger Kursbeeinflussung – das “IMC Securities” – Urteil des EuGH’
(2011) 24 NZG 934, 936.
28 See also Schmolke, ‘Artikel 12’ (n 1) para 188 (for a tabular overview).
29 BaFin, Issuer Guideline VI.3.25; Anschütz and Kunzelmann (n 12) § 14 para 23.
30 Recital 8 Commission Delegated Regulation (EU) 2016/522; Schmolke, ‘Artikel 12’ (n 1) para 189.
31 Klaus U Schmolke, ‘Das Verbot der Marktmanipulation nach dem neuen Marktmissbrauchsregime’ [2016] AG 434,
441.
32 Schmolke, ‘Artikel 12’ (n 1) para 196; Fleischer (n 12) § 20ª para 60; of a iferente opinion Buck-Heeb (n 14) para 580.
33 Schmolke, ‘Artikel 12’ (n 1) paras 199 f; Fleischer (n 12) § 20ª para 60.
34 Schmolke, ‘Artikel 12’ (n 1) para 202; Fleischer (n 12) § 20ª para 60.
35 See Schmolke, ‘Artikel 12’ (n 1) paras 203ff.
174
D. Information-based price manipulation
1 lit b MAR also covers actual or probable price manipulation, meaning any type of influence
on the price, irrespective of whether the price moves upwards or downwards.36
C. TRADE-BASED PRICE MANIPULATION
Art 12 para 1 lit b MAR regulates trade-based market manipulation. Trade-based market 12.020
manipulation comprises the following actions, namely entering into a transaction, placing an
order to trade and any other activity or behaviour on financial markets which affects or is likely
to affect the price of one or several financial instruments, a related spot commodity contract or
an auctioned product based on emission allowances, which employs a fictitious device or any
other form of deception or contrivance.
The broad term covers any other activity or behaviour, i.e., the offence is conceived as 12.021
a catch-all.37 A trade-based form of price manipulation is, for example, a hacker attack.38
Employing a fictitious device is a form of using another form of deception or contrivance. This
term is again very broad. In any case, the action must have a deceptive value.39 Annex I Section
B MAR contains indicators for the concrete definition of manipulative acts (see para 12.017).
D. INFORMATION-BASED PRICE MANIPULATION
Art. 12 para 1 lit c MAR regulates information-based market manipulation. Again – similar to 12.022
trading-based manipulation – two types of behaviour are covered: Art 12 para 1 lit c prohibits
the dissemination of information that is likely to send false or misleading signals or to induce
or be capable of inducing an abnormal or artificial price (see on the terms para 12.014).40
Information: The term information is not defined. It includes all information and data of any 12.023
kind. Information is not only facts, but also information about value judgements, forecasts and
rumours.41 Rumours also fall under the broad concept of information.
Rumours are unauthenticated news with uncertain truth.42 Even freely invented rumours are to 12.024
be qualified as information within the meaning of Art 12 para 1 lit c MAR.43
36 Schmolke, ‘Artikel 12’ (n 1) para 236; Fleischer (n 12) § 20ª para 34.
37 Anschütz and Kunzelmann (n 12) § 14 para 81; Dörte Poelzig, ‘Insider- und Marktmanipulationsverbot im neuen
Marktmissbrauchsrecht’ (2016) 14 NZG 528, 536; Zetzsche (n 2) § 7C para 81.
38 Anschütz and Kunzelmann (n 12) § 14 para 82; Zetzsche (n 2) § 7C para 81.
39 Anschütz and Kunzelmann (n 12) § 14 para 84; Georg Köpferl and Kilian Wegner, ‘Marktmissbrauch durch einen
Sprengstoffanschlag? – Überlegungen zur Marktmanipulation und zum Insiderhandel am Beispiel des Anschlags auf den
Mannschaftsbus von Borussia Dortmund’ (2017) 40 WM 1924, 1929.
40 Recital 47 MAR.
41 Schmolke, ‘Artikel 12’ (n 1) para 242; Fleischer (n 12) § 20a para 16.
42 Holger Fleischer and Klaus U Schmolke, ‘Gerüchte im Kapitalmarktrecht – Insiderrecht, Ad-hoc-Publizität,
Marktmanipulation’ [2007] AG 841, 842.
175
12.025 Dissemination: Information is disseminated if it is actually made available to the public or if

there is a likelihood that it will be made available to the public. The actual information is irrel-
evant. The information does not necessarily have to be made available to a number of persons,44
although, in accordance with Recitals 47 f, it is sufficient that access is given to individuals.45
The sufficiently large number is not determined numerically, but according to the purpose, as
to whether the information is actually likely to influence prices on a given market.
12.026 The dissemination of misleading news may be carried out through news services46 or other
media.47 Conceivable are interviews in newspapers, TV, social media (blogs) or also statements
at events.
12.027 The prohibition of the dissemination of information according to Art 12 para 1 lit c MAR
affects everyone. It is attributed to the person responsible for dissemination.48 In principle, the
manipulative behaviour can also be brought about by omitting certain information. Even the
omission or concealment of certain essential information may constitute an offence.49 However,
the distinction between this and active doing is fluid.
12.028 Information is false if non-existent circumstances are presented as given or actual circumstances
are presented as non-existent.50 If information is qualified as false, the incorrectness must be
clearly established.
12.029 Misleading information is information which, although correct in content, gives the recipient
a false impression of the facts described.51 Incomplete information is also misleading informa-
tion if it leads to an incorrect overall impression.52 It is thus likely to mislead a reasonable inves-
tor as to the true financial circumstances.53 With regard to the special provisions for journalists
see Art 21 (see paras 21.001ff).
E. MANIPULATION OF BENCHMARKS
12.030 According to Art 12 para 1 lit d MAR, benchmark manipulation is also provided for. The
regulation is a reaction to the LIBOR/EURIBOR scandal. Benchmark manipulation is
information-based market manipulation.54 In addition, both trading- and action-based manip-
ulation are covered.55 The decisive difference to the other types of offence is the manipulated
44 Of a different opinion Schmolke, ‘Artikel 12’ (n 1) para 247.

45 Lars Teigelack, ‘§ 13: Informationsgestützte Manipulation’ in Meyer, Rönnau and Veil (n 9)..
46 VwGH 16 May 2011, 2009/17/0187–6; Kalss, Oppitz and Zollner (n 3) § 22 para 39.
47 Hendrik Brinckmann, ‘§ 15: Benchmark-Manipulation’ in Meyer, Rönnau and Veil (n 9)..
48 Schmolke, ‘Artikel 12’ (n 1) para 251; to the previous law see Fleischer (n 12) § 20a para 19.
49 Brinckmann (n 47) § 15 paras 36 f; of a different opinion Teigelack (n 45) § 13 para 29.
50 Teigelack (n 45) § 13 para 39; Kalss, Oppitz and Zollner (n 3) § 22 para 40; Fleischer (n 12) § 20a para 20.
53 Teigelack (n 45) § 13 para 39.
54 Chrisoph H Seibt and Bernward Wollenschläger, ‘Revision des Marktmissbrauchsrechts durch
602; Zetzsche (n 2) § 7C para 65; Kiesewetter and Parmentier (n 2) 2371, 2375.
176
F. Subjective requirements – fault
object, not the price of a financial instrument, but the benchmark or the calculation of the
benchmark.56 According to Art 3 para 1 (29) MAR, a benchmark is a price index or value which
is made available to the public or published and which is determined periodically or regularly by
applying a formula to the value of one or more underlying assets or prices, including estimated
prices, actual or estimated interest rates or other values, and to which reference is made when
determining the amount to be paid for a financial instrument or the value of a financial instru-
ment. The concept of benchmark in MAR is not completely identical to that in the Benchmark
Regulation.57 It covers all published benchmarks that are available on the Internet, whether for
a fee or free of charge.58 Examples are the offered rates in interbank business, such as LIBOR
and EURIBOR, but also benchmarks for credit default swaps and indices, i.e., stock indices,
bond indices or also for commodities.
F. SUBJECTIVE REQUIREMENTS – FAULT
According to Art 12 para 1 MAR, there is no general requirement of intent under capital 12.031
market law for market manipulation.59 However, for individual elements, in particular for
information-based market manipulation – which is particularly important in practice – and for
benchmark manipulation, the explicit provision clearly stipulates the requirement of intent.60
Even if the general requirement of intent is not required, according to the case law, a rebuttable
presumption of intent must be assumed in the case of purely objective formulated types of the
offence.61
Attempt: According to Art 15 MAR, attempted market manipulation is also covered by the 12.032
prohibition; see also § 154 para 2 BörseG 2018.
1. Natural person – legal person relationship
Art 12 para 4 extends the liability of legal persons to natural persons for acts of price manipu- 12.033
lation. According to Austrian law, the natural person is primarily responsible under § 5 VStG
(Administrative Offences Act). According to § 9 (7) VStG, the legal person can, in addition to
paying administrative penalties, be included in the proceedings. It was not until the extensions
provided for under European law that the Austrian BWG/BörseG included the legal person as
a subject of administrative penalties.
56 Schmolke, ‘Das Verbot der Marktmanipulation nach dem neuen Marktmissbrauchsregime’ (n 31) 434, 442; Schmolke,
‘Artikel 12’ (n 1) para 274.
58 Recital 44 MAR.
59 Schmolke, ‘Das Verbot der Marktmanipulation nach dem neuen Marktmissbrauchsregime’ (n 31) 434, 443; Schmolke,
‘Artikel 12’ (n 1) para 301; Poelzig (n 37) 528, 536; Niamh Moloney, EU Securities and Financial Markets Regulation (3rd
edn, Oxford University Press 2014) 742.
60 Schmolke, ‘Artikel 12’ (n 1) para 297; Buck-Heeb (n 14) para 584; recital 23 CRIM-MAD.
61 Case C-45/08 Spector Photo Group [2009] ECR I-12073 paras 38, 44, 54, 62; Schmolke, ‘Artikel 12’ (n 1) para 301 fn
634.
177
G. COMPELLING EXAMPLES OF MARKET MANIPULATION (ART 12 PARA 2)
12.034 Relationship between Regulation and Delegated Regulation: The examples contained in Art
12 para 2 are concretisations of the basic facts set out in Art 12 para 1. The practices in Annex
II of the Delegated Regulation (EU) 522/2016 are again much more concrete, both at the level
of objective and subjective facts. If, however, a compelling example according to Art 12 para 2
MAR is fulfilled, there is no need for any further concretisation through one of the examples
in the Delegated Regulation.62
12.035 The following techniques are mentioned in Art 12 para 2:

● securing a dominant position (lit a);
● actual or likely influence on reference prices and prices displayed (lit b);
● trade-supported manipulation in conventional or also in electronic form (lit c);63
● scalping (lit d);64
● influencing auction clearing prices or otherwise misleading bidders for auctioned products
related to emission allowances (lit e).65
12.036 Scalping is explicitly defined in the MAR. Scalping is the concealment of certain informa-
tion; it is a form of information-supported manipulation.66 The wrongdoing lies in making
a statement and disseminating information without disclosing a conflict of interest and then
exploiting the effects of that information.
H. INDICATORS AND EXAMPLES (PARA 3, PARA 5)
12.037 Art 12 para 3 MAR explicitly refers to examples of situations in Annex I MAR, which lists
a non-exhaustive list of indicators of the existence of elements of the offence.67 This list in
Annex I and the reference to Art 12 para 3 MAR are supplemented by Art 12 para 5. This pro-
vision authorises the Commission to further specify the indicators provided for in Annex I by
means of a delegated regulation. Annex II of this Regulation contains precisely these clarifying
examples (Regulation (EU) 522/2016).
I. IMPLEMENTATION
12.038 In the UK, Art 118 Financial Services and Markets Act 2000, governing market manipulation,
has been superseded by Art 12 MAR. Accordingly, the Financial Conduct Authority (FCA)
had to adapt section 1.6 of the Handbook on Market Conduct (MCH) on Manipulating

63 See Schmolke, ‘Artikel 12’ (n 1) paras 341ff.
64 Schmolke, ‘Artikel 12’ (n 1) para 358; Poelzig (n 37) 528, 536; see also BGH 6.11.2003 1 StR 24/03, NJW 2004, 302,
303, Sascha Opel.
66 Teigelack (n 45) § 13 paras 3, 13, 60ff.
178
I. Implementation
Transactions.68 Nowadays, many sections merely reflect or refer to provisions of the MAR. Few
rules remain, that do more than refer to the MAR, but also give guidance on the FCA’s view
on market manipulation, e.g., section 1.6.7 f.69
Literature
Anschütz A and Kunzelmann M, ‘§ 14: Handels- und handlungsgestützte Maßnahmen’ in Meyer A,

Rönnau T and Veil R (eds), Handbuch zum Marktmissbrauchsrecht (C. H. Beck 2018)
Barth T, Zwischenschritte – Die Ad-hoc-Publizität bei gestreckten Sachverhalten (Linde 2018)
Brandl V, ‘§ 48a’ in Temmel C (ed), Börsegesetz: Praxiskommentar (LexisNexis 2011)
Brinckmann H, ‘§ 15: Benchmark-Manipulation’ in Meyer A, Rönnau T and Veil R (eds), Handbuch zum
Buck-Heeb P, Kapitalmarktrecht (9th edn, C. F. Müller 2017)
Fleischer H, ‘§ 20a: Verbot der Marktmanipulation’ in Fuchs A (ed), Wertpapierhandelsgesetz (2nd edn,
C. H. Beck 2016)
Fleischer H, ‘Vorbemerkung zu § 20a WpHG’ in Fuchs A (ed), Wertpapierhandelsgesetz (2nd edn., C.
H. Beck 2016)
Fleischer H and Schmolke K U, ‘Gerüchte im Kapitalmarktrecht – Insiderrecht, Ad-hoc-Publizität,
Marktmanipulation’ [2007] AG 841
Füssl J and Taborsky D, ‘Der Wertpapierhändler als Täter – Besondere Problematiken iZm
Marktmanipulation’ [2018] ZFR 114
Glaser S, ‘Vorgaben und Umsetzung der MAR und CS-MAD aus Sicht der Wissenschaft’ in Glaser S
and Kert R (eds), Marktmanipulation und Insiderhandel, Neue Wege der Bekämpfung (Linde 2017) 47
Gruber M, ‘Von der Marktmissbrauchsrichtlinie (MAD) zur Marktmissbrauchsverordnung (MAR)’
[2012] ZFR 50
Huber P and Matt B, ‘Zur Änderung des Börsegesetzes’ [2016] ecolex 139
Kiesewetter M and Parmentier M, ‘Verschärfung des Marktmissbrauchsrechts – Ein Überblick über
die neue EU-Verordnung über Insidergeschäfte und Marktmanipulation’ (2013) 40 BB 2371Klöhn
L, ‘Marktmanipulation auch bei kurzfristiger Kursbeeinflussung – das “IMC Securities” -Urteil des
EuGH’ (2011) 24 NZG 934
Köpferl G and Wegner K, ‘Marktmissbrauch durch einen Sprengstoffanschlag? – Überlegungen zur
Marktmanipulation und zum Insiderhandel am Beispiel des Anschlags auf den Mannschaftsbus von
Borussia Dortmund’ (2017) 40 WM 1924
Langenbucher K, ‘In Brüssel nichts Neues? – Der “verständige Anleger” in der Marktmissbrauchsverordnung’
[2016] AG 417
Mock S, ‘§ 20a: Verbot der Marktmanipulation’ in Hirte H and Möllers T M J (eds), Kölner Kommentar
zum WpHG (2nd edn, Carl Heymanns 2014)
Oppitz M, ‘Die borsegesetzlichen Marktmanipulationstatbestande im Licht des verfassungsrechtlichen
Bestimmtheitsgebots’ [2009] ÖBA 171
528
Schmolke K U, ‘Artikel 13: Zulässige Marktpraxis’ in Klöhn L (ed), Marktmissbrauchsverordnung (C.
H. Beck 2018)
Schmolke K U, ‘Das Verbot der Marktmanipulation nach dem neuen Marktmissbrauchsregime’ [2016]
AG 434
Schmolke K U, ‘Artikel 12: Marktmanipulation’ in Klöhn L (ed), Marktmissbrauchsverordnung (C. H.
Beck 2018)

2021).
69 cf Edward J Swan and John Virgo, Market Abuse Regulation (3rd edn, Oxford University Press 2019) 55ff.
179
Seibt C H and Wollenschläger B, ‘Revision des Marktmissbrauchsrecht durch Marktmissbrauchsverordnung

und Richtlinie über strafrechtliche Sanktionen für Marktmanipulation’ [2014] AG 593
Simons C, ‘Gesetzgebungskunst’ [2016] AG 651
Swan E J and Virgo J, Market Abuse Regulation (3rd edn, Oxford University Press 2019)
Teigelack L, ‘Marktmanipulation’ in Veil R (ed), Europäisches Kapitalmarktrecht (2nd edn, Mohr Siebeck
2014) 243
Teigelack L, ‘§ 12: Grundlagen’ | ‘§ 13: Informationsgestützte Manipulation’ in Meyer A, Rönnau T and
Veil R (eds), Handbuch zum Marktmissbrauchsrecht (C. H. Beck 2018)
Veil R, ‘Europäisches Insiderrecht 2.0 – Konzeption und Grundsatzfragen der Reform durch MAR und
CRIM-MAD’ [2014] ZBB 85
Vogl J, ‘§ 20a: Verbot der Marktmanipulation’ in Assmann H-D and Schneider U W (eds), WpHG (6th
edn, Otto Schmidt 2012)
Wagner D, ‘Verwaltungsstrafverfahren der FMA gegen Marktmanipulation’ in Glaser S and Kert R
(eds), Marktmanipulation und Insiderhandel: Neue Wege der Bekämpfung (Linde 2017) 89
Wilfling G, ‘Auswirkungen der Marktmissbrauchsverordnung auf Wertpapieremissionen’ [2016] ÖBA
353
Wilfling G, Praxishandbuch Börserecht (Linde 2017)
Zeder F, ‘Die neuen Strafbestimmungen gegen Marktmissbrauch, Europäische Vorgaben (MAR und
MAD) und ihre Umsetzung im österreichischen Börsegesetz’ [2017] NZWiSt 41
Zimmer D and Bator J, ‘Artikel 13 MAR: Zulässige Marktpraxis’ in Schwark E and Zimmer D (eds),
180
ARTICLE 13
ACCEPTED MARKET PRACTICES
Susanne Kalss
1. The prohibition in Article 15 shall not apply to the activities referred to in

Article 12(1)(a), provided that the person entering into a transaction, placing an order to
trade or engaging in any other behaviour establishes that such transaction, order or behav-
iour have been carried out for legitimate reasons, and conform with an accepted market
practice as established in accordance with this Article.
2. A competent authority may establish an accepted market practice, taking into account the
following criteria:
(a) whether the market practice provides for a substantial level of transparency to the
market;
(b) whether the market practice ensures a high degree of safeguards to the operation of
market forces and the proper interplay of the forces of supply and demand;
(c) whether the market practice has a positive impact on market liquidity and efficiency;
(d) whether the market practice takes into account the trading mechanism of the relevant
market and enables market participants to react properly and in a timely manner to
the new market situation created by that practice;
(e) whether the market practice does not create risks for the integrity of, directly or indi-
rectly, related markets, whether regulated or not, in the relevant financial instrument
within the Union;
(f) the outcome of any investigation of the relevant market practice by any competent
authority or by another authority, in particular whether the relevant market practice
infringed rules or regulations designed to prevent market abuse, or codes of conduct,
irrespective of whether it concerns the relevant market or directly or indirectly related
markets within the Union; and
(g) the structural characteristics of the relevant market, inter alia, whether it is regulated
or not, the types of financial instruments traded and the type of market participants,
including the extent of retail-investor participation in the relevant market.
A market practice that has been established by a competent authority as an accepted
market practice in a particular market shall not be considered to be applicable to other
markets unless the competent authorities of those other markets have accepted that prac-
tice pursuant to this Article.
3. Before establishing an accepted market practice in accordance with paragraph 2, the com-
petent authority shall notify ESMA and the other competent authorities of its intention to
establish an accepted market practice and shall provide the details of that assessment made
181
Article 13 ACCEPTED MARKET PRACTICES
in accordance with the criteria laid down in paragraph 2. Such a notification shall be made
at least three months before the accepted market practice is intended to take effect.
4. Within two months following receipt of the notification, ESMA shall issue an opinion
to the notifying competent authority assessing the compatibility of the accepted market
practice with paragraph 2 and with the regulatory technical standards adopted pursuant
to paragraph 7. ESMA shall also assess whether the establishment of the accepted market
practice would not threaten the market confidence in the Union’s financial market. The
opinion shall be published on ESMA’s website.
5. Where a competent authority establishes an accepted market practice contrary to the
opinion of ESMA issued in accordance with paragraph 4, it shall publish on its website
within 24 hours of establishing the accepted market practice a notice setting out in full its
reasons for doing so, including why the accepted market practice does not threaten market
confidence.
6. Where a competent authority considers that another competent authority has established
an accepted market practice that does not meet the criteria set out in paragraph 2, ESMA
shall assist the authorities concerned in reaching an agreement in accordance with its
powers under Article 19 of Regulation (EU) No 1095/2010.
If the competent authorities concerned fail to reach an agreement, ESMA may take
a decision in accordance with Article 19(3) of Regulation (EU) No 1095/2010.
regulatory technical standards specifying the criteria, the procedure and the requirements
for establishing an accepted market practice under paragraphs 2, 3 and 4, and the require-
ments for maintaining it, terminating it, or modifying the conditions for its acceptance.
July 2015.
(EU) No 1095/2010.
8. Competent authorities shall review regularly, and at least every two years, the accepted
market practices that they have established, in particular by taking into account significant
changes to the relevant market environment, such as changes to trading rules or to market
infrastructures, with a view to deciding whether to maintain it, to terminate it, or to modify
the conditions for its acceptance.
9. ESMA shall publish on its website a list of accepted market practices and in which Member
States they are applicable.
10. ESMA shall monitor the application of accepted market practices and shall submit an
annual report to the Commission on how they are applied in the markets concerned.
11. Competent authorities shall notify accepted market practices that they have established
before 2 July 2014 to ESMA within three months of the entry into force of the regulatory
technical standards referred to in paragraph 7.
The accepted market practices referred to in the first subparagraph of this paragraph
shall continue to apply in the Member State concerned until the competent authority has
made a decision regarding the continuation of that practice following ESMA’s opinion
under paragraph 4.
12. Without prejudice to accepted market practices as established in accordance with para-
graphs 1 to 11 of this Article, an issuer of financial instruments admitted to trading on
182
an SME growth market may enter into a liquidity contract for its shares where all of the
following conditions are met:
(a) the terms and conditions of the liquidity contract comply with the criteria set out
in paragraph 2 of this Article and in Commission Delegated Regulation (EU)
2016/908;1
(b) the liquidity contract is drawn up in accordance with the Union template referred to
in paragraph 13 of this Article;
(c) the liquidity provider is duly authorised by the competent authority in accordance
with Directive 2014/65/EU and is registered as a market member with the market
operator or the investment firm operating the SME growth market;
(d) the market operator or the investment firm operating the SME growth market
acknowledges in writing to the issuer that it has received a copy of the liquidity con-
tract and agrees to that contract’s terms and conditions.
The issuer referred to in the first subparagraph of this paragraph shall be able to demon-
strate at any time that the conditions under which the contract was concluded are met on
an ongoing basis. That issuer and the market operator or the investment firm operating the
SME growth market shall provide the relevant competent authorities with a copy of the
liquidity contract upon their request.
13. ESMA shall develop draft regulatory technical standards to draw up a contractual template
to be used for the purposes of entering into a liquidity contract in accordance with para-
graph 12, in order to ensure compliance with the criteria set out in paragraph 2, including
as regards transparency to the market and performance of the liquidity provision.
September 2020.
referred to in the first subparagraph of this paragraph in accordance with Articles 10 to 14
of Regulation (EU) No 1095/2010.

1 Commission Delegated Regulation (EU) 2016/908 of 26 February 2016 supplementing Regulation (EU) No 596/2014
of the European Parliament and of the Council laying down regulatory technical standards on the criteria, the procedure
and the requirements for establishing an accepted market practice and the requirements for maintaining it, terminating
it or modifying the conditions for its acceptance (OJ L 153, 10.6.2016, p. 3).
183
OVERVIEW
A. BASIC PRINCIPLES 13.001 D. ACCEPTED MARKET PRACTICE 13.012

B. SCOPE OF APPLICATION 13.008 E. PREVIOUS FMA MARKET PRACTICE 13.019
C. CONCRETE BEHAVIOUR 13.010 F. IMPLEMENTATION 13.020
A. BASIC PRINCIPLES
13.001 Art 13 provides for an exemption from the prohibited market manipulation, provided that
there are legitimate reasons for trading and a permissible market practice and that the trading
is in accordance with this market practice. The existence of the market practice defined by the
competent authority – in Austria by the FMA – is a central element. The provision therefore
defines the material criteria and the procedure for determining a market practice.
13.002 The purpose of the provision is to restrict the broad definition of the prohibition of price
manipulation under Art 12 para 1 lit a MAR. This is intended to ensure that certain conduct,
despite its potentially manipulative effect, is compatible with the structures, mechanisms and
operating conditions of the market concerned and is qualified as permissible and appropriate.2
It does not cover the employment of fictitious devices and other information or the use of
other forms of deception.3 The market practice and exemption provisions relate exclusively to
trade-based market manipulation activities.4
13.003 Permissible market practice was already provided for in § 48a para 1 no 3 lit b BörseG (Austrian
Stock Exchange Act). Under previous law, the FMA had recognised one single market practice
as permissible by decree, namely compensation transactions in bonds.5 The recognition of
market practices has so far remained low, not only in Austria, but throughout Europe.6
2 Klaus U Schmolke, ‘Artikel 13: Zulässige Marktpraxis’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck
2018) para 2; Dirk Zetzsche, ‘§ 7: Europäisches Kapitalmarktrecht’ in Martin Gebauer and Christoph Teichmann (eds),
Enzyklopädie Europarecht Band 6 - Europäisches Privat- und Unternehmensrecht (Nomos 2016) § 7 C para 70; on the
previous law Holger Fleischer, ‘Vorbemerkung zu § 20a WpHG’ in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd
edn, C. H. Beck 2016) para 78; Sebastian Mock, ‘§ 20a: Verbot der Marktmanipulation’ in Heribert Hirte and Thomas
M J Möllers (eds), Kölner Kommentar zum WpHG (2nd edn, Carl Heymanns 2014) paras 263 f; Susanne Kalss, Martin
Oppitz and Johannes Zollner, Kapitalmarktrecht (2nd edn, Linde 2005) § 22 paras 29 f.
3 Niamh Moloney, EU Securities and Financial Markets Regulation (3rd edn, Oxford University Press 2014) 750; Schmolke
(n 2) Art 13 para 15; Zetzsche (n 2) § 7 C para 71; on the previous law Kalss, Oppitz and Zollner (n 2) § 22 para 31;
Mock (n 2) § 20a para 260.
4 Kalss, Oppitz and Zollner (n 2) § 22 para 31; Mock (n 2) § 20a para 260.
5 Verordnung der Finanzmarktaufsichtsbehörde (FMA) über zulässige Marktpraktiken an österreichischen Finanzmärkten
(Marktpraxisverordnung – Market practice ordinance of the FMA), BGBl II 2005/1.
6 Schmolke (n 2) Art 13 para 6.
184
As the criteria are now harmonised throughout Europe by the Regulation and ESMA is inten- 13.004
sively involved in procedures to define a market practice on a specific market, the regulatory
standards are to be harmonised throughout Europe.7
Whereas under previous law the recognition of market practice, the existence of legitimate 13.005
reasons and convergence with existing market practice were to be qualified as exclusions of an
offence,8 under current law, a justification must be assumed.9 This is supported by the distribu-
tion of the burden of proof and the materials. The burden of proof of the existence of legitimate
reasons for the compliance of conduct with an acceptable market practice is expressly assigned
to the market participant and not to the supervisory authority pursuant to Art 12 para 1 lit
a MAR and Art 13 para 1 MAR.10
Art 13 MAR, similar to Art 5 and Art 11, provides for an exemption, but this does not consti- 13.006
tute an exemption in the sense of a safe harbour, but rather the conditions for an offence must
be met in order to justify the exemption. Of crucial importance is the fact that, in any case, an
acceptable market practice has been established by the competent authority.11
The broad definition of the offence and the fact that Art 13 is only a justification and further 13.007
that the burden of proof for the existence of the market practice and the compliance of the
concrete conduct with the market practice as well as the legitimate reasons lie with the market
participant is questionable from a legal policy point of view, also from a constitutional point of
view.12
The exemption and justification for the exemption on the basis of legitimate reasons and 13.008
existing market practice refer only to trade-based – effect-based – manipulation according to
Art 12 para 1 lit a MAR.
Material scope of application: The exemption clause applies in the context of trade-based 13.009
price manipulation to all instruments listed in Art 12, in Art 2 para 2 lit a and b MAR (cf para
12.020). Not only transactions on a regulated market or on an MTF or OTF are covered by the
prohibition and thus also by the exemption clause of Art 13 MAR, but also OTC transactions,
provided they meet the necessary conditions.13
7 Schmolke (n 2) Art 13 para 5; Moloney (n 3) 751.

8 Kalss, Oppitz and Zollner (n 2) § 22 para 29; Fleischer (n 2) vor § 20a para 76.
9 Schmolke (n 2) Art 13 para 8; Zetzsche (n 2) § 7 C para 71; ESMA, ‘Final Report: Draft Technical Standards on the
Market Abuse Regulation’, ESMA/2015/1455, 28 September 2015, 30 para 115.
10 Zetzsche (n 2) § 7 C para 76; Moloney (n 3) 750; Schmolke (n 2) Art 13 para 9.
11 Recital 42 MAR; Zetzsche (n 2) § 7 C para 70; Schmolke (n 2) Art 13 para 7.
12 To this specific provision see also Martin Oppitz, ‘Die börsegesetzlichen Marktmanipulationstatbestände im Licht des
verfassungsrechtlichen Bestimmtheitsgebots’ [2009] ÖBA 171.
13 ESMA (n 9) 31 f, paras 120ff.
185
C. CONCRETE BEHAVIOUR
13.010 The exemption clause of Art 13 only applies if there are legitimate reasons and if a certain
behaviour is to be classified as a recognised market practice, so that this conduct is in line
with a recognised market practice. Therefore, a subsumption of the specific behaviour with an
existing market practice must be made. The market practice and the legitimate reasons must
co-exist and be cumulative.14
13.011 Legitimate reasons indicate a subjective element.15 Thereby, the transaction, order or action
has legitimate reasons, i.e., a purpose pursued by accepted market practice. It must therefore
be examined whether the behaviour of the market participant is to be recognised under capital
market law in accordance with its objectives and purpose and does not contradict the recog-
nised principles, structures, mechanisms and functional conditions of the market.16 Ultimately,
there is a very close connection to the criteria for the recognition of a market practice in general
and the existence of the legitimate reason for the individual market participant in the concrete
situation, so that hardly a new criterion and new justification can be derived from this.17
D. ACCEPTED MARKET PRACTICE
13.012 Accepted market practice: The existence of a certain market practice means that it must be
a very specific, concrete market conduct subsumable under Art 12 para 1 lit a MAR, which may
not merely be a general activity such as arbitrage, hedging or short selling.
13.013 Thus practices and general activities are to be defined. Market practice requires a certain
concrete behaviour.18 The behaviour must be concrete, but it does not have to be traditional
and old-fashioned, but can also be new market practices according to Commission Delegated
Regulation 908/2016.19
13.014 The existence of a concrete market behaviour alone is not sufficient; rather, the competent
national authority, i.e., in Austria the FMA, must determine the permissible market practice.
As soon as a national authority recognises the market practice for its market, this does not
automatically result in an extension of admissibility to other markets, whether in terms of geog-
raphy or from the perspective of a market segment or a specific financial instrument. Rather,
recognition by the competent national authority must be made separately in each case.20
14 On the previous law Kalss, Oppitz and Zollner (n 2) § 22 para 32; Mock (n 2) § 20a para 272.
15 Moloney (n 3) 716; Zetzsche (n 2) § 7 C para 76; Schmolke (n 2) Art 13 para 27.
16 Schmolke (n 2) Art 13 para 28; on the previous law Fleischer (n 2) vor § 20a para 79; Joachim Vogl, ‘§ 20a: Verbot der
Marktmanipulation’ in Heinz-Dieter Assmann and Uwe H Schneider (eds), WpHG (6th edn, Otto Schmidt 2012) para
179.
17 On the previous law doubtfully Kalss, Oppitz and Zollner (n 2) § 22 para 32.
18 Schmolke (n 2) Art 13 para 20.
19 Recital 2 Commission Delegated Regulation (EU) 2016/908 of 26 February 2016 supplementing Regulation (EU) No
596/2014 laying down regulatory technical standards on the criteria, the procedure and the requirements for establishing
an accepted market practice and the requirements for maintaining it, terminating it or modifying the conditions for its
acceptance [2016] OJ L 153/3.
20 ESMA (n 9) 30 fn 112; Schmolke (n 2) Art 13 para 23.
186
E. Previous FMA market practice
The mere recognition of market practice is therefore not sufficient; a constitutive act of the 13.015
national authority is required. Therefore, for a certain activity, prior clarification with the
national authority and the application for recognition and determination of a recognised
market practice must be made.
The positive determination decision of an authority has no binding effect on another com- 13.016
petent authority. ESMA can only participate in and approve the respective national decision.
Art 13 para 2 subpara 1 MAR lists a number of criteria which the competent authority has 13.017
to take into account when deciding on the determination of a permissible market practice.
These are further specified in Commission Delegated Regulation 908/2016. The criteria are
as follows:
● The market practice must provide for a substantial level of transparency to the market.
● The market practice must be highly effective in ensuring the functioning of market forces
and the proper interplay of the forces of supply and demand.
● The market practice must have a positive impact on market liquidity and efficiency.
● The market practice takes into account the trading mechanism of the relevant market and
enables market participants to react properly and in a timely manner to the new market
situation created by that practice.
● The market practice does not create risks for the integrity of, directly or indirectly, related
markets, whether regulated or not, in the relevant financial instrument.
● The market practice does not infringe rules on market abuse.
● Due account is to be taken of the structural characteristics of the relevant market, inter
alia, whether it is regulated or not, the types of financial instruments traded and the type of
market participants, including the extent of retail-investor participation.
These criteria are relevant elements to be taken into account by the national authority when 13.018
determining market practice. In a multi-stage procedure, a certain concrete market behaviour
is to be qualified as accepted market practice and stipulated by a corresponding official act. The
national authority – the FMA – shall define the market practice in cooperation with ESMA
within a framework clearly defined in Art 13 paras 3–6.21 The elaborate procedure is intended
to ensure extensive supervisory convergence among the European national authorities.
E. PREVIOUS FMA MARKET PRACTICE
The only FMA ordinance to date on acceptable market practices on Austrian financial markets 13.019
relates to compensation transactions in debt securities.22 The ordinance stipulates that minor
compensation transactions in selected debt securities concluded by professional market par-
ticipants at prices adequate to the market are deemed to be concluded within the scope of
accepted market practice pursuant to § 1 para 1 of the MpV.23 Pursuant to § 1 para 2 of the
MpV, a compensation transaction is a securities transaction carried out for valuation purposes,
21 See Schmolke (n 2) Art 13 paras 62ff, 89.

22 Marktpraxisverordnung, BGBl II 2005/1.
187
in which there is no change of beneficial owner(s). According to the ordinance, a compensation

transaction is considered to be minor if the volume traded corresponds to the lowest order
volume that can be placed by the respective market participants or if the order value does not
exceed €1,000 excluding expenses.
F. IMPLEMENTATION
13.020 In the UK, Article 13 MAR superseded MAR 1 Annex 2 of the FCA’s Handbook on Market
Conduct.24 As of 27th October 2020, the FCA has not established any specific accepted market
practice.25 Also the German BaFin has not identified any accepted market practice yet.26
Literature
See Literature on Art 15 MAR, Art 12 MAR.

2021).
25 https://www.fca.org.uk/markets/market-abuse/regulation, accessed 13 August 2021.
26 See Daniel Zimmer and Jakob Bator, ‘Artikel 13 MAR: Zulässige Marktpraxis’ in Eberhard Schwark and Daniel
Zimmer (eds), Kapitalmarktrechts-Kommentar (5th edn, C. H. Beck 2020) para 8.
188
ARTICLE 14
PROHIBITION OF INSIDER DEALING AND
OF UNLAWFUL DISCLOSURE OF INSIDE
INFORMATION
Martin Winner
A person shall not:

(a) engage or attempt to engage in insider dealing;
(b) recommend that another person engage in insider dealing or induce another person to
engage in insider dealing; or
(c) unlawfully disclose inside information.
OVERVIEW
A. GENERAL REMARKS 14.001 1. Criminal law 14.009

B. ATTEMPT TO ENGAGE IN INSIDER DEALING 14.004 2. Administrative law 14.013
C. SANCTIONS 14.009 3. Contract and tort law 14.014
A. GENERAL REMARKS
Art 14 contains the prohibition of insider dealing, recommendation and disclosure. The 14.001
provision’s core is the prohibition of insider dealing, whereas the prohibition of recommen-
dation and disclosure set in before a transaction actually happens and are intended to prevent
the exploitation of inside information by third parties at all. The definitions of the first two
offences are found in Art 8, of the third in Art 10; see the comments there. Lit a prohibits not
only the completed offence but expressly also the attempt to engage in insider dealing.
The prohibitions are part of a directly applicable Regulation and, hence, address individuals 14.002
directly. Art 14 does not contain sanctions for a violation; see Arts 30ff and the CRIM-MAD
in conjunction with national law. For an overview see below paras 14.009ff.
189
Article 14 PROHIBITION OF INSIDER DEALING AND OF UNLAWFUL DISCLOSURE
14.003 The purpose of the prohibitions is, above all, to guarantee the functioning of the capital
markets.1 This is already evident from the objective contained in Art 1 (‘to ensure the integrity
of financial markets in the Union’) and Recitals 2, 4 and 5; see also para 8.003. Additionally,
Art 1 mentions the strengthening of investor protection as an additional aim; see below paras
14.014ff.
B. ATTEMPT TO ENGAGE IN INSIDER DEALING
14.004 Art 14 lit a prohibits, inter alia, the attempt to engage in ‘insider dealing’. Insider dealing in this
context does not include all the forms of behaviour referred to in Art 8, which is headed ‘Insider
dealing’, since the recommendations and inducements also covered by that provision are listed
separately in Art 14 lit b. Insider dealing within the meaning of Art 14 lit a refers therefore to
the offence according to Art 8, paras 1 and 3.2
14.005 This means that, in these cases, it is not at the discretion of the Member States whether they
want to sanction the attempt. The provision applies directly only to administrative sanctions.
However, Art 6 para 2 CRIM-MAD also covers the attempt to commit intentional offences
for criminal law purposes. Hence, the attempt to make a recommendation or to disclose inside
information is not prohibited by Art 14. The CRIM-MAD does not contain any further speci-
fications for these offences either. Since the MAR does not prohibit stricter rules, the Member
States may sanction the attempt also in these cases.3
14.006 It is questionable whether the significance of ‘attempt’ for the purposes of Art 14 MAR or Art
6 para 2 CRIM-MAD is determined by European law or whether reference is made to national
law in this respect.4 On the one hand, the MAR itself defines the completed offence; if one
of the prerequisites is lacking, the act can only be an attempt, if at all. On the other hand, the
MAR does not set the minimum threshold required for an act to constitute an attempt (and
not a preparatory act, which is not punishable). Hence, for the latter issue recourse to national
dogmatics is necessary, which, of course, impedes harmonisation.
14.007 As to the distinction between attempt and completed offence in the context of Art 8 para 1
and para 3:5 First of all, the acquisition or disposal as such is prohibited. For the completion
of the offence, it is not necessary that a loss occurs to another party,6 a profit is made, or the
1 See Stephan Grundmann, ‘Band 11 Bankvertragsrecht - Teilband 1 Investmentbanking I’ in Claus-Wilhelm Canaris,

Mathias Habersack and Carsten Schäfer (eds), Staub Handelsgesetzbuch Großkommentar (5th edn, De Gruyter 2017)
Part 6 para 337; Lars Klöhn, ‘Artikel 14: Verbot von Insidergeschäften und unrechtmäßiger Offenlegung von
Insiderinformationen’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) paras 6ff.
2 See also Carsten Gerner-Beuerle, ‘Article 14 MAR: Prohibition of Insider Dealing and of Unlawful Disclosure of Inside
Information’ in Matthias Lehmann and Christoph Kumpan (eds), European Financial Services Law (Beck-Hart-Nomos
2019) para 4.
3 Jesper Lau Hansen, ‘Article 14: Prohibition of Insider Dealing and of Unlawful Disclosure of Inside Information’ in
Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse Regulation (Oxford University Press 2017) paras B.14.10 f.
4 For a discussion see Gerner-Beuerle (n 2) para 6; Hansen (n 3) paras B.14.09, B.14.12.
5 For the distinction in the context of the prohibition of recommendations see para 8.098.
6 See, however, Hansen (n 3) para B.14.13: detriment necessary.
190
C. Sanctions
transaction is settled.7 Rather, it is sufficient if the transactions results in a legal claim to the
transfer of the financial instrument. As a rule, this will be the conclusion of the transaction
under the applicable contract law (see paras 8.044ff). This is, for example, the execution of the
order or a short sale.8 In contrast, the submission of the order or the offer is an attempt even if it
is not executed afterwards.9 If there is no actionable claim, the actual transfer of the instrument
is decisive for completion.
As far as the cancellation or modification of an order is concerned (sentence 2 of Art 8 para 14.008
1), the offence is completed as soon as the order has been effectively cancelled or modified. In
contrast, the manifestation of intent to do so is an attempt even if the broker does not cancel
the order.10
C. SANCTIONS
1. Criminal law
According to Art 3 CRIM-MAD, Member States shall ensure that insider dealing in the sense 14.009
of Art 8 MAR constitutes a criminal offence ‘at least in serious cases and when committed
intentionally’. Art 4 para 1 CRIM-MAD repeats this for the unlawful disclosure of inside
information under Art 10 MAR. The CRIM-MAD repeats the regulations of the MAR and is
to be interpreted as far as possible in accordance with the latter.11 Arts 8 and 10 in conjunction
with Art 14 MAR also address legal persons (see above paras 8.008ff and para 10.003). Art 8
CRIM-MAD contains a corresponding provision for sanctions under criminal law.
Insider dealing has to be committed intentionally. Hence, negligent actions are, according to 14.010
European law, not subject to criminal sanctions. This also means that secondary insiders must
be aware that the information is inside information (see Art 3 para 2 CRIM-MAD and for
the MAR above paras 8.021ff) and that tippees must know that the recommendation is based
on inside information (see Art 3 para 6 CRIM-MAD and for the MAR above paras 8.119ff).
Member States may, however, extend criminal sanctions to negligent behaviour.
As far as the expression at least in serious cases’ is concerned, Recital 11 to the CRIM-MAD 14.011
refers to violations
such as those where the impact on the integrity of the market, the actual or potential profit derived or
loss avoided, the level of damage caused to the market, or the overall value of the financial instruments
traded is high. Other circumstances that might be taken into account are, for instance, where an
offence has been committed within the framework of a criminal organisation or where the person has
committed such an offence before.
9 Gerner-Beuerle (n 2) para 7; Hansen (n 3) para B.14.13; Klöhn (n 1) para 81.
10 Gerner-Beuerle (n 2) para 7; Hansen (n 3) para B.14.14.
11 Recital 17 CRIM-MAD; Klöhn (n 1) para 39. However, especially the German language versions of CRIM-MAD and
MAR differ in various contexts; see Dörte Poelzig, ‘Durchsetzung und Sanktionierung des neuen Marktmissbrauchsrechts’
(2016) 13 NZG 492, 495.
191
Article 14 PROHIBITION OF INSIDER DEALING AND OF UNLAWFUL DISCLOSURE
14.012 Some Member States have transposed this by introducing thresholds making reference to the
purchase price.
2. Administrative law
14.013 Art 30 MAR contains rules on administrative sanctions, both for natural and for legal persons.
Art 30 para 1 lit a MAR makes reference to Art 14. See the comments to Art 30.
3. Contract and tort law
14.014 It is disputed whether the prohibition of insider dealing also aims at the individual protection
of the directly affected market participants. This is important for the consequences of a viola-
tion under contract and tort law, in particular for the right to claim damages. Many authors,
especially in Germany, reach the conclusion that the MAR generally, and Art 14 especially,
does not intend to protect market participants.12 However, the strengthening of investor pro-
tection is explicitly mentioned in Art 1 (albeit not in the Recitals to the MAR). This, in my
view, is an important argument in favour of a reading including the protection of individuals
within the aims of the MAR.13 It seems to indicate that claims to damages or similar individual
remedies are required under European law even though the final verdict is still outstanding.
Additionally, one may argue that effet utile requires that damaged counterparties may claim
compensation, similar to the situation in competition law. Even under a narrow understanding
of the Regulation’s purpose, individual Member States can still broaden the objectives upon
implementation and, hence, include a right to damages. In any case, the precise nature of the
remedies available is left to the national legal system.
14.015 Remedies affecting the validity of the contract tend to encumber exchange trading with the
uncertainties that are associated with the nullity of transaction. Apart from that, the practical
significance of nullity is weakened by the fact that, in exchange-based trading, it is not imme-
diately apparent, but only after closer investigation, who the other party to the contract is.
The situation may be different in face-to-face transactions that are executed outside the stock
exchange and where the national doctrines of misrepresentation may apply.14
12 cf Klöhn (n 1) paras 9ff; Petra Buck-Heeb, ‘§ 8: Insiderrecht’ in Heinz-Dieter Assmann, Rolf Schütze and Petra
Buck-Heeb (eds), Handbuch des Kapitalanlagerechts (5th edn, C. H. Beck 2020) paras 15ff; for Spain cf Aurora Martínez
Flórez, Los fundamentos de la prohibición del abuso del mercado (tirant lo blanch 2019) 147ff.
13 With similar results e.g., Grundmann (n 1) Part 6 paras 305ff; Poelzig (n 11) 501; Rüdiger Veil, ‘§ 7: Insiderhandelsverbot’
in Andreas Meyer, Thomas Rönnau and Rüdiger Veil (eds), Handbuch zum Marktmissbrauchsrecht (C. H. Beck 2018)
paras 102 f; Dirk Zetzsche, ‘7: Europäisches Kaptialmarktrecht – C. Marktintegrität / Marktmissbrauchsrecht’ in Martin
Gebauer and Christoph Teichmann (eds), Enzyklopädie Europarecht Band 6 - Europäisches Privat- und Unternehmensrecht
(Nomos 2016) § 7C para 6; Susanne Kalss, Martin Oppitz and Johannes Zollner, Kapitalmarktrecht (2nd edn,
Linde 2015) § 21 para 89; Wolfgang Sindelar, ‘Artikel 14 MAR: Verbot von Insidergeschäften und unrechtmäßiger
Offenlegung von Insiderinformationen’ in Michael Gruber (ed), Börsegesetz. Marktmissbrauchsverordnung (Manz 2020)
para 12. See also Klaus J Hopt and Christoph Kumpan, ‘§ 107: Insider- und Ad-hoc-Publizitätsprobleme’ in Herbert
Schimansky, Hermann-Josef Bunte and Hans-Jürgen Lwowski (eds), Bankrechts-Handbuch (5th edn, C. H. Beck 2017)
§ 107 paras 5, 173 f.
14 See Hopt and Kumpan (n 13) § 107 para 174.
192
C. Sanctions
As far as damages are concerned, market participants who did not transact with the insider 14.016
cannot successfully bring such a claim because the infringement was not causal for their loss15
– at least as long as the insider dealing itself was not price-relevant. Hence, in any case, proof
is required of having concluded a transaction with the insider, which is subject to practical
problems in the case of stock exchange transactions. Furthermore, national law may bar claims
for damages due the fact that the injured party would have concluded the transaction with
someone other than the insider.16
Literature
Beneke M and Thelen M, ‘Die Schutzgesetzqualität des Insiderhandelsverbots gem Art 14

Marktmissbrauchsverordnung’ (2017) 1 BKR 12
Gerner-Beuerle C, ‘Article 14 MAR: Prohibition of Insider Dealing and of Unlawful Disclosure
of Inside Information’ in Lehmann M and Kumpan C (eds), European Financial Services Law
(Beck-Hart-Nomos 2019)
2017)
Hansen J L, ‘Article 14: Prohibition of Insider Dealing and of Unlawful Disclosure of Inside Information’
in Ventoruzzo M and Mock S (eds), Market Abuse Regulation (Oxford University Press 2017)
Klöhn L, ‘Artikel 14: Verbot von Insidergeschäften und unrechtmäßiger Offenlegung von
Insiderinformationen’ in Klöhn L (ed), Marktmissbrauchsverordnung (C. H. Beck 2018)
Martínez Flórez A, Los fundamentos de la prohibición del abuso del mercado (tirant lo blanch 2019)
Poelzig D, ‘Durchsetzung und Sanktionierung des neuen Marktmissbrauchsrechts’ (2016) 13 NZG 492
Sindelar W, ‘Artikel 14 MAR: Verbot von Insidergeschäften und unrechtmäßiger Offenlegung von
Insiderinformationen’ in Gruber M (ed), Börsegesetz. Marktmissbrauchsverordnung (Manz 2020)
Veil R, ‘§ 7: Insiderhandelsverbot’ in Meyer A, Rönnau T and Veil R (eds), Handbuch zum
Zetzsche D, ‘§ 7: Europäisches Kaptialmarktrecht – C. Marktintegrität / Marktmissbrauchsrecht’ in
Gebauer M and Teichmann C (eds), Enzyklopädie Europarecht Band 6 - Europäisches Privat- und
15 See Hopt and Kumpan (n 13) § 107 para 174.

16 See Moritz Beneke and Martin Thelen, ‘Die Schutzgesetzqualität des Insiderhandelsverbots gem Art 14
Marktmissbrauchsverordnung’ (2017) 1 BKR 12, 17 f; Hopt and Kumpan (n 13) § 107 Rz 174; Frank A Schäfer,
‘Kapitalmarktbezogene Verhaltenspflichten’ in Reinhard Marsch-Barner and Frank A Schäfer (eds), Handbuch börsen-
notierte AG (4th edn, Otto Schmidt 2018) para 14.107.
193
ARTICLE 15
PROHIBITION OF MARKET MANIPULATION
Martin Oppitz
A person shall not engage in or attempt to engage in market manipulation.
OVERVIEW
A. CONTENT OF THE PROVISION 15.001 1. Attempt 15.004

B. DEFINITION ISSUES 15.004 2. Constellations of attempts 15.005
C. PUNISHMENT OF THE ATTEMPT 15.013
A. CONTENT OF THE PROVISION
15.001 This brief provision of the Regulation clarifies that not only the completed offence of market
manipulation but also ‘the attempt’ to do so is to be punished.1 According to the Recital 4,
there is a need:
to establish a more uniform and stronger framework in order to preserve market integrity, to avoid
potential regulatory arbitrage, to ensure accountability in the event of attempted manipulation, and to
provide more legal certainty and less regulatory complexity for market participants.2
The offence of market manipulation itself is regulated in Art 12.
15.002 Compared to the Market Abuse Directive 2003, the inclusion of attempt is new (cf Art 5
Market Abuse Directive).
1 cf Manfred Ketzer and Ina Pauer, ‘Die wesentlichen Neuerungen der geplanten Verordnung und Richtlinie der
Kommission zu Insiderhandel und Marktmanipulation: mit Anmerkungen aus rechtsstaatlicher Perspektive’ [2014]
ÖBA 165.
2 cf also Recital 13 of CRIM-MAD.
194
Martin Oppitz - 9781800882249
B. Definition issues
According to Recital 41 MAR, an attempt to engage in market manipulation should be 15.003

distinguished from behaviour which is likely to result in market manipulation. This Recital
gives as an example of attempt constellations situations where the activity is started but is not
completed, for example as a result of failed technology or an instruction to trade which is not
acted upon. Prohibiting attempts to engage in market manipulation is necessary, ‘to enable
competent authorities to impose sanctions for such attempts’.
B. DEFINITION ISSUES
1. Attempt
The activities covered by the concept of market manipulation are described in Art 12. In the 15.004
case of an attempt to commit an offence – since the MAR itself does not contain a definition of
attempt and an autonomous interpretation under European law does not lead to any obviously
different results3 – the matter must be dealt with in accordance with the relevant principles of
administrative and judicial criminal law.
2. Constellations of attempts
If one considers the possible acts of market manipulation under Art 12, the following conse- 15.005
quences result:
The offences pursuant to Art 12 para 1 lit a to c do not presuppose any actual success that can 15.006
be distinguished from the criminal act.4
Thus, according to Art 12 para 1 lit a, entering into transactions, placing orders or any other 15.007
behaviour are penalised even if false or misleading signals (i) or an abnormal or artificial price
(ii) are even ‘likely’. In this respect, the offence is also deemed to be completed if such signals or
prices are ultimately not given or do not occur at all. Such a deficit therefore in itself does not
yet qualify as an attempt. In principle, attempt constellations in which the deed falls short of
the statutory elements of the offence would be conceivable; for example, the business partner’s
corresponding declaration of intent could be absent in the case of the desired conclusion of
a transaction or the contractually required acceptance could be absent in the case of the issuing
of a trade order; however, it has been pointed out in the literature that the general clause-like
mention of ‘any other behaviour’ in Art 12 para 1a in turn compensates for such deficits in
the offence-related action, because the action is in fact not specified according to this group
3 For purposes of interpretation Klaus U Schmolke, ‘Artikel 15: Verbot der Marktmanipulation’ in Lars Klöhn (ed),
Marktmissbrauchsverordnung (C. H. Beck 2018) para 61 refers to the ‘Corpus Juris 2000’ initiated by the European
Parliament; its Art 11 bis (2) states: ‘A person is guilty of a criminal attempt if, with attempt to commit an offence under
Articles 1 to 3 and 5 to 8, he performs an act which constitutes the commencement of the commission of a criminal
offence.’
4 Schmolke (n 3) para 13.
195
Article 15 PROHIBITION OF MARKET MANIPULATION
of elements of the offence.5 In this respect, it is obvious, at least according to the wording,6
that constellations of attempts are to be assumed to be more likely to be successful, namely
if the realisation fails because the behaviour or activity in question does not objectively make
the envisaged success probable or is not at all suitable for bringing it about.7 If the action or
activity falls so far short of the intensity typical of market manipulation that, for example, false
or misleading signals or an abnormal or artificial price can only occur very improbably or not at
all, such suitability is lacking.
15.008 Art 12 para 1 lit b penalises entering into a transaction, placing an order to trade and any other
activity or behaviour which affects or is likely to affect the price of one or several financial
instruments, etc., which employs a fictitious device or any other form of deception or contriv-
ance; since here too, by taking into account ‘any other activity or behaviour’ on financial markets,
a ‘reserve’ offence has been created which goes beyond entering into a transaction or placing an
order to trade, attempt constellations again appear possible if, in the area of the effects of such
behaviour – for example, due to a technical failure or a temporary suspension of trading, etc., –
not even the suitability for influencing the price ensues; it would also be conceivable, however,
that there is a deficit in the act of committing the offence insofar as the manipulator does not
know that the facts he has fabricated are not in fact wrong but – as only a small number of
persons know – actually correct.
15.009 The dissemination of information through the media (Art 12 para 1 lit c) may remain at an
attempt stage if the dissemination as such succeeds, but lacks the objective suitability to send
even likely misleading signals or to induce an abnormal or artificial price level.8
15.010 According to Art 12 para 1 lit d, transmitting false or misleading information or providing
false or misleading inputs in relation to a benchmark shall be deemed an offence if the person
who provided the information or the inputs knew or ought to have known that it was false or
misleading; other behaviour manipulating the calculation of a benchmark shall also be deemed
to be an offence. It is not a question of mere suitability, but of the transmission or provision of
false or misleading information/data. In this respect, the offence is qualified by the result in the
sense of actually influencing the calculation process.9 The offence can remain in the attempt
stage if the transmission or provision is not successful because, for example, false contact details
are used or the addressee has no access to the information/data for other reasons.10
5 Schmolke (n 3) para 15.

6 However, it could also be argued that the legislator wanted to clearly distinguish certain typical situations, such as busi-
ness transactions or the placing of commercial orders, from the wide range of other types of action; this would, e.g., leave
room for the applicability of the attempt dogma in the event of a unsuccessful commercial order.
7 In that sense Schmolke (n 3) para 16.
8 Schmolke (n 3) para 17, who cites as an example the posting of an obsolete journalistic report in a blog, whereby the
information contained therein has now been rendered obsolete by a publication of the issuer; then it could hardly be
expected that reasonable market participants would be influenced by these recognisably outdated statements; in any case,
this is not likely (‘likely’).
9 Which is not necessarily reflected in the calculation result: Schmolke (n 3) para 19.
10 Schmolke (n 3) para 19 cites the example that a file attached in an e-mail is corrupted and therefore cannot be opened by
the addressee.
196
C. Punishment of the attempt
On the other hand, if the information transmitted or the inputs provided are objectively correct 15.011
and not misleading, it is reasonable to assume an absolutely unsuitable attempt, and thus
impunity.11
With regard to the variant of ‘other behaviour which manipulates the calculation of a benchmark’, 15.012
success of the offence is also required, namely actual manipulation. If – for whatever reason –
this does not happen, it is a mere attempt: The calculation procedure for the benchmark then
runs properly regardless of the attempted manipulation.12
C. PUNISHMENT OF THE ATTEMPT
Although Art 6 para 2 CRIM-MAD stipulates that the Member States shall take the neces- 15.013
sary measures to ensure that the attempt is punishable, there are no concrete indications, for
example, with regard to the level of penalties. CRIM-MAD only speaks in general terms of
effective, proportionate and dissuasive criminal sanctions (Art 7 for natural persons; Art 9 for
legal persons).
Literature
Ketzer M and Pauer I, ‘Die wesentlichen Neuerungen der geplanten Verordnung und Richtlinie der
Kommission zu Insiderhandel und Marktmanipulation: mit Anmerkungen aus rechtsstaatlicher
Perspektive’ [2014] ÖBA 162
Schmolke K U, ‘Artikel 15: Verbot der Marktmanipulation’ in Klöhn L (ed), Marktmissbrauchsverordnung
(C. H. Beck 2018)
11 cf Schmolke (n 3) para 23.

12 Schmolke (n 3) para 24, who cites the example of the delinquent manipulating the program calculating the benchmark,
but the manipulation is detected before the program is used and the error is corrected.
197
ARTICLE 16
PREVENTION AND DETECTION OF MARKET
ABUSE
Florian Kusznier
1. Market operators and investment firms that operate a trading venue shall establish
and maintain effective arrangements, systems and procedures aimed at preventing and
detecting insider dealing, market manipulation and attempted insider dealing and market
manipulation, in accordance with Articles 31 and 54 of Directive 2014/65/EU.
A person referred to in the first subparagraph shall report orders and transactions,
including any cancellation or modification thereof, that could constitute insider dealing,
market manipulation or attempted insider dealing or market manipulation to the compe-
tent authority of the trading venue without delay.
2. Any person professionally arranging or executing transactions shall establish and maintain
effective arrangements, systems and procedures to detect and report suspicious orders and
transactions. Where such a person has a reasonable suspicion that an order or transaction
in any financial instrument, whether placed or executed on or outside a trading venue,
could constitute insider dealing, market manipulation or attempted insider dealing or
market manipulation, the person shall notify the competent authority as referred to in
paragraph 3 without delay.
3. Without prejudice to Article 22, persons professionally arranging or executing transac-
tions shall be subject to the rules of notification of the Member State in which they are
registered or have their head office, or, in the case of a branch, the Member State where the
branch is situated. The notification shall be addressed to the competent authority of that
Member State.
4. The competent authorities as referred to in paragraph 3 receiving the notification of
suspicious orders and transactions shall transmit such information immediately to the
competent authorities of the trading venues concerned.
regulatory technical standards to determine:
(a) appropriate arrangements, systems and procedures for persons to comply with the
requirements established in paragraphs 1 and 2; and
(b) the notification templates to be used by persons to comply with the requirements
established in paragraphs 1 and 2.
ESMA shall submit those draft regulatory technical standards to the Commission by 3 July
2016.
198
Florian Kusznier - 9781800882249
B. Addressees of the norm
Power is delegated to the Commission to adopt the regulatory technical standards referred
to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No
1095/2010.
OVERVIEW
A. INTRODUCTION 16.001 D. PROCEDURE AND RESPONSIBILITIES 16.008

B. ADDRESSEES OF THE NORM 16.004 E. EXECUTION OF NOTIFICATIONS 16.011
C. FACTS OF THE NORM 16.006 F. IMPLEMENTATION 16.013
A. INTRODUCTION
The purpose of Art 16 MAR is to require market and trading venue operators and securities 16.001
dealers and intermediaries to establish and maintain effective rules, systems and procedures to
prevent and detect (attempted) insider dealing and market abuse. The aim is to ensure uniform
market conditions (MAR Recital 45).
Suspicious transactions must be reported to the competent authority without delay (Art 16 para 16.002
1 sent 2 MAR).
The provisions of Art 16 are complemented by the Commission Delegated Regulation 16.003
2016/957, which contains more detailed provisions on the characteristics of the systems to be
implemented and maintained (e.g., continuous monitoring of all orders for all types of clients
and all types of financial instruments, software for reading, analysing and retrieving order book
data, sufficient capacity for use in algorithmic trading, etc.), and stipulates that these systems
must be proportionate to the scope, size and type of business activity, evaluated regularly and
subjected to (at least) annual audits and reviews. Written documentation must be prepared on
them and kept for a period of five years. Furthermore, there is an obligation to hold regular
qualified training courses.1
B. ADDRESSEES OF THE NORM
The addressees of Art 16 are primarily all market operators (Art 3 para 1 (5) MAR, see para 16.004
16.005) and investment firms operating a trading venue (Art 3 para 1 (2) MAR). In the case
of market operators, the German version of Art 3 para 1 (5) MAR incorrectly refers to ‘market
participants’(Marktteilnehmer) instead of ‘market operators’ (Marktbetreiber) while the English
version of MAR correctly refers to ‘market operators’. If, however, one follows the reference
in MAR to MiFID II, this leads to the correct definition of a market operator: A person or
1 Arts 3 and 4 of the Commission Delegated Regulation (EU) 2016/957 [2016] OJ L 160/1.
199
Article 16 PREVENTION AND DETECTION OF MARKET ABUSE
persons that manages and/or operates the business of a regulated market and that may be the
regulated market itself.
16.005 Other addressees of the provision are all persons who professionally arrange or execute transac-
tions. These are persons who are professionally (i.e., regularly and with the intention of earning
income from it) involved in the reception and transmission of orders for, or in the execution of
transactions in, financial instruments (Art 3 para 1 (28) MAR).
C. FACTS OF THE NORM
16.006 Art 16 imposes an obligation to report orders and transactions, including their cancellation
or modification, which could constitute insider dealing, market manipulation or attempted
insider dealing or attempted market manipulation.
16.007 There must at least be a reasonable suspicion of prohibited actions. It is argued that the thresh-
old for reporting should be low, because only a reporting obligation applies.2 This appears
too strict: On the one hand, a reasonable suspicion requires, from a conceptual point of view,
that there must at least be comprehensible, objectifiable circumstances pointing to prohibited
conduct. These must be adequately identifiable if reasonable care is applied. Transferring the
monitoring obligations to market operators and investment firms already imposes obligations
on them which are sovereign tasks – the cost of setting up and maintaining such systems is
anyway passed on to private legal entities. If the obligation to report is foreseen at too early
a stage, this leads to excessive costs. It is correct, however, that requiring the addressees of the
regulation to apply investigative skills would go too far. In view of the threat of sanctions (Art
30 para 1 MAR),3 however, the wording of the provision will in practice lead to more reports.
D. PROCEDURE AND RESPONSIBILITIES
16.008 For market operators and investment firms that operate a trading venue, the competent report-
ing office is the authority of the trading venue.
16.009 In the case of persons professionally arranging or executing transactions, the competent author-
ity is the authority of the member state of authorisation or of the head office and, in the case of
branches, the authority of the member state in which the branch is located. That authority shall
without delay inform the competent authority of the respective trading venues.
16.010 A notification to a non-competent authority (e.g., to the authority of the head office through
a branch) may lead to the imposition of penalties.4
2 Sebastian Mock, ‘Article 16: Prevention and Detection of Market Abuse’ in Marco Ventoruzzo and Sebastian Mock
(eds), Market Abuse Regulation (Oxford University Press 2017) para B.16.03.
3 See paras 30.001 f.
4 Mock (n 2) para B.16.05.
200
F. Implementation
E. EXECUTION OF NOTIFICATIONS
The STOR form (Suspicious Transaction and Order Reports) is available for download in 16.011
Excel format on the FMA’s website.5 The completed form must be sent by e-mail to suspicious
-transactions@fma.gv.at. The content of the FMA form complies with the requirements of the
template in the annex to the MM-Compl-Regulation. The form in turn contains explanations
on the individual sections of the notification, which may therefore be helpful for filling out the
Austrian form, with respect to both content and level of detail.
For Germany, the BaFin has set up a separate portal (‘MVP portal’) to enable reporting obli- 16.012
gations to be fulfilled electronically.6 The STOR form is available from BaFin in German and
English.7 BaFin has integrated the explanation in the appendix of the MM-Compl-Regulation
directly into its form. For electronic transmission via the online portal, the applicant must
first be activated for the specialist procedure, ‘Suspicious activity reporting under the MAR’
(information on the website).
F. IMPLEMENTATION
In the UK, the reporting of suspicious transactions or orders is regulated by section 15.10. of 16.013
the Supervision Manual.8 Additionally, the FCA has introduced an online system to submit,
among others, suspicious transactions and order reports.9
Literature
Mock S, ‘Article 16: Prevention and Detection of Market Abuse’ in Marco Ventoruzzo and Sebastian
Mock (eds), Market Abuse Regulation (Oxford University Press 2017)
5 FMA, ‘Meldung verdächtiger Transaktionen und Aufträge’ https://www.fma.gv.at/kapitalmaerkte/marktmissbrauch/

meldung-verdaechtiger-transaktionen/accessed 31 August 2020.
6 BaFin, ‘MVP-Portal’ https://www.bafin.de/DE/DieBaFin/Service/MVPportal/MVPportal_node.html accessed 31
August 2020.
7 BaFin, ‘Verdachtsmeldungen nach Art. 16 Abs. 1 und 2 MAR’ https:// www .bafin
.de/
DE/
DieBaFin/ Service/
MVPportal/Verdacht_MAR/verdacht_mar_artikel.html?nn=7845910 accessed 31 August 2020.
8 FCA, Supervision Manual (available at https://www.handbook.fca.org.uk/handbook accessed 14 August 2021).
9 Available at https://www.fca.org.uk/firms/connect accessed 14 August 2021.
201
ARTICLE 17
PUBLIC DISCLOSURE OF INSIDE
INFORMATION
1. An issuer shall inform the public as soon as possible of inside information which directly
concerns that issuer.
The issuer shall ensure that the inside information is made public in a manner which
enables fast access and complete, correct and timely assessment of the information by the
public and, where applicable, in the officially appointed mechanism referred to in Article
21 of Directive 2004/109/EC of the European Parliament and the Council.1 The issuer
shall not combine the disclosure of inside information to the public with the marketing of
its activities. The issuer shall post and maintain on its website for a period of at least five
years, all inside information it is required to disclose publicly.
This Article shall apply to issuers who have requested or approved admission of their
financial instruments to trading on a regulated market in a Member State or, in the case of
instruments only traded on an MTF or on an OTF, issuers who have approved trading of
their financial instruments on an MTF or an OTF or have requested admission to trading
of their financial instruments on an MTF in a Member State.
2. An emission allowance market participant shall publicly, effectively and in a timely manner
disclose inside information concerning emission allowances which it holds in respect of
its business, including aviation activities as specified in Annex I to Directive 2003/87/EC
or installations within the meaning of Article 3(e) of that Directive which the participant
concerned, or its parent undertaking or related undertaking, owns or controls or for the
operational matters of which the participant, or its parent undertaking or related under-
taking, is responsible, in whole or in part. With regard to installations, such disclosure
shall include information relevant to the capacity and utilisation of installations, including
planned or unplanned unavailability of such installations.
The first subparagraph shall not apply to a participant in the emission allowance market
where the installations or aviation activities that it owns, controls or is responsible for,
in the preceding year have had emissions not exceeding a minimum threshold of carbon
1 Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of
transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated
market and amending Directive 2001/34/EC (OJ L 390, 31.12.2004, p. 38).
202
Susanne Kalss and Clemens Hasenauer - 9781800882249
Article 17 PUBLIC DISCLOSURE OF INSIDE INFORMATION
dioxide equivalent and, where they carry out combustion activities, have had a rated
thermal input not exceeding a minimum threshold.
The Commission shall be empowered to adopt delegated acts in accordance with Article
35 establishing a minimum threshold of carbon dioxide equivalent and a minimum thresh-
old of rated thermal input for the purposes of the application of the exemption provided for
in the second subparagraph of this paragraph.
35 specifying the competent authority for the notifications of paragraphs 4 and 5 of this
Article.
4. An issuer or an emission allowance market participant, may, on its own responsibility,
delay disclosure to the public of inside information provided that all of the following con-
ditions are met:
(a) immediate disclosure is likely to prejudice the legitimate interests of the issuer or
emission allowance market participant;
(b) delay of disclosure is not likely to mislead the public;
(c) the issuer or emission allowance market participant is able to ensure the confidential-
ity of that information.
In the case of a protracted process that occurs in stages and that is intended to bring about,
or that results in, a particular circumstance or a particular event, an issuer or an emission
allowance market participant may on its own responsibility delay the public disclosure
of inside information relating to this process, subject to points (a), (b) and (c) of the first
subparagraph.
Where an issuer or emission allowance market participant has delayed the disclosure
of inside information under this paragraph, it shall inform the competent authority spec-
ified under paragraph 3 that disclosure of the information was delayed and shall provide
a written explanation of how the conditions set out in this paragraph were met, immedi-
ately after the information is disclosed to the public. Alternatively, Member States may
provide that a record of such an explanation is to be provided only upon the request of the
competent authority specified under paragraph 3.
By way of derogation from the third subparagraph of this paragraph, an issuer whose
financial instruments are admitted to trading only on an SME growth market shall provide
a written explanation to the competent authority specified under paragraph 3 only upon
request. As long as the issuer is able to justify its decision to delay, the issuer shall not be
required to keep a record of that explanation.*
5. In order to preserve the stability of the financial system, an issuer that is a credit institu-
tion or a financial institution, may, on its own responsibility, delay the public disclosure
of inside information, including information which is related to a temporary liquidity
problem and, in particular, the need to receive temporary liquidity assistance from a central
bank or lender of last resort, provided that all of the following conditions are met:
(a) the disclosure of the inside information entails a risk of undermining the financial
stability of the issuer and of the financial system;
(b) it is in the public interest to delay the disclosure;
(c) the confidentiality of that information can be ensured; and
(d) the competent authority specified under paragraph 3 has consented to the delay on
the basis that the conditions in points (a), (b) and (c) are met.
203
6. For the purposes of points (a) to (d) of paragraph 5, an issuer shall notify the competent
authority specified under paragraph 3 of its intention to delay the disclosure of the inside
information and provide evidence that the conditions set out in points (a), (b) and (c) of
paragraph 5 are met. The competent authority specified under paragraph 3 shall consult, as
appropriate, the national central bank or the macro-prudential authority, where instituted,
or, alternatively, the following authorities:
(a) where the issuer is a credit institution or an investment firm the authority desig-
nated in accordance with Article 133(1) of Directive 2013/36/EU of the European
Parliament and of the Council;2
(b) in cases other than those referred to in point (a), any other national authority respon-
sible for the supervision of the issuer.
The competent authority specified under paragraph 3 shall ensure that disclosure of the
inside information is delayed only for a period as is necessary in the public interest. The
competent authority specified under paragraph 3 shall evaluate at least on a weekly basis
whether the conditions set out in points (a), (b) and (c) of paragraph 5 are still met.
If the competent authority specified under paragraph 3 does not consent to the delay
of disclosure of the inside information, the issuer shall disclose the inside information
immediately.
This paragraph shall apply to cases where the issuer does not decide to delay the disclo-
sure of inside information in accordance with paragraph 4.
Reference in this paragraph to the competent authority specified under paragraph 3 is
without prejudice to the ability of the competent authority to exercise its functions in any
of the ways referred to in Article 23(1).
7. Where disclosure of inside information has been delayed in accordance with paragraph 4
or 5 and the confidentiality of that inside information is no longer ensured, the issuer or the
emission allowance market participant shall disclose that inside information to the public
as soon as possible.
This paragraph includes situations where a rumour explicitly relates to inside informa-
tion the disclosure of which has been delayed in accordance with paragraph 4 or 5, where
that rumour is sufficiently accurate to indicate that the confidentiality of that information
is no longer ensured.
8. Where an issuer or an emission allowance market participant, or a person acting on their
behalf or for their account, discloses any inside information to any third party in the normal
course of the exercise of an employment, profession or duties as referred to in Article 10(1),
they must make complete and effective public disclosure of that information, simultane-
ously in the case of an intentional disclosure, and promptly in the case of a non-intentional
disclosure. This paragraph shall not apply if the person receiving the information owes
a duty of confidentiality, regardless of whether such duty is based on a law, on regulations,
on articles of association, or on a contract.
9. Inside information relating to issuers whose financial instruments are admitted to trading
on an SME growth market, may be posted on the trading venue’s website instead of on the
website of the issuer where the trading venue chooses to provide this facility for issuers on
that market.
2 Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit
institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC
and repealing Directives 2006/48/EC and 2006/49/EC (OJ L 176, 27.6.2013, p. 338).
204
draft implementing technical standards to determine:
(a) the technical means for appropriate public disclosure of inside information as referred
to in paragraphs 1, 2, 8 and 9; and
(b) the technical means for delaying the public disclosure of inside information as
referred to in paragraphs 4 and 5.
ESMA shall submit those draft implementing technical standards to the Commission by
3 July 2016.
1095/2010.
11. ESMA shall issue guidelines to establish a non-exhaustive indicative list of the legitimate
interests of issuers, as referred to in point (a) of paragraph 4, and of situations in which
delay of disclosure of inside information is likely to mislead the public as referred to in
point (b) of paragraph 4.
*As amended by the recent Regulation (EU) 2019/2115.
OVERVIEW
A. BASIC PRINCIPLES 17.001 D. NATURE AND CONTENT OF THE DISCLOSURE

1. Subject matter of the provision 17.001 (PARA 1) 17.065
2. Purpose of the norm 17.005 E. DEADLINE FOR DISCLOSURE 17.077
3. History of origins 17.006 F. UPDATING THE AD HOC NOTIFICATION 17.078
4. Significant changes to the existing law 17.007 G. DISCLOSURE UPON ONWARD DISCLOSURE OF
5. Practical significance 17.008 INSIDE INFORMATION (PARA 8) 17.079
B. ISSUERS 17.009 H. DELAY OF THE DISCLOSURE OBLIGATION 17.080
C. INSIDE INFORMATION 17.017 1. Decision on delay 17.086
1. Confidentiality 17.024 2. FMA information 17.090
2. Precise information 17.029 3. Conditions for the delay 17.093
(a) Events which have occurred 17.032 (a) Legitimate interests 17.095
(b) Future events 17.036 (b) Not misleading 17.102
(c) Price specificity 17.039 (c) Maintaining the confidentiality of
3. Price relevance 17.042 information 17.106
(a) Trading incentive for reasonable I. PRESERVING FINANCIAL STABILITY – CREDIT
investors 17.045 AND FINANCIAL INSTITUTIONS 17.111
(b) Protracted process 17.054 J. EMISSION ALLOWANCES 17.113
(c) Price relevance of intermediate steps K. SANCTIONS 17.116
17.057 L. IMPLEMENTATION 17.121
205
A. BASIC PRINCIPLES
1. Subject matter of the provision
17.001 Art 17 deals with ad hoc disclosure. Para 1 lays down the issuer’s fundamental obligation to
disclose inside information. Para 1 also specifies the manner in which the required disclosure
must be made. It must be made quickly, comprehensively, correctly and in a timely manner so
that the public can access and evaluate the inside information (cf para 17.065). It is expressly
prohibited to link ad hoc information with marketing information (advertising). The provision
also provides for a minimum period of five years for the provision of information subject to ad
hoc disclosure. Finally, the provision facilitates the availability of ad hoc information to SMEs.
17.002 Although Art 17 does not speak of ad hoc disclosure, but rather of the making public of inside
information, it nevertheless deals with an obligation to disclose information on specific occa-
sions, so that an ad hoc obligation can be assumed3 and therefore the well-established concept
of ad hoc disclosure can be continued.4
17.003 Geographical scope of application: Ad hoc disclosure refers to financial instruments, i.e., in
particular shares and debt securities (bonds) pursuant to Art 2 para 1 (cf paras 2.002ff), which
are traded on an EU trading venue pursuant to Art 3 para 1 (6)–(8) (cf paras 3.023ff) or which
are admitted to or whose admission to trading on such a trading venue has been applied for.
Thus, the marketplace principle applies to the geographic scope of application.5 The ad hoc
disclosure obligation therefore also applies to issuers that are not based in the EU but in a third
country.
17.004 Supervision responsibility: According to Art 22 MAR in connection with § 152 BörseG
(Austrian Stock Exchange Act), the FMA is responsible for the supervision of issuers in
Austria.
2. Purpose of the norm
17.005 The regulation of ad hoc disclosure serves several purposes,6 namely to ensure the functioning
of the capital market by including all relevant information in the price formation process as
quickly as possible. Efficient pricing is intended to ensure that the capital market functions
properly.7 The second regulatory objective is investor protection. Investors should be placed in
a position that enables them to react to changed circumstances as quickly and concomitantly
as possible, to buy or sell securities or financial instruments that have already incorporated
the price changes. The aim is thus to ensure that prices are set for the benefit of all investors,
thereby ensuring that the investor makes a well-founded and independent decision. Finally,
3 Lars Klöhn, ‘Ad-hoc-Publizität und Insiderverbot im neuen Marktmissbrauchsrecht’ [2016] AG 423, 429.
4 Klöhn, ‘Ad-hoc-Publizität und Insiderverbot im neuen Marktmissbrauchsrecht’ (n 3) 423, 429.
5 Dörte Poelzig, ‘Insider- und Marktmanipulationsverbot im neuen Marktmissbrauchsrecht’ (2016) 14 NZG 528, 530 f.
6 Lars Klöhn, ‘Vorbemerkungen zu Artikel 17’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) paras
34ff, 51ff, 5ff
7 Heinz-Dieter Assmann, ‘Artikel 17 MAR: Veröffentlichung von Insiderinformationen’ in Heinz-Dieter Assmann, Uwe
H Schneider and Peter Mülbert (eds), Wertpapierhandelsrecht (7th edn, Otto Schmidt 2019) para 11.
206
A. Basic principles
timely and concurrent disclosure is intended to ensure equal treatment in terms of information.
Ultimately, ad hoc disclosure aims to provide flanking and supplementary protection against
insider dealing.8
3. History of origins
Originally, the ad hoc disclosure obligation was regulated in the BörseG 1989 pursuant to § 82 17.006
para 6. Until the amendment of the BörseG in 2004,9 § 48d para 2 BörseG 1989 was the rele-
vant legal basis. The legal basis under European law was Art 6 of the Market Abuse Directive
(MAD).10 Ad hoc disclosure was previously already regulated in the Listing Directive11 and the
Insider Directive.12
4. Significant changes to the existing law
The relevant triggering fact of inside information (cf paras 17.017ff, 7.001ff) changes only in 17.007
marginal areas. Several details of the ad hoc disclosure obligation are regulated in more detail
by Art 17 compared to the old legal situation pursuant to § 48d BörseG 1989. For example, the
scope of application has been extended and now also refers to a multilateral or organised trading
system. Emission allowances are also covered if certain limits are exceeded. The regime of
self-liberation (delay) is newly regulated and finally the availability of information is extended
and SMEs are subjected to certain simplified special rules.13
5. Practical significance
The obligation of ad hoc disclosure is one of the central behavioural obligations for issuers and 17.008
plays a major role in business and legal practice.14 It is the third pillar of the duty to provide
information under stock exchange law, alongside rule and investment disclosure.15 Although the
8 Susanne Kalss, Martin Oppitz and Johannes Zollner, Kapitalmarktrecht (2nd edn, Linde 2015) § 16 para 4; Stefan
Grundmann, Europäisches Gesellschaftsrecht (2nd edn, C F Müller 2011) § 18 paras 632ff; Heinz-Dieter Assmann,
‘§ 15: Mitteilung, Veröffentlichung und Übermittlung von Insiderinformationen an das Unternehmensregister’
in Heinz-Dieter Assmann and Uwe H Schneider (eds), Wertpapierhandelsgesetz (6th edn, Otto Schmidt 2012)
paras 27ff; Lars Klöhn, ‘§ 15: Mitteilung, Veröffentlichung und Übermittlung von Insiderinformationen an das
Unternehmensregister’ in Heribert Hirte and Thomas M J Möllers (eds), Kölner Kommentar zum WpHG (2nd edn,
Carl Heymanns 2014) para 4; Alain Pietrancosta, ‘A4: Public Disclosure of Inside Information and Market Abuse’ |
‘Article 17: Public Disclosure of Inside Information’ in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse
Regulation: Commentary and Annotated Guide (Oxford University Press 2017) paras A 4.16, B 17.09; Dörte Poelzig, ‘Die
Neuregelung der Offenlegungsvorschriften durch die Marktmissbrauchsverordnung’ (2016) 20 NZG 761, 763; Thomas
Barth, Zwischenschritte – Insider-Informationen im zeitlichen Ablauf (Linde 2018) 10.
9 BGBl I 2004/127.
manipulation (Market Abuse Directive) [2003] OJ L 96/16 .
11 Council Directive 79/279/EEC of 5 March 1979 coordinating the conditions for the admission of securities to official
stock exchange listing [1979] OJ L 66/21 .
12 Council Directive 89/592/EEC of 13 November 1989 coordinating regulations on insider dealing [1989] OJ L 334/30.
13 See Markus Pfüller, ‘§ 15: Mitteilung, Veröffentlichung und Übermittlung von Insiderinformationen an das
Unternehmensregister‘ in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016) paras 41 f.
15 Pietrancosta (n 8) para B.17.14.
207
number of ad hoc disclosures in the vast majority of EU Member States has risen continuously
in recent years,16 a slight decline can be observed in Austria. While 569 ad hoc notifications
were published in 2010, in 2016 only 435 ad hoc notifications were made by issuers in Austria.17
B. ISSUERS
17.009 Issuer – obligated party: The ad hoc disclosure obligation is an obligation that only affects
certain market participants and not everyone, namely the issuer.18 Only financial instruments
issued by the issuer trigger the ad hoc disclosure for it, while other financial instruments that
only relate to it (options) are not relevant.19 A direct reference to the issuer is necessary for the
ad hoc disclosure obligation, whereas the indirect reference is sufficient for the existence of
inside information.20 A relevant fundamental value reference is therefore decisive; a reference
only to the order situation is not decisive for Art 17.21 Fundamental value-relevant means
that all publicly known information is changed in such a way that the reasonable investor
comes to a different assessment of the risk/return ratio of the issued financial instruments.22
Examples of this are circumstances from the sphere of the issuer, such as a capital increase,
but also external circumstances, such as an acquisition of an equity holding or a takeover bid.23
Disclosure of company-specific information is most likely to be reasonable for the issuer, who
can provide the disclosure at the lowest cost.24 The ad hoc disclosure obligation pursuant to
Art 17 para 1 subpara 3 applies to issuers, regardless of whether they are domiciled at home or
abroad or according to which company statutes they are organised. The issuer does not have
to be domiciled in the same country in which the financial instruments are listed on a market
(e.g., Austrian issuer and listing on the Vienna Stock Exchange) or within the EU. It may also
come from another EU or EEA Member State or even from a third country. Also under the
previous law, it was irrelevant pursuant to § 48d para 1 Stock Exchange Act whether the issuer
is domiciled in Austria or abroad, whether it is domiciled within the EU or in a third country.25


17 See in this respect the overview in FMA, Annual Report of the FMA 2016, 81 and FMA, Annual Report of the FMA
2012, 127.
18 Assmann, ‘Artikel 17 MAR’ (n 7) para 19.
19 Lars Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ in Klöhn (n 6) para 63; Lars Klöhn, ‘Artikel 7:
Insiderinformationen’ in Klöhn (n 5) para 242.
20 Klaus J. Hopt and Christoph Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (2017) 46/6 ZGR 765,
781; Klaus J. Hopt and Christoph Kumpan, ‘§ 107: Insiderrecht’ in Herbert Schimansky, Hermann-Josef Bunte and
Hans-Jürgen Lwowski (eds), Bankrechts-Handbuch (5th edn, C. H. Beck 2017) para 113.
21 Andreas Merkner, Marco Sustmann and Alexander Retsch, ‘Insiderrecht und Ad-hoc Publizität im neuen
Emittentenleitfaden’ [2019] AG 621, 622; Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para
74.
22 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 75.
23 CESR, ‘MAD Level 3 – second set of CESR guidance and information on the common operation of the Directive to the
market’, CESR/06–562b, July 2007 para 1.15; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’
(n 18) 765, 785; Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 92.
24 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) paras 69 f.
208
B. Issuers
Group: The group as such – due to its lack of legal personality – is not a direct addressee of the 17.010
ad hoc disclosure obligation. However, circumstances in the sphere of the parent company or
subsidiary may trigger the ad hoc duty with the issuer.26 If, for example, both parent company
and subsidiary are listed on the stock exchange, both companies and possibly also a sister
company may be subject to the disclosure obligation. The disclosure of one company does not
automatically trigger the ad hoc disclosure obligation of the other companies. In each case, the
relevant question is whether the fundamental value of the issuer has been changed by a measure
or an event in a group company in such a way that the threshold of price relevance is exceeded
for the issuer in particular.27
The term ‘issuer’ is based on Art 3 (see para 3.049). 17.011
Organisation of the issuer: In order to be able to properly fulfil the ad hoc disclosure obligation, 17.012
the issuer must take organisational measures to ensure that it immediately becomes aware of
inside information concerning it and can act accordingly.28 The issuer is aware of inside infor-
mation if the management board as a body or an individual member of the management board
possesses such knowledge. According to the principles of knowledge attribution,29 the issuer
is also to be attributed knowledge which the management board as the body responsible for
fulfilling the ad hoc disclosure obligation does not actually have, but which would be accessible
if the knowledge organisation were properly fulfilled.30 The attribution of knowledge and the
necessary organisational duty to do so follow from Art 1731 and, in addition, Austrian corporate
and civil law.32 Thus, knowledge that contributes to the fulfilment of Art 17 by persons who are
subject to the organisational control of the issuer’s management board or by persons who are
themselves originally obliged by virtue of their position on the board is to be attributed to the
management board. The knowledge of individual members of the management board is only
not attributable to the issuer if there are higher-ranking privacy law reasons against attribution,
such as the diagnosis of a serious illness or the self-recognition of serious private tax evasion.33
Nor is the knowledge of the management board attributable to the issuer if the attribution is
prevented by a legal or normatively prescribed duty of confidentiality, such as from another
position on another body.34 For example, if a member of the management board learns of inside
information from a supervisory board function in another company, but the duty of confiden-
26 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 93; Assmann, ‘Artikel 17 MAR’ (n 7) para
24.
27 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 100; Kalss, Oppitz and Zollner (n 9) § 16
para 23.
28 Thomas Barth, ‘Zur Wissenszurechnung von Aufsichtsratswissen - Zugleich eine Besprechung des BGH-Urteils XI
ZR 108/15 und seiner Auswirkungen auf das österreichische Recht’ (2016) 5 GesRZ 319; Hans-Christoph Ihrig,
‘Wissenszurechnung im Kapitalmarktrecht – untersucht anhand der Pflicht zur Ad-hoc-Publizität gem Art 17 MAR’
(2017) 181 ZHR 381, 382ff
29 Gerald Spindler, ‘Wissenszurechnung in der GmbH, der AG und im Konzern’ (2017) 181 ZHR 311, 311ff; Barth, ‘Zur
Wissenszurechnung von Aufsichtsratswissen’ (n 26) 319, 319ff; Jens Koch, ‘Die Ad-hoc-Publizität: Veröffentlichungs-
oder Wissensorganisationspflicht?’ [2019] AG 273, 273ff.
30 Rüdiger Veil and Alexander Brüggemeier, ‘§ 10: Veröffentlichungen von Insiderinformationen’ in Andreas Meyer,
Thomas Rönnau and Rüdiger Veil (eds), Handbuch Marktmissbrauchsrecht (C. H. Beck 2018) para 20.
31 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) paras 111ff.
32 Ihrig (n 28) 381, 388.
33 E.g., Ihrig (n 28) 381, 396ff
34 Spindler (n 29) 311, 329; Barth, Zwischenschritte (n 8) 129.
209
tiality arising from the supervisory board-related activity conflicts with the attribution.35 Other
knowledge of the management board acquired professionally or privately is attributable to the
company.36
17.013 The breach of the attribution follows from a legal duty of confidentiality, not least because
a legal system cannot feign a transfer of knowledge by way of knowledge attribution, which
must not actually be carried out.37 The knowledge that the supervisory board has as a body is
also attributable to the issuer, in particular in the case of knowledge for which the supervisory
board is responsible, whether in plenary sessions or in committees, such as the dismissal of
a member of the management board or the devaluation of certain claims.38 If the supervisory
board has not acquired the knowledge within its competence, the knowledge cannot simply be
attributed to the management board – and thus to the issuer – since the latter is not generally
in a position to control the knowledge and its transfer.39 The knowledge of individual members
of the supervisory board is also only attributable to the company if the knowledge was acquired
in the course of their activities as members of the supervisory board.40 If the knowledge of
a supervisory board member was acquired outside the company and thus not within the scope
of the supervisory board activity, attribution is generally not possible.41
17.014 Group: The mere fact of being part of a group does not automatically lead to an attribution
of knowledge.42 The attribution of knowledge is based on controllability and enforceability.43
For example, knowledge is attributed within a contract-based group of affiliated companies
or a group of limited liability companies as well as within a de facto group, provided that the
transfer of information is ensured.44 There is generally no attribution of knowledge from the
parent company to the subsidiary.45
17.015 Market: The market link has been extended for the application of the ad hoc disclosure obli-
gation. The disclosure obligation pursuant to Art 17 para 1 subpara 3 applies to issuers whose
financial instruments have applied for or received admission to trading on a regulated market
in a Member State or to issuers who have received admission to or are applying for admission
to a multilateral or organised trading system in a Member State or have applied for admission
to a multilateral trading system in a Member State. Where not only an issuer but also another
person may apply for inclusion, the inclusion must at least be at the initiative of the issuer or

36 Spindler (n 29) 311, 325 f.
37 Ihrig (n 28) 381, 399; Barth, Zwischenschritte (n 8) 138; Mathias Habersack, ‘Verschwiegenheitspflicht und
Wissenszurechnung – insbesondere im Konzern und mit Blick auf die Pflicht zur Ad-hoc-Publizität’ (2016) 26–27 DB
1551, 1554; Barth, ‘Zur Wissenszurechnung von Aufsichtsratswissen’ (n 28) 319, 320 ef; Jens Koch, ‘Wissenszurechnung
aus dem Aufsichtsrat’ [2015] ZIP 1757, 1763; Peter O Mülbert and Alexander Sajnovits, ‘Verschwiegenheitspflichten
von Aufsichtsratsmitgliedern als Schranken der Wissenszurechnung’ [2016] NJW 2540, 2540 f.
38 Ihrig (n 28) 381, 404ff
39 Spindler (n 29) 311, 328; Barth, Zwischenschritte (n 8) 138.
40 Barth, Zwischenschritte (n 8) 136; Barth, ‘Zur Wissenszurechnung von Aufsichtsratswissen’ (n 28) 319, 320.
41 Barth, ‘Zur Wissenszurechnung von Aufsichtsratswissen’ (n 28) 319, 320; in doubt Ihrig (n 28) 381, 409.
42 Assmann, ‘Artikel 17 MAR’ (n 7) para 59; Barth, Zwischenschritte (n 8) 139; Ihrig (n 26) 381, 411; Spindler (n 29) 311,
333.
43 Barth, Zwischenschritte (n 8) 139; Spindler (n 29) 311, 333 f.
44 More reserved Ihrig (n 28) 381, 412 regarding the de facto stock corporation group.
45 Ihrig (n 28) 381, 412.
210
C. Inside information
they must agree to the inclusion.46 The scope of application is thus extended in comparison with
the old law, not least because, until the entry into force of the MAR, listing on a multilateral
trading system was not included.47 In Austria, now also issuers whose securities are listed on
the third market of the Vienna Stock Exchange are subject to ad hoc disclosure requirements.
The listing on a regulated market, on a multilateral trading system or on an organised trading
system does not have to be located domestically, i.e., not in Austria. A listing or application
for listing on a regulated market or on a multilateral or organised trading system in a Member
State, i.e, within the EU, suffices. Thus, both the geographical scope of application compared
to the old legal situation is extended just as significantly as the functional market-related scope
of application from the regulated market to other, multilateral and organised trading systems.
The purpose of the extension is to improve investor protection also for these trading platforms,
to preserve the integrity of the markets and to curb market abuse in these markets.48 As a result,
access to a multilateral trading system for companies that have hitherto been remote from the
capital market will be subject to significantly higher requirements and associated costs, which
may make the entry threshold too high in many cases.
Insolvency: In the event of insolvency, the disclosure obligation continues to exist;49 despite the 17.016
opening of insolvency proceedings, the issuer and not the liquidator is still obliged.50
C. INSIDE INFORMATION
Art 17 provides that issuers of shares must disclose inside information that directly concerns 17.017
them to the public as soon as possible. The decisive term is therefore the concept of inside
information. According to Art 7, inside information is precise information that is not publicly
known and that directly or indirectly concerns one or more issuers or one or more financial
instruments and which, if it were publicly known, would be likely to have a significant impact
on the price of these financial instruments or the price of related derivative financial instru-
ments (cf para 7.001ff).
Art 7 follows the one-tier or uniform model of inside information: This means that the MAR 17.018
uses the same concept of inside information for the application of insider dealing prohibitions
and the triggering of the duty of disclosure (ad hoc disclosure) and that the individual duties of
conduct and the duty of disclosure are not linked differently to price-sensitive and substantive
inside information.51 While the insider prohibitions pursuant to Art 14 ‘only’ trigger abstention
obligations, Art 17 requires an active duty of action with the disclosure obligation and affects
46 Assmann, ‘Artikel 17 MAR’ (n 7) para 20; Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para
57; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 781.
48 Recital 8 MAR; Pfüller (n 13) § 15 para 70.
50 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 62; differentiating Ulla Reisch, ‘§ 26: Der
Vorstand in der Insolvenz’ in Susanne Kalss, Stephan Frotz and Paul Schörghofer (eds), Handbuch für den Vorstand
(facultas 2017) paras 190 f.
51 Pietrancosta (n 8) paras A.4.18ff, B.17.33; see already Kalss, Oppitz and Zollner (n 8) § 16 paras 4, 18 as well as §
21 para 24; Katja Langenbucher, ‘Über die allmähliche Verfertigung des Gesetzes beim Regulieren – Der Begriff der
Insiderinformation nach der Marktmissbrauchsverordnung’ [2014] ÖBA 656; Barth, Zwischenschritte (n 8) 21.
211
issuers directly and frequently and in many contexts (cf para 17.008). Therefore, it is necessary
to discuss the basic features of inside information – in particular with regard to the disclosure
obligation.
17.019 Four conditions must be fulfilled in order for inside information to be present: (i) the infor-
mation must not be publicly known; (ii) the information must be precise; (iii) the information
must be price-significant; and (iv) the information must directly or indirectly affect the issuer.
The ECJ clarified that the two elements of inside information – precise information on the one
hand and price significance on the other – must be assessed separately.52
17.020 Firstly, Art 7 requires for the existence of inside information that the information must relate
directly or indirectly to the issuer or the financial instrument itself. There must therefore be
a direct or indirect reference to issuer or insider securities. Since precise information that is
also price-sensitive will normally also have the necessary direct or indirect reference to the
issuer or insider securities, the independent significance of this element is not very high in
practice.53 Nevertheless, these terms should be briefly explained: Issuer-related information
is not only present if it concerns internal transactions of an issuer of shares or the information
has otherwise entered its field of activity, but also if it is externally initiated and the issuer is at
least indirectly affected by it. Reference is made to information relating to insider securities if
the financial instrument itself is directly or indirectly affected by the information. An example
of this is knowledge of the existence of a certain order volume for the acquisition or disposal
of shares.54
17.021 Even if Art 7 para 1 lit a provides that inside information is already given if the issuer or the
financial instrument itself is directly or indirectly affected by the information, a disclosure
obligation pursuant to Art 17 para 1 only exists if there is a direct reference to the issuer. This
means that inside information that only relates to insider securities or inside information that
only indirectly affects the issuer is not subject to disclosure.55 A negative definition is usually
used for the purpose of delimitation: Accordingly, information that is not directly related to the
issuer is circumstances and events that affect general market data and can therefore be relevant
for any market participant.56 This includes, for example, commodity prices or general market
statistics as well as interest rate developments or interest rate decisions.57 For the purposes of
52 Martin Oppitz, ‘Anmerkungen zur Entscheidung des EuGH vom 28.6.2012 in der RS C-19/11’ (2012) 4 GesRZ 250,
252; Thomas Barth, ‘Der Zwischenschritt’ (2017) 5 GesRZ 312, 316.
53 cf Heinz-Dieter Assmann, ‘§ 13: Insiderinformationen’ in Assmann and Schneider (n 8) para 46; Lars Klöhn, ‘§ 13:
Insiderinformationen’ in Hirte and Möllers (n 8) para 121; Barth, Zwischenschritte (n 8) 40 f.
54 cf Petra R. Mennicke and Niko Jakovou, ‘§ 13: Insiderinformation’ in Fuchs (n 13) § 13 paras 113ff.
55 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 781; Hopt and Kumpan, ‘§ 107’ (n
120) para 113.
56 Assmann, ‘Artikel 17 MAR’ (n 7) para 41; Daniel Zimmer and Dominik Kruse, ‘§ 15 WpHG: Produktintervention’ in
Eberhard Schwark and Daniel Zimmer (eds), Kapitalmarktrechts-Kommentar (4th edn, C. H. Beck 2010) para 38.
57 See in this respect also BaFin, ‘Issuer Guidelines Module C – Requirements based on the Market Abuse Regulation
(MAR)’, 25 March 2020, I.3.2.2.2. with regard to the exemplary list of further examples of an indirect issuer ref-
erence included there. The FMA takes these examples from a statement of the Committee of European Securities
Regulators (CESR): ‘CESR’s Advice on Level 2 Implementing Measures for the proposed Market Abuse Directive’
CESR/02–089d, December 2002 para 36. Although the FMA expressly points out that its Issuers’ Guidelines have
become obsolete since the entry into force of the MAR and are no longer valid, the authors refer to the FMA’s Issuers’
212
the disclosure obligation pursuant to Art 17, the term inside information is therefore restricted
by law.
In the case of M&A transactions, a distinction must be made: On the side of the acquirer or 17.022
disposer of a company, the direct issuer reference is always present insofar as the respective
acquirer or disposer is an issuer of shares and is therefore listed on the stock exchange.58 If the
target company is listed on the stock exchange, a direct issuer reference, in our opinion, only
exists on the part of the target company if such a significant share package is transferred that it
can be assumed that the transaction will have an influence on the strategy, the composition of
the corporate bodies or the other future development of this target company.59 In the case of
takeover bids pursuant to the Takeover Act, it must be assumed that the issuer will in any case
be directly affected.60
Moreover, the obligation of the target company to disclose may also fail because the transaction 17.023
is not (yet) known to the company. It is possible that the target company itself only learns
about the planned or even completed acquisition or disposal of the shares through the media
or through the fulfilment of other disclosure and reporting obligations, such as the fulfilment
of the reporting obligation under stock exchange law pursuant to § 130 BörseG (disclosures on
investments).
1. Confidentiality
Inside information is only present if it is not yet publicly known. With regard to the question of 17.024
when information is publicly known, the concept of public domain became established under
the old law.61 Under current law, the public domain is not sufficient; the general public62 must
be informed. It is not necessary that the information is actually acknowledged.63 It is also irrele-
vant who made the information public and whether a correct mode of dissemination was used.64
In any case, the general public is informed if the information has been made available via an 17.025
electronically operated information dissemination system pursuant to § 117 para 7 BörseG.
This is in any event the case if the information is circulated via the news agencies, Reuters,
Bloomberg or Dow Jones Newswire. In the case of distribution by other supra-regional news
agencies, too, it can be assumed, in our opinion, that the information is available to the general
public.
Guidelines at a few points in this commentary to the extent that the provisions contained therein can still be considered
a useful interpretation aid, at least in substance.
58 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 814 f.
59 cf also Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 781; Pfüller (n 13) § 15 paras
166ff; see also BaFin (n 57) I.3.2.2.2.
60 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 781; Klöhn, ‘§ 15’ (n 8) para 122.
61 Kalss, Oppitz and Zollner (n 8) § 16 paras 25 f; Holger Fleischer and Klaus U. Schmolke, ‘Gerüchte im Kapitalmarktrecht
– Insiderrecht, Ad-hoc-Publizität, Marktmanipulation’ [2007] AG 841, 847 f; Assmann, ‘§ 13’ (n 53) para 34.
62 Barth, Zwischenschritte (n 6) 28; Hartmut Krause, ‘§ 6: Begriff der Insiderinformation’ in Andreas Meyer, Rönnau and
Veil (n 30) para 78; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 775; Klöhn,
‘Ad-hoc-Publizität und Insiderverbot im neuen Marktmissbrauchsrecht’ (n 3) 423, 427.
63 See Mennicke and Jakovou (n 54) § 13 para 82.
213
17.026 The information can thus also be made available to the public by means of publication in other
public media such as television, press or radio.65 The involvement of a news agency is not neces-
sary in this case. The previous announcement on television, press or radio is sufficient, provided
that it at least concerns media with supra-regional importance. However, it is not sufficient if
information is given to several analysts or journalists or if a press conference is held.66 The mere
passing on of information to analysts or journalists is not sufficient for the establishment of
a broad public. Only when the information can be accessed by market participants is it publicly
known. Even court disclosure or the announcement of the information as part of the Annual
General Meeting is not sufficient.67 The information does not have to be disclosed by the issuer
itself, only the fact of disclosure and the creation of disclosure is decisive.68
17.027 In the literature, it is argued that the disclosure on the website of the company is not sufficient
for the production of the required disclosure.69 While it is to be assumed that an unspecified
number of persons have regular access to news agencies and to the press, radio or television, it
is not to be assumed that representatives of the public domain are always present on the issuer’s
website.70 This line of argument will probably be followed: It must be acknowledged that inves-
tors probably do not constantly check the websites of listed companies and that therefore, in
the case of exclusive disclosure via the website, the risk of asymmetrical information of market
participants is much greater.
17.028 In practice, the information should be made public via the news services, Thomson Reuters,
Bloomberg and Dow Jones Newswire in order to comply with the supervisory requirements
pursuant to § 2 para 2 VMV (Verbreitungs- und Meldeverordnung, Austrian Dissemination
and Notification Ordinance).71
2. Precise information
17.029 According to Art 7 para 2, information is deemed to be precise if it refers to a set of

circumstances:
● which already exist, or

● which can reasonably be expected to come into existence, or an event which has occurred
or which may reasonably be expected to occur in the future, and that information is also
specific enough to enable a conclusion to be drawn as to the possible effect of that set of cir-
cumstances or event on the prices of the financial instruments such as shares or the related
derivative financial instruments.
65 Mennicke and Jakovou (n 54) § 13 para 96.

66 Mennicke and Jakovou (n 54) § 13 para 97.
67 Assmann, ‘§ 13’ (n 53) paras 39 f; see also BaFin (n 57) I.2.1.1.
68 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 775; Hopt and Kumpan, ‘§ 107’ (n
20) para 53.
69 Susanne Rückert, ‘Insiderrecht’ in Thorsten Kuthe, Susanne Rückert and Mirko Sickinger (eds), Compliance-Handbuch
Kapitalmarktrecht (2nd edn, C. H. Beck 2008) 97 para 10.
70 Krause (n 62) § 6 para 92; Assmann, ‘§ 13’ (n 53) para 39.
71 BGBl II 2017/205.
214
It follows that information is only precise if it: 17.030
● has already occurred, or

● insofar as the information relates to future circumstances or a future event, if the occurrence
of such information can reasonably be expected.
Furthermore, in any case, the information must be sufficiently specific to allow a conclusion 17.031
to be drawn on the price effect of the set of circumstances or event. The information must
therefore be specific enough to allow an assessment of its effect on the price of the financial
instrument and thus, for example, on the share price. The existence of this requirement is
generally referred to as ‘price specificity’.72 Thus, a two-step examination must always be carried
out: First, it must be asked whether the circumstances or event in question have occurred or
whether such an occurrence can reasonably be expected (in the past, it was said in this context
that the occurrence had to be ‘sufficiently probable’) and, in a second step, the price specificity
of the event must be assessed.73 The purpose of the rule is to ensure that the market is not
flooded with pure presumptions or speculation.74 Rather, only concrete information – even if it
concerns intermediate steps in a protracted process – should trigger the disclosure obligation.
(a) Events which have occurred

A set of circumstances or an event can only be said to have occurred if they are states and 17.032
events that have entered into reality in a sensually perceptible manner and are open to proof.75
It follows that only such circumstances and events that have also appeared to the outside world
can be considered for notification as inside information. A fact without external effect – such
as the passing of a resolution by an individual member of the management board – is therefore
not as a rule considered precise information.76 Even the CEO’s thoughts – however interesting
they may be for the capital market – about possible future transactions do not constitute precise
information. However, once a set of circumstances or an event has appeared to the outside
world and thus occurred, precise information is present, so that this element is fulfilled.77
Occurrence of intermediate step: Art 7 para 3 last sentence expressly states that an intermedi- 17.033
ate step in a protracted process is deemed to be inside information if, by itself, it satisfies the
criteria of inside information. The wording, ‘by itself’, makes it clear, in our opinion, that the
intermediate step itself must satisfy all criteria for the existence of inside information:78 The
intermediate step itself must therefore (i) either have occurred or its occurrence must be reason-
ably expected, (ii) be price-specific and (iii) have an independent price relevance.
In any case, intermediate steps that have already occurred constitute precise information. 17.034
Whereas under the previous legal situation it was to be assumed that precise information was
72 Assmann, ‘§ 13’ (n 53) para 8; Barth, Zwischenschritte (n 8) 33.

73 cf Kalss, Oppitz and Zollner (n 8) § 16 para 28.
74 Barth, ‘Der Zwischenschritt’ (n 52) 312, 313ff; Valerie Brandl, ‘§ 48a’ in Christian Temmel (ed), Börsegesetz:
Praxiskommentar (LexisNexis 2011) para 22.
75 Eberhard Schwark and Dominik Kruse, '§ 13 WpHG: Sofortiger Vollzug (§ 4 Abs. 7 WpHG aF)’ in Schwark and
Zimmer (n 56) para 8.
77 Austrian VwGH 30 January 2015, 2011/17/0267, Skylink.
78 Barth, Zwischenschritte (n 8) 64ff; Barth, ‘Der Zwischenschritt’ (n 52) 312, 314ff.
215
only available if the final event had already occurred or if the occurrence of the final event
was sufficiently probable,79 it must now be assumed that each intermediate step itself can also
satisfy the criterion of precision.80 Art 7 para 2 explicitly provides for this. Accordingly, an
intermediate step that has already occurred is no longer only relevant to the extent that it is
precisely this intermediate step that leads to the occurrence of the final event being reasonably
expected, but rather can itself constitute precise information.
17.035 However, the criterion of price significance exists as a corrective for the existence of inside
information. If this criterion did not exist, the disclosure obligation would probably no longer
be controllable, since every event during the existence of a company can be considered as a tem-
porally extended process.81
(b) Future events

17.036 According to Art 7 para 2, a future event represents precise information if the occurrence of
that event can reasonably be expected.
17.037 Since Art 7 para 2 speaks of the fact that the occurrence of a future event must be reasonably
expected, this means that the occurrence must be fulfilled with a minimum threshold of prob-
ability of more than 50 per cent.82
17.038 Future intermediate step: Every intermediate step of a protracted process – therefore, not only
the final event, such as the closing of the transaction – can also be precise information. As such,
it is not only the probability of occurrence of the final event that is relevant, but also the prob-
ability of occurrence of each intermediate step in the protracted process.83 At the assessment
level of precise information, it must therefore also be asked whether, for example, the conclu-
sion of a letter of intent or the positive conclusion of a due diligence review can be reasonably
expected. If this question can be answered in the affirmative, there is precise information and
thus, if this information is relevant to the share price, there is already inside information.
(c) Price specificity

17.039 According to Art 7 para 2, information is only considered precise if it is specific enough to
allow a conclusion to be drawn as to the possible effect of the set of circumstances or event on
the price of a financial instrument, such as a share.
79 Susanne Kalss and Clemens Hasenauer, ‘Ad-hoc-Publizität bei Beteiligungs- und Unternehmenstransaktionen’ (2010)
6 GesRZ 301, 308 with further references.
80 Barth, Zwischenschritte (n 8) 64ff; Oppitz (n 52) 250, 251 f.
81 Sebastian Mock, ‘Gestreckte Verfahrensabläufe im Europäischen Insiderhandelsrecht. Zugleich Besprechung von
EuGH v 28. Juni 2012 – Rs C-19/11 (Geltl/Daimler AG)’ [2012] ZBB 286, 287; Barth, ‘Der Zwischenschritt’ (n 52)
312, 313ff
82 Barth, ‘Der Zwischenschritt’ (n 52) 312, 314; Hopt and Kumpan, ‘§ 107’ (n 20) para 45; Klöhn, ‘Ad-hoc-Publizität und
Insiderverbot im neuen Marktmissbrauchsrecht’ (n 3) 423, 428; Poelzig (n 5) 528, 532.
83 Alexander Schopper and Mathias Walch, ‘Ad-hoc-Publizität bei zeitlich gestreckten Sachverhalten – Zugleich
eine Besprechung von VwGH 2012/17/0554’ [2014] ZFR 255, 256; Barth, Zwischenschritte (n 8) 66ff; Barth, ‘Der
Zwischenschritt’ (n 52) 312, 313.
216
In the case of a protracted process, it must be examined with regard to each individual inter- 17.040
mediate step whether the criterion of price specificity is satisfied.84 This means that an inter-
mediate step can only represent inside information if it has already occurred or its occurrence
can reasonably be expected and, in addition, the intermediate step is sufficiently certain that
reasonable investors are in a position to assess possible price effects on the basis of the informa-
tion provided by the intermediate step. In addition, the intermediate step is also only subject to
the disclosure obligation if it satisfies the criterion of price relevance.
The purpose of the requirement of price specificity is to ensure equal information opportuni- 17.041
ties, according to which all investors should have equal access to price-relevant information.85
It is therefore necessary that reasonable investors can benefit from the information. Otherwise
there is no incentive to trade.86 Although this understanding of price specificity is correct in
our view, it has the consequence that the boundaries to the requirement of price relevance (see
below) become blurred because price relevance also concerns the existence of a trading incentive
(cf para 17.045).87 Even if the requirement of price relevance is blurred, price specificity should,
in our opinion, only be assumed to exist if investors can derive an advantage from the informa-
tion. They must therefore at least be in a position to judge whether the price of the share will
rise or fall when the information is disclosed, regardless of whether the individual investor is
anticipating a rising or falling price. Otherwise, no meaningful conclusion can be drawn about
the possible effects of the information on the share price. In most cases, the mere fact that the
share price is moving does not in itself provide any useful information for investors. However,
the judicature – both the ECJ88 and the Austrian Administrative Court89 – do not require it to
be possible to say whether the price will rise or fall, they affirm the existence of price specificity
irrespective of this.
3. Price relevance
According to Art 7 para 1 lit a, the information is to be made public if it would be likely to 17.042
have a significant effect on the prices of financial instruments or the price of related derivative
financial instruments. Art 7 para 4 additionally states that information which would be likely
to have a significant effect on prices must be assumed if a reasonable investor would be likely to
use it as part of the basis of its investment decision. In the German language version, Art 7 para
4 speaks of ‘spürbar’ (noticeably), Art 7 para 1 lit a, however, refers to ‘erheblich’ (significantly).
Although there is a difference between these two terms, in our opinion, and not everything
that is noticeable must also be significant, the legislator obviously assumed that these two terms
have the same meaning for the question of the existence of inside information (see also para
7.028).
84 Susanne Kalss and Clemens Hasenauer, ‘Aktuelles zur Ad-hoc-Publizität bei Beteiligungs- und
Unternehmenstransaktionen’ (2014) 5 GesRZ 269, 271; Kalss, Oppitz and Zollner (n 8) § 21 para 28.
85 Lars Klöhn, ‘Lafonta/AMF – die neue cause célèbre des europäischen Insiderrechts?’ [2014] ZIP 945, 951.
86 Klöhn, ‘Lafonta/AMF’ (n 85) 945, 951.
87 Corinna Ritz, ‘§ 13: Insiderinformation’ in Clemens Just and others (eds), Wertpapierhandelsgesetz: WpHG (C. H. Beck
2015) para 43.
88 Case C-628/13 Lafonta [2015] ECLI:EU:C:2015:162.
89 Austrian VwGH 20 April 2016, Ra 2015/02/0152, Verbund I; see also BaFin (n 57) I.2.1.2.
217
17.043 The impact on the price must be significant. Minor cases, in which only minor price move-
ments occur, should therefore be excluded.90 It is also irrelevant whether or not a price change
actually occurs after the information has been disclosed.91 The only relevant factor is the
suitability of the significant effect on prices.92 The suitability for influencing the price must, as
a rule, be determined in an ex ante prognosis using objective criteria.93 However, a subsequent
change in price can, in the context of consideration of evidence, generally serve as an indication
of a potential change in price at the time of the facts of the case.94 In our opinion, however, the
significance of a subsequent actual price change or even of a non-reaction of the price to the
information must not be overestimated for the sole reason that a multitude of other factors –
such as relevant index movements, other events affecting the issuer, rumours already absorbed
by the market, etc. – can play an important role in the actual price effect and there is a temp-
tation to use this argument in a flexible manner to justify the respective desired standpoint,
whereby the objectivity of the argument falls by the wayside.
17.044 Fixed percentages cannot be used to assess the extent to which a price influence is significant.
To date, the FMA has cited the existence of corresponding analyses by financial experts, his-
torical comparisons with similar information from issuers in the past, the number of market
participants, the general market conditions, and generally the information policy of the issuer as
possible indicators in assessing whether a suitability for a significant influence on prices exists.
For the Austrian Administrative Court (VwGH), this is a legal question.95
(a) Trading incentive for reasonable investors

17.045 The decisive criterion for assessing price relevance is the so-called incentive theory. Just as in
the assessment of price specificity, there must also be an incentive to trade for price relevance
to exist. The information must provide a considerable incentive for reasonable investors to buy
or sell, i.e., it must be worthwhile for them to conclude the transaction.96 If it is not possible
to gain an appreciable economic advantage by using the information, there is also no incentive
to use the information.97 It is irrelevant whether the specific investor benefits or considers the
information to be price-relevant.98 It is also irrelevant whether the price has actually reacted.
This is only in retrospect an indication for the ex ante assessment.99
17.046 This incentive must exist for reasonable investors. These are reasonable investors who know
the stock market, i.e., are familiar with the conditions on the capital market, and not just
90 Michael Gruber, ‘Ad-hoc-Publizität’ [2003] ÖBA 239, 246; Barth, Zwischenschritte (n 8) 68 f.

91 Christian Temmel, ‘Ausgewählte kapitalmarktrechtliche Aspekte des Unternehmens- und Anteilkaufs’ in Franz
Althuber and Alexander Schopper (eds), Unternehmenskauf and Due Diligence I (LexisNexis 2015) 663, 671 para 26.
93 Barth, Zwischenschritte (n 8) 68; Stephan Harbarth, ‘Ad-hoc-Publizität beim Unternehmenskauf’ [2005] ZIP 1898,
1902; Schwark and Kruse (n 75) § 13 WpHG para 44; Austrian VwGH 23 May 2014, 2014/02/0032, Miba; recital 14
MAR.
94 Mennicke and Jakovou (n 54) § 13 para 131; Alexander Schopper, ‘Ad-hoc-Meldepflicht als Schutzgesetz’ [2014] ÖBA
495, 497; BaFin (n 57) I.2.1.4.2.
95 Verbund I (n 89).
96 Kalss and Hasenauer (n 77) 301, 304; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20)
765, 776; Barth, Zwischenschritte (n 8) 46.
97 Assmann, ‘§ 13’ (n 53) para 66; Mennicke and Jakovou (n 54) § 13 para 161.
98 Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 776.
99 Recital 15 MAR; Hopt and Kumpan, ‘Insidergeschäfte und Ad-hoc-Publizität bei M&A’ (n 20) 765, 776.
218
average reasonable investors.100 Reasonable investors are thus laymen with stock market experi-
ence who do not behave speculatively but rationally.101 They understand the functioning of the
capital markets, the financial instruments traded on these markets and act in a yield-oriented
manner. However, they are not professional market participants, such as fund managers or
equity analysts.
It would be wrong, in our opinion, to try to explain the concept of reasonable investor with 17.047
that of rational investors in terms of capital market theories, i.e., solely on the basis of empirical
observations. The concept of reasonable investor is a normative legal figure that cannot be
defined solely empirically or by reference to rational investor behaviour in the sense of capital
market theories.102 This is also confirmed by the Austrian Administrative Court (VwGH) when
it states in its decisions of 24 April 2014103 and 20 April 2016104 that the question of whether
reasonable investors make information the basis of their investment decision is a legal question.
The legal figure of the reasonable investor is intended to ensure that not every precise and price 17.048
sensitive piece of information is also inside information.105 Thus, a corrective is created in order
to prevent the ad hoc reporting obligation from becoming excessive. Only such information
is to be covered which, in terms of its true content, gives reasonable investors an incentive to
trade. However, the corrective only works if it is assumed that reasonable investors do not make
their decision on a purely speculative basis.
Most inside information is not so-called spontaneous inside information, rather inside infor- 17.049
mation develops over a certain time.106 Examples are corporate mergers, capital increases, coop-
erations, acquisitions or disposals of shares. Like a cooperation, a capital increase is an event
that is preceded by a long planning phase with numerous individual preparatory steps.107 These
individual activities represent intermediate steps, i.e., preparatory measures, circumstances or
events that precede a final event in the entire process or a protracted process.
100 Schwark and Kruse (n 75) § 13 WpHG para 47.

101 Andreas Zahradnik and Tamara Kapeller, ‘Ad-Hoc-Publizität – Pflichten der Emittenten bei unternehmensspezifischen
Transaktionen’ in Ernst Brandl and others (eds), Handbuch Kapitalmarktrecht III (Bank-Verlag 2006) 130, 138; Katja
Langenbucher, ‘Zum Begriff der Insiderinformation nach dem Entwurf für eine Markmissbrauchsverordnung’ (2013)
36 NZG 1401, 1405; Barth, Zwischenschritte (n 8) 51 f.
102 Florian Schuhmacher, ‘Zur Auslegung des neu gefassten Tatbestands des Missbrauchs einer Insider-Information’ [2005]
ÖBA 533, 542; Schwark and Kruse (n 75) § 13 WpHG paras 47 f; Assmann, ‘§ 13’ (n 53) paras 57 f; Dirk Kocher
and Stefan Widder, ‘Anmerkung zum Urteil des EuGH vom 28.06.2012 (C-19/11) – Zu den Zwischenschritten einer
gestreckten Entscheidung als Insider-Informationen’ (2012) 30 BB 1820, 1821; Hans-Christoph Ihrig and Christopher
Kranz, ‘Das Geltl/Daimler-Verfahren in der nächsten Runde – Keine abschließende Weichenstellung des BGH für
die Ad-hoc-Publizität bei gestreckten Geschehensabläufen’ [2013] AG 515, 517; Chrisoph H. Seibt, ‘Europäische
Finanzmarktregulierung zu Insiderrecht und Ad-hoc-Publizität’ (2013) 177 ZHR 388, 401; Hartmut Krause and
Michael Brellochs, ‘Insiderrecht und Ad-hoc-Publizität bei M&A- und Kapitalmarkttransaktionen im europäischen
Rechtsvergleich. Ein Beitrag zum Begriff der Insiderinformation im kommenden EU-Marktmissbrauchsrecht’ [2013]
AG 309, 314; Andreas Zahradnik, ‘Entscheidungsanmerkung VwGH 29.4.2014, 2012/17/0554’ [2014] ÖBA 630, 631
f; Kalss and Hasenauer (n 84) 269, 273 f.
103 Austrian VwGH 24 April 2014, 2014/02/0016.
104 Verbund I (n 89).
105 Kalss and Hasenauer (n 84) 269, 274; Krause and Brellochs (n 102) 309, 314.
106 Barth, ‘Der Zwischenschritt’ (n 52) 312, 313.
107 Barth, ‘Der Zwischenschritt’ (n 52) 312, 313.
219
17.050 Term: Art 7 para 3 defines the intermediate step as inside information given in a protracted
process if, by itself, it satisfies the criteria for inside information as referred to in this article.
17.051 The special feature of such protracted processes or intermediate steps is that they have a double
meaning:
● First of all, the intermediate steps can be independent inside information if they, as isolated
own circumstances, contain a corresponding information content which independently
constitutes inside information. Of particular importance here is, above all, the suitability for
considerable price relevance.108
● However, they can also be only part of a sequence of events or a protracted process which
contributes to bringing the final event, namely the capital increase, closer. Here, the focus
is not so much on price relevance as on the precision (= accuracy) of the information, and
thus on the sufficient probability of occurrence.
17.052 An intermediate step is to be judged according to the same elements as a final event.109 This is
precisely what is expressed in the normative definition of Art 7 para 3. At the European level,
the existence of the four elements of the offence is explicitly prescribed by law. In the evalua-
tion of each individual intermediate step, the four elements of inside information must not be
confused with the elements of the final event at the assessment level.110
17.053 Since intermediate steps are not only to be considered in isolation, but are part of the develop-
ment towards the realisation of the final event, and since with each intermediate step the final
event also draws nearer and thus its occurrence becomes more probable, intermediate steps over
the course of time are not only to be assessed individually, but at the same time the final event
is also to be assessed under consideration of the respective intermediate step just taken, namely
whether the final event is already to be qualified as inside information.111 In particular, the
element of accuracy and thus, as a future event, the reasonable probability of occurrence, must
be assessed. Therefore, an event that only develops over a certain time period is to be assessed
in a two-track examination grid, namely, with reference to the independent assessment of the
respective individual concrete activity, on the one hand, and with reference to the final event,
on the other hand.
108 Barth, Zwischenschritte (n 8) 64ff; Barth, ‘Der Zwischenschritt’ (n 52) 312, 313; Sebastian Sieder, ‘Ad-hoc-Publizität bei
gestreckten Sachverhalten: VwGH Rs 2016/02/0020 eine richtungsweisende (Fehl-)Entscheidung?’ (2017) 5 GesRZ
305, 309; Gernot Wilfling, ‘Anmerkung zur Entscheidung des VwGH vom 27.04.2017, Ro 2016/02/0020 ua’ [2017]
ZFR 337, 338; Jochen Vetter, Daniel Engel and Theresa Lauterbach, ‘Zwischenschritte als ad-hoc-veröffentlichungsp-
flichtige Insiderinformation’ [2019] AG 160, 160; Merkner, Sustmann and Retsch, (n 21) 626; reserved BaFin (n 57)
I.2.1.2.
109 Barth, ‘Zur Wissenszurechnung von Aufsichtsratswissen’ (n 28) 319, 359, 362; Barth, ‘Der Zwischenschritt’ (n 52) 312,
313; Kalss, Oppitz and Zollner (n 68) § 16 para 36; Kalss and Hasenauer, ‘Aktuelles zur Ad-hoc-Publizität bei Beteiligungs-
und Unternehmenstransaktionen’ (n 84) 270; Wolfgang Sindelar, ‘Zwischenschritte als Insiderinformation - Steht die
jüngst dazu vom VwGH aufgestellte Judikatur im Einklang mit den Vorgaben der Marktmissbrauchsverordnung?’
[2015] ÖBA 483, 485; Krause and Brellochs (n 102) 309, 312; Schopper and Walch (n 83) 255, 257; Sieder (n 108) 305,
309ff.
110 Barth, ‘Der Zwischenschritt’ (n 52) 312, 319; see already Susanne Kalss and Clemens Hasenauer, ‘Update:
Ad-hoc-Publizität bei Beteiligungs- und Übernahmetransaktionen’ (2012) 10 RdW 576, 580.
111 Expressis verbis Barth, ‘Der Zwischenschritt’ (n 50) 312, 313 f.
220
(b) Protracted process

In the case of a protracted process, both the final event and each intermediate step are a separate 17.054
object of examination. The procedure is as follows:
The final event (e.g., the conclusion of a transaction) is subject to disclosure under Art 17 if: 17.055
● the occurrence of the final event can reasonably be expected (the probability must be at least
over 50 per cent);
● the final event is price-specific (the information about the final event must not be merely
vague or of a general nature); and
● the final event is price-relevant (based on the information about the final event, there must
be an incentive for reasonable individually, not purely speculative individually, investors to
buy or sell financial instruments such as shares).
Every intermediate step on the path to the final event (e.g., the conclusion of a letter of intent 17.056
or due diligence review is subject to the disclosure obligation112 pursuant to Art 17 if:
● the intermediate step has occurred or its occurrence can reasonably be expected (the proba-
bility must be at least over 50 per cent);
● the intermediate step is price-specific (the information on the intermediate step must not
be merely vague or of a general nature);
● the intermediate step is price-relevant (based on the information about the intermediate
step, there must be an incentive for reasonable – not purely speculative – investors to buy
or sell financial instruments, such as shares; according to the new case law of the Austrian
Administrative Court,113 this is also the case if the occurrence of the final event cannot yet
be reasonably expected and thus the probability of the final event occurring is – at times
even far – below 50 per cent but if the information is disclosed, a high price impact can be
assumed).
(c) Price relevance of intermediate steps

When assessing the price relevance of the final event of a protracted process – such as the con- 17.057
clusion of an M&A transaction – it is clear that precisely this information must be examined
to determine whether it provides an incentive for reasonable investors to buy or sell. Here the
problem does not arise that disclosing information that is still too uncertain would possibly be
prejudicial, as the transaction has already been completed and the underlying information has
therefore already materialised. It can therefore only depend on whether this information – such
as the volume or the strategic importance of the M&A transaction – is important enough for
reasonable investors to use it for a purchase or sale decision.
The matter is somewhat more difficult when assessing the price relevance of intermediate 17.058
steps. If, for example, a letter of intent or due diligence review has been concluded (or can
reasonably be expected), reasonable investors are hardly likely to act on the basis of information
about this intermediate step, but rather they will possibly use this information as an opportunity
to buy or sell shares because they believe it makes the final event more likely to occur. The
112 Kalss and Hasenauer (n 109) 269, 271; Barth, Zwischenschritte (n 8) 64ff.
113 Austrian VwGH 27 April 2017, Ro 2016/02/0020, Verbund II.
221
conclusion of the letter of intent or due diligence review, therefore, only affects the price of
the issuer because it contains information about the planned M&A transaction.114 The infor-
mation about the conclusion of the letter of intent or the due diligence itself, i.e., about the
intermediate step, does not have any information content of its own for the suitability of price
development, but is rather only relevant to the price because of the final event.115 It is therefore
derived information.116
17.059 Part of the doctrine draws on the so-called probability/magnitude test, with reference to the
German Federal Court of Justice (BGH),117 for the question as to the extent to which the prob-
ability of occurrence of the final event must be present in order to speak of a price relevance of
the intermediate step.118 Accordingly, the probability of the occurrence of the final event must
be related to the price relevance. The higher the potential price impact of the final event, the
lower the probability of the event actually occurring must be. This means that the intermediate
step that has occurred, or the intermediate step that can reasonably be expected to occur, is,
as a rule, a protracted process sufficient for the existence of an obligation to disclose pursuant
to Art 17, even if the occurrence of the final event is still unlikely, but would be particularly
relevant to the price.
17.060 The FMA also assumes that preparatory steps, such as the launch of a merger project, will
trigger the ad hoc reporting obligation if the future event is of corresponding importance.
17.061 Even if supporters of this view are of the opinion that the ECJ is inclined to their view, the
ECJ has not explicitly commented on this question in particular, but has left it open.119 In
Austria, the Administrative Court initially decided the matter as follows: In its decision of 24
March 2014120 and also in its decision of 29 April 2014,121 it initially dealt intensively with the
ECJ decision, Geltl and, for the question of whether there is an ad hoc reporting obligation,
focused on whether the occurrence of the final event is sufficiently probable (can reasonably be
expected).
17.062 Since 2016, however, the new case law in Austria122 has no longer been focusing on whether the
final event is sufficiently probable, but instead relies on (though in connection with the assess-
114 Schopper and Walch (n 83) 255, 257.

115 Kalss and Hasenauer (n 109) 269, 274.
116 Barth, Zwischenschritte (n 8) 70.
117 BGH 23.4.2013, II ZB 7/09, Daimler-Chrysler II.
118 Alexander Schall, ‘Ad-hoc-Mitteilung auch über Zwischenschritte eines kursrelevanten Vorgangs als Insiderinformation,
Hier: Ausscheiden des Vorstandsvorsitzenden von Daimler (“Geltl”)’ [2012] ZIP 1286, 1288; Lars Klöhn, ‘Das deutsche
und europäische Insiderrecht nach dem Geltl-Urteil des EuGH’ [2012] ZIP 1885, 1891; Schopper and Walch (n 83)
255, 258; Klöhn, ‘§ 13’ (n 53) paras 201ff; Ritz (n 87) § 13 para 102; see for a different opinion e.g., Schuhmacher (n
102) 533, 542; Zahradnik (n 102) 630, 631 f; Kalss and Hasenauer (n 109) 269, 273 f; Oppitz (n 52) 250, 252; Barth,
Zwischenschritte (n 8) 73ff; see also BaFin (n 57) I.2.1.4.3; Schwark and Kruse (n 75) § 13 WpHG paras 50 f; Assmann,
‘§ 13’ (n 53) para 25b; Kocher and Widder (n 102) 1820, 1821; Ihrig and Kranz (n 102) 515, 517; Seibt (n 102) 388, 401;
Krause and Brellochs (n 102) 309, 314; Sieder (n 108) 305, 309ff; Barth, ‘Der Zwischenschritt’ (n 52) 312, 317ff
119 Vetter, Engel and Lauterbach (n 108) 160, 164; Schopper and Walch (n 83) 255, 258.
120 Austrian VwGH 24 March 2014, 2012/17/0118, OMV.
121 Austrian VwGH 29 April 2014, 2012/17/0554, RBI.
122 Austrian BVwG 14.2.2019, W210 2195872–1/6E, Wiener Privatbank; Austrian BVwG 13.6.2019, W204 2209288–1;
Austrian BVwG 21.8.2019, W148 2196914–1; Austrian BVwG 8.5.2020, W148 2217970–1.
222
D. Nature and content of the disclosure (para 1)
ment level as to the existence of precise information) the probability/magnitude test, which was
expressly rejected by the ECJ in the Geltl123 decision. This creates considerable uncertainties
for the legal practitioner in practice, since with this case law, a workable distinction between
relevant facts cannot be made. Therefore, the delay instrument of the disclosure obligation
pursuant to Art 17 para 4 described below comes all the more to the fore in daily practice for
issuers (cf paras 17.080ff).
In our opinion, contrary to the case law of the Austrian Administrative Court and the BVwG 17.063
(Austrian Federal Administratve Court), the intermediate step is only price-relevant if the
occurrence of the final event – for example, the conclusion of the M&A transaction – can
reasonably be expected. It should be expressly emphasised that practice will nevertheless have
to follow this case law in order to comply with the law from the point of view of supervision.
Due to the now prevailing highest court rulings, which assume the applicability of the probabil- 17.064
ity/magnitude test, practice will not be based on the – in our opinion, correct – legal view that,
in the case of a protracted process, an intermediate step is only price-relevant if the occurrence
of the final event is highly probable. Rather, even in the case of an unlikely final event, a dis-
closure obligation pursuant to Art 17 will exist if the price relevance in the event of disclosure
is classified as particularly high – a decision that is really difficult for any issuer, in fact hardly
affordable, and which must be made in a very short time and under massive threats of penalties.
D. NATURE AND CONTENT OF THE DISCLOSURE (PARA 1)
Art 17 para 1 requires that the information is made public in a manner which enables fast access 17.065
and complete, correct and timely assessment of the information by the public.
Prior notification: Before the issuer carries out the disclosure pursuant to Art 17 para 1 or 17.066
para 8 (cf para 17.079), it must inform the FMA and the Vienna Stock Exchange or other
marketplaces. Only then may the disclosure be carried out.124 § 119 para 6 BörseG stipulates
the prior notification to the FMA and the exchange operating company. This is to ensure that
the FMA and the exchange can examine whether trading should be suspended. In addition, the
monitoring of compliance with the rules is ensured.125
Prohibition of marketing: Issuers may not combine the making public of inside information 17.067
with the marketing of their activities.126 In addition, issuers must also make all inside informa-
tion that they are required to disclose to the public available on their website for a period of at
least five years.
Furthermore, the Commission has made use of its authorisation provided for in Art 17 para 17.068
3 to adopt an Implementing Regulation and on 29 June 2016 adopted the Implementing
Regulation laying down implementing technical standards with regard to the technical means
123 Case C-19/11 Geltl [2012] ECLI:EU:C:2012:397.

124 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) Art 17 para 499.
125 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) Art 17 para 505.
223
for appropriate public disclosure of inside information and for delaying the public disclosure of
inside information.127 Accordingly, inside information must be disclosed in a non-discrimina-
tory manner to the widest possible public, free of charge and simultaneously throughout the
Union.128 The electronic means used must guarantee the completeness, integrity and confi-
dentiality of the information during transmission. It must be ensured that the information
transmitted is inside information, and the disclosure notice must clearly state (i) the identity of
the issuer (full legal name), (ii) the identity of the person making the notification (first name,
surname, position), (iii) the subject of the inside information and (iv) the date and time of
transmission of the notification to the media.129
17.069 Access and maintenance: In addition, the websites of issuers subject to the disclosure obliga-
tion must satisfy the following requirements: The information must be accessible to users in
a non-discriminatory manner and free of charge, the users of the website must be able to access
the inside information in an easily identifiable section of the website and it must be guaran-
teed that the inside information disclosed contains clear indications of the date and time of
disclosure and that the information is listed in chronological order.130 In practice, it is therefore
advisable to set up a clearly visible access for the retrieval of all disclosed inside information
of the last five years on the homepage of the website at least immediately after the Investor
Relations section. All ad hoc notifications will no longer be disclosed on FMA’s website. The
issuer alone is responsible for making and maintaining access.
17.070 Content: There is no reference in the MAR to the content requirements for an ad hoc noti-
fication. The Austrian Publication and Reporting Ordinance131 adopted in 2005 was replaced
by the Austrian Dissemination and Reporting Ordinance132 on 3 January 2018. While § 3 of
the Publication and Reporting Ordinance still stipulated that an ad hoc notification must be
formulated briefly and concisely, the Ordinance now in force does not contain any such spec-
ification. However, it can still be assumed that the inside information to be made public must
be formulated briefly and concisely.133 It is not intended to provide the issuer with an incentive
to misuse an ad hoc notification for advertising messages or as a carrier of PR messages.134 At
the end of the 1990s, ad hoc notifications were increasingly used for purposes of advertising,
self-promotion and public relations. This ‘marketing prohibition’ has now been explicitly
included in the MAR.
17.071 Media: Pursuant to § 119 para 7 BörseG, the information itself must be made public via an
electronically operated information dissemination system that is widely used at least in the EU.
Pursuant to § 2 para 2 VMV135 (Austrian Disclosure and Reporting Ordinance), this includes
127 Commission Implementing Regulation (EU) 2016/1055 of 29 June 2016 laying down implementing technical standards
with regard to the technical means for appropriate public disclosure of inside information and for delaying the public
disclosure of inside information in accordance with Regulation (EU) No 596/2014 [2016] OJ L 173/47.
128 Art 2 para 1 lit a Implementing Regulation (EU) 1055/2016.
129 Art 2 para 1 lit b Implementing Regulation (EU) 1055/2016.
130 Art 3 Implementing Regulation (EU) 1055/2016; cf BaFin (n 57) I.3.10.3.
131 BGBl II 2005/109 in the version BGBl II 2008/113.
132 BGBl II 2017/205.
134 Assmann, ‘§ 15 (n 8) para 199.
135 BGBl II 2017/205.
224
D. Nature and content of the disclosure (para 1)
the news services, Thomson Reuters, Bloomberg and Dow Jones Newswire. In practice, issuers
use external service providers, such as Euro Adhoc, DGAP or Pressetext, to carry out the dis-
closure, and these ensure the legally correct form of publication. The disclosure must reach the
general public; whether investors actually take note of it is irrelevant (cf para 17.024).136 Access
to information must be free of charge for investors; there must be no charge for specific inside
information; general acquisition and network costs are not included.137
Content: The information to be made public must therefore be limited to the core content of 17.072
the inside information itself. Superfluous information must not be included. Accompanying
information may be given to the extent that it is necessary to enable the classification of inside
information subject to the disclosure obligation.138 Therefore, supplementary statements which
are suitable for classifying the significance of the reported information are not only permissible
but also necessary within reasonable limits.139 To put it bluntly, an ad hoc notification can be
regarded as the ‘shortest prospectus’.140
Addressees – comprehensibility: The notifications must be formulated in such a way that 17.073
they can be understood by all potential investors, in particular also by small private investors
(broad investor audience). The position of a reasonable investor that is familiar with the stock
exchange as a professional market participant should not be taken into account.141
For the purposes of M&A transactions, this means that the essentialia negotii must be reported. 17.074
Therefore, the parties to the transaction as well as the principle performances to be transferred
including the purchase price to be paid, whereby this price has to be indicated not only in terms
of the reasons but also the amount, have to be disclosed. In addition, other significant contrac-
tual terms and conditions that are relevant for assessing the economic agreement of the parties
must also be disclosed. These may, for example, be variable purchase price components, such as
earn-out provisions, or rights of recourse of one or both parties, such as options or rights of first
refusal. Furthermore, the economic terms of these variable purchase price components or rights
of recourse must be disclosed if they are relevant to the transaction as a whole.
Any significant conditions precedent that must still occur before the transaction can be closed 17.075
– such as non-disclosure under antitrust or regulatory law – are also part of the notification to
be made. The closing itself, in our opinion, usually does not have to be reported ad hoc because
the market normally assumes that the transaction will actually close within the usual time
frame. Only if the closing fails, is massively delayed beyond market expectations, or if there is
a material deviation from the information already reported, does another ad hoc notification
appear to be necessary.
137 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 536; Lars Klöhn, ‘Wann ist eine Information
öffentlich bekannt iSv Art. 7 MAR?’ (2016) 180 ZHR 707, 726.
138 Assmann, ‘§ 15’ (n 8) para 202.
139 Zimmer and Kruse (n 56) § 15 WpHG para 107.
140 Thorsten Voß, ‘§ 15: Mitteilung, Veröffentlichung und Übermittlung von Insiderinformationen an das
Unternehmensregister’ in Clemens Just and others (n 87) § 15 para 313.
141 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 516; Zimmer and Kruse (n 56) § 15 WpHG
paras 108 f; Voß (n 140) § 15 para 315.
225
17.076 Other disclosure: Each party is, of course, free to make further information available to the
public by other means, provided this is permitted under the terms of the contractual agreements
in the framework of transaction documents. Very often, buyers and sellers hold a joint press
conference or send out a press release in addition to the ad hoc notification, which then also
contains detailed interviews, with the CEO, for example.
E. DEADLINE FOR DISCLOSURE
17.077 Disclosure must be made without delay. It must therefore be carried out without undue
delay.142 The issuer must take all necessary and reasonable precautions to identify the infor-
mation that is subject to an ad hoc obligation, to clarify the facts of the case, to forward and
store the information, to examine its ad hoc obligation and to make it public. Necessary and
reasonable are all requirements that the issuer can meet in the interest of the information supply
of the market. The issuer must investigate and, if necessary, make public information that arises
in the issuer’s area of activity as quickly as possible, even if there is a mere suspicion that it is
subject to the ad hoc disclosure obligation. In the case of information outside the issuer, but
which directly affects the issuer, the information must be forwarded to the competent authority
and examined.143 A reasonable amount of time must be allowed for the examination, which
may also include the involvement of an external consultant. The exact period depends on the
complexity and difficulty of the legal assessment. If the ad hoc disclosure obligation is affirmed,
the information must be made public immediately at any time of the day or night, including
Sundays and public holidays.144
F. UPDATING THE AD HOC NOTIFICATION
17.078 The MAR does not autonomously regulate either the adjustment or the updating. Adjustment
is the correction of an ad hoc notification that was incorrect from the beginning.145 Updating,
on the other hand, is the addition, replacement or other change to the content of an ad hoc
notification that was originally correct at the time of its disclosure.146 Therefore, an already
disclosed ad hoc notification only needs to be adjusted or updated according to the general
rule of Art 17 para 1, i.e., if a price-sensitive part was incorrect from the beginning or has
become incorrect due to subsequent changes. An update is therefore necessary if the situation
described in an earlier ad hoc notification changes in such a way that new, not publicly known,
price-sensitive information arises which directly affects the issuer, for example in the course of
142 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 116; Klöhn, ‘Ad-hoc-Publizität und
Insiderverbot im neuen Marktmissbrauchsrecht’ (n 3) 423, 430; Poelzig (n 8) 761, 766.
143 See OLG Düsseldorf 4.3.2010, I-6 U 94/09, AG 2011, 31, 34, IKB.
145 Assmann, ‘Artikel 17 MAR’ (n 7) para 203; Veil and Brüggemeier (n 30) § 10 para 181.
146 Kalss, Oppitz and Zollner (n 8) § 16 para 85; Barth, Zwischenschritte (n 8) 157; Klöhn, ‘Artikel 17: Veröffentlichung von
Insiderinformationen’ (n 19) Art 17 para 555.
226
H. Delay of the disclosure obligation
contractual negotiations involving several intermediate steps.147 If the conditions for a delay
pursuant to Art 17 para 4 are met, the issuer is exempted from updating (cf paras 17.080ff).148
G. DISCLOSURE UPON ONWARD DISCLOSURE OF INSIDE INFORMATION

(PARA 8)
Facts: Art 17 para 8 does not link the obligation to make ad hoc disclosures to the existence 17.079
of inside information that directly affects the issuer, but to the fact that one piece of inside
information is disclosed to another and the other is not obliged to maintain confidentiality.
In the case of an intentional disclosure of inside information to another person, the public
disclosure must be made simultaneously; in the case of a non-intentional disclosure or passing
on of the information to a third party, the publication must be made promptly.149 Art 17 para 8
is a supplement to Art 10 in conjunction with Art 14 on the unlawful disclosure (passing on) of
inside information and also supplements the delay of inside information. Selective disclosure of
information is only permissible insofar as the issuer has no inside information directly relating
to it or the information does not need to be disclosed due to other overriding confidentiality
interests pursuant to Art 17 para 4 (see paras 17.080ff). If no delay is taken and the inside
information is disclosed (passed on), the inside information must in principle be made public
promptly. Public disclosure can only be omitted if the recipient of the information is obliged
to maintain confidentiality.150 This applies to both authorised and unauthorised disclosure of
the information. If the information is thus passed on, confidentiality must be ensured in order
not to fall under the disclosure obligation as a result of the passing on of the information.151
If appropriate precautions are taken, disclosure can thus be delayed, and thus the practical
significance is not too great.
H. DELAY OF THE DISCLOSURE OBLIGATION
As already mentioned above, the institution of delay of the disclosure obligation – due to the 17.080
bringing forward of the notification date based on the current case law of the Administrative
Court – is becoming increasingly important. In the case of a delay, disclosure no longer has to
take place as soon as possible, but only when the conditions for the existence of a delay are no
longer given.152 There is no maximum period for the duration of the exemption.153 The conse-
quences of the exemption are, first of all, the documentation obligation and the obligation to
inform the FMA, although under the new legal situation, the FMA must only be informed of
the delay once the inside information has actually been made public (cf para 17.090).
147 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) paras 560 f; Barth, Zwischenschritte (n 8) 157.
150 Krause (n 145) § 10 para 192.
151 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) paras 451, 478.
152 Thomas Lechner and Christian Temmel, ‘§48 d’ in Temmel (n 74) para 63.
153 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 291; furthermore Pfüller (n 13) § 15 para
493.
227
17.081 Art 17 contains several reasons for delay, four in all:154
● Art 17 para 4 provides for the delay of ad hoc disclosure in the interest of the issuer, thus in
the interest of the company and the shareholders of the company subject to ad hoc disclo-
sure obligations,155 who are also protected in a reflex manner.156
● Art 17 is also open to the delay of ad hoc disclosure in order to protect the individual inter-
ests of the person personally affected by the ad hoc reporting obligation. This can be seen,
for example, in the case of a serious illness of the chairman of the management.157
● Art 17 opens up the possibility of a short delay in order to clarify and withhold information
that is already subject to the ad hoc disclosure obligation in the interest of the market.158
● Art 17 para 5 allows a delay in order to protect the public interest in financial stability.
17.082 The conditions for a delay of the disclosure obligation are regulated in Art 17 para 4.
Implementing Regulation 2016/1033 provides details on the technical means for delaying the
disclosure of inside information.
17.083 Documentation: According to Art 4 Implementing Regulation 2016/1033, the following

information in particular must be documented on a permanent data carrier, whose accessibility,
readability and maintenance must be guaranteed:
Date and time:

(i) the first occurrence of inside information of the issuer,
(ii) the decision on delay, and
(iii) the probable disclosure of inside information by the issuer.
• The identity of the persons at the issuer who are responsible for and supervise the delay.
• Proof that the conditions for delay have been met (legitimate interest, no deception and guarantee
of confidentiality – see below).
17.084 Time frame: These new regulations massively increase the documentation requirements of
issuers in the case of a delay. The issuer is thus subject to a large number of documentation
and updating obligations during the entire delay period. On the one hand, these relate to the
above-mentioned information, but also include, for example, the obligation to update the
154 Lars Klöhn, ‘Der Aufschub der Ad-hoc-Publizität zum Schutz der Finanzstabilität (Art 17 Abs 5 MAR)’ (2017) 181
ZHR 746, 749.
155 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) Art 17 para 137; Lars Klöhn and Klaus U
Schmolke, ‘Der Aufschub der Ad-hoc-Publizität nach Art. 17 IV MAR zum Schutz der Unternehmensreputation’
(2016) 45/6 ZGR 866, 874; Klöhn, ‘Der Aufschub der Ad-hoc-Publizität zum Schutz der Finanzstabilität’ (n 154) 746,
749.
156 Peter O Mülbert and Alexander Sajnovits, ‘Der Aufschub der Ad-hoc-Publizitätspflicht bei Internal Investigations’
(2017) 42 WM 2001, 2003.
157 Walter Bayer, ‘Erkrankungen von Vorstandsmitgliedern - Rechtlicher Rahmen, empirische Studie, Empfehlungen an
Praxis und Regelsetzer’ in Bernd Erle and others (eds), Festschrift für Peter Hommelhoff (Otto Schmidt 2012) 87, 95;
Holger Fleischer, ‘Schwere Erkrankung des Vorstandsvorsitzenden und Ad-hoc-Publizität - Zum Spannungsverhältnis
zwischen Markttransparenz und personenbedingten Geheimhaltungsinteressen im deutschen und US-amerikanischen
Kapitalmarktrecht’ in Ulrich Burghard and others (eds), Festschrift für Uwe H Schneider (Otto Schmidt 2011) 333, 350;
Klöhn, ‘Der Aufschub der Ad-hoc-Publizität zum Schutz der Finanzstabilität’ (n 154) 746, 750; Klöhn, ‘Artikel 17:
Veröffentlichung von Insiderinformationen’ (n 19) paras 137, 379.
158 ESMA, ‘Consultation Paper Draft Guidelines on the Market Abuse Regulation’, ESMA/2016/162, 28 January 2016, 22
f paras 64, 67.
228
disclosure notification to be prepared as a precautionary measure159 (see para 17.110) or also

decisions on the delay of intermediate steps.
Protracted process: Art 17 para 4 expressly provides that in the case of a protracted process that 17.085
occurs in stages and that is intended to bring about or that results in a particular circumstance
or a particular event, the public disclosure of inside information relating to this process may
be delayed. As a result, the approach currently mostly chosen in practice is to delay not only
the disclosure of the final event itself but also the disclosure of each intermediate step, which
requires a number of individual measures and decisions.
1. Decision on delay
In any case, the issuer must make a corresponding decision to delay.160 In reality, it is a decision 17.086
of the management of the company. It must be borne in mind that a delay must either be in
the interest of the company and thus the shareholders or in the interest of the market.161 In
any case, the delay must not be based on a self-interest of the management of the company,
for example in the case of losses and mismanagement to conceal such from shareholders, in the
case of positive information, to conceal a competitive advantage from customers and business
partners as well as competitors. Under the current legal situation, an ex lege exemption is not
possible if the conditions for delay are met.162 However, ESMA provides in the standards that
it is not necessarily the executive body which makes the decision to delay.163 The MAR does
not explicitly prescribe a decision, but it apparently requires it.164 In principle, the managing
body of the issuer is responsible for the decision on delay, i.e., the board of directors in the case
of an Austrian public limited company, and the management in the case of a private limited
company.165 However, the decision does not necessarily have to be made by the board of direc-
tors; it can also be delegated according to general principles of company law.166 Nevertheless,
it is advisable to obtain a board decision for the initial delay.167 This should be made in writing
if possible. For the delay of intermediate steps, a corresponding decision by a member of the
management board responsible according to the allocation of responsibilities or by another
person authorised by the management board, such as the Compliance Officer, is then sufficient.
Exceptionally, the supervisory board may also be responsible for the decision, namely if the
159 Kalss, Oppitz and Zollner (n 8) § 16 para 67; Lechner and Temmel (n 152) § 48d para 95.
162 Poelzig (n 8) 761, 765.
163 ESMA, ‘Final Report : Draft technical standards on the Market Abusre Regulation’, ESMA 2015/1455, 28 September
2015, 52 para 239; ESMA, ‘MAR Guidelines: Delay in the disclosure of inside information’, ESMA 2016/1478, 20
October 2016, 3 para 4.
164 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 182; Barth, Zwischenschritte (n 8) 161.
165 Assmann, ‘Artikel 17 MAR’ (n 7) para 92; Mülbert and Sajnovits, ‘Der Aufschub der Ad-hoc-Publizitätspflicht bei
Internal Investigations’ (n 156) 2001, 2003; Barth, Zwischenschritte (n 8) 161; Alexander Retsch, ‘Die Selbstbefreiung
nach der Marktmissbrauchsverordnung’ (2016) 31 NZG 1201, 1205.
166 Retsch (n 165) 1201, 1205; Mülbert and Sajnovits, ‘Der Aufschub der Ad-hoc-Publizitätspflicht bei Internal
Investigations’ (n 156) 2001, 2003.
167 See also the recommendation of Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 190;
Mülbert and Sajnovits, ‘Der Aufschub der Ad-hoc-Publizitätspflicht bei Internal Investigations’ (n 156) 2001, 2003;
Peter O Mülbert, ‘Die Selbstbefreiung nach § 15 Abs. 3 WpHG durch den Aufsichtsrat’ in Mathias Habersack, Karl
Huber and Gerald Spindler (eds), Festschrift für Eberhard Stilz (C. H. Beck 2014) 411, 419.
229
information subject to the ad hoc disclosure obligation originates from the supervisory board’s
original area of responsibility under stock corporation law, especially in the case of personnel
decisions such as the early dismissal of a member of the management board or the appointment
of a new member of the supervisory board.168 As the supervisory board is responsible for the ad
hoc disclosure obligation in personnel matters, it is also responsible for the decision on delay.
17.087 In any case, it is advisable to document the existence of the conditions for delay accordingly in
the delay resolution of the management board as well as in the decisions regarding the delay of
intermediate steps and to update them regularly.169
17.088 The disclosure notifications to be prepared as a precautionary measure should preferably be

attached to the decision or the decision on further delay as an annex (cf para 17.110).
17.089 Precautionary exemption: A precautionary exemption is also permissible and not unusual in
practice, and is thus an exemption from ad hoc disclosure in the event of a sufficiently specific
ad hoc information obligation. This is intended to give the issuer the possibility of a preventive
precaution in the case that it is not clear whether inside information is already available. In any
case, the possibility of delay should be determined in advance.170
2. FMA information
17.090 If an issuer has decided to delay the disclosure of inside information, it must now inform the
FMA about the delay, not immediately upon the decision on the delay but immediately after
the disclosure of the relevant information and, upon request by the FMA, explain in writing
whether the conditions for delay are met.171 In this context, Austria has made use of the option
provided in Art 17 para 4 that the relevant explanations need only be submitted to the FMA
upon request.172 Administrative practice to date shows that immediately after the FMA is
informed that a delay has occurred, the FMA, as a rule, requires a written explanation of the
fulfilment of the conditions for delay.
17.091 The great advantage of the current regulation is that the FMA only has to be informed of
the delay once the inside information has been disclosed. Therefore, if inside information
is not disclosed because it has not arisen at all or if it ceases to exist – this could be the case,
for example, if an M&A transaction is broken off in the course of contract negotiations – no
notification to the FMA is required.173
168 Assmann, ‘Artikel 17 MAR’ (n 7) para 95; Kalss, Oppitz and Zollner (n 8) § 16 para 50; Klöhn, ‘Artikel
17: Veröffentlichung von Insiderinformationen’ (n 19) para 193; Mülbert (n 167) 411, 417, 422; Jens Koch,
‘Beschlusserfordernis und rechtmäßiges Alternativverhalten bei der Selbstbefreiung nach § 15 Abs·3 WpHG’ in
Matthias Casper and others (eds), Festschrift für Johannes Köndgen (RWS 2016) 329, 341.
170 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 187; Holger Pattberg and Martin Bredol,
‘Der Vorgang der Selbstbefreiung von der Ad-hoc-Publizitätspflicht’ (2013) 3 NZG 87, 88 f.
171 See in this respect also Krause (n 145) § 10 para 141.
172 § 155 Abs 4 BörseG; Art 4 para 2 Implementing Regulation (EU) 1055/2016.
230
This new regulation marks a significant change: According to the old legal situation, the 17.092
notification of the delay and the explanations on the existence of the conditions for delay had
to be made at the time of delay and not only when the inside information was disclosed.174 As
a consequence, issuers, in practice, were rather reluctant to use the institution of delay.175 If the
issuer took advantage of this possibility and informed the FMA of a decision to delay, this often
meant that the issuer was automatically placed on the FMA’s ‘radar’ and in many cases audit
procedures were initiated by the supervisory authority at a later point in time.
3. Conditions for the delay
The conditions for delay are provided for in Art 17 para 4. Accordingly, the issuer may post- 17.093
pone the disclosure of inside information176 if:
● immediate disclosure is likely to prejudice the legitimate interests of the issuer;
● the delay is not likely to mislead the public; and
● the confidentiality of the information is guaranteed.
A delay is therefore possible if disclosure would jeopardise the fundamental value of the 17.094
issuer’s shares, for example because the issuer would lose a business opportunity in the case of
premature disclosure or because creditors would have an incentive to call in loans. The issuer’s
interest is all the greater the more the fundamental value of the share would be impaired by
the disclosure. Moreover, maintaining an artificial price level is not in the interest of the issuer
and thus its shareholders. Overall, it can be seen that the delay of positive news is less critical
in relation to the interests of the issuer and the shareholders than the delay of negative news,
because the management’s interest in self-interest is lower in relation to shareholder interests.177
(a) Legitimate interests

Ongoing negotiations: Recital 50 MAR sets out the two most significant reasons for the exist- 17.095
ence of a legitimate interest of the issuer and, indirectly, of the shareholders to justify a delay.
On the one hand, such a legitimate interest may lie in the fact that ongoing negotiations
are endangered.178 On the other hand, a legitimate interest exists if the required approval of
another body of the issuer, such as the supervisory board, is still pending and otherwise a correct
assessment of the information by the public would be jeopardised. The legitimate interest
of the issuer must exist in any case, but it does not have to outweigh the market’s interest in
information pursuant to Art 17.179

175 Kalss and Hasenauer (n 109) 269, 276.
176 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) paras 143ff; Mülbert and Sajnovits, ‘Der
Aufschub der Ad-hoc-Publizitätspflicht bei Internal Investigations’ (n 156) 2001, 2003ff.
178 Krause (n 145) § 10 para 104.
179 Klöhn, ‘Ad-hoc-Publizität und Insiderverbot im neuen Marktmissbrauchsrecht’ (n 3) 423, 430; Mülbert and Sajnovits,
‘Der Aufschub der Ad-hoc-Publizitätspflicht bei Internal Investigations’ (n 156) 2001, 2003; Barth, Zwischenschritte (n
8) 165 f.
231
17.096 Example: Art 17 para 11 further provides that ESMA shall issue guidelines to establish
a non-exhaustive indicative list of possible legitimate interests of the issuer and of situations in
which the delay in the disclosure of inside information is likely to mislead the public.
17.097 The corresponding guidelines were published on 20 October 2016 as ‘MAR Guidelines: Delay
in the Disclosure of Inside Information’.180 As an example for the existence of a legitimate
interest, it is stated that the conducting of negotiations, the outcome of which would likely be
jeopardised by immediate public disclosure, constitutes a legitimate interest. Examples of such
negotiations may be those related to mergers, acquisitions, splits and spin-offs, the purchase
or disposal of major assets or branches of corporate activity, restructurings and reorganisations.
Similarly, according to the ESMA Guidelines, a legitimate interest exists where an issuer is
planning to acquire or sell a major shareholding in another company and disclosure of this
information is likely to jeopardise the implementation of that plan. Thus, a delay may be
justified even before negotiations are conducted if disclosure would otherwise jeopardise the
acquisition or sale itself. Ultimately, all types of negotiations can justify a delay if the negoti-
ations have a price-sensitive content and their disclosure would jeopardise the outcome of the
negotiations.181
17.098 Approval by the supervisory board: A further significant reason justifying the delay is if
a decision taken or contracts entered into by the management body pursuant to national law
or the issuer’s bylaws still require the approval of another body of the issuer – apart from the
shareholders’ general assembly – in order to become effective.182 Although the failure to obtain
the approval for the execution of a measure requiring the approval of the supervisory board in
accordance with § 95 para 5 AktG (Stock Corporation Act), and § 30j para 5 GmbHG (Private
Limited Liability Company Act) does not have any external effect – i.e., the measure taken by
the management without the approval of the supervisory board is still effective, but may trigger
liability consequences for the management – the still pending procurement of the approval of
the supervisory board provided for by law or the articles of association will justify a delay due to
a teleological reduction of the guidelines’ text. It must be taken into account that these ESMA
Guidelines apply to all Member States of the European Union and are applicable to the most
diverse national company law forms of the interaction of organs. It was therefore not possible
to address every company law arrangement in the individual Member States with 100 per cent
accuracy.
17.099 However, the guidelines also require that, in the case of pending approval by the supervisory
authority, delay is justified only to the extent that immediate disclosure of the information
before a definitive decision is taken would jeopardise the correct assessment of that information
by the public and the issuer ensures that the definitive decision is taken as soon as possible.183
Therefore, if it is already clear how the supervisory board will decide, a delay will no longer
be possible for this reason alone. The issuer must also attempt as quickly as possible to bring
about the still pending decision of the supervisory board. Simply waiting for the next routinely
scheduled meeting, which is still several months away, is not sufficient. As a matter of principle,
180 ESMA 2016/1478 (n 163).

181 Retsch (n 165) 1201, 1203.
183 Krause (n 145) § 10 para 114.
232
therefore, the delay may not be postponed until the next ordinary meeting of the supervisory
board; instead, the supervisory board must meet as soon as possible or adopt a circular resolu-
tion.184 However, it must be approved that appropriate organisational measures can be taken to
ensure that a meeting of the supervisory board can be duly held. In practice, this may take some
time, especially in the case of internationally composed supervisory board members. A reason-
able period of time for the convening of the board meeting is to be assumed, to be assessed
according to the circumstances of the individual case.
Crisis – innovation: Other grounds for delay185 set out in the ESMA Guidelines concern 17.100
circumstances where the financial viability of the issuer would be seriously and immediately
jeopardised or, for example, where the issuer has developed a product or created an invention
and immediate disclosure would be likely to jeopardise the issuer’s intellectual property rights.
Moreover, even if a previously announced transaction is subject to approval by a public author-
ity, the ESMA Guidelines provide that a legitimate interest of the issuer may also exist if such
approval is subject to further requirements and the prompt disclosure of those requirements
would in all likelihood affect the issuer’s ability to comply with those requirements and thus
ultimately prevent the success of the transaction.186
As already explained, the cases mentioned above are only a demonstrative list of a few exam- 17.101
ples. Of course, other circumstances with similar weight may also justify a delay in disclosure
by the issuer.
(b) Not misleading

According to Art 17 para 4 lit b, the delay of disclosure must not be likely to mislead the public, 17.102
more precisely: The public is not likely to be misled. The ESMA Guidelines187 state that at
least the following circumstances are apt to mislead the public: (i) the inside information to be
delayed is materially different from the issuer’s previous public announcement on the matter
to which the inside information refers or (ii) the inside information to be delayed regards the
fact that the issuer’s financial objectives are not likely to be met, where such objectives were
previously publicly announced, (iii) the inside information to be delayed is in contrast with the
market’s expectations, where such expectations are based on signals that the issuer has previ-
ously sent to the market (e.g., through interviews or roadshows). The purpose of this criterion
is to protect the market. Delay is not (no longer) permitted if there is a danger of misleading,
regardless of the source of this danger.188
The cases referred to by ESMA also concern possible contradictions with previous statements 17.103
or signals from the issuer to the market. However, it is of course equally misleading, during the
delay period, to disclose information or send signals to the market that contradict the inside
information whose disclosure is being delayed.189 As in the past, it is therefore advisable not to
send any signals to the market in the relevant period of time during a delay that are related to
185 See also Assmann, ‘Artikel 17 MAR’ (n 7) paras 108ff; BaFin (n 57) I.3.3.1.2.
186 cf also Poelzig (n 8) 761, 764.
187 ESMA 2016/1478 (n 163) 5 para 9.
188 Klöhn , ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) para 248.
189 Retsch (n 165) 1201, 1204.
233
the undisclosed inside information, and to remain as quiet as possible as an issuer during this
time.
17.104 In the case of rumours, misleading information may arise in particular if, due to the issuer’s
behaviour in connection with these rumours, beliefs are aroused which are false when consid-
ering inside information.190 Pursuant to Art 17 para 7, in the event of rumours arising, the
delayed inside information must be made public as soon as possible if the rumour is sufficiently
accurate to indicate that it can be assumed that the confidentiality of the information is no
longer ensured.191 It is irrelevant in whose sphere the confidentiality gap arose.192 Rather,
a rumour is already sufficiently precise if the information to be inferred from it suggests that an
information leak has occurred, whereby its origin is irrelevant.193
17.105 However, an arbitrary dissemination of diffuse information, which is equivalent to the dissem-
ination of false or misleading information with the intention of eliciting correct information
from the issuer, is not sufficient.194 The now quite strict regulation concerning the obligation
to disclose delayed inside information in the event of rumours should not be misused to elicit
inside information from the issuer on a speculative basis. In general, it must be said that not
every rumour automatically triggers the disclosure obligation under Art 17 para 7. It is quite
possible that rumours arise merely due to general market conditions or pure speculation and
clearly have nothing to do with an alleged information leak.
(c) Maintaining the confidentiality of information

17.106 Art 17 para 4 lit c also requires that the issuer is able to ensure the confidentiality of the delayed
inside information during the entire period of delay. For this purpose, the issuer must establish
appropriate compliance arrangements.195
17.107 Pursuant to § 119 para 4 BörseG, the issuer shall issue internal guidelines for the disclosure
of information within the company and monitor compliance with these guidelines as well as
take appropriate organisational measures to prevent the abuse or disclosure of inside infor-
mation. In addition, the issuer must inform their employees and other persons working for
them that the abuse of inside information is prohibited. These general obligations, together
with the concrete measures (establishment of confidentiality areas, handling and passing on
compliance-relevant information, blocking periods and trading prohibitions, insider lists, etc.)
form the basis for ensuring confidentiality also in those cases in which the issuer has decided
to delay the disclosure of inside information. Furthermore, insider lists must be maintained in
accordance with Art 18 (cf paras 18.014ff).
17.108 In this context, it should also be considered that the corresponding organisational measures
must not only be taken within the company itself, but that suitable precautions must also be

192 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) paras 269ff; ESMA /2015/1455 (n 163) 242ff (p
53).
193 Klöhn, ‘Artikel 17: Veröffentlichung von Insiderinformationen’ (n 19) paras 287ff; Krause (n 145) § 10 para 131; BaFin
(n 57) Modul C, I.3.3.1.4.
194 Assmann, ‘Artikel 17 MAR’ (n 7) para 140; BaFin (n 57) I.3.3.1.4.
234
I. Preserving financial stability – credit and financial institutions
taken to ensure that the confidential treatment of delayed inside information continues to be
guaranteed in the event of a permissible disclosure to third parties. In the FMA’s view, such
appropriate precautions include ordering employees to inform the addressee of the informa-
tion that it is inside information or obtaining a corresponding acknowledgement from the
addressee that the latter acknowledges both its obligations under capital market law and that
it is aware of the sanctions that will be imposed if inside information is misused or improperly
disseminated.196
In the case of M&A transactions, for example, it is best to make provisions for this eventu- 17.109
ality when concluding a non-disclosure agreement or other confidentiality agreement at the
beginning of the transaction and ensure that such an acknowledgement is given. Furthermore,
the contracting party must be informed of the emergence of the inside information and the
decision to delay. All this must also be documented accordingly in order to be able to provide
evidence of the fulfilment of the compliance obligations under organisational law at a later date.
Due to the obligation to be in a position, at any time, to publish the delayed inside information 17.110
required by Art 17 para 7 in the case of rumours circulating on the market, in our opinion – as
in the past – a disclosure notification should be prepared at the time of the delay and updated
on an ongoing basis.197 This is also in line with common practice in Austria, although the new
Austrian Disclosure and Reporting Ordinance no longer contains an explicit obligation to
prepare a precautionary publication notification. Since circumstances may change continuously
during the period of delay, the precautionary publication notification must also be updated
accordingly. In any case, such an update is required if a further intermediate step is taken in the
case of a protracted process and a new decision to delay is taken (cf para 17.085).
I. PRESERVING FINANCIAL STABILITY – CREDIT AND FINANCIAL INSTITUTIONS
Special provisions for carrying out a delay exist for listed credit or financial institutions in 17.111
accordance with Art 17 paras 5 and 6.198 These institutions may delay the public disclosure if:
(i) the disclosure of the inside information entails the risk of undermining the financial stability
of the issuer and of the financial system; (ii) it is in the public interest to delay the disclosure;
(iii) the confidentiality of the information concerned can be ensured; and (iv) the competent
authority gives its consent to the delay. In contrast to the other cases of delay, the consent of
the supervisory authority must be obtained in advance.199 The supervisory authority must then
ensure that the delay is granted only for the period of time necessary in the public interest.200
The authority must therefore regularly review the existence of the conditions for delay.
196 FMA, ‘Rundschreiben der FMA vom 06.02.2012 zu den Comliance-Regelungen gemäß Börsegesetz 1989 und ECV
2007’ (circular), 6 February 2012, 16.
197 Lechner and Temmel (n 152) § 48d para 95. Of a different opinion Klöhn, ‘Artikel 17: Veröffentlichung von
Insiderinformationen’ (n 19) paras 281 f, according to which, the individual case must be taken into account and in
particular, if the content to be disclosed may change, there is no need to prepare a detailed ad hoc notification.
198 Klöhn, ‘Der Aufschub der Ad-hoc-Publizität zum Schutz der Finanzstabilität’ (n 154) 746, 746ff
235
17.112 The special delay regulation for credit and financial institutions is a typical consequence of the
lessons learned from the financial crisis. It is intended to allow the delay of inside information
that affects the financial stability of the issuer and whose disclosure could potentially jeopardise
the financial system. This applies in particular to information on temporary liquidity problems
of a systemically important credit institution.201
J. EMISSION ALLOWANCES
17.113 In the case of emission allowances, the issuer is not the person obliged to disclose inside infor-
mation. Rather, every market participant must publicly, effectively and in a timely manner
disclose any inside information which it may possess in relation to emission allowances for
its business activities. For example, the disclosure obligation in relation to facilities includes
information relevant to their capacity and use, including the planned or unplanned unavailabil-
ity of these facilities, which includes all facilities owned or controlled by the issuer, its parent
company or an affiliated company.
17.114 Participants in the emission allowance market are exempted from the disclosure obligation
pursuant to Art 17 if the emissions of the installation do not exceed certain minimum carbon
dioxide equivalent thresholds and, if combustion takes place, its rated thermal input also does
not exceed a certain minimum threshold.202
17.115 Furthermore, corresponding regulations apply to emission allowances as to the disclosure of

other inside information, in particular with regard to time, manner of disclosure, documenta-
tion obligations, etc. The delay provisions discussed above also apply to the market participant
with regard to emission allowances.
K. SANCTIONS
17.116 Administrative offence: Pursuant to § 155 para 1 line 2 BörseG, a violation of administrative
law is deemed to have been committed if the obligations to disclose inside information pursu-
ant to Art 17 MAR and Regulation EU No 596/2014 are not complied with. The fine shall
be imposed by the FMA and shall amount to up to three times the benefit gained from the
violation, including any loss avoided, provided the pecuniary benefit can be quantified. The fine
may amount to up to one million euro (§155 para 1 last sentence).
17.117 Legal person: Pursuant to § 156 para 1 BörseG, an administrative penalty for violation of the
ad hoc disclosure obligation may also be imposed on the legal person, i.e., the issuer. For other
administrative measures see § 157 BörseG.
201 Poelzig (n 8) 761, 765; BaFin (n 57) I.3.3.2.1.

202 See in this regard Art 5 of the Commission Delegated Regulation (EU) 2016/522 of 17 December 2015 supplementing
Regulation (EU) No 596/2014 as regards an exemption for certain third countries public bodies and central banks, the
indicators of market manipulation, the disclosure thresholds, the competent authority for notifications of delays, the
permission for trading during closed periods and types of notifiable managers' transactions [2015] OJ L 88/1, with regard
to the minimum thresholds laid down therein.
236
L. Implementation
Civil liability: The law does not provide for an explicit liability regime for violation of the 17.118
disclosure obligation pursuant to Art 17.
Violation of protective legislation: According to the case law203 and the predominant litera- 17.119
ture,204 the duty of disclosure represents a protective law, the violation of which – if the con-
ditions are met – can give rise to compensation. The subjects of protection are the company,
shareholders, investors and creditors of the company.
The law does not provide for further legal consequences under civil law, such as a prohibition 17.120
on voting rights or suspension of rights.
L. IMPLEMENTATION
In the UK, the disclosure of inside information is governed by section 2.2. of the Disclosure 17.121
Guidance and Transparency Rules sourcebook (DTR).205 While the rules requiring the disclo-
sure of inside information, 2.2.1 f DTR, were superseded by Art 17 MAR, some accompanying
guidelines are still in place.206
Literature
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BaFin, ‘FAQ regarding Art 17 MAR’, 29 May 2019
BaFin, ‘Issuer Guidelines Module C – Requirements based on the Market Abuse Regulation’, 25 March
2020
Barth T, ‘Zur Wissenszurechnung von Aufsichtsratswissen - Zugleich eine Besprechung des BGH-Urteils
XI ZR 108/15 und seiner Auswirkungen auf das österreichische Recht’ (2016) 5 GesRZ 319
Barth T, ‘Der Zwischenschritt’ (2017) 5 GesRZ 312
Barth T, Zwischenschritte – Die Ad-hoc-Publizität bei gestreckten Sachverhalten (Linde 2018)
Barth T, ‘Der Zwischenschritt’ (2017) 5 GesRZ 312
Bayer W, ‘Erkrankungen von Vorstandsmitgliedern – Rechtlicher Rahmen, empirische Studie,
Empfehlungen an Praxis und Regelsetzer’ in Erle B and others (eds), Festschrift für Peter Hommelhoff
(Otto Schmidt 2012) 87
Brandl V, ‘§ 48a’ in Temmel C (ed), Börsegesetz: Praxiskommentar (LexisNexis 2011)
Cascante C and Bingl A, ‘Insiderhandel – in Zukunft leichter nachweisbar? – Die Auslegung des
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203 OGH 15.3.2012, 6 Ob 28/12d, GesRZ 2012, 252; OGH 24.1.2013, 8 Ob 104/12w, ÖBA 2013, 438.
204 Kalss, Oppitz and Zollner (n 8) § 20 para 16; Lechner and Temmel (n 152) § 48d paras 62 f; for a different opinion see
Michael Enzinger, ‘Grundlagen und Voraussetzungen der Haftung für Erklärungen an die Öffentlichkeit, insbesondere
im Kapitalmarktrecht’ in Josef Aicher and Siegfried Fina (eds), Festschrift für Manfred Straube (Manz 2009) 19, 33ff;
Schopper, ‘Ad-hoc-Meldepflicht als Schutzgesetz’ (n 94) 495, 495ff; Alexander Schopper, Presentation at the 19th
Austrian Conference of Lawyers (ÖJT) (2016).
205 See FCA, Disclosure Guidance and Transparency Rules sourcebook (available at https://www.handbook.fca.org.uk/
handbook, accessed 14 August 2021).
206 cf section 6.3. DTR regarding the process of disseminating inside information; even section 6.3. DTR is heavily referring
to EU legislative acts; see also Andrew Procter and others, ‘Update on the market abuse regime’ [2019] C.O.B. 1, 21.
237
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ARaktuell 26
Gruber M, ‘Ad-hoc-Publizität’ [2003] ÖBA 239
Gruber M, ‘Von der Marktmissbrauchsrichtlinie (MAD) zur Marktmissbrauchsverordnung (MAR)’
[2012] ZFR 50
Gunßer C, ‘Ad-hoc-Veröffentlichungspflicht bei zukunftsbezogenen Sachverhalten’ (2008) 22 NZG 855
Habersack M, ‘Verschwiegenheitspflicht und Wissenszurechnung – insbesondere im Konzern und mit
Blick auf die Pflicht zur Ad-hoc-Publizität’ (2016) 26–27 DB 1551
Harbarth S, ‘Ad-hoc-Publizität beim Unternehmenskauf’ [2005] ZIP 1898
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222
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Bankrechts-Handbuch (5th edn, C. H. Beck 2017) § 107
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515
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Kalss S, ‘Insiderinformation wohin?’ (2011) 22/12 EuZW 449
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6 GesRZ 301
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(2012) 10 RdW 576
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238
L. Implementation

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Compliance in der Unternehmenspraxis (2nd edn, LexisNexis 2015) 323
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1885
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(2017) 181 ZHR 746
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Zwischenschritten einer gestreckten Entscheidung als Insider-Informationen’ (2012) 30 BB 1820
Krause H and Brellochs M, ‘Insiderrecht und Ad-hoc-Publizität bei M&A- und Kapitalmarkttransaktionen
im europäischen Rechtsvergleich. Ein Beitrag zum Begriff der Insiderinformation im kommenden
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Kumpan C, ‘Kapitalmarktrecht: Offenlegung von Insider-Informationen mit nicht genau bekanntem
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883
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Markmissbrauchsverordnung’ (2013) 36 NZG 1401
Langenbucher K, ‘Über die allmähliche Verfertigung des Gesetzes beim Regulieren – Der Begriff der
Insiderinformation nach der Marktmissbrauchsverordnung’ [2014] ÖBA 656
Lechner T and Temmel C, ‘§48 d’ in Temmel C (ed), Börsegesetz: Praxiskommentar (LexisNexis 2011)
Mennicke P R and Jakovou N, ‘§ 13: Insiderinformation’ in Fuchs A (ed), Wertpapierhandelsgesetz (2nd
Merkner A, Sustmann M and Retsch A , ‘Insiderrecht und Ad-hoc Publizität im neuen Emittentenleitfaden’
[2019] AG 621
Merkner A, Sustmann M and Retsch A, ‘Update: Insiderrecht und Ad-hoc Publizität im neuen (und nun
finalen) Emittentenleitfaden der BaFin’ [2020] AG 477
Mock S, ‘Gestreckte Verfahrensabläufe im Europäischen Insiderhandelsrecht. Zugleich Besprechung von
EuGH v 28. Juni 2012 – Rs C-19/11 (Geltl/Daimler AG)’ [2012] ZBB 286
Möllers T M J, ‘Der BGH, die BaFin und der EuGH: Ad-hoc-Publizität beim einvernehmlichen vorzei-
tigen Ausscheiden des Vorstandsvorsitzenden Jürgen Schrempp’ (2008) 9 NZG 330
Mülbert P O, ‘Die Selbstbefreiung nach § 15 Abs. 3 WpHG durch den Aufsichtsrat’ in Habersack M,
Huber K and Spindler G (eds), Festschrift für Eberhard Stilz (C. H. Beck 2014) 411
Mülbert P O and Sajnovits A, ‘Der Aufschub der Ad-hoc-Publizitätspflicht bei Internal Investigations’
(2017) 42 WM 2001
239
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2010)
Nietsch M, ‘Die Verwendung der Insiderinformation. Eine Standortbestimmung zwischen
Insiderfundamentalismus und Marktrealismus’ (2010) 174 ZHR 556
Oppitz M, ‘Anmerkungen zur Entscheidung des EuGH vom 28.6.2012 in der RS C-19/11’ (2012) 4
GesRZ 250
Pattberg H and Bredol M, ‘Der Vorgang der Selbstbefreiung von der Ad-hoc-Publizitätspflicht’ (2013)
3 NZG 87
Pfüller M, ‘§ 15: Mitteilung, Veröffentlichung und Übermittlung von Insiderinformationen an das
Unternehmensregister’ in Fuchs A (ed), Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016)
528
Poelzig D, ‘Die Neuregelung der Offenlegungsvorschriften durch die Marktmissbrauchsverordnung’
(2016) 20 NZG 761
Rathammer M and Sam M, ‘Ad-hoc- und Directors’ Dealings-Verpflichtungen im MAR-Regime’
[2016] ÖBA 436
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1286
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Zimmer D (eds), Kapitalmarktrechts-Kommentar (4th edn, C. H. Beck 2010)
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sende (Fehl-)Entscheidung?’ (2017) 5 GesRZ 305
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Althuber F and Schopper A (eds), Unternehmenskauf and Due Diligence I (LexisNexis 2015) 663
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and Veil R (eds), Handbuch Marktmissbrauchsrecht (C. H. Beck 2018)
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353
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241
ARTICLE 18
INSIDER LISTS
Ursula Rath
1. Issuers and any person acting on their behalf or on their account, shall each:
(a) draw up a list of all persons who have access to inside information and who are
working for them under a contract of employment, or otherwise performing tasks
through which they have access to inside information, such as advisers, accountants
or credit rating agencies (insider list);
(b) promptly update the insider list in accordance with paragraph 4; and
(c) provide the insider list to the competent authority as soon as possible upon its request.
2. Issuers and any person acting on their behalf or on their account, shall take all reasonable
steps to ensure that any person on the insider list acknowledges in writing the legal and
regulatory duties entailed and is aware of the sanctions applicable to insider dealing and
unlawful disclosure of inside information.
Where another person is requested by the issuer to draw up and update the issuer’s
insider list, the issuer shall remain fully responsible for complying with this Article. The
issuer shall always retain a right of access to the insider list that the other person is drawing
up.
3. The insider list shall include at least:
(a) the identity of any person having access to inside information;
(b) the reason for including that person in the insider list;
(c) the date and time at which that person obtained access to inside information; and
(d) the date on which the insider list was drawn up.
4. Issuers and any person acting on their behalf or on their account shall each update their
insider list promptly, including the date of the update, in the following circumstances:
(a) where there is a change in the reason for including a person already on the insider list;
(b) where there is a new person who has access to inside information and needs, there-
fore, to be added to the insider list; and
(c) where a person ceases to have access to inside information.
Each update shall specify the date and time when the change triggering the update
occurred.
5. Issuers and any person acting on their behalf or on their account shall each retain their
insider list for a period of at least five years after it is drawn up or updated.
6. Issuers whose financial instruments are admitted to trading on an SME growth market
shall be entitled to include in their insider lists only those persons who, due to the nature of
their function or position within the issuer, have regular access to inside information.
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Article 18 INSIDER LISTS
By way of derogation from the first subparagraph of this paragraph and where justified
by specific national market integrity concerns, Member States may require issuers whose
financial instruments are admitted to trading on an SME growth market to include in their
insider lists all persons referred to in point (a) of paragraph 1. Those lists shall comprise
information specified in the format determined by ESMA pursuant to the fourth subpar-
agraph of this paragraph.
The insider lists referred to in the first and second subparagraphs of this paragraph shall
be provided to the competent authority as soon as possible upon its request.
ESMA shall develop draft implementing technical standards to determine the precise
format of the insider lists referred to in the second subparagraph of this paragraph. The
format of the insider lists shall be proportionate and represent a lighter administrative
burden compared to the format of insider lists referred to in paragraph 9.
by 1 September 2020.
referred to in the fourth subparagraph of this paragraph in accordance with Article 15 of
Regulation (EU) No 1095/2010.
7. This Article shall apply to issuers who have requested or approved admission of their
financial instruments to trading on a regulated market in a Member State or, in the case of
an instrument only traded on an MTF or an OTF, have approved trading of their financial
instruments on an MTF or an OTF or have requested admission to trading of their finan-
cial instruments on an MTF in a Member State.
8. Paragraphs 1 to 5 of this Article shall also apply to:
(a) emission allowance market participants in relation to inside information concerning
emission allowances that arises in relation to the physical operations of that emission
allowance market participant;
(b) any auction platform, auctioneer and auction monitor in relation to auctions of emis-
sion allowances or other auctioned products based thereon that are held pursuant to
Regulation (EU) No 1031/2010.
draft implementing technical standards to determine the precise format of insider lists and
the format for updating insider lists referred to in this Article.
by 3 July 2016.
1095/2010.

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OVERVIEW
A. INTRODUCTION 18.001 (e) Electronic list management 18.035

B. SCOPE OF APPLICATION 18.003 D. OBLIGATION TO UPDATE 18.037
1. Issuers 18.007 1. Trigger 18.037
2. Persons acting on behalf or on the 2. Case groups 18.039
account of the issuer 18.009 3. Time limit 18.041
3. Relief 18.012 4. Cessation 18.042
C. INSIDER LISTS 18.015 E. DECLARATIONS OF ACKNOWLEDGEMENT 18.043
1. Occasion and time 18.015 1. Obligation to inform 18.044
2. Persons to be included 18.017 2. Content 18.047
(a) Reference to issuer 18.017 3. Form 18.052
(b) Authorised access 18.019 4. Time and repetition 18.053
(c) Case groups 18.020 F. TRANSMISSION OBLIGATION 18.056
3. Language, format and content 18.024 G. MAINTENANCE AND DESTRUCTION 18.058
(a) Event-based section 18.027 1. Manner of maintenance and access 18.058
(b) Permanent insider section 18.029 2. Retention period 18.059
(c) Data to be included 18.030 3. Destruction 18.062
(d) SMEs growth market issuers 18.034 H. SANCTIONS 18.063
A. INTRODUCTION
18.001 Since 3 July 2016, Art 18 MAR has regulated the obligation under EU law to draw up insider
lists in a uniform manner and to inform all persons included on the insider list about the sanc-
tions applicable in the event of abuse of inside information.
18.002 As in the past, the management of insider lists serves four functions in terms of legal policy: (1)
organisational and monitoring function, which helps issuers to control the flow of information;
(2) educational and deterrent function, which makes it easier for persons with access to inside
information to become aware of the sanctions for violations of their legal obligations; (3) crimi-
nal prosecution and investigation function, which makes it easier for the competent supervisory
authorities to investigate legal violations; and (4) enforcement function, because the insider list
facilitates the presentation of evidence (proof of intent) in criminal proceedings.1
18.003 According to the wording of Art 18 para 1 MAR, the obligation to draw up insider lists is
directed at issuers or all persons acting on their behalf or on their account.
1 Recital 57 MAR; on the previous legal framework in Germany Markus Pfüller, ‘§ 15b Führung von Insiderverzeichnissen’
in Andreas Fuchs (ed), Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016) paras 1ff; Rolf Sethe, ‘§ 15b Führung von
Insiderverzeichnissen’ in Heinz-Dieter Assmann and Uwe Schneider (eds), Wertpapierhandelsgesetz (6th edn, Otto
Schmidt 2012) paras 2ff. On the background and historical development: Marco Dell’Erba, ‘Article 18: Insider lists’ in
Marco Ventoruzzo and Sebastian Mock (eds), MAR (Oxford University Press 2017) paras B.18.08 ff.
244
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While the national implementation differed with regard to the circle of those subject to the 18.004
obligation under the old legal situation (alternative or cumulative obligation), Art 18 para 1
MAR uses the uniform term ‘or’. However, Art 18 para 2 subpara 2 MAR allows the out-
sourcing of the management of the insider list by the issuer to a third party. The interaction
of these two provisions thus opens up the question of whether under the MAR both groups of
persons are obliged to draw up an insider list independently of each other or whether they can
coordinate their activities and thus only one is obliged to draw up the list.
The legal interpretation of the supervisory authorities was initially inconsistent: While the 18.005
FMA considered Art 18 para 1 MAR as an alternative obligation and considered it sufficient
if only one of the two groups of persons drew up the insider list, BaFin assumed a cumulative,
therefore independent, obligation of both the issuer and the persons acting on its behalf or for
its account (‘service providers’) to draw up the insider list.2
Like BaFin, ESMA now also assumes a cumulative obligation:3 This means that both issuers 18.006
and their service providers are each obliged to draw up insider lists independently of each other.
1. Issuers
The scope of application of Art 18 MAR is limited according to para 7, compared to the 18.007
general scope of application of the MAR, to issuers4 of financial instruments5 who have
requested or approved admission of these financial instruments to trade on a regulated market,
an MTF or an OTF in a Member State. This means that only those issuers who have either
requested admission to trade their financial instruments themselves or approved the application
of a third party to request admission to trading will have to take measures to prevent market
abuse. Art 18 MAR therefore does not apply to issuers whose financial instruments are traded
without approval of the issuer.6
In addition, Art 18 para 8 MAR now also obliges emission allowance market participants 18.008
(in relation to inside information concerning emission allowances that arises in relation to the
physical operation of these market participants) and all auction platforms, auctioneers and the
auction monitor (in relation to auctions of emission allowances or other auctioned products
based thereon held pursuant to Regulation 1031/2010) to draw up insider lists and to obtain
declarations of consent.
2 BaFin, ‘FAQ on insider lists pursuant to Article 18 of the Market Abuse Regulation (EU) No 596/2014’, Version 4, 13
November 2019, No II 2 https://www.bafin.de/SharedDocs/Downloads/EN/FAQ/dl_faq_mar_art_18_insiderlisten
_en.html accessed 23 July 2020. Details of the apparently divergent legal interpretation of the FMA and BaFin Gernot
Wilfling, Praxishandbuch Börserecht (2nd edn, Linde 2020) paras 795ff.
3 ESMA, ‘Questions and Answers On the Market Abuse Regulation (MAR)’, ESMA70–145–111, version 15 of 6 August
2021
4 Art 3 para 1 (21) MAR.
5 This means that issuers who have only requested or approved admission of their bonds to trading on a regulated market,
an MTF or an OTF in a Member State are now also covered and obliged to draw up the insider list.
6 An inclusion of financial instruments for trading on the Third Market of the Vienna Stock Exchange (an MTF) is
also possible without the issuer’s approval; Art 18 MAR would not be applicable in this case. Also BaFin (n 2) No II
1; Michaela Göttler, ‘§ 11 Insiderliste’ in Andreas Meyer, Rüdiger Veil and Thomas Rönnau (eds), Handbuch zum
Marktmissbrauchsrecht (C. H. Beck 2018) para 6; Wilfling (n 2) para 775; Wolf-Georg Ringe, ‘Article 18: Insider lists’ in
Matthias Lehmann and Christoph Kumpan (eds), European Financial Services Law (Nomos 2019) para 10.
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2. Persons acting on behalf or on the account of the issuer
18.009 The term ‘any person acting on their [issuer’s] behalf or on their account’ is to be interpreted in
accordance with prevailing European law and broadly covers7 all persons who act (at least also)
in the interest of the issuer on the basis of any contractual or legal obligation and who, in doing
so, gain knowledge of inside information8 as intended and authorised.9 This primarily refers to
service providers commissioned by the issuer.
18.010 In the German literature, the following case groups have been developed for this purpose:10
They include lawyers, tax advisers, accountants and auditors, sub-advisers, (private) experts,
notaries, investor relations agencies, translation agencies, printers, rating agencies (insofar as
instructed by the issuer), credit institutions if they provide services beyond general banking
services (e.g., investment banks for an IPO, a corporate action or an M&A transaction), 11 but
also insolvency administrators, communication agencies and layout designers.
18.011 As a rule, authorities, courts, suppliers and customers, rating agencies (if they are commis-
sioned by an investor or if they act on their own initiative), credit institutions when they merely
provide general banking services, affiliated companies12 and major or majority shareholders
are not included (because they do not act on behalf of or on account of the issuer). The same
applies to service providers commissioned by a service provider of the issuer, or negotiating
partners of the issuer litigation counterparties or potential buyers, as these are typically not
active for the issuer.13 Furthermore, service providers of SMEs are excluded, because Art 18
para 6 MAR provides for the listing requirement only for SME issuers, but not for their service
providers.14
3. Relief
18.012 In order to limit the administrative burden for issuers with financial instruments listed on SME
growth markets, MAR provides for further relief.15
18.013 Pursuant to Art 18 para 6 MAR, these issuers are (initially) exempt from the obligation to
draw up insider lists (but not from the obligation to provide information; see below) under
certain conditions. To this end, they must take all reasonable steps to ensure that any persons
7 Stephan Semrau, ‘Artikel 18: Insiderlisten’ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) para 14.
8 On the previous legal framework in Austria Thomas Lechner and Christian Temmel, ‘§ 48d’ in Christian Temmel (ed),
Börsegesetz: Praxiskommentar (LexisNexis 2011) para 111 with further references; in Germany Pfüller (n 1) § 15b para
19; Sethe (n 1) § 15b para 17 with further references.
9 Semrau (n 7) Art 18 para 15.
10 Göttler (n 6) § 11 paras 13ff; Semrau (n 7) Art 18 paras 16ff; BaFin (n 2) No II 4. On the previous legal framework in
Germany Pfüller (n 1) § 15b paras 21aff; Sethe (n 1) § 15b paras 19ff.
11 Ringe (n 6) Art 18 para 14.
12 Unless they are acting on behalf of or on the account of the issuer, for example because they provide group services; cf
Göttler (n 6) § 11 para 19; Semrau (n 7) Art 18 para 23 with further references.
13 Göttler (n 6) § 11 para 10; Cornelius Simons, ‘Die Insiderliste (Art. 18 MMVO)’ (2016) 5 Corporate Compliance
Zeitschrift 221 f. For its part, the service provider must include sub-service providers in its own insider list; Semrau (n 7)
Art 18 para 24.
14 Göttler (n 6) § 11 para 11.
15 Recital 6 MAR.
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C. Insider lists
with access to potential inside information acknowledge their duties arising therefrom and are
aware of the possible sanctions in the event of non-compliance (Art 18 para 6 lit a MAR).
The obligation to provide information therefore still applies. Furthermore, these issuers must
be in a position to provide the competent supervisory authority with an insider list (drawn up
subsequently) upon request (Art 18 para 6 lit b MAR).
The exemption is however unlikely to lead to significant relief in practice. To be able to disclose 18.014
an insider list based on Annex II MM-Insider Lists Regulation16 upon request, it will de facto
be necessary to document the relevant information on an ongoing basis and to draw up an
insider list.17
C. INSIDER LISTS
1. Occasion and time
According to MAR, the obligation to draw up the (event-related) insider list commences with 18.015
the creation of the inside information and ends with it being made public.18 Provided that the
information is inside information the disclosure of which was not delayed in accordance with
Art 17 MAR, the event-related insider list, in principle, has a very short ‘lifespan’.19
The mere suspicion or indication that inside information exists or could exist in the near future 18.016
does not, however, trigger an obligation to maintain an insider list and to provide information
under MAR. Both in the legal opinion of (German) BaFin20 and in the view of the (Austrian)
FMA,21 the precautionary creation of an insider list in advance of the existence of inside infor-
mation is still permissible, i.e., at a point in time when the information has not yet reached
the degree of detail required for it to constitute inside information. At the same time, the
mere fact that an issuer is creating an insider list as a precautionary measure does not imply
that inside information, which must be made public immediately pursuant to Art 17 MAR
or whose publication must be delayed, already exists.22 In the opinion of Semrau, this can be
further supported by the fact that the list is only referred to internally as an ‘insider list’ when
inside information actually exists.23 The drawing up of such lists, referred to as ‘shadow lists’
containing the relevant data, also appears to correspond to current market practice.24
16 Commission Implementing Regulation (EU) 2016/347 of 10 March 2016 laying down implementing technical stand-
ards with regard to the precise format of insider lists and for updating insider lists in accordance with Regulation (EU)
No 496/2014 of the European Parliament and of the Council [2016] OJ L 65/49.
17 Also Göttler (n 6) § 11 para 8; Wilfling (n 2) para 808; Thyl N. Haßler, ‘Insiderlisten gem. Art. 18 MMVO und ihre
praktische Handhabung’ (2016) 33 DB 1920, 1923; critical also Pfüller (n 1) § 15b para 17a.
18 Wilfling (n 2) para 786; BaFin (n 2) No IV 3.
19 Also Göttler (n 6) § 11 para 25.
20 BaFin (n 2) No IV 3.
21 FMA, ‘Präsentation MAR Forum Teil 2’, 27 June 2017, 9 f https://www.fma.gv.at/download.php?d=2999 accessed 14
January 2021.
22 BaFin (n 2) No IV 2; FMA, ‘Präsentation MAR Forum Teil 2’ (n 21) 10. Also on the previous legal framework in
Germany Sethe (n 1) § 15b para 28 and Pfüller (n 1) § 15b para 36 each with further references.
24 Also Göttler (n 6) § 11 para 28.
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2. Persons to be included
(a) Reference to issuer

18.017 Pursuant to Art 18 para 1 lit a MAR, persons who work for the obligated party under a contract
of employment or otherwise perform tasks through which they have access to inside informa-
tion (cf para 18.019 below) must be included in an insider list.
18.018 The two terms ‘under a contract of employment’ and ‘otherwise performing tasks’ are broadly
understood and therefore cover both internal and external persons, i.e., employees and service
providers. It does not depend on the type of contract, but on the fact that the person is actually
employed within the company or otherwise performs tasks for an issuer; this follows from
the wording of Art 18 para 1 MAR and Recital 57. According to the (German) literature,
appointment to a corporate body without an employment contract, freelance work and actual
employment relationships or part-time work are therefore also sufficient. Even mere ‘good-
will’ relationships are covered (e.g., family members working for free).25 Family members of
board members or employees of public authorities are not typically employed by the issuer.26
Contractual partners (‘service providers’) of the issuer who have access to inside information
either on a regular basis or as required to perform their function must also be included.
However, both internal and external persons will only need to be included if they have author-
ised access to inside information (see para 18.019 below).
(b) Authorised access

18.019 Only persons who have authorised access to inside information are to be included in an insider
list.27 A causal link between the person’s status as an employee/service provider and potential
access to inside information is required. The person must therefore be entrusted with a task
that enables regular access to inside information. Merely fortuitous, occasional or even illegal
access to such information is not deemed ‘authorised’.28
(c) Case groups

18.020 Based on the aforesaid, it is possible to determine in each individual case whether a person
is deployed in such a way that he or she has or can have access to inside information at all
times or on an ad hoc basis. This requires a certain degree of forecasting in individual cases,
as the precautionary inclusion of all employees of an issuer in the insider list is not considered
permissible.29 Nevertheless, some typical case groups have been developed which can serve as
a guideline for such assessment:
25 On the previous legal framework in Germany Sethe (n 1) § 15b para 38.

26 On the previous legal framework in Germany Pfüller (n 1) § 15b para 56 with further references.
27 Wilfling (n 2) para 784; on the previous legal framework in Germany: Sethe (n 1) § 15b para 39; Pfüller (n 1) § 15b paras
57ff with further references.
28 Semrau (n 7) Art 18 para 28 with further references; Ringe (n 6) Art 18 para 22 (knowledge gained by chance or unlaw-
fully does not lead to an inclusion in an insider list); differently, Dell’Erba (n 1) Art 18 para B.18.29 (arguing that also
an occasional access triggers the obligation to include a person in an insiders’ list because the emphasis should be on the
access itself). On the previous legal framework in Austria Lechner and Temmel (n 8) § 48d para 111; for GER Sethe (n
1) § 15b para 39.
29 Semrau (n 7) Art 18 para 33; on the previous legal framework in Germany Sethe (n 1) § 15b para 39; Pfüller (n 1) § 15b
para 66, each with further references.
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C. Insider lists
Examples of persons who may be included in the insider list on a regular basis: Members of 18.021
the management body (executive board, managing director and the managing and personally
liable partner of a partnership who is authorised to represent said partnership), members of the
supervisory bodies (whether delegated or elected), heads and key employees of central business
units (e.g., finance and accounting, the controlling derpartment, legal and compliance, group
strategy, M&A, investor relations) as well as individuals, who (co-)decide on a delay of a disclo-
sure according to Art 17 MAR, persons with secretarial or assistant functions,30 provided they
have authorised access to inside information in the course of their activities (e.g., preparation
and follow-up of meetings), or because they have access to mail/e-mail of their superior, or
members of the works council who have access to inside information, regardless of whether
they work at home or abroad.31
It is not necessary to include internal couriers, employees of the IT department who, due to 18.022
their administrator role, have access to internal e-mail traffic or databases, as it is not their
responsibility to be familiar with the content of e-mail traffic,32 drivers of management or
supervisory members, cleaning staff, the production or research and development department,
as well as shareholders, as these persons will, as a rule, not have access to inside information.33
In exceptional cases, however, the inclusion of such persons may be required by law.
The persons concerned may not object to their inclusion in the insider list.34 18.023
3. Language, format and content
Neither MAR, the MM-Insider Lists Regulation nor ESMA specify in which language the 18.024
insider list is to be drawn up. It is therefore expedient to draw up the list in the official lan-
guage of the competent supervisory authority – for France, thus in French and for Austria and
Germany in German.35
Art 18 para 3 MAR regulates the content of insider lists only rudimentarily providing that the 18.025
identity of all persons who have access to inside information, the reason for inclusion in the
insider list, the date and time at which the person obtained access to the inside information and
the date on which the insider list was drawn up must be included.
30 On the individual case groups in more detail Göttler (n 6) § 11 paras 40ff; Semrau (n 7) Art 18 para 31; on the previous
legal framework in Germany Sethe (n 1) § 15b para 42 ff; Pfüller (n 1) § 15b para 69; in Austria Lechner and Temmel
(n 8) § 48d para 114.
31 On the previous legal framework in Germany Sethe (n 1) § 15b paras 42ff; Pfüller (n 1) § 15b para 69.
32 Haßler (n 17) 1922; Ringe (n 6) Art 18 para 22. However, insofar as IT employees have potential access to inside
information, e.g., when operationally involved in a due diligence, they should be included. Differently, Dell’Erba (n 1)
Art 18 para B.18.28, who classifies ‘IT people’ as permanent insiders because the IT unit has regular access to inside
information.
33 Semrau (n 7) Art 18 para 29; BaFin (n 2) No V 1; in a group context see BaFin (n 2) No V 2. On the previous legal
framework in Germany Pfüller (n 1) § 15b para 74 and Sethe (n 1) § 15b para 46.
34 Simons (n 13) 224. Employees are obligated to transmit the corresponding data under labour law, also due to their duty
of loyalty: Simons (n 13) 226. This is not so clear for those external to the company. In this case, the FMA recommends
that refusals to supply data be documented: FMA, ‘Präsentation MAR Forum Teil 2’ (n 21) 20.
35 For GER also Simons (n 13) 226.
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18.026 The MM-Insider Lists Regulation to Art 18 MAR provides two format templates for drawing
up insider lists in a uniform manner throughout the EU:36 For the section on deal-specific or
event-based inside information, Annex I Template 1 is to be used; for the section on permanent
insiders, Annex I Template 2 is to be used.
(a) Event-based section

18.027 As multiple pieces of inside information may exist at the same time within one company, it
is necessary to indicate which specific pieces of inside information the persons to be included
had access to (whether it is, e.g., a transaction, a project, a corporate or financial event, the
publication of financial statements or profit warnings). Each piece of inside information is to
be documented in a separate, event-related section.37 A new section must therefore be added
if new inside information is to be added. The insider list must therefore be drawn up on
a project-related and inside information-related basis.38
18.028 With the exception of permanent insiders,39 all persons who perform tasks for the issuer
and thus have authorised access to the relevant inside information must be included in the
event-related section.40 It must be made clear to which inside information the person concerned
has access. If a person has access to several different types of inside information, they must
be listed several times (i.e., in all relevant sections).41 The obligation to include the person
concerned in the event-related section commences with the inside information coming into
existence and ends with its disclosure. Since the issuer must disclose inside information as
soon as possible (Art 17 MAR), the ‘lifespan’ of an event-related section of the insider list is
typically very short. It is precisely this short time window between the coming into existence
of the inside information and its disclosure that should be documented. A longer ‘lifespan’ is
conceivable, for example, if disclosure is delayed in accordance with Art 17 para 4 MAR or if
the inside information does not directly concern the issuer (paras 17.080ff), because in this case
there is no disclosure obligation in accordance with Art 17 para 1 MAR. Even in the case of
a protracted process, the obligation to draw up an insider list only arises when inside informa-
tion actually exists, namely, in relation to an intermediate step or the final result. As long as
the information does not (yet) have the quality of inside information, no list is to be drawn up.
Although it is permissible to create an insider list in advance of inside information coming into
existence, the date and time when the inside information was deemed to come into existence
must be left open for the time being and may only be added when inside information actually
comes into existence.42 If the project fails before the inside information comes into existence,
these fields will remain permanently unpopulated.43
36 This is intended to make it easier for those obliged to keep lists to comply with the obligation to create and update
inside lists in a uniform manner. The competent authorities should also receive the necessary information to facilitate the
examination and investigation of possible cases of market abuse (Recital 2 MM-Insider Lists Regulation).
37 Recital 3 MM-Insider Lists Regulation; FMA, ‘Präsentation MAR Forum Teil 2’ (n 21) 15; Dell’Erba (n 1) Art 18 paras
B.18.26 f; Ringe (n 6) Art 18 para 30.
38 Göttler (n 6) § 11 para 32.
39 FMA, ‘Präsentation MAR Forum Teil 2’ (n 21) 7.
40 Wilfling (n 2) para 784.
42 See above para 18.015.
43 Simons (n 13) 225.
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C. Insider lists
(b) Permanent insider section

In order to avoid multiple entries for one and the same person in different sections of the 18.029
insider list, an additional section for ‘permanent insiders’ can be created and continuously
updated.44 This section may only include those persons who, due to the nature of their function
or position, have access to all inside information at all times.45 This section, therefore, does
not refer to any specific piece of inside information. If a permanent insider is included in the
section of permanent insiders, it will be considered an insider for the entire time that the inside
information is deemed to exist.46
(c) Data to be included

Finally, the MM-Insider Lists Regulation specifies the types of data to be included in an 18.030
insider list. The following data must be included: Date and time of the creation and of each
update of the relevant section as well as date of the transmission to the competent authority,
first name and surname and, if different, birth surname, date of birth, company and personal
address,47 national identification number (if applicable)48, professional and personal telephone
number (landline and mobile), function and reason for inclusion in the insider list,49 date and
time at which access to the inside information was obtained (not date and time of inclusion of
the person into the list!), date and time of termination of access to inside information in case of
event-related insiders and date and time of inclusion in the list in case of permanent insiders.50
It is not permitted to include data by reference to or through linking with other databases or, 18.031
for example, to use the personnel number instead of a person’s name.51
It should be noted that, with the exception of transmission to the competent authority, all times 18.032
must be given in CUT,52 i.e., Coordinated Universal Time. The date shall be given in accord-
ance with ISO 8601. The date format shall be yyyy-mm-dd and the time format hh:mm.53
If the persons to be included refuse to provide their data, the FMA recommends documenting 18.033
this in order to exclude any subsequent culpability, if at all, for lack of fault.54
44 Recital 4 MM-Insider Lists Regulation.

45 Recital 4 and Art 2 para 2 MM-Insider Lists Regulation; FMA, ‘Präsentation MAR Forum Teil 2’ (n 21) 19.
ESMA names the CEO, e.g., ESMA, ‘Final Report: Draft technical standards on the Market Abuse Regulation’,
ESMA/2015/1455, 28 September 2015, 61 para 286. Whether even a CEO has access to all inside information in the
company at any time is, in my opinion, questionable.
46 ESMA, ‘Final Report’, (n 45) 61 para 285.
47 In the opinion of BaFin, if necessary also with reference to a second residence: BaFin (n 2) No VI 6; as far as can be seen,
the FMA has not yet commented on this.
48 If, in a country, no national identification number exists (e.g., in Germany or in the UK), this box should be left blank.
Regarding this issue see Ringe (n 6) Art 18 fn 20 with further references.
49 In the current view of the FMA, the inclusion of project code names is not permitted: FMA, ‘Präsentation MAR Forum
Teil 2’ (n 21) 14; e.g., ‘increase in capital of XY plc’ instead of ‘project Danube’.
50 BaFin (n 2) No VI 2.
52 That is CET less one hour or CEST less two hours.
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(d) SMEs growth market issuers

18.034 Issuers in SME growth markets benefit from reliefs: Under certain conditions they are
exempted from the ongoing obligation to draw up and keep insider lists up to date and are
only obliged to create and provide an insider list retrospectively in accordance with the format
specified in Annex II of the MM-Insider Lists Regulation upon request of the competent
authority.55
(e) Electronic list management

18.035 Insider lists must be drawn up and updated electronically.56 The use of special software solu-
tions57 or Excel files is common market practice. In order to comply with legal requirements,
each electronic solution must ensure confidentiality of the information included therein by
restricting access to clearly identified persons for whom such access is necessary due to their
function or position, the accuracy of the information contained therein and access to and
retrieval of previous versions of the insider list.58
18.036 While issuers in SME growth markets are exempted from the electronic list keeping require-
ment, such issuers must also provide insider lists to the competent authorities on request in
a format that guarantees completeness, confidentiality and integrity of information.59
D. OBLIGATION TO UPDATE
1. Trigger
18.037 Persons obliged to maintain insider lists must update the relevant section of the insider list
pursuant to Art 18 para 4 MAR promptly if (i) the reason for inclusion of already included
persons on the insider list changes; (ii) a new person has gained access to inside information
and must therefore be added to the insider list; or (iii) a person ceases to have access to inside
information. Accordingly, an obligation to update arises whenever the insider list has become
incorrect, for example, because previously entered data (e.g., the address) changes60 or becomes
incomplete.
18.038 Each update shall specify the date and time (in CUT) of the update. However, this require-
ment only applies if the inside information already exists at the relevant time and not if a list is
only created as a precautionary measure (before inside information is deemed to exist).61 Since
the respective sections of the insider list must be stored before updating in accordance with
Art 18 para 5 MAR and must not be deleted, the corresponding sections, in my opinion, may
55 For more information Art 18 para 6 MAR; Recital 9 and Art 3 MM-Insider Lists Regulation.
56 Recital 7 and Art 2 MM-Insider Lists Regulation.
57 E.g., Altares, EQS, pressetext, or ACTICO; see Ringe (n 6) Art 18 para 29.
58 Art 2 para 3 MM-Insider Lists Regulation.
59 Ringe (n 6) Art 18 para 51; Dell’Erba (n 1) Art 18 para B.18.32.
60 Different opinion Semrau (n 7) Art 18 para 63 and probably also Göttler (n 6) § 11 para 52, who does not consider this
to be an update in the sense of the MAR.
61 Also Semrau (n 7) Art 18 para 64.
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E. Declarations of acknowledgement
not simply be overwritten. The versions prior to updating must be kept at all times.62 It must
therefore be technically ensured that previous versions can still be retrieved.63
2. Case groups
The reason for adding persons already included in the insider list can, for instance, change 18.039
if a new project is added as a new event-related section and a person already included also
works for this new project. A further reason would be, for example, a professional change of
an external consultant (e.g., the issuer’s lawyer moves to the issuer’s legal department).64 An
update must also be made if a new person gains access to inside information, for example, if
a new employee of the issuer joins the project team.65 An update must also be carried out if
a person ceases to have access to inside information, for example, if employees leave the issuer’s
company.66
Holidays or short-term absences, for example due to illness, do not trigger any update 18.040
obligation.67
3. Time limit
According to Art 18 para 4 MAR, updates are to be undertaken promptly, i.e., without culpa- 18.041
ble delay.68 Delays are only permissible within very narrow limits, for example in cases of doubt
or when legal advice is required.
4. Cessation
The obligation to update ceases when the information no longer qualifies as inside informa- 18.042
tion, i.e., typically when the information is disclosed or because it loses its character as inside
information.69
E. DECLARATIONS OF ACKNOWLEDGEMENT
All persons included in an insider list must acknowledge in writing the legal and regulatory 18.043
duties entailed. They must be made aware of the sanctions applicable to insider dealing and
unlawful disclosure of inside information. Art 18 para 2 MAR provides for a corresponding
obligation to inform the persons (to be) included in an insider list.
62 This also appears to be in line with the legal interpretation of FMA: FMA, ‘Präsentation MAR Forum Teil 2’ (n 21) 16.
63 Haßler (n 17) 1922; Ringe (n 6) Art 18 paras 34, 42.
64 On the previous legal framework in Austria Lechner and Temmel (n 8) § 48d para 124.
67 Göttler (n 6) § 11 para 54. On the previous legal framework in Germany Pfüller (n 1) § 15b para 78 with further
references.
68 Already the previous legal framework in Austria: Lechner and Temmel (n 8) § 48d para 122; for GER Pfüller (n 1) §
15b para 80.
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1. Obligation to inform
18.044 Both issuers and any persons acting on their behalf or on their account are obliged to provide
information to the persons (to be) included in an insider list. Art 18 para 1 MAR provides for
a parallel obligation in this respect. This appears to be in line with the view of ESMA.70 Each
person subject to the obligation to draw up a list is thus independently responsible for the list
to be drawn up by it and the related duties to provide information, i.e., they must inform the
persons on ‘their’ list. Thus, for example, the duty of a service provider’s employees to provide
information lies with the service provider and not with the issuer.71
18.045 According to Art 18 para 2 subpara 2 MAR, the issuer remains fully responsible for com-
pliance with Art 18 MAR even if the obligation to draw up the list is outsourced to a third
party. Pfüller is of the opinion that the issuer should have fulfilled its obligation if it informs
the service provider, whom it has engaged with, (i) about the obligation to draw up an insider
list and (ii) about the duty to inform and (iii) obtains written confirmation from the service
provider that it will comply with the obligations under Art 18 MAR.72 It is unclear whether this
is actually sufficient or whether the issuer would have to exercise its right of access pursuant to
Art 18 para 2 subpara 2 sent 2 MAR (see below) in order to preclude liability for lack of fault.
18.046 If the obligation to draw up the list is outsourced, the issuer has the right to access the insider
list.73 However, the issuer does not have a right of access if a delegated service provider is
subject to an independent obligation to draw up a list. This is not a case of outsourcing, but an
independent obligation of the delegatee.74
2. Content
18.047 The duty to inform and thus the content of the declaration of acknowledgement include on the
one hand the legal obligations arising in connection with the access to inside information, and
on the other hand the sanctions which may be imposed in the case of non-compliance.
18.048 For information purposes, it is sufficient, in my opinion, to briefly indicate the legal obligations
and sanctions in the event of infringements and to refer to the exact wording of the provisions
for details, extracts of which should be attached.75 With regard to how the confidential treat-
ment of inside information is to be ensured, it is advisable to include corresponding examples
in the declaration of acknowledgement (keeping the documents concerned under lock and key,
observance of Chinese walls, sending of e-mails only in compliance with encryption systems or
to selected addressees, etc.).76
70 View above para 18.003. In this sense also ESMA, ‘Questions and Answers On the Market Abuse Regulation (MAR)’
(n 3) A 10.2.
72 On the previous legal framework in Germany Pfüller (n 1) § 15b para 86a.
73 Art 18 para 2 subpara 2 sent 2 MAR.
75 On the previous legal framework in Germany Pfüller (n 1) § 15b para 88a.
76 On the previous legal framework in Germany Pfüller (n 1) § 15b para 88.
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E. Declarations of acknowledgement
Service providers: According to BaFin, the issuer does not have to inform every single employee 18.049
of its service providers who works ‘for it’. It is sufficient if the issuer informs the service provider
as such. The service provider is then obliged to inform the employees included in its list.77 This
is consistent insofar as, in the opinion of BaFin, when service providers are included, only one
contact person of the service provider must be included in the insider list, stating all legally
required data, and therefore only this contact person must be informed. The FMA has not yet
commented on this issue. Due to ESMA’s clarification as regards the obligation to draw up the
cumulative list, this view, in my opinion, must also be followed for Austria.78 As far as can be
seen, the issuer often acts in this way in practice.
In the FMA’s view, the declarations of acknowledgement should be drafted in accordance with 18.050
the wording of MAR.79 BaFin provides a template in German and English on its website.80 As
far as can be seen, the FMA has not yet published a corresponding template.
If the informed persons refuse to sign the declaration of acknowledgement, the FMA recom- 18.051
mends documenting this in order to be able to subsequently refute any culpability for lack of
fault.81
3. Form
The form of notification is determined by the fact that the person concerned can later prove 18.052
that he or she was informed of the obligations and sanctions. If this is ensured, it is irrelevant,
according to BaFin,82 whether the declaration of acknowledgement is submitted in electronic
form (e-mail or by ‘clicking’ in an electronic workflow) or in paper form. The FMA is also of
the opinion that the declaration of acknowledgement can be submitted electronically, pro-
vided that it can be proven at a later date in an unaltered form.83
4. Time and repetition
The duty to inform is triggered when a person is included in the insider list for the first time. 18.053
This applies both to permanent insiders and to event-related insiders. According to Semrau,
earlier notification is also permissible, for example if a list is already being drawn up as a pre-
cautionary measure for a potentially insider-relevant project.84
77 See also para 18.043; Göttler (n 6) § 11 para 60; Semrau (n 7) Art 18 para 41; BaFin (n 2) No III 1; similar on the previ-
ous legal framework in Germany Pfüller (n 1) § 15b para 86; Sethe (n 1) § 15b para 69; for Austria Lechner and Temmel
(n 8) § 48d para 134, according to which, in the case of legal persons, a signature by declaration of acknowledgement is
sufficient for authorised representatives, who in turn undertake to inform their employees accordingly.
78 As a result also Wilfling (n 2) paras 800ff.
80 BaFin (n 2) No III 4.
82 BaFin (n 2) No III 2.
83 FMA, ‘Änderung der Verwaltungspraxis: Meldepflicht nach Art. 19 MAR und Anerkenntnis nach Art. 18 Abs. 2
MAR’, FMA-SN00100/0025-WAM/2017, 26 September 2017.
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18.054 If the same person is added to the insider list again, no repeated information is required. The
principle ‘once informed, always informed’ applies.
18.055 However, it will be expedient to inform persons who have already been notified if they are to be
included in another event-based section of the insider directory in the future, for example due
to a new project. It is then up to the issuer to voluntarily repeat the notification on this occasion.
In some cases, a repetition may be necessary, for example, if the legal basis or sanctions change
substantially.85
F. TRANSMISSION OBLIGATION
18.056 Insider lists shall be transmitted to the competent authority at its request as soon as possible,
without undue delay.86
18.057 Insider lists should always be transmitted in such a way that the completeness, confidentiality
and integrity of information is ensured.87 The electronic means defined by the competent
authority and published on its website are to be used.88 According to BaFin, insider lists must
be transmitted by means of Secure Mail (electronically secured transmission by e-mail).89 The
FMA has apparently not yet published any such information.
G. MAINTENANCE AND DESTRUCTION
1. Manner of maintenance and access
18.058 Insider lists contain personal data and are therefore subject to data protection regulations. In
particular, they are to be treated as strictly confidential. Since this data is sensitive, it is recom-
mended that it be encrypted. In addition, only those persons responsible for the management of
the insider list or specifically delegated to do so, both inside and outside the company, can have
access to it (e.g., board of directors, compliance staff or a delegated external representative in
accordance with Art 18 para 2 subpara 2 MAR). The group of persons entitled to access must
therefore be restricted to the extent absolutely necessary (‘need to know’ principle).90
85 BaFin (n 2) No III 3; Wilfling (n 2) para 804; on the previous legal framework in Germany Sethe (n 1) § 15b para 64.
86 In this sense also on the previous legal framework in Germany Pfüller (n 1) § 15b para 82 with further references.
87 Recital 9 MM-Insider Lists Regulation.
88 Recital 9 and Art 2 para 5 MM-Insider Lists Regulation.
89 BaFin (n 2) No VII 1.
90 On data protection and labour law aspects: Simons (n 13) 226 f. On the previous legal framework in Germany, Sethe (n
1) § 15b para 63; Pfüller (n 1) § 15b paras 91 f.
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H. Sanctions
2. Retention period
The insider list must be retained for a period of at least five years after its preparation or after 18.059
its (last) update.91 For each update, the relevant sections prior to the update must be retained
for five years and may not be deleted.92
The obligation to retain the information shall also apply in the event of a delay, in which case 18.060
the inside information shall subsequently cease to exist.93 The data must therefore be retained
in such a way that, during the retention period, anyone who had access to inside information
within this period can be verified at any time. The historical course of events must therefore
(also) be documented.
Under Austrian law, the period for calculating time limits commences at the earliest when the 18.061
inside information is available. If, for example, a project-specific section in the list is created as
a precautionary measure in a potentially insider-relevant project at the start of the project, the
five-year period does not begin until the point in time at which inside information has arisen
and this has been documented in the list. If the project is terminated before the inside informa-
tion arises, the corresponding section does not need to be retained.94
3. Destruction
After expiry of the retention period, the data must be deleted in such a way that it can no longer 18.062
be recovered.95 When the retention period ends, as a rule, the justification in terms of data
protection law for the storage of the data no longer exists.
H. SANCTIONS
Violations of the obligations according to Art 18 MAR or the MM-Insider Lists Regulation 18.063
are administrative violations. In the case of natural persons, they are sanctioned with fines
of up to three times the benefit obtained from the violation or – if this benefit cannot be
quantified – with up to € 500,000. In the case of legal persons, the penalties amount to up to
three times the benefit gained from the violation or – if this benefit cannot be quantified – up
to € 1,000,000.96 Failure to comply with the obligation to draw up insider lists or to obtain
declarations of acknowledgement or serious defects are, according to the wording of the law,
equally sanctioned as a relatively minor breach of duty (e.g., failure to state the time in CUT).
91 Art 18 para 5 MAR.

93 FMA,‘Prasentation MAR Forum Teil 2’ (n 21) 16 and 18.
95 Göttler (n 6) § 11 para 56. On the previous legal framework in Germany Thomas Eckhold, ‘§ 15b WpHG’ in Frank
Schäfer and Uwe Hamann (eds), Kapitalmarktgesetze (2nd edn, Kohlhammer 2013) paras 63 f; Pfüller (n 1) § 15b para
96; Sethe (n 1) § 15b para 63.
96 Art 30 para 2 lits i and j MAR; see also paras 30.007 f and para 30.012 on the transposition into national law.
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However, the severity of the breach of duty will have to be taken into account when calculating
the penalty.97
18.064 In addition to the above-mentioned fines, other administrative measures including publication
of sanctions may be imposed.98
18.065 Whether a violation of Art 18 MAR and/or the MM-Insider Lists Regulation also justifies
sanctions under civil law is disputed: The classification of these provisions as protective laws
is, in my opinion, contradicted by Recitals 56 and 57 MAR, which aim at protecting market
integrity and facilitating investigations for competent authorities. This was apparently also the
prevailing doctrine in Germany regarding the previous legal framework.99 In Austria, it was
argued that the relevant provisions had the character of a protective law.100 If one follows this
view, investors could also assert claims for damages against the issuer in certain situations (e.g.,
disadvantages suffered through insider dealing, which are due to a breach of the issuer’s duty to
inform its employees). It would also be conceivable for the issuer to assert claims for damages
under civil law if the issuer delegated its own obligation to maintain insider lists to a third party
in accordance with Art 18 para 2 subpara 2 MAR, and the issuer suffers a loss from a breach
by the service provider.
Literature
BaFin, ‘FAQ on insider lists pursuant to Article 18 of the Market Abuse Regulation (EU) No 596/2014’,
Version 4, 13 November 2019, No II 2 https://www.bafin.de/SharedDocs/Downloads/EN/FAQ/
dl_faq_mar_art_18_insiderlisten_en.html accessed 23 July 2020
Dell’Erba M, ‘Article 18: Insider lists’ in Ventoruzzo M and Mock S (eds), MAR (Oxford University
Press 2017)
Eckhold T, ‘§ 15b WpHG’ in Schäfer F and Hamann U (eds), Kapitalmarktgesetze (2nd edn,
Kohlhammer 2013)
ESMA, ‘Final Report: Draft technical standards on the Market Abuse Regulation’, ESMA/2015/1455,
28 September 2015
ESMA, 'Questions and Answers On the Market Abuse Regulation (MAR)’, ESMA70–145–111, version
15 of 6 August 2021FMA, ‘Präsentation MAR Forum Teil 2’, 27 June 2017, https://www.fma.gv.at/
download.php?d=2999 accessed 14 January 2021
FMA, ‘Änderung der Verwaltungspraxis: Meldepflicht nach Art. 19 MAR und Anerkenntnis nach Art.
18 Abs. 2 MAR’, FMA-SN00100/0025-WAM/2017, 26 September 2017
Göttler M, ‘§ 11 Insiderliste’ in Meyer A, Veil R and Rönnau T (eds), Handbuch zum Marktmissbrauchsrecht
(C. H. Beck 2018)
Haßler T, ‘Insiderlisten gem. Art. 18 MMVO und ihre praktische Handhabung’ (2016) 33 DB 1920
Lechner T and Temmel C, ‘§ 48d’ in Temmel C (ed), Börsegesetz: Praxiskommentar (LexisNexis 2011)
Pfüller M, ‘§ 15b: Führung von Insiderverzeichnissen’ in Fuchs A (ed), Wertpapierhandelsgesetz (2nd edn,
C. H. Beck 2016)
97 Art 31 para 1 MAR; see also paras 31.004ff on the penalty assessment criteria and para 31.003 on the transposition into
national law.
98 Art 30 para 2 lit a to g MAR; see para 30.009 and para 30.012 on the transposition into national law.
99 On the previous legal framework in Germany Pfüller (n 1) § 15b para 104; Sethe (n 1) § 15b paras 84 f with further
references.
100 On the previous legal framework in Austria Lechner and Temmel (n 8) § 48d para 139; Susanne Kalss, Martin Oppitz
and Johannes Zollner (eds), Kapitalmarktrecht (2nd edn, Linde 2015) § 23 para 68 with further references.
258
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H. Sanctions
Ringe W-G, ‘Article 18: Insider lists’ in Lehmann M and Kumpan C (eds), European Financial Services
Law (Nomos 2019)
Semrau S, ‘Artikel 18: Insiderlisten’ in Klöhn L (ed), Marktmissbrauchsverordnung (C. H. Beck 2018)
Sethe R, ‘§ 15b: Führung von Insiderverzeichnissen’ in Assmann H-D and Schneider U (eds),
Simons C, ‘Die Insiderliste (Art. 18 MMVO)’ (2016) 5 Corporate Compliance Zeitschrift 221
259
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ARTICLE 19
MANAGERS’ TRANSACTIONS
1. Persons discharging managerial responsibilities, as well as persons closely associated with

them, shall notify the issuer or the emission allowance market participant and the compe-
tent authority referred to in the second subparagraph of paragraph 2:
(a) in respect of issuers, of every transaction conducted on their own account relating
to the shares or debt instruments of that issuer or to derivatives or other financial
instruments linked thereto;
(b) in respect of emission allowance market participants, of every transaction conducted
on their own account relating to emission allowances, to auction products based
thereon or to derivatives relating thereto.
Such notifications shall be made promptly and no later than three business days after the
date of the transaction.
The first subparagraph applies once the total amount of transactions has reached the
threshold set out in paragraph 8 or 9, as applicable, within a calendar year.
1a. The notification obligation referred to in paragraph 1 shall not apply to transactions in
financial instruments linked to shares or to debt instruments of the issuer referred to in
that paragraph where at the time of the transaction any of the following conditions is met:
(a) the financial instrument is a unit or share in a collective investment undertaking in
which the exposure to the issuer’s shares or debt instruments does not exceed 20% of
the assets held by the collective investment undertaking;
(b) the financial instrument provides exposure to a portfolio of assets in which the expo-
sure to the issuer’s shares or debt instruments does not exceed 20% of the portfolio’s
assets;
(c) the financial instrument is a unit or share in a collective investment undertaking
or provides exposure to a portfolio of assets and the person discharging managerial
responsibilities or person closely associated with such a person does not know, and
could not know, the investment composition or exposure of such collective invest-
ment undertaking or portfolio of assets in relation to the issuer’s shares or debt instru-
ments, and furthermore there is no reason for that person to believe that the issuer’s
shares or debt instruments exceed the thresholds in point (a) or (b).
If information regarding the investment composition of the collective investment under-
taking or exposure to the portfolio of assets is available, then the person discharging
managerial responsibility or person closely associated with such a person shall make all
reasonable efforts to avail themselves of that information.
260
Article 19 MANAGERS’ TRANSACTIONS
2. For the purposes of paragraph 1, and without prejudice to the right of Member States to
provide for notification obligations other than those referred to in this Article, all trans-
actions conducted on the own account of the persons referred to in paragraph 1, shall be
notified by those persons to the competent authorities.
The rules applicable to notifications, with which persons referred to in paragraph 1 must
comply, shall be those of the Member State where the issuer or emission allowance market
participant is registered. Notifications shall be made within three working days of the
transaction date to the competent authority of that Member State. Where the issuer is not
registered in a Member State, the notification shall be made to the competent authority of
the home Member State in accordance with point (i) of Article 2(1) of Directive 2004/109/
EC or, in the absence thereof, to the competent authority of the trading venue.
3. The issuer or emission allowance market participant shall make public the information
contained in a notification referred to in paragraph 1 within two business days of receipt of
such a notification.*
The issuer or emission allowance market participant shall use such media as may reason-
ably be relied upon for the effective dissemination of information to the public throughout
the Union, and, where applicable, it shall use the officially appointed mechanism referred
to in Article 21 of Directive 2004/109/EC.
Alternatively, national law may provide that a competent authority may itself make
public the information.
4. This Article shall apply to issuers who:
(a) have requested or approved admission of their financial instruments to trading on
a regulated market; or
(b) in the case of an instrument only traded on an MTF or an OTF, have approved
trading of their financial instruments on an MTF or an OTF or have requested
admission to trading of their financial instruments on an MTF.
5. Issuers and emission allowance market participants shall notify the person discharging
managerial responsibilities of their obligations under this Article in writing. Issuers and
emission allowance market participants shall draw up a list of all persons discharging man-
agerial responsibilities and persons closely associated with them.
Persons discharging managerial responsibilities shall notify the persons closely associ-
ated with them of their obligations under this Article in writing and shall keep a copy of
this notification.
6. A notification of transactions referred to in paragraph 1 shall contain the following
information:
(a) the name of the person;
(b) the reason for the notification;
(c) the name of the relevant issuer or emission allowance market participant;
(d) a description and the identifier of the financial instrument;
(e) the nature of the transaction(s) (e.g. acquisition or disposal), indicating whether it is
linked to the exercise of share option programmes or to the specific examples set out
in paragraph 7;
(f) the date and place of the transaction(s); and
(g) the price and volume of the transaction(s). In the case of a pledge whose terms provide
for its value to change, this should be disclosed together with its value at the date of
the pledge.
261
7. For the purposes of paragraph 1, transactions that must be notified shall also include:
(a) the pledging or lending of financial instruments by or on behalf of a person discharg-
ing managerial responsibilities or a person closely associated with such a person, as
referred to in paragraph 1;
(b) transactions undertaken by persons professionally arranging or executing transactions
or by another person on behalf of a person discharging managerial responsibilities or
a person closely associated with such a person, as referred to in paragraph 1, including
where discretion is exercised;
(c) transactions made under a life insurance policy, defined in accordance with Directive
2009/138/EC of the European Parliament and of the Council,1 where:
(i) the policyholder is a person discharging managerial responsibilities or a person
closely associated with such a person, as referred to in paragraph 1,
(ii) the investment risk is borne by the policyholder, and
(iii) the policyholder has the power or discretion to make investment decisions regard-
ing specific instruments in that life insurance policy or to execute transactions
regarding specific instruments for that life insurance policy.
For the purposes of point (a), a pledge, or a similar security interest, of financial instru-
ments in connection with the depositing of the financial instruments in a custody account
does not need to be notified, unless and until such time that such pledge or other security
interest is designated to secure a specific credit facility.
For the purposes of point (b), transactions executed in shares or debt instruments of an
issuer or derivatives or other financial instruments linked thereto by managers of a collec-
tive investment undertaking in which the person discharging managerial responsibilities
or a person closely associated with them has invested do not need to be notified where
the manager of the collective investment undertaking operates with full discretion, which
excludes the manager receiving any instructions or suggestions on portfolio composition
directly or indirectly from investors in that collective investment undertaking.
Insofar as a policyholder of an insurance contract is required to notify transactions
according to this paragraph, an obligation to notify is not incumbent on the insurance
company.
8. Paragraph 1 shall apply to any subsequent transaction once a total amount of EUR 5 000
has been reached within a calendar year. The threshold of EUR 5 000 shall be calculated by
adding without netting all transactions referred to in paragraph 1.
9. A competent authority may decide to increase the threshold set out in paragraph 8 to EUR
20 000 and shall inform ESMA of its decision and the justification for its decision, with
specific reference to market conditions, to adopt the higher threshold prior to its applica-
tion. ESMA shall publish on its website the list of thresholds that apply in accordance with
this Article and the justifications provided by competent authorities for such thresholds.
10. This Article shall also apply to transactions by persons discharging managerial respon-
sibilities within any auction platform, auctioneer and auction monitor involved in the
auctions held under Regulation (EU) No 1031/2010 and to persons closely associated with
such persons in so far as their transactions involve emission allowances, derivatives thereof
or auctioned products based thereon. Those persons shall notify their transactions to the
1 Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and
pursuit of the business of Insurance and Reinsurance (Solvency II) (OJ L 335, 17.12.2009, p. 1).
262
auction platforms, auctioneers and auction monitor, as applicable, and to the competent
authority where the auction platform, auctioneer or auction monitor, as applicable, is reg-
istered. The information that is so notified shall be made public by the auction platforms,
auctioneers, auction monitor or competent authority in accordance with paragraph 3.
11. Without prejudice to Articles 14 and 15, a person discharging managerial responsibilities
within an issuer shall not conduct any transactions on its own account or for the account of
a third party, directly or indirectly, relating to the shares or debt instruments of the issuer
or to derivatives or other financial instruments linked to them during a closed period of 30
calendar days before the announcement of an interim financial report or a year-end report
which the issuer is obliged to make public according to:
(a) the rules of the trading venue where the issuer’s shares are admitted to trading; or
(b) national law.
12. Without prejudice to Articles 14 and 15, an issuer may allow a person discharging manage-
rial responsibilities within it to trade on its own account or for the account of a third party
during a closed period as referred to in paragraph 11 either:
(a) on a case-by-case basis due to the existence of exceptional circumstances, such as
severe financial difficulty, which require the immediate sale of shares; or
(b) due to the characteristics of the trading involved for transactions made under, or
related to, an employee share or saving scheme, qualification or entitlement of shares,
or transactions where the beneficial interest in the relevant security does not change.
35 specifying the circumstances under which trading during a closed period may be permit-
ted by the issuer, as referred to in paragraph 12, including the circumstances that would be
considered as exceptional and the types of transaction that would justify the permission for
trading.
35, specifying types of transactions that would trigger the requirement referred to in
paragraph 1.
15. In order to ensure uniform application of paragraph 1, ESMA shall develop draft imple-
menting technical standards concerning the format and template in which the information
referred to in paragraph 1 is to be notified and made public.
by 3 July 2015.
1095/2010.
*As amended by the recent Regulation (EU) 2019/2115.
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OVERVIEW
A. INTRODUCTION 19.001 (i) Close family relationship 19.052

1. Overview 19.001 (ii) Close business relationship 19.059
2. Legal basis 19.005 3. Notification threshold 19.070
3. Purpose of the notification duty 19.006 C. DUTY TO NOTIFY 19.078
B. SCOPE OF APPLICATION 19.013 D. LIST 19.082
1. Material scope of application 19.013 E. TIME, CONTENT AND FORM OF NOTIFICATION
(a) Markets covered 19.013 AND DISCLOSURE 19.085
(b) Financial instruments covered 19.017 1. Time of notification and disclosure 19.085
(c) Transactions covered 19.022 2. Content of the notification 19.090
2. Personal scope of application 19.037 3. Form of the notification 19.092
(a) Persons discharging managerial F. PROHIBITION ON TRADING 19.098
responsibilities 19.038 1. Scope 19.098
(i) Board members 19.040 2. Exemptions from the trade prohibition 19.106
(ii) Other management 19.044 G. SANCTIONS 19.112
(b) Close connection to management 19.047 H. IMPLEMENTATION 19.118
A. INTRODUCTION
1. Overview
19.001 Art 19 para 1 provides that, on the one hand, persons discharging managerial responsibilities
and, on the other hand, persons closely associated with them shall notify the issuer or the
emission allowance market participant and the FMA of: (i) in respect of issuers, every trans-
action conducted on their own account relating to shares or debt instruments of that issuer
or to derivatives or other financial instruments linked thereto and (ii) in respect of emission
allowance market participants, every transaction conducted on their own account relating to
emission allowances, to auction products based thereon or derivatives linked thereto. The
provision thus applies to persons discharging managerial responsibilities and closely associated
persons vis-à-vis issuers of shares and bonds and issuers of emission allowances.
19.002 Such notifications shall be made promptly and no later than three business days after the date
of the underlying transaction.
19.003 The issuer is then subsequently obliged – similar to the disclosure of the notification regarding
the total number of voting rights and capital pursuant to § 135 para 2 BörseG (Austrian Stock
Exchange Act) – pursuant to Art 19 para 3 MAR to make these reports public promptly and
no later than three business days after the transaction.2 In doing so, the issuer must make use of
2 Mathias Rathammer and Markus Sam, ‘Ad-hoc- und Directors’ Dealings-Verpflichtungen im MAR Regime’ [2016]
ÖBA 436, 437.
264
A. Introduction
media where it can reasonably be assumed that the information will actually be disseminated to
the public throughout the Union.3
In addition, the issuer must notify the persons discharging managerial responsibilities, and they 19.004
in turn must notify the persons closely associated to them, of the obligations set out in Art 19
(cf paras 19.078ff).4 Art 19 para 5 obliges the issuer to draw up a list of the persons subject to
the notification obligation (see paras 19.082ff). In addition to the notification and disclosure
obligation, Art 19 para 11 provides for a trading prohibition for persons discharging managerial
responsibilities for certain periods of time (cf paras 19.098ff).
2. Legal basis
Art 19 forms the basis of the regulation for management transactions. Art 19 is supplemented 19.005
(i) by a Delegated Regulation,5 which, among others, lists types of transactions subject to
notification duties and exemptions from the trading prohibition, and (ii) by two Implementing
Regulations,6 which, among others, contain a format and a template for the notification of own
account transactions.7
3. Purpose of the notification duty
Recital 58 of the MAR states that the purpose of the regulation is that greater transparency 19.006
of transactions conducted by persons discharging managerial responsibilities at the issuer level
and, where applicable, by persons closely associated with them, constitutes a measure to prevent
market abuse and, in particular, insider dealing, and thus serves to prevent market abuse.8
Indeed, the notification of such transactions, on at least an individual basis, can be a highly
valuable source of information for investors. Moreover, full and proper market transparency
is a prerequisite for the confidence of market participants and in particular of a company’s
shareholders.
3 Franz Hartlieb and Zurab Simonishvili, ‘Directors‘ Dealings nach der Marktmissbrauchsverordnung’ [2015] ZFR 61,
64.
4 Stephan Semrau, ‘Artikel 19: Eigengeschäfte von Führungskräften’ in Lars Klöhn (ed), Marktmissbrauchsverordnung
(C. H. Beck 2018) paras 1 f; Marco Dell’Erba, ‘Article 19: Managers´ transactions’ in Marco Ventoruzzo and Sebastian
Mock (eds), Market Abuse Regulation: Commentary and Annotated Guide (Oxford University Press 2017) para B.19.01.
5 Commission Delegated Regulation (EU) 2016/522 of 17 December 2015 supplementing Regulation (EU) No 596/2014
as regards an exemption for certain third countries public bodies and central banks, the indicators of market manipu-
lation, the disclosure thresholds, the competent authority for notifications of delays, the permission for trading during
closed periods and types of notifiable managers' transactions [2015] OJ L 88/1.
6 Commission Implementing Regulation (EU) 2016/523 laying down implementing technical standards with regard to
the format and template for notification and public disclosure of managers’ transactions in accordance with Regulation
(EU) No 596/2014 [2016] OJ L 88/19 as well as Commission Implementing Regulation (EU) 2016/1055 of 29 June
2016 laying down implementing technical standards with regard to the technical means for appropriate public disclosure
of inside information and for delaying the public disclosure of inside information in accordance with Regulation (EU)
No 596/2014 [2016] OJ L 173/47.
7 The power to adopt delegated acts concerning types of transactions subject to notification obligations and exemptions to
the trading prohibition has been conferred on the Commission for an indeterminate period of time by Art 35 para 2 of
the MAR and may be revoked at any time by the European Parliament or by the Council.
8 Recital 58 MAR; Semrau (n 4) Art 19 para 4.
265
19.007 Recital 59 MAR adds that the notification of transactions conducted by persons discharging
managerial responsibilities on their own account, or by a person closely associated with them,
not only provides valuable information for other market participants, but also constitutes an
additional means for competent authorities to supervise markets.9
19.008 Further, the purpose of the notification obligation is to provide the public with estimates
of future transaction and success prospects of persons who often have a head start in terms
of knowledge about the economic circumstances of the issuer, and thus to reduce existing
information asymmetry.10 It is intended to enable investors to draw conclusions about the
circumstances of the issuer and to be able to judge for themselves to what extent the securities
transactions of persons discharging managerial responsibilities of the issuer have an indicator
or signal effect.11
19.009 In addition, the prompt notification obligation and the associated disclosure of securities
transactions by persons discharging managerial responsibilities are intended to increase market
transparency and serve the integrity of the market. Similar to the disclosure obligation under
Art 17, potentially decision-relevant information should be made available to all investors in
order to maintain equal information opportunities for all investors.12 Ultimately, the aim is
therefore also to increase fairness on the capital markets.13
19.010 In this sense, the notification obligation under Art 19 also serves to prevent insider dealing
by persons discharging managerial responsibilities, who should not even be tempted to take
advantage of their knowledge of the issuer.14 In addition, it is often only through the disclosure
of a manager’s transaction that attention is drawn to this person, making it easier to detect any
insider dealing. This increased risk of detection is intended to act as a deterrent and prevent
insider dealing from arising in the first place.15 The notifications pursuant to Art 19 should
therefore offer the supervisory authorities additional opportunities to supervise the market
and, in conjunction with the high penalties, have a deterrent effect with regard to potential
violations of the law.16
19.011 On the other hand, however, the notification obligation must not, in our opinion, lead to the
notifying person becoming a quasi-suspect and to official investigations always being initiated
in order to check whether or not the person in question discharging managerial responsibilites
had inside knowledge when the transaction was carried out.17 Normally, managers tend to act
9 See also Christoph Kumpan, ‘Die neuen Regelungen zu Directors‘ Dealings in der Marktmissbrauchsverordnung’ [2016]
AG 446, 450; Semrau (n 4) Art 19 para 4.
10 Kumpan (n 9) 446, 448.
11 Rolf Sethe and Alexander Hellgardt, ‘Artikel 19 MAR: Eigengeschäfte von Führungskräften’ in Heinz-Dieter
Assmann, Uwe H Schneider and Peter Mülbert (eds), Wertpapierhandelsrecht (7th edn, Otto Schmimdt 2019) para 10;
Susanne Kalss, Martin Oppitz and Johannes Zollner, Kapitalmarktrecht (2nd edn, Linde 2015) § 19 para 5.
13 Philipp Maume and Martin Kellner, ‘Directors’ Dealings unter der EU-Marktmissbrauchsverordnung’ (2017) 46/3
ZGR 273, 275.
14 Kumpan (n 9) 446, 448.
15 Kumpan (n 9) 446, 448.
16 Maume and Kellner (n 13) 273, 276.
17 Martina Stegmaier, ‘§ 19: Offenlegungspflichten’ in Andreas Meyer, Thomas Rönnau and Rüdiger Veil (eds), Handbuch
266
cautiously, not least because of the sensitivity of the issue, which is also widely discussed in the
public domain, and will refrain from carrying out transactions in case of doubt, i.e., if there is
a risk that inside information might already be present. Experience shows, however, that, for
example, the execution of securities transactions by managers in a period close in time to the
disclosure of inside information according to Art 17 is viewed critically by the authorities and
often results in investigations. Even if at the time of the performance of the relevant securities
transactions the subsequently reported inside information was not available in any way, the
manager automatically needs to justify himself in such a case and it is therefore advisable to
refrain from the relevant transaction in such cases and to conclude it only at a later date.
The scope of application for management transactions has been extended18 beyond regulated 19.012
markets to MTF and OTF and covers not only issuers of shares but also debt securities and
derivatives thereof and finally emission allowances.
1. Material scope of application
(a) Markets covered

Persons discharging managerial responsibilities and persons closely related to them of issuers 19.013
whose financial instruments are traded on a regulated market, a multilateral trading facility
(‘MTF’) or – since 3 January 2018 – an organised trading facility (‘OTF’) are subject to
a notification duty. The latter two cases were not covered by the notification obligation before
the entry into force of the MAR. Securities listed on a non-regulated market were in fact
excluded from the scope of the notification duty.19 It should be emphasised that the obligation
on persons discharging managerial responsibilities to make public transactions conducted on
their own account pursuant to Art 19 para 4 lit a MAR already applies from the time when the
issuer has requested admission of their financial instruments to trading on a regulated market
(cf also para 19.023).
The new regulation now also covers unregulated markets that are organised as MTF or OTF. 19.014
Therefore, managers are also subject to the notification obligation pursuant to Art 19 for the
Regulated Market of the Vienna Stock Exchange and for securities traded on the Third Market
of the Vienna Stock Exchange, since the Third Market is a multilateral trading facility operated
by the Wiener Börse AG.
However, there is a notification duty only if20 the issuer has requested admission of the finan- 19.015
cial instrument to trading on the MTF or OTF or has at least had this request approved. In
this context, BaFin requires that the issuer must have been actively involved in the listing of
18 Dell’Erba (n 4) Art 19 para B.19.26.

20 See in this respect Kumpan (n 9) 446, 451, who (contrary to the German BaFin, ‘Issuer Guidelines Module C –
Requirements based on the Market Abuse Regulation (MAR)’, 25 March 2020, II.2.1) does not use the restrictive
wording ‘only if’, but states that the obligation to notify pursuant to Art 19 is applicable ‘even’ as from the application for
admission for trading.
267
its financial instruments on a multilateral trading facility, whereby three constellations are
conceivable: (i) issuers that have themselves applied for admission/inclusion to trading in the
MTF; (ii) issuers that have instructed a third party to apply for admission/inclusion to trading;
and (iii) issuers that have had the admission/inclusion of their securities to trading approved by
a third party. In all these cases, the issuer is to be considered ‘actively involved’.21
19.016 In addition, since 3 January 2018, persons discharging managerial responsibilities of auction
platforms, auctioneers and the auction supervisory authority as well as persons closely associ-
ated with them are also subject to the notification obligation when they engage in transactions
in emission allowances, derivatives thereto or auction products based thereon.22
(b) Financial instruments covered

19.017 The notification obligation applies to any transaction by persons discharging managerial
responsibilities conducted on their own account or a transaction by a person closely associated
with that is carried out:
● in shares or debt instruments23 of the issuer that are traded on a regulated market or MTF/
OTF at the request or with the approval of the issuer; or
● in derivatives or other financial instruments linked thereto; or
● in respect of emission allowance market participants, in emission allowances, in derivatives
relating thereto or auctioned products based thereon.
19.018 The notification obligation therefore applies primarily to shares and other interests held by the
issuer.24 In contrast to the previous legal situation, however, transactions in debt instruments of
the issuer are now also covered.25 Prior to the entry into force of the MAR, only transactions in
shares and share-like securities (= share certificates) of the issuer or derivatives related thereto
were subject to the notification obligation. Equity-like securities had to give the beneficiary
a similar position as a share with regard to their property rights: These included certificates rep-
resenting shares, equity-oriented profit-sharing rights, participation certificates and extremely
income-oriented profit participation bonds, participation certificates and high return-oriented
participating bonds but also convertible bonds and options that conferred a right to acquire
such securities.26 In addition to shares and equity-like securities, debt instruments, including
derivatives related thereto or other financial instruments related thereto, are now also covered
by the notification requirement since the entry into force of the MAR.27
21 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.1.1.

22 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.2.1; Maume and Kellner (n 13) 273, 286.
23 cf Christoph H. Seibt and Bernward Wollenschläger, ‘Revision des Marktmissbrauchsrechts durch die
601, who refer to the resulting tightening of the notification obligation.
24 Moritz B. Diekgräf, Directors‘ Dealings (Nomos 2017) 118.
25 BaFin, ‘FAQ regarding Art 19 MAR’, Version 10, 23 November 2018, No II.11; Seibt and Wollenschläger (n 23)
593, 601; cf also Kumpan (n 9) 446, 451; Gernot Wilfling, ‘Auswirkungen der Marktmissbrauchsverordnung auf
Wertpapieremissionen’ [2016] ÖBA 353, 358.
26 Kalss, Oppitz and Zollner (n 11) § 19 paras 32ff; Thomas Lechner and Christian Temmel, ‘§ 48d’ in Christian Temmel
(ed), Börsegesetz: Praxiskommentar (LexisNexis 2011) para 164.
27 Dell’Erba (n 4) Art 19 para B.19.26; Semrau (n 4) Art 19 para 17.
268
The financial instruments are listed accordingly in Annex I Section C of Directive 2004/39/ 19.019
EC. In view of the list contained therein (as well as the list in Art 10 (2) of Commission
Delegated Regulation 522/2016), virtual remuneration programmes – stock appreciation
rights and phantom stocks – are not considered financial instruments and are therefore not
subject to the notification obligation,28 which is also the view of the German Federal Financial
Supervisory Authority (BaFin) (cf also paras 19.031 f).29
In the opinion of the European legislator, the acquisition or disposal of mere debt instruments 19.020
of a company now also has a signal effect on the market and accordingly must be made public.30
In our opinion, however, the signal effect is likely to be limited to the fact that the issuer is in
a position to serve the interest of the bond and to repay it on maturity. Ultimately, the signal
effect in the case of a mere bond thus essentially refers to the fact that the company is not at risk
of insolvency. However, such a statement is also made, for example, with an unqualified audi-
tor’s certificate every year. The significance of the notification obligation of debt instruments
for the market is therefore much less important than for shares and, in our opinion, should be
questioned in general.
Finally, own account transactions in emission allowances, auction products based thereon 19.021
or derivatives relating thereto are also subject to the notification obligation, provided that
the relevant transaction is carried out by a person discharging managerial responsibilities of
a participant in the market for emission allowances within the meaning of Art 3 para 1 (20) (or
a person closely associated with them).
(c) Transactions covered

All transactions conducted on own account relating to financial instruments covered by the 19.022
notification obligation must be communicated.31 The term ‘transactions conducted on own
account’ is to be interpreted broadly, so that in principle any acquisition or disposal of financial
instruments, in whatever form, is to be subsumed under this term.32 Art 19 para 7 provides
a non-exhaustive list of transactions subject to the notification obligation; the term is to be
understood very broadly.33
The obligation to notify is already triggered by the conclusion of an agreement under the law of 19.023
obligations, whereby, in the case of conditionally concluded legal transactions – contrary to the
previous legal situation34 – the obligation to notify does not arise upon conclusion of the oblig-
atory transaction, but only upon the occurrence of the condition.35 The decisive factor is not the
conclusion of the transaction under the law of obligations, but its actual execution within the
28 Stegmaier (n 17) § 19 para 70; Kumpan (n 9) 446, 451; Matthias Söhner, ‘Praxis-Update Marktmissbrauchsverordnung:
Neue Leitlinien und alte Probleme’ (2017) 6 BB 259, 264; of a different opinion Sethe and Hellgardt (n 11) Art 19 MAR
para 75.
29 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.9.1.1.
30 See also Hartlieb and Simonishvili (n 3) 61, 62.
31 Kumpan (n 9) 446, 452 f.
32 Sethe and Hellgardt (n 11) Art 19 MAR para 71; Kumpan (n 9) 446, 452 f; Semrau (n 4) Art 19 para 53.
35 Stegmaier (n 17) § 19 para 79.
269
framework of the execution in rem.36 This also results from Recital 30 of Delegated Regulation
522/2016, according to which, in the case of a conditional transaction, the requirement to
notify only arises with the occurrence of the relevant condition, i.e., when the transaction in
question actually takes place.37 According to this Recital, a double notification – at the time of
the conclusion of the contract and the time of occurence of the condition – is expressly rejected.
With reference to Recital 30 of Delegated Regualtion 522/2016, it must be emphasised that
this only applies to conditions precedent, not to conditions subsequent, as the point in time at
which ‘the transaction in question actually takes place’ is decisive.38 If the transaction under the
law of obligations is concluded before the application for admission to a regulated market has
been filed, there is, in our opinion, no notification obligation pursuant to Art 19 MAR, since
by express order in Art 19 para 4 lit a MAR, this only applies from the time the request for
admission is filed (cf already para 19.013).
19.024 Art 19 para 7 states that, in addition to acquisition and disposal:
● the pledging or lending of financial instruments by or on behalf of a person discharging

managerial responsibilities or a person closely associated with such a person;
● transactions undertaken by persons professionally arranging or executing transactions, or
by another person on behalf of a person discharging managerial responsibilities or a person
closely associated with such a person; and
● certain transactions in the context of a life insurance policy
are subject to the notification obligation pursuant to Art 19 para 1.39
19.025 The pledging or lending of financial instruments was included in Art 19 since, in the event
of the financial instrument’s collateral being realised, a significant impact on the issuer can be
expected.40 The decisive factor is therefore the security of a loan or comparable transaction.41
Recital 58 of the MAR states that the obligation to disclose transactions conducted by persons
discharging managerial responsibilities should also include the pledging and lending of finan-
cial instruments, as the pledging of shares can result in a material and potentially destabilising
impact on the company in the event of a sudden and unforeseen disposal. Without disclosure,
the market would not know, for example, that there was an increased possibility of a significant
future change in share ownership, an increase in the supply of shares to the marketplace or
a loss of voting rights in that company.42
19.026 The notification obligation in the area of (classic) pledging of financial instruments (or similar
hedging transactions) is, in our opinion, excessive. While ‘unspecific’ hedging transactions
36 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.2 and II.3.9.7.

37 Semrau (n 4) Art 19 para 50; Dörte Poelzig, ‘Die Neuregelung der Offenlegungsvorschriften durch die
Marktmissbrauchsverordnung’ (2016) 20 NZG 761, 768; see also BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.9.7.
38 Poelzig (n 37) 761, 768.
39 Semrau (n43) Art 19 para 49; Kumpan (n 9) 446, 452 f; Rathammer and Sam (n 2) 436, 437; Gernot Wilfling,
‘Eigengeschäfte von Aufsichtsräten nach der Marktmissbrauchsverordnung’ (2015) 3 ARaktuell 10, 12.
40 Semrau (n 4) Art 19 paras 48ff; Seibt and Wollenschläger (n 23) 593, 602.
41 Semrau (n 4) Art 19 paras 48ff.
42 cf also Poelzig (n 37) 761, 768.
270
are – in our opinion, rightly so43 – exempt from the notification obligation pursuant to Art 19
para 7, there is no exemption if a specific loan is to be hedged: A pledge, or a similar security
interest, of financial instruments in connection with the depositing of the financial instruments
in a custody account does not need to be notified, unless and until such time that such pledge
or other security interest is designated to secure a specific credit facility.44
However, in our opinion, it is not clear what the signal effect for the market is when a person
with managerial responsibilities pledges a package of shares to secure a loan for the purchase of
an apartment – i.e., a specific credit facility. On the contrary: In the vast majority of cases, the
loan will be repaid and the shares will remain with the person discharging managerial respon-
sibilities. In such a case, the requirement of a notification obligation and to make the pledge
public is, in our opinion, excessive. Therefore, there would only be scope for a notification
obligation (for the reasons stated in Recital 58 of the MAR) in the case of a pledge or a similar
hedging transaction, in our opinion, if it is already foreseeable at the time of its conclusion that
the enforcement event will occur. However, such a differentiation appears inappropriate due
to the question of evidence alone in practice. As a result, de lege ferenda all ‘classical’ pledges of
financial instruments (or similar hedging transactions) should therefore be (again) exempted
from the notification requirement.
In the case of lending of financial instruments, on the other hand, the notification obligation 19.027
is understandable at least to the extent that lending of financial instruments can enable short
selling, which can have a signal effect on the market.45
An exemption from the principle that each manager must only report transactions conducted 19.028
on their own account and not those of third parties is found in Art 19 para 7 lit b, according
to which transactions that must be notified are those undertaken by persons professionally
arranging or executing transactions (or transactions undertaken on behalf of a person discharg-
ing managerial responsibilities or a person closely associated with them). Thus, above all, asset
managers who act on behalf of a person discharging managerial responsibilities are included,
regardless of whether or not they exercise their own discretion.46
However, this does not apply to transactions involving shares in undertakings for collective 19.029
investment in transferable securities (UCITS) or portfolios of assets. According to Art 19
para 7 subpara 3 MAR, which was subsequently supplemented by Art 56 of Regulation (EU)
1011/2016,47 a notification obligation pursuant to Art 19 para 7 lit b MAR is not necessary if
43 The bank's securities account conditions will often provide for the securities held in the securities account to be pledged
as security for the (custodian) bank's claims to remuneration arising from the business relationship with the client;
Semrau (n 4) Art 19 para 49.
44 The German version of the respective part of the MAR has been corrected in OJ L 287/323 of 21 October 2016; see also
Semrau (n 4) Art 19 para 49.
45 Semrau (n 4) Art 19 para 53; Sethe and Hellgardt (n 11) Art 19 MAR para 83; Kumpan (n 9) 446, 452.
46 Semrau (n 4) Art 19 para 50; Stegmaier (n 17) § 19 para 60; Kumpan (n 9) 446, 453; BaFin, ‘Issuer Guidelines Module
C’ (n 20) II.3.9.10.
47 Regulation (EU) 2016/1011 of 8 June 2016 on indices used as benchmarks in financial instruments and financial con-
tracts or to measure the performance of investment funds and amending Directive 2008/48/EC and 2014/17/EU and
Regulation (EU) 596/2014 [2016] OJ L 171/1. This is the so-called Benchmark Regulation which was implemented
following the LIBOR scandal.
271
the person discharging managerial responsibilities cannot exert any influence on the respective
UCITS or portfolio because the full scope of discretion lies, for example, with the investment
company or the respective asset manager.48 Moreover, according to Art 19 para 1a, which was
also subsequently supplemented by Art 56 of Regulation (EU) 1011/2016,49 the notification
obligation for UCITS or a portfolio of assets is only triggered if (i) the financial instrument
is a unit or share in a collective investment undertaking in which the exposure to the issuer’s
shares exceeds 20 per cent of the assets held by the collective investment undertaking or (ii)
the financial instrument provides exposure to a portfolio of assets in which the exposure to the
issuer’s shares exceeds 20 per cent of the portfolio’s assets.50 A further condition for the notifi-
cation obligation is that the person obliged to notify was aware of the corresponding assets of
the UCITS or portfolio or at least could have known their composition, whereby the person
obliged to notify must make all reasonable efforts to avail themselves of that information.51
19.030 According to Art 19 para 7 lit c, transactions that are carried out in connection with a life insur-
ance policy trigger the notification requirement if the policyholder (i) is a person discharging
managerial responsibilities (or a person closely associated with such a person), (ii) bears the
investment risk, and (iii) has the power or discretion to make investment decisions regarding
specific instruments in that life insurance policy or to execute transactions in relation to specific
instruments for this life insurance policy.52 Therefore, it does not cover traditional unit-linked
life insurance where the policyholder has no influence over which financial instruments are
included in the insurance pool for this life insurance, even if the policyholder ultimately bears
the investment risk of the investment, for example because the product is not guaranteed.53 If
the policyholder is already subject to the notification obligation, the insurance company is no
longer obliged to make a notification pursuant to Art 19 para 7.
19.031 Transactions within the scope of remuneration programmes54 are also generally subject to the
notification obligation. Contrary to the previous legal situation, according to which acquisi-
tions based on employment contracts, such as participation in employee stock option plans,
were not covered by the notification obligation, remuneration programmes based on employ-
ment contracts are now also subject to the notification obligation.55 According to the legal
opinion of BaFin, this applies regardless of whether or not the entitled person has room for
manoeuvre in the allocation. For example, share allocations are subject to the notification obli-
gation.56 However, BaFin also refers in this context to the Q&As of ESMA. In this context,
ESMA states with reference to Art 10 para 2 lit i of the Delegated Regulation 522/2016 that
remuneration programmes whose allocation is linked to certain conditions are only subject to
48 Diekgräf (n 24) 125; Sethe and Hellgardt (n 11) Art 19 MAR para 87.
49 Regulation (EU) 2016/1011; Semrau (n 4) Art 19 para 51.
50 Stegmaier (n 17) § 19 para 47.
51 Rathammer and Sam (n 2) 436, 438.
53 Regarding the exceptional nature of such provison see also Sethe and Hellgardt (n 11) Art 19 MAR para 88.
54 Söhner (n 28) 259, 264 f.
55 See Art 10 para 2 lit b of the Commission Delegated Regulation (EU) 522/2016; see also Rathammer and Sam (n 2) 436,
437; Semrau (n 3) Art 19 para 53.
56 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.9.1.1; Rathammer and Sam (n 2) 436, 437.
272
the notification obligation if these conditions occur and the transactions are actually executed.57
Therefore, it is now to be assumed for the purposes of ESMA that the room for manoeuvre of
the beneficiary in the allocation is not important and therefore, in the case of the conditional
allocation of shares as part of remuneration programmes, the notification is only to be made
when the shares are actually allocated due to the occurrence of the conditions.
This also corresponds to the above-mentioned current opinion of BaFin that, in the case of con- 19.032
ditionally concluded legal transactions, it should be the occurrence of the conditions and not
the conclusion of the contract that is decisive (cf para 19.023). These conditions must, however,
be those which the beneficiary cannot determine itself. As a rule, typical remuneration pro-
grammes are dependent on the achievement of certain goals which are defined by reference to
earnings, profitability or other key figures of a company. The allotment of shares on condition
of the corresponding achievement of targets can therefore neither create a risk of insider dealing
nor send a signal to the market because these future targets must first be achieved. Even the fact
that, according to Art 10 Delegated Regulation 522/2016, the acceptance or exercise of stock
options is also subject to the notification obligation does not change this:58 The acceptance of
a stock option is only subject to the notification obligation if it is an unconditional acceptance
– i.e., the acceptance does not only become effective when certain company figures have been
achieved. According to the legal opinion of BaFin, instruments settled in cash that are neither
tradable nor assignable and that serve to calculate a performance-related remuneration entitle-
ment (e.g., so-called phantom stocks, stock appreciation rights, restricted stock units) are also
not subject to the notification obligation.59
The granting of subscription rights issued to shareholders in the context of a capital increase is 19.033
also subject to the notification obligation. It should be noted, however, that the party subject
to this notification obligation is not usually aware of the time at which subscription rights are
granted. Therefore, the date of the transaction must be the date of the entry of the subscription
rights in the deposit of the party subject to this notification obligation (cf paras 19.084ff).
Trading in subscription rights is subject to the notification obligation in the same way as the
acquisition of shares by exercising subscription rights. In the case of the latter, the ‘type of
transaction’ shall be the acquisition of shares through the exercise of subscription rights. The
date of the transaction shall be the date on which the shares are created by the registration of
the capital increase in the commercial register.60
A non-exhaustive61 list of notifiable transactions can be found in Art 10 Delegated Regulation 19.034
522/2016.62
● Accordingly, securities lending, for example, is also subject to the notification obligation.
However, the retransfer after securities lending is not subject to the notification obligation.63
57 ESMA, ‘Questions and answers on the Market Abuse Regulation (MAR)’, Version 14, ESMA70–145–111, 29 March
2019, No 7.5; see also Sethe and Hellgardt (n 11) Art 19 MAR para 74.
58 Söhner (n 28) 259, 264.
59 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.9.1.1; Söhner (n 28) 259, 264 f; Semrau (n 4) Art 19 para 53; Kumpan
(n 9) 446, 451.
60 Semrau (n 4) Art 19 para 53; BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.9.2.
62 Poelzig (n 37) 761, 768; Kumpan (n 9) 446, 453.
63 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.9.14.
273
● The acquisition or disposal of certificates by a person discharging managerial responsibili-

ties of a certificate issuer is also subject to the notification obligation pursuant to Art 19.64
● Gifts and donations made or received and inheritances received also count as transactions
subject to the notification obligation.65 It can probably be concluded from this that it does
not matter whether the legal transaction is remunerated or not, and thus a gift or other gra-
tuitous legal transaction is also subject to the notification obligation.66 BaFin also appears to
share this view.67 However, it should be noted that, in the case of gifts, the initiative of the
person performing management functions is regularly lacking,68 with the consequence that
in such a case it is hardly possible to speak of a signal effect for the market.69 However, this
argument can also be applied to inheritances. Ultimately, therefore, gifts and inheritances
will, in our opinion, now also be covered by the notification obligation pursuant to Art
19. It is not the inheritance (death of the testator), but only the acquisition based on the
acceptance of the bequest that is subject to the notification obligation.70 This view is also
supported by the fact that the catalogue included in Art 10 Delegated Regulation 522/2016
is not an exhaustive list of all relevant transactions.71
19.035 However, own transactions carried out by the issuer, such as the acquisition of own shares, do
not have to be notified pursuant to Art 19.72 The provisions of § 119 para 9 BörseG (transpar-
ency of own shares) and the provisions on the disclosure of shareholdings apply to them.
19.036 The status of shares held, debt securities and other financial instruments subject to the notifi-
cation obligation is not required to be disclosed when a person assumes a management function
or when a ‘close relationship’ of a person with a manager begins.73
2. Personal scope of application
19.037 According to Art 19 para 1, the notification obligation applies to persons discharging manage-
rial responsibilities and persons closely associated with them.74 Who belongs to this group in
detail is defined in Art 3 para 1 (25) and (26). The notification obligation applies independently
to the representatives of these two groups, for example, the member of the management board
or supervisory board on the one hand and the spouse on the other.
64 BaFin, ‘FAQ regarding Art 19 MAR’ (n 25) No IV.14.

65 Art 10 para 2 lit k of the Delegated Regulation (EU) 522/2016; see also ESMA, ‘Questions and answers on the Market
Abuse Regulation (MAR)’, Version 13, ESMA70–145–111, 12 November 2018, No 7.4; Rathammer and Sam (n 2)
436, 437 f; Semrau (n 4) Art 19 para 53.
66 Gernot Wilfling, Praxishandbuch Börserecht (2nd edn, Linde 2019) para 706.
69 Hartlieb and Simonishvili (n 3) 61, 63.
71 Semrau (n 4) Art 19 para 53; of a different opinion apparently Poelzig (n 37) 761, 768.
72 ESMA70–145–111 (n 57) No 7.10; BaFin, ‘Issuer Guidelines Module C’ (n 20) II.1.2.5; Maume and Kellner (n 13) 273,
287; Semrau (n 4) Art 19 para 41.
73 Semrau (n 4) Art 19 para 47; Kumpan (n 9) 446, 452.
274
(a) Persons discharging managerial responsibilities

Pursuant to Art 3 para 1 (25), a person discharging managerial responsibilities is a person 19.038
within an issuer, an emission allowance market participant or another entity referred to in Art
19 para 10 who is:
● a member of the administrative, management or supervisory body of that entity; or

● a senior executive who is not a member of any of the aforementioned bodies, but who has
regular access to inside information relating directly or indirectly to that entity and power
to take managerial decisions affecting the future developments and business prospects of
that entity.
It follows from this definition that (i) board members and (ii) other managers are considered 19.039
to be persons performing managerial responsibilities and are therefore addressees of the noti-
fication obligation. On paper, therefore, nothing has changed compared to the previous legal
situation.75
(i) Board members

This group includes all members of the management board regardless of their responsibili- 19.040
ties and all members of the supervisory board regardless of whether they are shareholder or
employee representatives. Members of the administrative board and executive directors of an
SE are also included.76 This group also includes deputy members of the management board
and incorrectly appointed members of executive bodies.77 However, substitute members of the
supervisory board are not included, as they only enter into the position of the supervisory board
with all rights and obligations after the original member has left the supervisory board.78
According to the legal opinion of BaFin, the members of an advisory council of a limited 19.041
company issuing bond instruments are also to be qualified as ‘persons performing manage-
rial responsibilities’ insofar as the advisory board discharges responsibilities such as those of
a supervisory board or a management board in a specific individual case.79 Advisory council
members are subject to the notification obligation if the body is to be treated as equivalent to
a supervisory board.80 Also (sole) partners in the form of a legal person are to be regarded as
‘persons performing managerial responsibilities’ in the case of a limited company issuing bond
instruments, provided that in the concrete individual case the partner discharges responsibil-
ities such as those of a supervisory board or a management board.81 In this respect, however,
it should be noted that a mere partial exercise of such competences, in our opinion, may not
be sufficient. For example, the partner’s reservations of consent standardised in the articles of
association in application of § 35 of the GmbHG (Austrian Limited Liability Companies Act)
(comparable with those of § 30j para 5 of the GmbHG) – without the typical monitoring and
75 Maume and Kellner (n 13) 273, 287.

78 Sethe and Hellgardt (n 11) Art 19 MAR para 27; Kumpan (n 9) 446, 449; Semrau (n 4) Art 19 para 22.
80 Sethe and Hellgardt (n 11) Art 19 MAR para 28; cf also Austrian OGH 27.9.2006, 9 ObA 130/05s , GesRZ 2007, 197
regarding the equivalent treatment.
275
advisory functions of a supervisory board being added – will not, in our opinion, lead to the
partner being regarded as a ‘person performing managerial responsibilities’.
19.042 Shareholders, and thus also not the members of a shareholders’ committee that does not have
a supervisory board function, are not subject to any notification obligation for management
transactions pursuant to Art 19. The shareholders are subject solely to the obligation to disclose
their voting rights pursuant to §§ 130ff BörseG with completely different thresholds.
19.043 As a rule, the notification obligation begins with the appointment or acceptance of the appoint-
ment and ends at the point in time at which management tasks are no longer performed, i.e., at
the termination of the office (effectiveness of the resignation or dismissal).82
(ii) Other management

19.044 A closer look at the group of managers who do not belong to any of the company’s bodies
is required. In order to be subject to the notification obligation pursuant to Art 19, ‘other’
managers must have regular access to inside information and must also be authorised to make
entrepreneurial decisions on future developments and business prospects of the issuer.83
19.045 The regulation on other managers also takes into account those national legal systems in
Europe in which entrepreneurial decisions on future developments and business prospects of
the issuer are not made at the level of the management, the executive board or the supervisory
board, but by non-executive bodies (e.g., senior executives or ‘senior managers’).84 Since, under
Austrian law, non-executive bodies such as authorised signatories (or authorised persons) –
even if their activities can have a significant impact on the issuer (such as, e.g., own account
traders of securities trading companies, some of which move considerable sums of money) – do
not make such entrepreneurial decisions (and these generally do not have regular access to
inside information), an obligation to disclose own account transactions by such persons is no
longer applicable, as was previously the case.85 In practice, therefore, in Austria, the notifica-
tion obligation will continue to be limited to the members of the management board and the
supervisory board and, in the case of an SE, to the members of the administrative board and
to executive directors. In the event of insolvency, the insolvency administrator also falls within
this group.86
19.046 Members of executive bodies of subsidiaries or parent companies of the issuer are also not
subject to the notification obligation if they are not at the same time members of an executive
body of the issuer, as these are not administrative, management or supervisory bodies of the
issuer itself.87
82 Sethe and Hellgardt (n 11) Art 19 MAR para 38.

83 Rathammer and Sam (n 2) 436, 437; Kumpan (n 9) 446, 449.
85 Kalss, Oppitz and Zollner (n 11) § 19 para 17; Wilfling, Praxishandbuch Börserecht (n 66) paras 819ff; Wilfling,
‘Eigengeschäfte von Aufsichtsräten nach der Marktmissbrauchsverordnung’ (n 39) 10, 11.
86 Kumpan (n 9) 440, 449.
87 Kumpan (n 9) 446, 449.
276
(b) Close connection to management

Art 19 obliges not only the persons discharging managerial responsibilities themselves to 19.047
notify, but also persons closely associated with them. Two completely different groups are
covered, namely, on the one hand, natural persons with a close personal relationship and, on
the other hand, legal persons or comparable legal entities controlled by the person discharging
managerial responsibilities or in which it has economic interests.
According to Art 3 para 1 (26), persons closely associated are: 19.048
(a) a spouse, or a partner considered to be equivalent to a spouse in accordance with national

law;
(b) a dependent child, in accordance with national law; or
(c) a relative who has shared the same household for at least one year on the date of the
transaction concerned.
The second group consists of a legal person, trust or partnership the managerial responsibilities
of which are discharged by a person discharging managerial responsibilities or by a person
referred to in point (a), (b) or (c), or which is directly or indirectly controlled by such a person,
or which is set up for the benefit of such a person, or the economic interests of which are
substantially equivalent to those of such a person. For all these persons, the law assumes in
a generalised way that they can share in the knowledge advantage due to their close relationship
with the person discharging managerial responsibilities.88
Although the German wording of Art 19 para 1 (‘in enger Beziehung’ i.e., ‘in a close rela- 19.049
tionship’) and Art 3 para 1 (26) (‘eng verbunden’ i.e., ‘closely associated’) is different, it can be
assumed that the terms have the same normative meaning, especially since the English version
of the MAR also uniformly speaks of ‘person closely associated’.89
The definition in Art 3 para 1 (26) suggests that the characteristic of ‘closely associated’ with 19.050
persons discharging managerial responsibilities should be examined with regard to close
family ties on the one hand and close economic ties on the other. The list of related parties is
exhaustive. It cannot therefore simply be extended in parallel cases.90
Testamentary or legal heirs of a person discharging managerial responsibilities are not auto- 19.051
matically persons closely associated by virtue of this position. According to the legal opinion
of BaFin, it can be assumed that the beneficiaries of inheritance are not – or no longer – to be
considered closely associated persons.91
(i) Close family relationship

These include spouses, partners, dependent children and certain other family members. The 19.052
notification obligation applies to transactions carried out by the spouse of a person discharging
88 cf Leo Helm, ‘Pflichten des Wertpapierdienstleistungsunternehmens in der Finanzportfolioverwaltung bei Directors’

Dealings nach der Marktmissbrauchsverordnung’ [2016] ZIP 2201, 2203.
89 cf also Maume and Kellner (n 13) 273, 287.
91 BaFin, ‘FAQ regarding Art 19 MAR’ (n 25) No IV.9.
277
managerial responsibilities during an intact marriage. Transactions that are carried out before
or after an intact marriage, on the other hand, do not trigger a notification obligation, although
the lack of repercussions is viewed critically in the literature.92 Equally critical could be the
cessation of the notification obligation when the manager himself or herself leaves his or her
position as a board member, as inside knowledge is not lost from one day to the next – insofar
as the information has not become obsolete in the meantime or has not been made public.
19.053 The criterion triggering the attribution is thus the existence of an intact marriage, regardless of
whether there is domestic cohabitation. The same principles apply to registered partners under
the Austrian Registered Partnership Act as to marriage.93 In contrast, partners in non-marital
domestic partnerships (= life partners) are not closely associated persons pursuant to Art 3 in
conjunction with Art 19, irrespective of whether or not the two persons live in one household.94
19.054 According to Art 3 para 1 (26), the concept of dependent child is to be assessed under national
law. According to Austrian law, the child’s claim to maintenance ends with the child’s ability
to maintain itself, which does not depend on the child reaching a certain age (in particular not
on reaching majority), but on whether the child is able to earn the means to provide for his or
her own adequate maintenance. For the purposes of the MAR, in our opinion, probably only
children over the age of 14 are subject to the obligation to notify. After the child has become
capable of self-support, there may be an obligation to notify if, for example, the child has
belonged to the same household as the person discharging managerial responsibilities for at
least one year at the time of the transaction in question.95
19.055 Example: The stepson (20 years old, student, no own income) of the supervisory board member
(Mr X) of an issuer lives with the wife of Mr X in Klagenfurt. Mr X himself lives in Vienna and
visits his wife and stepson at the weekend in Klagenfurt. Occasionally his wife and stepson also
visit Mr X in Vienna or spend the weekend together at Mr X’s house in Burgenland. Mr X is
not responsible for the maintenance of the stepson, but finances for example, holidays, study
literature, car. Does the stepson therefore have to report his own transactions as defined by Art
19? Answer: No, according to national law, the stepson is not a dependent child of Mr X. If he
has not been adopted, he should not be considered as a (other) relative. There is therefore no
need to examine the household affiliation.
19.056 Moreover, according to the provisions of the MAR, a (other) relative must have been a member
of the same household as the person discharging managerial responsibilities for at least one year
at the time the relevant transaction is carried out.96
19.057 Example: The apartment of the supervisory board member (Mr X) of an issuer is physically
connected with that of his mother. The mother has lived in the ‘connected apartment’ for more
than one year, receives a pension and does not require any care. Mr X is not liable for mainte-
92 Kalss, Oppitz and Zollner (n 11) § 19 para 43 with further references.

94 Semrau (n 4) Art 19 para 34; Wilfling, Praxishandbuch Börserecht (n 66) para 689; to the previous law see Kalss, Oppitz
and Zollner (n 11) § 19 para 48.
95 cf also Kalss, Oppitz and Zollner (n 11) § 19 para 47.
278
nance for his mother, but finances the running costs for her apartment, the telephone and the
car. Does Mr X’s mother therefore have to report her own transactions within the meaning
of Art 19? Answer: Yes, if the households cannot be reasonably separated, for example, the
kitchen is shared, a relative in the same household must be assumed.
The transactions of management personnel and (natural) persons closely associated to them are 19.058
not aggregated, but are considered and calculated individually (cf also paras 19.070ff).97
(ii) Close business relationship

For economic proximity, the MAR provides four different attribution criteria. According to 19.059
Art 3 para 1 (26), a person closely associated with a person discharging managerial responsibil-
ities can also be a legal person, a trust or a partnership the managerial responsibilities of which
are discharged by (a) a person discharging managerial responsibilities or by a person closely
associated with a person discharging managerial responsibilities (see above), or (b) which is
directly or indirectly controlled by such a person, or (c) which was set up for the benefit of such
a person, or (d) whose economic interests are substantially equivalent to those of such a person.
A constellation that occurs comparatively frequently in practice is that a person discharging 19.060
managerial responsibilities of the issuer also performs managerial responsibilities in another
legal person. This is not only the case for groupwide issues and raises the question of whether,
according to the definition just mentioned, the legal person is considered closely associated to
the person discharging managerial responsibilities.
In principle, the definition of such element is far too broad and must be interpreted restric- 19.061
tively for the specific purpose. In particular, the question arises as to whether a legal entity
(which is not identical to the issuer) should be subject to the notification obligation solely
because a person discharging managerial responsibilities of the issuer also performs managerial
responsibilities in this legal person (e.g., supervisory board mandate both with the issuer and
with another company). BaFin explains that the mere fact that a manager performs manage-
ment functions in another legal person does not constitute a notification obligation of this
legal person, provided this legal person is also controlled directly or indirectly by the person
discharging managerial responsibilities of the issuer or was set up for its benefit or its economic
interests are not substantially equivalent to those of the person discharging managerial respon-
sibilities (‘pure dual mandates’).98 Furthermore, BaFin states that a notification obligation only
exists for transactions of a company conducted for its own account if a person discharging
managerial responsibilities of the issuer (or a natural person closely associated with the person
discharging managerial responsibilities) can potentially gain a significant economic advantage
for itself.99 Such a significant economic advantage can be achieved, for example, if the person
discharging managerial responsibilities or natural person closely associated with the person dis-
charging managerial responsibilities has a shareholding of at least 50 per cent in the company
97 ESMA70–145–111 (n 57) No 7.3; BaFin, ‘FAQ regarding Art 19 MAR’ (n 25) No III.1; in doubt Semrau (n 4) Art 19
para 56; of a different opinion Kumpan (n 9) 446, 455.
99 See also Semrau (n 4) Art 19 para 40.
279
or if at least 50 per cent or more of the company’s profits are allocated to it. BaFin also refers to
the relevant statements in the Q&As of ESMA.100
19.062 However, this legal interpretation of BaFin is no longer in line with the statements of ESMA,
which would like to make it sufficient for the legal person to be subject to the notification
obligation that the person discharging managerial responsibilities takes part in decisions of
the legal person to carry out transactions in financial instruments of the issuer. If a person
discharging managerial responsibilities of the issuer also works as a person discharging mana-
gerial responsibilities in another legal person without participating in or influencing decisions
concerning transactions of the financial instruments of the issuer, there is no notification
obligation according to Art 19.101 This opinion of ESMA was already published in July 2017,
whereas the Issuer Guidelines of the BaFin are dated March 2020. In its Issuer Guidlines,
the German authority nevertheless adopts the restrictive interpretation in a purposeful and
appropriate manner.102
19.063 Based on this opinion of ESMA, the FMA has now changed its legal interpretation as regards
the notification obligation of legal persons. Previously, the FMA had been of the opinion that
legal persons were only subject to a notification obligation pursuant to Art 19 if the respective
person discharging managerial responsibilities gained a significant economic advantage from
the specific transaction.103 This is in line with the opinion of BaFin as expressed above (without
reference to ESMA). The FMA now also refers to the above-mentioned legal opinion of
ESMA104 on this issue and also expressly points out that it is changing its administrative prac-
tice accordingly.105
19.064 In any case, the new legal interpretation of ESMA and the FMA extends the scope of the
notification obligation for legal persons. However, it does not always have to be the case that
a person discharging managerial responsibilities of an issuer who simultaneously performs
management functions in another legal person also participates in decisions concerning
transactions with financial instruments of the issuer. If, for example, the CEO of an issuer
sits on the supervisory board of another company and this company acquires shares in the
issuer, a member of the supervisory board is not involved in this, according to the law and in
fact typically. The acquisition of shares as a pure investment, for example, in the exercise of
a treasury function, is typically not subject to supervisory board requirements under § 95 AktG
(Stock Corporation Act). The approval rights of the supervisory board must therefore be set
out accordingly in the rules of procedure. If a shareholding is acquired within the meaning of §
189 para 2 UGB (Austrian Commercial Code), the disclosure of the shareholding pursuant to
§ 130 BörseG applies in any case. A member of the management board is also not necessarily
involved in the decision. This depends on the competence and the specific rules of procedure.
A member of the management board will not be involved as a rule, especially if the investment
100 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.1.2.3 and II.1.2.7.

101 ESMA70–145–111 (n 57) No 7.7.
102 Semrau (n 4) Art 19 para 39 (with reference not to this, but to a previous discussion).
103 cf the view of the FMA published on 15 June 2016, which was confirmed by the FMA in the course of the MAR Forum
on 27 June 2017.
104 ESMA70–145–111 (n 57) No 7.7.
105 Information of the FMA available under https:// www .fma.gv
.at/
kapitalmaerkte/
directors
-dealings/
, accessed on 5
February 2019.
280
is merely a financial investment or other investment. In any case, it is advisable to ensure in

the rules of procedure of both the management board and the supervisory board that, in the
event of a necessary decision by the supervisory board, the relevant supervisory board member is
excluded from any information, any participation in the decision-making process and any right
to vote. Also, in our opinion, provision could be made to ensure that the relevant person dis-
charging managerial responsibilities does not participate in decisions concerning transactions
with financial instruments of the issuer. If, however, such participation in decisions is required
for reasons of due diligence, the notification obligation of the legal person, in which the execu-
tive of the issuer performs executive functions according to the strictly formal view of the FMA,
cannot be excluded. However, the FMA requires a notification obligation without signal effect.
In particular, it is not clear what concrete benefits the market and investors should derive 19.065
from the fact that a legal person has to report a transaction conducted on its own account only
because one of its persons discharging managerial responsibilities (in particular a member of
the supervisory board) also performs management functions at an issuer. The previous legal
interpretation of BaFin and the FMA, with the restriction of the notification obligation to
those cases in which the person discharging managerial responsibilities gains a significant
economic advantage from the transaction, in our opinion, contained precisely the corrective
that is necessary to prevent the expansion of the notification obligation.106 If, on the other
hand, the respective person discharging managerial responsibilities does not gain a significant
advantage from the transaction, it is also not apparent what advantage investors should gain
from the notification or disclosure of such a transaction.107 The notification obligation pursuant
to Art 19 is intended to ensure that any economic advantage from securities transactions of
a person discharging managerial responsibilities is made known to the public and the elements
of attribution are intended to prevent circumvention. Thus, an attribution is no longer justified
if the person discharging managerial responsibilities cannot derive any significant economic
advantage from it.108
The notification obligation also exists if a person discharging managerial responsibilities 19.066
or a person closely associated to him controls a legal person, a trust or a partnership. The
Regulation does not specify exactly what triggers such control. As in the past, in accordance
with the control element of accounting law (§ 189 UGB; § 244 UGB), it must be assumed that
especially the majority of voting rights, the right to appoint and/or dismiss board members or
a control agreement establish control.109 In addition, the provisions on consolidation according
to the Commercial Code or IFRS will also have to be taken into account, whereby the mere
possibility of blocking important decisions is not sufficient for the existence of control.110 In
any case, control can be exercised directly or indirectly, whereby in the case of indirect exercise,
control must exist at the level of each intermediate company.111
106 Explicitly Semrau (n 4) Art 19 para 39.

107 cf also Sethe and Hellgardt (n 11) Art 19 MAR para 52, who also consider a restrictive interpretation to be necessary.
108 Stegmaier (n 17) § 19 para 35; see also Kalss, Oppitz and Zollner (n 11) § 19 para 50.
109 Kumpan (n 9) 446, 450.
111 Kalss, Oppitz and Zollner (n 11) § 19 para 56; Wilfling, Praxishandbuch Börserecht (n 66) para 694.
281
19.067 The notification oligation also applies if the economic interests of the person discharging
managerial responsibilities or a person close to the said person’s family largely correspond to
those of the legal person. This is the case if the legal person concerned exclusively or predom-
inantly pursues the economic interests of the person discharging managerial responsibilities or
of a person close to said person’s family, as is the case with trust structures.112 The existence of
largely identical economic interests can also be assumed if the person concerned has a share of
more than 50 per cent in the profits and losses of the company.113
19.068 The notification obligation also exists if a legal person was founded for the benefit of a person
discharging managerial responsibilities or a person close to its family. In such a case, however,
there will probably already be a notification obligation due to the existence of largely identical
economic interests. One possible application is, for example, a private foundation or a trust
under foreign law or a special fund whose sole or predominant beneficiary is a person discharg-
ing managerial responsibilities or a person close to its family.114
19.069 No notification obligation exists in the case of transactions for non-profit legal persons.115
3. Notification threshold
19.070 Art 19 para 8 stipulates that the notification obligation is only triggered if the total volume of
the transactions effected reaches € 5,000 within a calendar year. In this regard, Recital 58 of the
MAR states that the threshold is intended to ensure an appropriate balance between the level
of transparency and the number of reports notified to competent authorities and the public.
19.071 Art 19 para 9 adds that a competent authority may decide to increase the threshold set out in
para 8 to € 20,000.116 However, if the competent authority makes use of this possibility, it shall,
before applying this threshold, inform ESMA of its decision and of the reasons for it, with
specific reference to market conditions. In Austria, the possibility of increasing the threshold
has not been used so far, so that the threshold is still set at € 5,000.117
19.072 The threshold of € 5,000 is calculated by aggregating all own account transactions without
netting. Purchases and sales are therefore added, not subtracted. In the opinion of BaFin118 and
the predominant German literature,119 the transactions of the person discharging managerial
responsibilities and the person closely associated to it should not be aggregated when calculat-
112 Kalss, Oppitz and Zollner (n 11) § 19 para 57; Semrau (n 3) Art 19 para 44; BaFin, ‘Issuer Guidelines Module C’ (n 20)
II.1.2.3.
113 Kumpan (n 9) 446, 451.
114 Semrau (n 4) Art 19 para 44; Kalss, Oppitz and Zollner (n 11) § 19 para 58; Wilfling, Praxishandbuch Börserecht (n 66)
para 695; BaFin, ‘Issuer Guidelines Module C’ (n 20) II.1.2.3.
115 Wilfling, Praxishandbuch Börserecht (n 66) para 695.
116 Diekgräf (n 24) 131.
117 The BaFin, however, used this possibility with effect as of 1.1.2020 and raised the threshold to € 20,000 see BaFin,
‘Issuer Guidelines Module C’ (n 20) II.2.3.
119 Helm (n 88) 2201, 2202; Semrau (n 4) Art 19 para 56; Sethe and Hellgardt (n 11) Art 19 MAR para 113; of a different
opinion Maume and Kellner (n 13) 273, 289ff; Kumpan (n 9) 446, 455.
282
ing the € 5,000 threshold pursuant to Art 19 para 8.120 ESMA also shares the view that the
transactions of persons discharging managerial responsibilities and persons closely associated to
them should not be aggregated. For example, if a CEO concludes a transaction in the amount
of € 4,000 and his spouse concludes another transaction in the amount of € 2,000, this does not
lead to the € 5,000 threshold being exceeded.121
When the € 5,000 threshold is reached, it is not necessary to report the transactions for the 19.073
entire year retroactively, but only the transaction with which the threshold is reached and all
subsequent transactions.122 According to the purpose of the provision, all transactions with
a business volume of € 5,000 or more within a calendar year must be reported.123
If the transaction is carried out in a currency other than the euro, the exchange rate to be used 19.074
to determine if the € 5,000 threshold is reached is the official daily spot foreign exchange rate
which is applicable at the end of the business day on which the transaction is concluded. Where
available, the exchange rate published by the European Central Bank on its website should be
used.124
It is questionable in this context how the € 5,000 threshold for gifts and inheritances is to be 19.075
calculated. BaFin states that the last published price for the financial instrument concerned
in accordance with the post-trade transparency requirements pursuant to Arts 6, 10, 20 and
21 of Regulation 600/2014 (MiFIR) on the day of acceptance of the gift or inheritance is
decisive. ESMA adds125 that, in the case of unavailability of this price, the last published price
shall apply.126 It also states that when reporting a gift, donation or inheritance, the price to be
indicated is ‘0’ (zero) (cf also para 19.091).127
In the context of employee options, the question arises on which basis the € 5,000 threshold 19.076
should be calculated. ESMA states that the economic value assigned to the options by the
issuer when granting them is decisive. If this value is not known, the employee options are to
be assessed using a generally accepted option price model. Such a model determines the price
of the option, taking into account various variables such as the current share price of the issuer,
the exercise price of the option and the time until expiry of the option. Which variables are
included in the calculation in a specific case depends on which generally accepted valuation
model is used. Irrespective of the calculation of the reporting threshold described above, the
price ‘0’ must be indicated as the price when reporting the granting of employee options to
executives (cf also para 19.091).128
120 cf also Gernot Wilfling, ‘Directors’ Dealings: Welche Pflichten Aufsichtsräte treffen’ (2017) 1 ARaktuell 16, 18.
121 ESMA70–145–111 (n 57) No 7.3.
122 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.1.2.3; Seibt and Wollenschläger (n 23) 593, 601.
124 ESMA70–145–111 (n 57) No 7.1.
126 ESMA70–145–111 (n 57) No 7.4.
127 The BaFin has transferred such view to its FAQs. See BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.9.12 and
II.3.9.13.
128 ESMA70–145–111 (n 57) No 7.6.
283
19.077 Moreover, persons discharging managerial responsibilities (and persons closely associated with
them) of emission allowance market participants are not subject to a notification obligation if
these market participants (at group level) have not exceeded certain minimum thresholds (in
terms of carbon dioxide equivalent, rated thermal input) in the previous year (see Art 17 para 2
subpara 2 MAR and Art 5 Delegated Regulation 522/2016).
C. DUTY TO NOTIFY
19.078 The duty to notify is two-tiered, namely the duty to notify persons discharging managerial
responsibilities and the duty to inform persons closely associated with them. Art 19 para 5
provides that issuers and emission allowance market participants must notify the persons
discharging managerial responsibilities in writing of their obligations regarding the notification
obligation pursuant to Art 19, i.e., they must notify them of the notification obligations. In this
context, issuers and emission allowance market participants are also required to draw up a list of
all persons discharging managerial responsibilities and persons closely associated with them.129
19.079 In addition, Art 19 para 5 requires persons discharging managerial responsibilities to (i)
notify persons closely associated with them in writing of their obligation to report transac-
tions conducted on their own account and (ii) keep a copy of the document evidencing such
notification.130
19.080 There are therefore, two levels to the obligation to notify. On the one hand, issuers must
inform persons discharging managerial responsibilities in writing of their obligations under the
notification obligation pursuant to Art 19. On the other hand, persons discharging managerial
responsibilities also have their own obligation to inform all persons closely associated with them
in writing of their obligations in connection with the notification obligation pursuant to Art
19.131 In addition, a copy of this notification must be kept. The precise scope of the duty to
notify is not specified in the Regulation. The communication of the relevant legal texts or, in
the event that an internal compliance guideline of the issuer contains statements on the disclo-
sure obligation pursuant to Art 19, even the mere communication of this compliance guideline
should suffice here.132
19.081 Since Art 19 para 5 requires that persons discharging managerial responsibilities must inform
persons closely associated with them in writing of their obligation to notify transactions con-
ducted on their own account, of considerable importance in practice are the measures taken by
the respective person discharging managerial responsibilities to duly fulfil this obligation. It is
already apparent from the wording of the provision that oral notification is insufficient. The
notification must be made in writing.133 Written notification does not require any reciprocal
production by the persons being notified, although this is useful for unequivocal documenta-
129 Seibt and Wollenschläger (n 23) 593, 601; cf also Stephan Pachinger and Thomas Mayr-Riedler, ‘Verschärfungen im
europäischen Kapitalmarktrecht’ (2015) 4 GesRZ 230, 231.
131 Sethe and Hellgardt (n 11) Art 19 MAR para 152; Kumpan (n 9) 446, 456.
132 Wilfling, ‘Directors’ Dealings’ (n 120) 16, 18.
284
E. Time, content and form of notification and disclosure
tion.134 It is decisive, in our opinion, that the person discharging managerial responsibilities can
prove the communication of the notification, for example, in the form of a confirmation that
an e-mail has been sent or read, or by a written countersignature.135
D. LIST
List of persons subject to the notification obligation: According to Art 19 para 5, the issuer 19.082
must draw up a list of all persons discharging managerial responsibilities and persons closely
associated with them. Members of both groups must be included in this list. With regard to the
list to be drawn up by the issuer pursuant to Art 19 para 5 of persons discharging managerial
responsibilities and persons closely associated with them, BaFin states that the person’s name is
sufficient, provided that this information unambiguously identifies the person concerned (if the
names of persons discharging managerial responsibilities and persons closely associated with
them are identical, a further identifier should be added, e.g., the date of birth).136
When drawing up this list, the person discharging managerial responsibilities has an obligation 19.083
to cooperate with the issuer, as the issuer is generally unaware of these close relationships.137
This duty of cooperation results from the relationship of the person with managerial respon-
sibilities to the issuer as a member of a corporate body and is transformed from a public law
duty into a private legal relationship by virtue of the resulting duty of loyalty and cooperation.
In our experience, however, the identification of persons closely associated works quite well in
practice138 if a correspondingly workable notification precisely specifies which persons are to be
regarded as closely associated with the respective person subject to the notification obligation.
The issuer shall keep the list. The obligation to draw up and maintain this list does not entail 19.084
any obligation on the part of the issuer towards the persons discharging managerial responsi-
bilities to monitor their transactions and notification obligations. The list only serves to check
the plausibility of the notifications submitted by the obligated persons.139
E. TIME, CONTENT AND FORM OF NOTIFICATION AND DISCLOSURE
1. Time of notification and disclosure
Art 19 para 1 provides that the notifications shall be made promptly, but no later than three 19.085
business days after the date of the underlying transaction; this is an ex post transparency obliga-
tion.140 The date on which the transaction under the law of obligations is concluded is deemed
134 Wilfling, ‘Directors’ Dealings’ (n 120) 16, 18.

135 See also Wilfling, ‘Directors’ Dealings’ (n 120) 16, 18.
138 In doubt Rathammer and Sam (n 2) 436, 439.
140 Diekgräf (n 24) 138.
285
the date of the transaction.141 In the case of an unconditionally concluded transaction under the
law of obligations, whose execution in rem depends on the occurrence of certain conditions, the
obligation to notify pursuant to Art 19 does not arise at the time of conclusion of a transaction
governed by the law of obligations, but only, as a rule, when the transaction is actually executed
in rem.142 A double notification is therefore not necessary (cf also para 19.023).
19.086 As stated above, the notification must be made no later than three business days after the
date of the underlying transaction. ‘Business day’/‘working day’ means any day other than
a Saturday, Sunday or public holiday.143 In any event, a public holiday shall be deemed a rele-
vant holiday for the determination if the day in question is a public holiday at the location of
the issuer’s registered office.144
19.087 Disclosure obligation: Until the most recent amendment of the MAR (Regulation (EU)
2019/2115) the issuer was obliged to make public the notification adderssed to it promptly
and no later than three business days after the transaction.145 The maximum time limit applied
in total to both transactions, i.e., notification to the issuer and the public disclosure. This
meant that the notification and disclosure deadlines were identical, and compliance with these
required precautions to be taken by the issuer and also by persons with managerial responsibil-
ities, particularly in the case of closely associated persons.146
Since 1 January 2021, Art 19 para 3 provides that an issuer shall make public the information
contained in a notification pursuant to Art 19 para 1 within two business days of receipt of
such a notification. When making the notification public, the issuer must use media where
it can reasonably be assumed that the information will actually be disseminated to the public
throughout the Union.147 In any event, these include the traditional news services, Reuters,
Dow Jones and Bloomberg. The disclosure obligation is incumbent on the issuer and not on
the FMA as was previously the case.
19.088 Art 19 paras 1 and 2 provide that persons discharging managerial responsibilities must notify
the issuer and the competent authority of transactions conducted on their own account. In
practice, the question arises in this context as to whether it is permissible for the issuer to
submit the corresponding notification to the competent authority when the notified own
account transactions are made public. This is to be answered in the affirmative. It is possible
that the party subject to the notification obligation appoints a third party (e.g., the issuer or
a lawyer) to transmit the notification. In this case, however, the party subject to the notification
obligation has an organisational and monitoring obligation, i.e., it must ensure and oversee that
the notification obligations are properly fulfilled when a third party is engaged.148
141 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.2.7; Poelzig (n 37) 761, 767; Semrau (n 4) Art 19 para 60.
143 See also Sethe and Hellgardt (n 11) Art 19 MAR para 131.
144 Semrau (n 4) Art 19 para 61; Söhner (n 28) 259, 263; BaFin, ‘Issuer Guidelines Module C’ (n 20) II.2.7.
146 Poelzig (n 37) 761, 769; Semrau (n 4) Art 19 para 64.
286
E. Time, content and form of notification and disclosure
If the persons discharging managerial responsibilities or persons closely associated with them 19.089
fail to comply with their notification obligation, or fail to do so in a timely manner, the issuer
– at least if they have been properly notified (cf paras 19.078ff) – is not to be reproached for
this and therefore the issuer is not to be sanctioned. § 155 para 2 BörseG provides for a special
regulation in this case (cf para 19.114); however, it is the responsibility of the issuer to ensure
that the procedure as a whole complies with the law.149
2. Content of the notification
Art 19 para 6 stipulates that the notification must contain the following information: 19.090
● the name of the person;
● the reason for the notification;
● the name of the relevant issuer or emission allowance market participant;
● a description and the identifier of the financial instrument;
● the nature of the transaction(s) (e.g., acquisition or disposal), indicating whether it is linked
to the exercise of share option programmes or to the specific examples set out in para 7;
● the date and place of the transaction(s); and
● the price and volume of the transaction(s) (in the case of a pledge whose terms provide for
its value to change, this should be disclosed together with its value at the date of the pledge).
When notifying a gift, the price to be entered is ‘0’ (zero).150 When notifying an inheritance, the 19.091
price should also be indicated as ‘0’ (zero).151 This is also in line with ESMA, which also states
that when reporting a gift, donation or inheritance, the price should be indicated as ‘0’ (zero).152
The price must also be indicated as ‘0’ (zero) in a notification of the granting of employee
options to persons discharging managerial responsibilities.153
3. Form of the notification
Implementing Regulation 2016/523 contains an annexed template to be used for the notifica- 19.092
tion of transactions.154
The notification shall be publicly disclosed in the form in which it was submitted to the FMA. 19.093
The template included in the Annex to Implementing Regulation 2016/523 must be used.
The use of any other template is not permitted.155 The form must be submitted to the FMA by
e-mail to the following address: marktaufsicht@fma.gv.at.156
Boxes 4 a) to c), e) and f) of the notification template must, in principle, contain information 19.094
on each individual transaction. If the transaction is carried out by way of partial executions, the

152 ESMA70–145–111 (n 57) No 7.4.
153 ESMA70–145–111 (n 57) No 7.6.
154 cf also Rathammer and Sam (n 2) 436, 438.
287
information on each individual partial execution must be provided. In field 4 c), the price of
the financial instrument and the transaction volume (as a rule, price of the financial instrument
multiplied by the quantity involved) must be indicated.157 If several transactions are carried out
on the same day, a separate notification must be made for each transaction.158 Finally, it must
be specified whether the declaration is an initial or a rectification declaration.
19.095 Looking at field 4 d) of the form to be used for the notification, the question arises as to
whether the public disclosure of transactions in respect of each financial instrument (per day
and trading venue) must be reported in aggregated form, indicating the weighted average price
of the transactions, or whether field 4 d) only provides an option for this. BaFin’s legal opinion
is that all transactions must be listed individually, and a notification with aggregated informa-
tion is only an additional option. A notification on an aggreggated basis alone is therefore, in
our opinion, also not sufficient in Austria.159
19.096 The date must be indicated in accordance with ISO 8601. The date format yyyy-mm-dd shall
be used.
● Example: 3.7.2016 – Date format according to ISO 8601: 2016–07–03
The time must be indicated by stating the difference to the Coordinated Universal Time
(CUT) in the form +01:00. Where the time is given in Coordinated Universal Time, the
Central European Time (CET) in Austria is obtained by adding one hour, and the Central
European Summer Time (CEST) in summer is obtained by adding two hours.
● Example: Vienna trading venue: 3.7.2016, 14:20 Uhr (CET); Vienna trading venue:
2016–07–03 14:20 +01:00 (CET)160
19.097 Implementation Regulation 523/2016 does not require that the notification template form be
dated and signed. If the person subject to the notification obligation nevertheless enters the
date and signature on the notification template, BaFin will of course not object to this.161
F. PROHIBITION ON TRADING
1. Scope
19.098 In addition to the notification and public disclosure obligation for management transactions,
Art 19 para 11 provides for a trading prohibition for certain closed periods.162 Under previous
law, trading prohibitions were regulated in Art 8 “Issuers Compliance Regulation (ECV)”,163
which was repealed with effect from 1 January 2018.

158 BaFin, ‘FAQ regarding Art 19 MAR’ (n 25) No VIII.2.
160 cf also BaFin, ‘Issuer Guidelines Module C’ (n 20) II.2.6 as well as ‘FAQ regarding Art 18 MAR’, Version 3, 13 January
2017, No VI.7.
161 BaFin, ‘FAQ regarding Art 19 MAR’ (n 25) No VIII.9.
162 Diekgräf (n 24) 223.
163 See Kalss, Oppitz and Zollner (eds), Kapitalmarktrecht (2nd edn, Linde Verlag 2015) (n 11) § 23 para 44.
288
F. Prohibition on trading
Purpose: The reason for the trading prohibition provided for in Art 19 para 11 is that at certain 19.099
times the risk of insider dealing by persons discharging managerial responsibilities is considered
so high that a mere notification or public disclosure obligation no longer appears sufficient.164
Art 19 para 11 therefore stipulates that a person discharging managerial responsibilities within
an issuer shall not conduct any transactions on its own account or for the account of a third
party, directly or indirectly, relating to the shares or debt instruments of the issuer or to deriv-
atives or other financial instruments linked to them during a closed period of 30 calendar days
before the announcement of an interim financial report or a year-end report which the issuer is
obliged to make public according to (i) the rules of the trading venue where the issuer’s shares
are admitted to trading; or (ii) national law.165
‘Announcement’ of an interim financial report or a year-end financial report pursuant to Art 19.100
19 para 11166 shall mean the public disclosure of the respective report, thereby determining the
end of the trading prohibition in each case.167 According to ESMA, this is the day of public
disclosure (‘The date when the ‘announcement” is made is the end date for the thirty-day
closed period’ 168). In this context, BaFin takes the view in its Issuer Guidelines that the trading
prohibition ends on the date the financial report is published.169 In addition to annual and
semi-annual financial reports pursuant to §§ 124 f BörseG, the category ‘interim report and
year-end report’ also includes quarterly reports, which issuers are required to publicly disclose
pursuant to § 126 BörseG in connection with point 2 of the rules and regulations of the Wiener
BörseAG for the Prime Market.170 The trading prohibition may therefore last up to 120 days
per year and may be in place for a period of up to one-third of the year.171 The voluntary public
disclosure of quarterly reports or notices does not trigger the trading prohibition.172 An – albeit
planned – ad hoc public disclosure of inside information pursuant to Art 17 does not trigger
the trading prohibition provided for in Art 19 para 11.173 However, such a prohibition can and
is usually imposed in such cases.
Persons discharging managerial responsibilities should not be permitted to trade before the 19.101
announcement of an interim or year-end report. An exception can only be made if special and
restricted circumstances exist which would justify a permission, pursuant to Art 19 paras 12
and 13, by the issuer allowing a person discharging managerial responsibilities to trade (cf paras
19.106ff).174
164 Sethe and Hellgardt (n 11) Art 19 MAR para 153; Kumpan (n 9) 446, 456; Kalss, Oppitz and Zollner (n 11) § 23 para
44.
165 Söhner (n 28) 259, 263; Maume and Kellner (n 13) 273, 293.
166 Rathammer and Sam (n 2) 436, 439; Maume and Kellner (n 43) 273, 293.
167 Sethe and Hellgardt (n 11) Art 19 MAR para 167; Semrau (n 3) Art 19 para 88; Söhner (n 27) 259, 263.
168 ESMA70–145–111 (n 57) No 7.2; see also Semrau (n 4) Art 19 para 91 accordingly (with reference to the ESMA,
MAR Q&A just quoted and to Söhner (n 28) 259, 263); it is at least necessary to wait for the time that capital market
participants usually need to evaluate the information and own account trading is possible again from the next trading day.
170 Rathammer and Sam (n 2) 436, 439; regarding German law see Semrau (n 4) Art 19 para 85.
171 Maume and Kellner (n 13) 273, 294; Hartlieb and Simonishvili (n 3) 61, 64; regarding German law see Seibt and
Wollenschläger (n 23) 593, 602.
172 Semrau (n 4) Art 19 para 86; of a different opinion Kumpan (n 9) 446, 456.
173 ESMA, ‘Final Report: ESMA’s technical advice on possible delegated acts concerning the Market Abuse Regulation’,
ESMA/2015/224, 3 February 2015, 50 para 138; Semrau (n 4) Art 19 para 89.
174 Recital 61 MAR.
289
19.102 However, a transaction concluded unconditionally under the law of obligations before the
start of the period of the trading prohibition may be executed within the period of the trading
prohibition.175 This is justified by a reference to the interpretation of Art 9 para 3 lit a.176 Other
acquisition transactions are also permissible, for example, acceptance of an inheritance by virtue
of legal transfer.
19.103 The trading prohibition applies exclusively to persons discharging managerial responsibilities
and not to persons closely associated with them. Art 19 para 11 does not mention the persons
closely associated with the person discharging managerial responsibilities, so that these are
generally not covered by the trading prohibition either.177 However, since the trading prohi-
bition also applies to transactions on own account conducted indirectly or for the account of
a third party, the legal opinion of the BaFin is that, depending on the facts of the individual
case, transactions conducted through or for a closely associated person may also fall under the
trading prohibition.178 Therefore, the trading prohibition cannot be circumvented by the fact
that securities transactions are carried out by subsidiaries (e.g., limited liability companies with
a managing director who is also the sole shareholder) and not directly by the person discharging
managerial responsibilities, but by the ‘instructed’ spouse of the person discharging managerial
responsibilities.179

19.104 Companies can voluntarily extend trading prohibitions to further periods as well as to associ-
ated persons. However, their violation does not trigger the sanction pursuant to § 155 para 1
(4) BörseG. A time limitation of the trading prohibition for persons discharging managerial
responsibilities is not permitted.
19.105 In this context, the question of whether the public disclosure of preliminary financial results
also leads to the end of the trading prohibition is of practical relevance. BaFin merely states
that, under certain conditions, the disclosure of preliminary operating results can mark the
end of the trading prohibition set out in Art 19 para 11 and refers to the Q&As of ESMA for
further details.180 There it is stated that a publicly disclosed preliminary annual report may also
mark the end of the trading prohibition if the published preliminary figures contain all key
information that is expected to be included in the year-end report.181
175 Sethe and Hellgardt (n 11) Art 19 MAR para 160; Söhner (n 28) 259, 263; BaFin, ‘Issuer Guidelines Module C’ (n 20)
II.3.7; Diekgräf (n 24) 232.
177 Semrau (n 4) Art 19 para 82; Söhner (n 28) 259, 264; Helm (n 88) 2201, 2203; ESMA70–145–111 (n 57) No 7.9.
178 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.7; see also Söhner (n 28) 259, 264.
179 See also Semrau (n 4) Art 19 para 82; BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.7.
181 ESMA70–145–111 (n 57) No 7.2; Söhner (n 28) 259, 264.
290
F. Prohibition on trading
2. Exemptions from the trade prohibition
However, Art 19 para 12 restricts the trading prohibition by providing that an issuer may allow 19.106
a person discharging managerial responsibilities within it to trade on its own account or for the
account of a third party during a closed period as referred to in para 11 either:
● on a case-by-case basis due to the existence of exceptional circumstances, such as severe

financial difficulty, which require the immediate sale of shares: or
● due to the characteristics of the trading involved for transactions made under, or related to,
an employee share or saving scheme, qualification or entitlement of shares, or transactions
where the beneficial interest in the relevant security does not change.182
The first case of the two exemptions under Art 8 Commission Delegated Regulation 522/2016 19.107
covers the existence of exceptional circumstances and thus the typical emergency sale. In this
case, the person discharging managerial responsibilities must describe the planned transaction
to the issuer in a written application183 and explain why the sale of shares is the only reasonable
way to obtain the necessary funds.184 According to Art 8 line 2 Delegated Regulation 522/2016,
exceptional circumstances only exist if they are extremely urgent, unforeseen and compelling,
where their cause is external to the person discharging managerial responsibilities and the
person discharging managerial responsibilities has no control over them. The prerequisites are
therefore extremely narrow.
In determining whether exceptional circumstances exist, consideration shall be given to, among 19.108
other things, whether and to what extent (i) the person discharging managerial responsibilities
is at the moment of submitting its request facing a legally enforceable financial commitment or
claim and (ii) the person discharging managerial responsibilities has to fulfil or is in a situation
entered into before the beginning of the closed period and requiring the payment of sum to
a third party, including tax liability, and cannot reasonably satisfy a financial commitment or
claim by means other than the immediate sale of shares. The purpose of this exemption is to
allow the sale of financial resources during a closed period only to the extent necessary to meet
an obligation – the sale of financial resources thus ultimately being the only reasonable way of
obtaining the funds necessary to meet that obligation.185
The second exemption to the trade prohibition laid down in Art 19 para 12 lit b MAR is 19.109
supplemented by Art 9 Delegated Regulation 522/2016. This article lists certain circumstances
in connection with (i) employee schemes, (ii) options, warrants and conversion of convertible
bonds received from employee schemes, (iii) transfers without price changes between accounts
of the same person discharging managerial responsibilities (= transfer of securities account)
and (iv) qualification and entitlement of shares, under which the issuer may permit a person
discharging managerial responsibilities to conduct transactions for his own account or for the
account of third parties during a closed period. These conditions are given by way of example.
This already follows from the wording of Art 9 Delegated Regulation 522/2016 (‘including
182 Maume and Kellner (n 13) 273, 295; Söhner (n 28) 259, 265; Seibt and Wollenschläger (n 23) 593, 602; Kumpan (n 9)
446, 457.
184 See Art 7 (2) of the Commission Delegated Regulation (EU) 522/2016.
291
but not limited to’).186 Although Art 19 para 12 lit b MAR refers to ‘employee share or saving
scheme’ and ‘entitlement of shares’, it also applies to members of governing bodies.187
19.110 Competence: Permission to conduct business within the periods for which trading prohibitions
are laid down in Art 19 para 11 is granted by the management board and – if members of the
management board are affected – by the supervisory board of the company, and in the case of
supervisory board remuneration issues, by the general meeting.188 In addition to the general
exemptions provided for in Art 9 Delegated Regulation 522/2016, a generally regulated
exemption can also be granted, but not in the case of an individual decision in accordance
with Art 8 Delegated Regulation. If a permit is granted although the prerequisites for this
are not actually met, the permissibility of the transaction and the associated sanctions depend
on whether the person discharging managerial responsibilities had to recognise the error or
whether it was self-induced.189
19.111 If inside information is actually present, the transaction may not be concluded. Art 14 takes
precedence over Art 19 paras 12 f.190 If the transaction is concluded, the notification and public
disclosure obligations pursuant to Art 19 paras 1 f also apply.
G. SANCTIONS
19.112 Administrative law: Pursuant to § 155 para 1 (4) BörseG, a violation of the obligations directly
based on Art 19 as well as obligations pursuant to Implementing Regulation 596/2014 is
deemed a violaton of administrative law and shall be sanctioned by the FMA with a fine up to
three times the benefit gained from the violation, including any loss avoided, provided that the
pecuniary benefit can be quantified, or with a fine of up to € 500,000.
19.113 The obligated parties are a) persons discharging managerial responsibilities and b) closely asso-
ciated persons, on the one hand, and c) the issuer on the other. Since § 155 BörseG generally
refers to the obligations pursuant to Art 19 as well as those of the Regulation, all obligations,
i.e., the notification and public disclosure obligations as well as the notification obligations
pursuant to Art 19 para 5 subpara 2 and the obligation to draw up the list pursuant to Art 19
para 5 subpara 1 and finally the compliance with the trading prohibitions pursuant to Art 19
para 11, are covered by the administrative penalty.191
19.114 Relief for issuers: Pursuant to §155 para 2 BörseG, the issuer shall not be penalised if the issuer
can furnish proof that the person subject to the notification obligation pursuant to Art 19 para
1 sent the notification too late (at the end of the third day or even later) and the issuer makes
the information public on the business day following receipt of the notification. The assessment
186 BaFin, ‘Issuer Guidelines Module C’ (n 20) II.3.7; Semrau (n 4) Art 19 para 98.
187 BaFin, ‘FAQ regarding Art 19 MAR’ (n 25) No VII.1.
188 Hartlieb and Simonishvili (n 3) 61, 65; Semrau (n 4) Art 19 para 93.
190 ESMA/2015/224 (n175) 51 para 141; Semrau (n 4) Art 19 para 95.
191 Wilfling, Praxishandbuch Börserecht (n 66) para 704.
292
H. Implementation
of the conduct of the person discharging managerial responsibilities that is subject to the noti-
fication obligation or a closely associated person is independent thereof.
Civil law sanctions: Neither the MAR nor the Implementing Regulation provide for civil law 19.115
sanctions for a violation of Art 19.
Protective law: Similar to the previously applicable provision of Art 19 MAR (§ 48d para 4 19.116
BörseG), the notification and public disclosure obligation is to be regarded as a protective law
for the benefit of the company as well as for investors in the capital market.192
No suspension of voting rights: The law does not provide for the suspension of voting rights in 19.117
the event of a violation of Art 19 para 1, in contrast to the violation of shareholding disclosure
pursuant to § 137 BörseG.
H. IMPLEMENTATION
In the UK, rules regarding PDMR (Person discharging managerial responsibilities) can be 19.118
found in section 3 of the Disclosure Guidance and Transparency Rules sourcebook (DTR).
Nowadays section 3 DTR mainly refers to the MAR.193 The Model Code had to be deleted
alltogether.194
Literature
BaFin, ‘FAQ regarding Art 19 MAR’, Version 10, 23 November 2018

BaFin, ‘Issuer Guidelines Module C – Requirements based on the Market Abuse Regulation’, 25 March
2020
Bednarz L, ‘Pflichten des Emittenten bei einer unterlassenen Mitteilung von Directors’ Dealings’ [2005]
AG 835
Bode C, ‘Die Anwendung von § 15a WpHG bei Geschäften innerhalb eines Konzerns’ [2008] AG 648
von Buttlar J, ‘Directors‘ Dealings: Änderungsbedarf aufgrund der Marktmissbrauchsrichtlinie’ (2003)
41 BB 2133
Diekgräf M B, Directors’ Dealings (Nomos 2017)
Diekmann H and Sustmann M, ‘Gesetz zur Verbesserung des Anlegerschutzes
(Anlegerschutzverbesserungsgesetz – AnSVG)’ (2004) 20 NZG 929
Engelhart M, ‘Meldepflichtige und meldefreie Geschäftsarten bei Directors’ Dealings (§ 15a WpHG)’
[2009] AG 856
Erkens M, ‘Directors’ Dealings nach neuem WpHG’ [2005] Der Konzern 29
ESMA, ‘Questions and Answers on the Market Abuse Regulation’, Version 13 | Version 14,
ESMA70–145–111, 12 November 2018 | 29 March 2019
Fida S and Steindl T, ‘Directors’ Dealings – Der sachliche Anwendungsbereich’ (2005) 7 wbl 306
192 Kalss, Oppitz and Zollner (n 11) § 19 para 74; Lechner and Temmel (n 26) § 48d para 180; of a different view Christian
Herbst and Florian Kusznier, ‘Die Meldepflichten für Directors’ Dealings’ in Ernst Brandl and others (eds), Handbuch
Kapitalmarktrecht III (Bank-Verlag 2006), 61, 85 f; regarding German law see Semrau (n 4) Art 19 para 106; Kumpan
(n 9) 446, 458.
193 See FCA, Disclosure Guidance and Transparency Rules sourcebook (available on https://www.handbook.fca.org.uk/
handbook); Andrew Procter and others, ‘Update on the market abuse regime’ [2019] C.O.B. 1, 22.
194 Procter and others (n 195) 1, 21.
293
Fleischer H, ‘Directors’ Dealings’ [2002] ZIP 1217

Hagen-Eck R and Wirsch S, ‘Gestaltung von Directors’ Dealings und die Pflichten nach § 15a WpHG’
(2007) 9 DB 504
Hartlieb F and Simonishvili Z, ‘Directors’ Dealings nach der Marktmissbrauchsverordnung’ [2015] ZFR
61
Hellgardt A, ‘Zivilrechtliche Gewinnabschöpfung bei Verstößen gegen das Handelsverbot des Art 19
Abs 11 MAR?’ [2018] AG 602
Helm L, ‘Pflichten des Wertpapierdienstleistungsunternehmens in der Finanzportfolioverwaltung bei
Directors’ Dealings nach der Marktmissbrauchsverordnung’ [2016] ZIP 2201
Herbst Ch and Kusznier F, ‘Die Meldepflichten für Directors’ Dealings’ in Brandl E and others (eds),
Handbuch Kapitalmarktrecht III (Bank-Verlag 2006) 61
Hitzer M and Wasmann D, ‘Von § 15a WpHG zu Art 19 MMVO: Aus Directors’ Dealings werden
Managers’ Transactions’ (2016) 25 DB 1483
Kalss S and Zollner J, ‘Directors’ Dealings – Der neue § 48d Abs 4 BörseG’ (2005) 3 GeS 106
Kalss S and Zollner J, ‘Zurechnungsfragen beim Directors’ Dealings – Erste Anwendungsprobleme beim
neuen § 48d Abs 4 BörseG’ (2005) 3 GeS 197
Kumpan C, ‘Die neuen Regelungen zu Directors’ Dealings in der Marktmissbrauchsverordnung’ [2016]
AG 446
Maume P and Kellner M, ‘Directors’ Dealings unter der EU-Marktmissbrauchsverordnung’ (2017) 46/3
ZGR 273
Moser C, ‘Directors’ Dealings – erwünschte Beteiligung oder verbotene Insidertransaktion?’ (2011) 3
ecolex 268
Nowotny C, ‘Aktienbesitz von Vorstands- und Aufsichtsratsmitgliedern’ [2001] SWK 991
Nowotny C and Stern E, ‘Fragen zum Directors’ Dealing’ [2005] SWK 445
Pachinger S and Mayr-Riedler T, ‘Verschärfungen im europäischen Kapitalmarktrecht’ (2015) 4 GesRZ
230
Pfüller M, ‘Directors’ Dealings’ in Habersack M, Mülbert P O and Schlitt M (eds), Handbuch der
Kapitalmarktinformation (2nd edn, C. H. Beck 2013)
Poelzig D, ‘Die Neuregelung der Offenlegungsvorschriften durch die Marktmissbrauchsverordnung’
(2016) 20 NZG 761
Rathammer M and Sam M, ‘Ad-hoc- und Directors’ Dealings-Verpflichtungen im MAR-Regime’
[2016] ÖBA 436
Rubner D and Pospiech L, ‘Die EU-Marktmissbrauchsverordnung – verschärfte Anforderungen an die
kapitalmarktrechtliche Compliance auch für den Freiverkehr’ [2016] GWR 228
Schneider U H, ‘Meldepflichtige Wertpapiergeschäfte von Organmitgliedern (“Directors’ Dealings”) im
Konzern’ [2002] AG 473
Schneider U H, ‘Der pflichtenauslösende Sachverhalt bei “Directors’ Dealings”’ (2002) 36 BB 1817
[2014] AG 593
Seibt C H and Wollenschläger B, ‘Revision des Europäischen Transparenzregimes: Regelungsinhalte der
TRL 2013 und Umsetzungsbedarf’ [2014] ZIP 545
Söhner M, ‘Praxis-Update Marktmissbrauchsverordnung: Neue Leitlinien und alte Probleme’ (2017) 6
BB 259
Stegmaier M, ‘§ 19: Offenlegungspflichten’ in Meyer A, Rönnau T and Veil R (eds), Handbuch
Wastl U, ‘Directors’ Dealings und aktienrechtliche Treuepflicht’ (2005) 1 NZG 17
Wilfling G, ‘Eigengeschäfte von Aufsichtsräten nach der Marktmissbrauchsverordnung’ (2015) 3
ARaktuell 10
353
Wilfling G, ‘Directors’ Dealings: Welche Pflichten Aufsichtsräte treffen’ (2017) 1 ARaktuell 16
Wolfbauer R, ‘Die Transaktionsmeldepflicht des § 91a BörseG’ (2001) 7 ecolex 567.

See also Literature regarding Art 17 MAR.
294
ARTICLE 20
INVESTMENT RECOMMENDATIONS AND
STATISTICS
Martin Oppitz
1. Persons who produce or disseminate investment recommendations or other information

recommending or suggesting an investment strategy shall take reasonable care to ensure
that such information is objectively presented, and to disclose their interests or indicate
conflicts of interest concerning the financial instruments to which that information relates.
2. Public institutions disseminating statistics or forecasts liable to have a significant effect on
financial markets shall disseminate them in an objective and transparent way.
regulatory technical standards to determine the technical arrangements for the categories
of person referred to in paragraph 1, for objective presentation of investment recommen-
dations or other information recommending or suggesting an investment strategy and for
disclosure of particular interests or indications of conflicts of interest.
July 2015.
Power is delegated to the Commission to adopt the regulatory technical standards referred
to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No
1095/2010.
The technical arrangements laid down in the regulatory technical standards referred to
in paragraph 3 shall not apply to journalists who are subject to equivalent appropriate reg-
ulation in a Member State, including equivalent appropriate self-regulation, provided that
such regulation achieves similar effects as those technical arrangements. Member State
shall notify the text of that equivalent appropriate regulation to the Commission.
OVERVIEW
A. CONTENT OF THE PROVISION 20.001 D. ESMA 20.011

B. CATEGORIES OF PERSONS COVERED 20.003 E. JOURNALISTS’ PRIVILEGE 20.012
C. PUBLIC INSTITUTIONS 20.007
295
Article 20 INVESTMENT RECOMMENDATIONS AND STATISTICS
20.001 This provision deals with ‘investment recommendations and statistics’; the focus is on the dis-
semination of investment recommendations or other information recommending or suggesting
an investment strategy (para 1). This refers in particular to the activities of financial analysts.1
20.002 Para 3 empowers ESMA to develop regulatory technical standards; reference is made to
Delegated Regulation 958/2016 of 9 March 2016.2
B. CATEGORIES OF PERSONS COVERED
20.003 Para 1 refers to persons who produce or disseminate investment recommendations or other
information recommending or suggesting an investment strategy. The concept of investment
recommendations is defined in Art 3 para 1 (35); it refers to information recommending or
suggesting an investment strategy, explicitly or implicitly, concerning one or several financial
instruments or the issuers, including any opinion as to the present or future value or price of
such instruments, intended for distribution channels or the public. What is meant by ‘recom-
mending or suggesting an investment strategy’ is set out in Art 3 para 1 (34). Accordingly,
the producer or originator of such information may be an independent analyst, an investment
firm, a credit institution or any other person whose main business is to produce investment
recommendations; in this case, this information must ‘directly3 or indirectly’4 express ‘a particu-
lar investment proposal in respect of a financial instrument or an issuer’; in addition, persons
working for the aforementioned institutions under a contract of employment or otherwise
(lit i); however, information recommending or suggesting an investment strategy may also be
produced by a person other than the aforementioned persons that directly proposes a particular
investment decision in respect of a financial instrument (lit ii). Thus, the personal scope of this
provision is broad. Anyone who produces or disseminates investment recommendations or
other relevant information is subject to the duty of care set out in para 1.
20.004 Para 1 only refers to the objective presentation of ‘information’, but does not explicitly mention
‘investment recommendations’ in the context of the requirement of objectivity; Art 3 of Delegated
Regulation (EU) 958/2016, however, lays down general conditions for the objective presenta-
1 In that sense also Doerte Poelzig, Kapitalmarktrecht (C. H. Beck 2018) para 847; cf Martin Oppitz, ‘Finanzanalyse als
Gegenstand des österreichischen Kapitalmarktrechts’ (2014) 113 ZVglRWiss 329 f on their scope of activities.
2 Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation No 596/2014 with
regard to regulatory technical standards for the technical arrangements for objective presentation of investment recom-
mendations or other information recommending or suggesting an investment strategy and for disclosure of particular
interests or indications of conflicts of interest [2016] OJ L 160/15.
3 A direct investment recommendation exists if a concrete price target is defined or if the purchase, sale or holding of
a financial instrument is expressly advised: Poelzig (n 1) para 847; cf also Oppitz (n 1) 333.
4 Such a statement is deemed to be made if, in an overall consideration of all circumstances, it expresses sufficiently clearly
how the current or future price or value of a financial instrument is assessed, without a direct recommendation being
made: Poelzig (n 1) para 847.
296
C. Public institutions
tion of recommendations;5 accordingly, persons producing recommendations must ensure that

their recommendations meet certain requirements (Art 3 para 1):
● facts are clearly distinguished from interpretations, estimates, opinions and other types of
non-factual information (lit a);
● all substantially material sources of information are clearly and prominently indicated (lit b);
● all sources of information are reliable or, where there is any doubt as to whether a source is
reliable, this is clearly indicated (lit c);
● all projections, forecasts and price targets are clearly and prominently labelled as such, and
the material assumptions made in producing or using them are indicated (lit d);
● the date and time when the production of the recommendation was completed is clearly and
prominently indicated (lit e).
Para 1 further emphasises that the interests or conflicts of interest concerning the financial 20.005
instruments to which the information relates shall be disclosed; the Delegated Regulation also
comments on this in detail: According to Art 5, persons who produce recommendations shall
disclose in their recommendations all relationships and circumstances that may reasonably be
expected to impair the objectivity of the recommendation, including any interests or conflicts
of interest, on their part or on the part of any natural or legal person working for them under
a contract, including a contract of employment, or otherwise, and who was involved in pro-
ducing the recommendation, concerning any financial instrument or the issuer to which the
recommendation directly or indirectly relates.
Additional conditions for the disclosure of interests and conflicts of interest are set out in Art 20.006
6 of the Delegated Regulation. These relate to conflicts of interest resulting from owning a net
long or short position (exceeding the threshold of 0.5 per cent of the total issued share capital
of the issuer), holding by the issuer of more than 5 per cent of the total issued share capital,
and conflict of interest activities of the person producing the recommendation (or any other
person belonging to the same group) which could lead to a conflict of interest. This includes
market-making activities, the leading (or co-leading) participation in the public issue of finan-
cial instruments of the issuer during the preceding 12 months or the conclusion of agreements
with the issuer for the provision of investment services and the production of investment
recommendations.
C. PUBLIC INSTITUTIONS
Public institutions disseminating6 statistics7 or forecasts8 liable to have a significant effect on 20.007
financial markets shall do so in an objective and transparent way (para 2). This extends the
requirement of objectivity and transparency to ‘public institutions’; in principle, these are
5 For details cf Kay Rothenhöfer, ‘§ 23: Besondere Anforderungen’ in Andreas Meyer, Rüdiger Veil and Thomas Rönnau
(eds), Handbuch zum Marktmissbrauchsrecht (C. H. Beck 2018) paras 12ff.
6 Public dissemination is not explicitly required; however, whether passing on to just a third person is sufficient, as
Rothenhöfer (n 5) para 47 assumes, seems doubtful, because the Regulation also aims at a scattering effect according to
its telos. Accessibility via the Internet – whether or not there is a charge – is likely to be regarded as dissemination.
7 This means in particular the processing of historical data: Rothenhöfer (n 5) para 48.
8 These relate to the uncertain occurrence of future events: Rothenhöfer (n 5) para 48.
297
Article 20 INVESTMENT RECOMMENDATIONS AND STATISTICS
institutions that perform sovereign tasks (including commissioned companies),9 but – in light
of systematic teleological considerations – also institutions that participate as private parties in
the fulfilment of public tasks in the sense of a duty to perform.10 Those who merely contribute
input data do not themselves disseminate statistics or forecasts.11
20.008 In Austria, in addition to the average bond yield weighted by outstanding amount (UDRB),12
provided by the Austrian National Bank (OeNB), the issuance calendar drawn up by the
Notification Office in accordance with the KMG (Austrian Capital Market Act) (§ 24 KMG),
which serves in particular to provide market information, i.e., information on capital market
activity, should be considered.13 Anyone intending to offer securities or investments for the
first time must inform the Notification Office as soon as possible about the issuer, the expected
date of issue, the total volume, denomination, period of validity and – in the case of public
offerings – other conditions, as well as, if applicable, about those circumstances that justify an
exemption from the obligation to publish a prospectus pursuant to Art 3 of the KMG or the
Regulation (EU) 2017/1129 (§ 24 para 1 of the KMG).14 The Notification Office must publish
the reports received continually on its website (Art 24 para 3 KMG).15 Although there is no
sovereign power associated with the drawing up of the issuance calendar,16 it can be assumed
that the Notification Office is to be understood as a ‘public institution’ within the meaning
of para 2 due to the legal anchoring of the issuance calendar: According to § 23 para 1 of the
KMG, the Österreichische Kontrollbank AG (OeKB) is a notification office under the KMG.
As a notification office, the OeKB is required to inform the Federal Ministry of Finance, the
FMA and the Austrian National Bank (OeNB) on a regular basis about developments on the
capital market and without delay for special reasons (§ 23 para 3 (2) KMG). In addition, it is
required to provide the FMA with automated access to data based on notifications under the
KMG and decrees issued pursuant to the Act at any time (§ 23 para 3 (3) of the Act).
20.009 In addition, § 23 para 3 (1) of the KMG obliges the Notification Office to carry out statistical
analyses of prospectuses on securities and investments.
20.010 According to para 2, such statistics or forecasts must potentially ‘have a significant effect’
on financial markets. This criterion is formulated vaguely; there is no concrete indication of
9 Rothenhöfer (n 5) para 47.

10 cf Ulrich Zellenberg, ‘Die Inpflichtnahme’, in Claudia Fuchs and others (eds), Staatliche Aufgaben, private Akteure II
(Manz 2017) 129.
11 See Regulation (EU) 2016/1011 of 8 June 2016 on indices used as benchmarks in financial instruments and financial
contracts or to measure the performance of investment funds and amending Directive 2008/48/EC and 2014/17/
EU and Regulation (EU) 596/2014 (Benchmark Regulation – BMR) [2016] OJ L 171/1. Contributing input data to
a benchmark (Art 3 para 1 (8) BMR) is the transmission of input data which is not readily available to an administrator
or to another person for forwarding to an administrator, which is necessary in connection with the determination of
a benchmark and is carried out for this purpose.
12 The consumer price index (CPI), provided by the Federal Statistical Office of Austria, probably does not have sufficient
direct reference to the capital market to be considered in this context
13 Thomas Zivny, Kapitalmarktgesetz (2nd edn, Manz 2016) § 13 para 1.
14 The notification duty following § 24 para 1 KMG does not apply for securities due to Art 1 para 2 lit a and c, para 4 lit
e, h and i of the Regulation (EU) 2017/1129 and for investments due to § 1 para 1 (1) KMG (§ 24 para 2 KMG).
15 The Notification Office shall announce the publication organ and any changes thereto in the Official Gazette of the
Wiener Zeitung. It shall answer enquiries from issuers about planned issuance projects anonymously.
16 Stefan Weber, Kapitalmarktrecht (Springer 1999) 434; also Zivny (n 13) para 2.
298
E. Journalists’ privilege
the degree of significance.17 If the financial markets are also influenced by the fact that the
disclosure of issue volumes could influence the dispositions of other market participants, the
issuance calendar under the KMG will probably have to assume that this significance threshold
is exceeded.
D. ESMA
Para 3 entrusts ESMA to develop draft regulatory technical standards; attention is drawn to the 20.011
above-mentioned Delegated Regulation 958/2016.
E. JOURNALISTS’ PRIVILEGE
Para 3 further provides for a privilege for journalists; the technical arrangements laid down in 20.012
the regulatory technical standards shall not apply to journalists who are subject to equivalent
appropriate regulation in a Member State (including equivalent appropriate self-regulation),
provided that such regulation achieves similar effects as those technical arrangements.
A self-regulatory body in Austria is the Austrian Press Council (Presserat18). In accordance 20.013
with § 2 (2) sent 1 of its statutes, this association serves to promote freedom of the press, as
well as the use of this freedom to establish truth and correctness, and to exercise self-regulation
of the print media and news agencies, ‘including self-regulation in the field of financial and
economic reporting (cf EU Regulation 596/2014)’. This at least addresses the MAR itself
(although not explicitly also the Delegated Regulation mentioned above).
Literature
Oppitz M, ‘Finanzanalyse als Gegenstand des österreichischen Kapitalmarktrechts’ (2014) 113

ZVglRWiss 329
Poelzig D, Kapitalmarktrecht (C. H. Beck 2018)
Rothenhöfer K, ‘§ 23: Besondere Anforderungen’ in Meyer A, Veil R and Rönnau T (eds), Handbuch zum
Weber S, Kapitalmarktrecht (Springer 1999)
Zellenberg U, ‘Die Inpflichtnahme’, in Fuchs C and others (eds), Staatliche Aufgaben, Private Akteure II
(Manz 2017) 129
Zivny T, Kapitalmarktgesetz (2nd edn, Manz 2016)
17 Rothenhöfer (n 5) para 48 wants to fall back on the specifications developed in the context of insider law.
18 www.presserat.at, accessed on 10 February 2021.
299
ARTICLE 21
DISCLOSURE OR DISSEMINATION OF
INFORMATION IN THE MEDIA
Martin Oppitz
For the purposes of Article 10, Article 12(1)(c) and Article 20, where information is disclosed
or disseminated and where recommendations are produced or disseminated for the purpose
of journalism or other form of expression in the media, such disclosure or dissemination of
information shall be assessed taking into account the rules governing the freedom of the press
and freedom of expression in other media and the rules or codes governing the journalist
profession, unless:
(a) the persons concerned, or persons closely associated with them, derive, directly or
indirectly, an advantage or profits from the disclosure or the dissemination of the infor-
mation in question; or
(b) the disclosure or the dissemination is made with the intention of misleading the market
as to the supply of, demand for, or price of financial instruments.
OVERVIEW
A. CONTENT OF THE PROVISION 21.001 C. FREEDOM OF THE PRESS, FREEDOM OF

B. ON THE SCOPE OF THE EXEMPTION 21.002 OPINION AND JOURNALISTIC RULES OF
1. Journalistic purposes 21.003 PROFESSIONAL CONDUCT 21.013
2. Other form of expression in the media 21.005 D. COUNTER-EXEMPTIONS 21.015
3. Media 21.006 1. Advantage or profit 21.016
4. Privileged actions 21.007 2. Intention to mislead 21.018
21.001 This provision contains a ‘media sector exemption’ with regard to Art 10 (unlawful disclosure
of inside information), Art 12 para 1c and Art 20 (investment recommendations and statistics).
This addresses the area of conflict between the regulatory concern of the MAR, which is ori-
300
B. On the scope of the exemption
ented towards capital market law, and the freedom of opinion and press freedom under Art 11
Charter of Fundamental Rights.1
B. ON THE SCOPE OF THE EXEMPTION
First of all, it is striking that this provision is open in terms of its personal scope of application; 21.002
it does not privilege the disclosure or dissemination of information in the media by certain per-
sons;2 instead, it refers to ‘the purpose of journalism or other form of expression in the media’.
1. Journalistic purposes
The term ‘journalistic purposes’ is widely understood in literature.3 Accordingly, journalists, 21.003
publishers and editors, but also those directly involved in the production and distribution of
printed works are considered to be included in the personal scope of protection, which can
be derived from the interpretations of Art 11 para 2 Charter of Fundamental Rights (CFR).4
Since Art 21 is not aimed at a specific journalistic profession, a wide range of persons working
in journalism fall under the privileged circumstances.5
On the other hand, the concept of ‘journalistic purposes’ must not be overstretched; if it is 21.004
a matter of mere marketing or advertising – customer acquisition in the broadest sense – it will
hardly be possible to speak of ‘journalistic purposes’.6
2. Other form of expression in the media
‘Journalistic purposes’ is contrasted with ‘other form of expression in the media’; this turn of 21.005
phrase is regarded as a catch-all for forms of expression that do not (clearly) have journalistic
purposes, but nevertheless enjoy protection as a fundamental right under Art 11 CFR.7 The
term ‘other form of expression’ indicates, in view of its indeterminacy, that a wide range of
expressions is addressed, namely the dissemination of information in the broadest sense;
therefore, both expressions of fact and of opinion but also advertising are taken into account.8
1 cf Lars Klöhn, ‘Artikel 21: Weitergabe oder Verbreitung von Informationen in den Medien’ in Lars Klöhn (ed),
Marktmissbrauchsverordnung (C. H. Beck 2018) para 1.
2 cf Martin Oppitz, ‘Das Spannungsfeld Finanzanalysten – Medien im Lichte des Anlegerschutzes’ in Ernst Brandl and
others (eds), Handbuch Kapitalmarktrecht Vol 3: Informationsverhalten am Kapitalmarkt (Bankverlag 2006) 280 relating to
the duties of journalists.
3 cf Klöhn (n 1) para 14 maintaining a ‘funktionsbezogenen Privilegierung’ (privilege following the function) and at the
same time rejecting any reference to traditional job descriptions.
4 cf Klöhn (n 1) para 15.
5 Klöhn (n 1) para 15 also refers to freelance or occasional journalists; also employees in the company who are entrusted
with journalistic activities there, e.g., in the context of a client or customer information medium (e.g., press officers).
6 To the point Klöhn (n 1) para 17 refers to the difficulties of delimination in each single case.
7 cf the wording used by Klöhn (n 1) para 21.
8 According to the case law of the ECHR, information of a commercial nature (including business advertising) also falls
under the protection of freedom of expression insofar as it has evaluative content: further evidence is provided by Klöhn
(n 1) para 3 25: Markt Intern Verlag GmbH and Beermann v Germany, App no 10572/83 (ECtHR, 20 November 1989);
Casado Coca v Spain, App no 15450/89 (ECtHR, 24 February 1994).
301
Article 21 DISCLOSURE OR DISSEMINATION OF INFORMATION IN THE MEDIA
Legally ordered disclosure obligations (such as publications by issuers in the context of ad

hoc disclosure) are not, however, an ‘other form of expression in the media’.9 Otherwise, the
exemption would most likely completely melt away.10
3. Media
21.006 The term ‘media’ is not defined in the MAR itself; it refers – in light of Art 11 para 2 CFR – to
mass media.11
4. Privileged actions
21.007 As far as privileged actions are concerned, they relate, on the one hand, to the disclosure
or dissemination of information and, on the other, to the giving or dissemination of
recommendations:
21.008 The term ‘information’ is broadly defined; a limitation to inside information is neither intended
nor can be derived from the wording of the provision.12
21.009 The term ‘recommendation’ is specified as ‘investment recommendation’ in the catalogue of

definitions of Art 3 para 1 in (35).13 The Austrian Press Council defines the recommendation
in its guidelines on financial and economic reporting14 as an ‘editorially journalistically prepared
report that explicitly or implicitly contains suggestions for investments or investment strategies
relating to financial instruments or issuers of financial instruments’. (point 2.1.)
21.010 Information is ‘disclosed’ if the discloser at least allows another person to gain knowledge of
the information without the information becoming publicly known within the meaning of Art
7 para 1a.15
21.011 The term ‘dissemination’, which is used both in connection with information and recommen-
dations, is already found in Art 12 para 1c (types of market manipulation by dissemination of
information through the media, including the Internet or by any other means). When dissem-
inating recommendations, questions of delimitation arise if the text of the original recommen-
9 To the point Klöhn (n 1) para 26.

10 Klöhn (n 1) para 26 consequently considers voluntary issuer disclosure to be covered by the exemption (‘denn insoweit
sind dem Emittenten die zu veröffentlichenden Informationen nicht vorgeschrieben’).
11 Klöhn (n 1) para 21, who, on the one hand, mentions the press – especially print media – and, on the other hand, all
kinds of electronic forms of distribution such as broadcasting, films and new media as well as the Internet, unless it is
an individual communication. Recital 48 considers that ‘disseminating false or misleading information via the internet,
including through social media sites or unattributable blogs, should be considered, for the purposes of this Regulation,
to be equivalent to doing so via more traditional communication channels’.
12 cf Klöhn (n 1) para 11.
13 It is therefore information recommending or suggesting investment strategies, explicitly or implicitly, in relation to one
or more financial instruments or issuers, intended for distribution channels or for the public, including an assessment of
the current or future value or price of such instruments.
14 Clarification as to s 11 of the principles of journalistic work – ethical code for the Austrian press (‘Grundsätze für die
publizistische Arbeit – Ehrenkodex für die österreichische Presse’), accessible via www.presserat.at accessed on 7 March
2019.
15 Klöhn (n 1) para 10.
302
C. FREEDOM OF THE PRESS, FREEDOM OF OPINION AND JOURNALISTIC RULES
dation is interfered with,16 for example in the sense of a shortening or summary; here, a material
consideration is required: If the tendency remains the same, there is still a dissemination of this
recommendation. If, on the other hand, a recommendation is ‘turned upside down’ in terms of
content or commented upon in such a way that the journalist doubts its tenability, it is basically
no longer disseminated as a recommendation.17
The disclosure or dissemination itself does not have to occur ‘in the media’; the phrase ‘in the 21.012
media’ refers to the ‘other form of expression’, but not to the disclosure or dissemination.18 The
passing on of information, for example within a newspaper editorial office, also falls under the
privilege; the individual act of disclosure or dissemination is of course to be measured against
the journalistic purposes or the ‘other form of expression in the media’ as the respective end
purpose.
C. FREEDOM OF THE PRESS, FREEDOM OF OPINION AND JOURNALISTIC RULES

OF PROFESSIONAL CONDUCT
The disclosure/dissemination of information or recommendations is not privileged as such; 21.013

rather, the rules of freedom of the press and freedom of expression in other media as well as
the rules of the journalistic profession and professional ethics must be ‘taken into account’; thus,
Art 21 refers – dynamically – to other sources of law, without giving more specific details in
this regard. Only the reference to freedom of the press and freedom of expression is clear; Art
11 CFR is addressed here.
The Austrian Press Council19 (www.presserat.at)20 is one such self-regulatory body. The codes 21.014
of conduct of professional journalistic associations are among the professional rules and profes-
sional codes of conduct as well as state standards governing journalistic activities.21 According
16 S 7. of the Directives issued by the Austrian Press Council regarding financial and economic press coverage (coverage
regarding third-party recommendations – ‘Berichterstattung über Empfehlungen Dritter’) reads as follows:
Press coverage regarding third party recommendations has to adhere to the following principles:
(a) The identity of the recommending person has to be stated in a clear and unambiguous manner.
(b) Recommendations of third parties must not be changed in their meaning, they have to be strictly distinguished
from own recommendations.
(c) Summaries of third party recommendations must not be misleading, where appropriate reference has to be made
to the underlying document as well as to the place at which the disclosure statements are directly and easily
accessible for the public.’
17 Changes of recommendations are dealt with (in another context) in Oppitz, ‘Das Spannungsfeld Finanzanalysten’ (n 2)
281.
18 cf Klöhn (n 1) para 12, who, in this respect, refers to the clear English language version: ‘Where information is disclosed
or disseminated and where recommendations are produced or disseminated for the purpose of journalism or other form
of expression in the media’.
19 The association’s name due to § 1 (1) of its Articles is ‘Verein zur Selbstkontrolle der österreichischen Presse –
Österreichischer Presserat’. Special attention is turned to financial and economic press coverage ; § 2 (2) of the Articles
expressly states:
The association serves the purpose of promoting the freedom of the press as well as its dedication to the inquiry of truth
and to correctness, and the purpose of self control of print media and news agencies including self control in the field
of financial and economic press coverage (cf EU Regulation 596/2014).
20 cf in particular the mentioned directives of the Austrian Press Council.
303
Article 21 DISCLOSURE OR DISSEMINATION OF INFORMATION IN THE MEDIA
to Austrian law, this also includes22 the criteria of journalistic diligence pursuant to § 29 Media
Act.23
D. COUNTER-EXEMPTIONS
21.015 The disclosure or dissemination privilege for journalistic purposes or other form of expression
in the media does not exist in two cases:
1. Advantage or profit
21.016 Firstly, the privilege becomes void if the persons concerned or persons closely associated with
them derive a direct or indirect advantage or profit from the disclosure or dissemination of the
information concerned (lit a). This covers purely self-interest purposes; however, in contrast
to lit b, lit a avoids mentioning a subjective component; if there is no (contingent) intention
on the part of the ‘persons concerned’ – i.e., the disclosing or disseminating journalists – to gain
an advantage or profit from the disclosure or dissemination of the information concerned, the
exemption remains; this must also apply to the giving or dissemination of recommendations,
although these are not expressly mentioned in lit a.
21.017 There is a need to differentiate between this exemption and the scalping activities of journal-
ists;24 of course, this exemption is not invalidated per se by the fact that a journalist (also) holds
financial instruments in its private assets on which (or their issuers) it reports in the media.25
2. Intention to mislead
21.018 Similarly, the realisation of the exemption is prevented by disclosure or dissemination with
the intention of misleading the market as to the supply of, demand for, or price of financial
instruments (lit b). As to the degree of fault, the qualification of ‘intent’ is therefore required.
21.019 The intention to mislead as described in lit b does not have to be accompanied by the intention
to financially benefit or harm third parties.26
22 cf Heinz Wittmann, ‘Börsegesetznovelle 2004 und die Medien’ [2005] MR 5; Martin Oppitz, ‘Noch Journalist oder
schon Analyst? Zu den Tücken einer “Empfehlung” nach der Börsegesetznovelle 2004’ [2005] ÖBA 460; Susanne Kalss,
Martin Oppitz and Johannes Zollner, Kapitalmarktrecht (2nd edn, Linde Verlag 2015) para § 8 para 67.
23 cf Wittmann (n 22) 5; Oppitz, ‘Noch Journalist oder schon Analyst?’ (n 22) 460; Kalss, Oppitz and Zollner (n 22) § 8
para 67.
24 On the term ‘scalping’ cf only Martin Oppitz, ‘Insiderrecht und zivilrechtliche Aspekte der Insiderverbote’, in Brandl (n
2) 173 f.
26 Klöhn (n 1) para 36, who also excludes the applicability of Art 21 if the trader deliberately deceives the market to the
(alleged) best, e.g., because he considers a financial instrument to be over- or under-valued or wants to help an issue or
other package sale to succeed.
304
D. Counter-exemptions
Literature
Berka W, Redaktionsgeheimnis und Pressefreiheit (Neuer Wissenschaftlicher Verlag 2001)

Kalss S, Oppitz M and Zollner J, Kapitalmarktrecht (2nd edn, Linde Verlag 2015)
Klöhn L, ‘Artikel 21: Weitergabe oder Verbreitung von Informationen in den Medien’ in Klöhn L (ed),
Klöhn L and Büttner S, ‘Finanzjournalismus und neues Marktmissbrauchsrecht – Hintergrund, Inhalt
und praktische Bedeutung von Art. 21 MAR’ (2016) 47 WM 2241
Oppitz M, ‘Insiderrecht und zivilrechtliche Aspekte der Insiderverbote’ in Brandl E and others (eds),
Handbuch Kapitalmarktrecht Vol 3: Informationsverhalten am Kapitalmarkt (Bankverlag 2006) 164
Oppitz M, ‘Das Spannungsfeld Finanzanalysten – Medien im Lichte des Anlegerschutzes’ in Brandl E
and others (eds), Handbuch Kapitalmarktrecht Vol 3: Informationsverhalten am Kapitalmarkt (Bankverlag
2006) 267
Oppitz M, ‘Noch Journalist oder schon Analyst? Zu den Tücken einer “Empfehlung” nach der
Börsegesetznovelle 2004’ [2005] ÖBA 459
Wittmann H, ‘Börsegesetznovelle 2004 und die Medien’ [2005] MR 3.
305
ARTICLE 22
COMPETENT AUTHORITIES
Peter Jedlicka
Without prejudice to the competences of the judicial authorities, each Member State shall
designate a single administrative competent authority for the purpose of this Regulation.
Member States shall inform the Commission, ESMA and the other competent authorities of
other Member States accordingly. The competent authority shall ensure that the provisions
of this Regulation are applied on its territory, regarding all actions carried out on its territory,
and actions carried out abroad relating to instruments admitted to trading on a regulated
market, for which a request for admission to trading on such market has been made, auctioned
on an auction platform or which are traded on an MTF or an OTF or for which a request for
admission to trading has been made on an MTF operating within its territory.
OVERVIEW
A. INTRODUCTION 22.001 C. CONTENT OF THE PROVISION 22.010

B. DIRECT APPLICABILITY AND LIMITED DIRECT 1. Competent authorities 22.011
EFFECT 22.004 2. Material and local competence 22.016
A. INTRODUCTION
22.001 Art 22 is the central provision in Union law for the system of supervision in the field of com-
batting market abuse.1 It forms the basis for a uniform system of supervision by designated
competent authorities in all the Member States of the European Union.
22.002 Art 22 is not limited to regulating the organisational form of the supervisory authorities. From
a Union law perspective, Art 22 establishes the material and local competence for the supervi-
sion of compliance with the provisions of the MAR by the competent authorities designated
by the Member States.
1 Niamh Moloney, EU Securities and Financial Markets Regulation (3rd edn, Oxford University Press 2014) 755.
306
Peter Jedlicka - 9781800882249
B. Direct applicability and limited direct effect
Compared to Art 11 of Directive 2003/6/EC,2 the core content of the provision, namely the 22.003
grounds for competence, remains unchanged.3 However, the European legislator decided to
also regulate the local competence of the designated authorities in Art 22.
B. DIRECT APPLICABILITY AND LIMITED DIRECT EFFECT
In a departure from previous practice, the European legislators have summarised the Union’s 22.004
regulations for preventing market abuse in a Regulation in the sense of Art 288 para 2 TFEU.
The classification of the MAR in the legal source system of the TFEU is of fundamental
importance, because this results in certain legal effects and, subsequently, obligations for the
Member States, which are relevant for the scope of Art 22. Some provisions of the MAR
provide for implementation obligations for the Member States. These are, above all, the rules
on the organisation of the competent authority, the minimum set of powers of these authori-
ties (Art 23), the cooperation with other competent authorities and ESMA (Arts 24–26) and
a minimum set of administrative offences and administrative sanctions (Arts 30 and 31).
Art 22 is part of a Regulation pursuant to Art 288 para 2 TFEU. As a provision of a Regulation, 22.005
Art 22 is therefore in principle of general application, it is binding in its entirety and is directly
applicable in all Member States.4 According to the established case law of the ECJ, direct
application means that Art 22 does not require a Member State to transpose it in order to
establish rights and obligations.5 In principle, therefore, national legislative acts that incorpo-
rate the contents of Art 22 are not only superfluous but also impermissible due to their direct
effect.6 The adoption of implementing provisions or binding rules of interpretation for Art 22
as directly applicable provisions of a Regulation in the sense of Art 288 para 2 TFEU is also
prohibited in principle.7
While Art 22 is directly applicable, its direct effect is, however, in my opinion, limited to only 22.006
a part of the provision, namely to the material and local competence of the designated com-
petent authority. Thus, the principles mentioned in para 22.005 are only applicable to these
aspects.
manipulation (market abuse directive) [2003] OJ L 96/16.
3 Moloney (n 1) 756.
4 Case 26/62 Van Gend en Loos [1963] ECR 1, para 12; Case 43/71 Politi v Ministero delle finanze [1971] ECR 1039,
para 9; Michael Bobek, ‘The effects of EU law in the national legal systems’ in Catharine Barnard and Steve Peers (eds),
European Union Law (2nd edn, Oxford University Press 2017) 151; Damian Chalmers, Gareth Davies and Giorgio
Monti, European Union Law (4th edn, Cambridge University Press 2019) 114 and 302; Paul Craig and Gráinne De
Búrca, EU Law (6th edn, Oxford University Press 2015) 107 and 198; Thomas Oppermann, Claus Classen and Martin
Nettesheim, Europarecht (8th edn, C. H. Beck 2018) § 9 para 71; Werner Schroeder, ‘Art 288 TFEU’ in Rudolf Streinz
(ed), EUV/AEUV (3rd edn, C. H. Beck 2018) paras 37ff; Matthias Ruffert, ‘Art 288’ in Christian Calliess and Matthias
Ruffert (eds), EUV/AEUV (5th edn, C. H. Beck 2016) paras 19ff.
5 Politi v Ministero delle finanze (n 4) para 9. Case 94/77 Zerbone [1978] ECR 99, paras 27 and 28; Chalmers and Davies
and Monti (n 4) 114; Oppermann, Classen and Nettesheim (n 4) § 9 para 78; Schroeder (n 4) para 43; Ruffert (n 4) para
20.
6 Politi v Ministero delle finanze (n 4) para 9; Chalmers, Davies and Monti (n 4) 114; Oppermann, Classen and Nettesheim
(n 4) § 9 para 79; Schroeder (n 4) para 43; Ruffert (n 4) para 20.
7 Case 9/74 Casagrande v Landeshauptstadt München [1974] ECR 773, 15; Chalmers, Davies and Monti (n 4) 114.
307
Article 22 COMPETENT AUTHORITIES
22.007 The wording of the provision (‘… each Member State shall designate’) indicates in particular
that Art 22, in my opinion, obliges the Member States to adopt appropriate organisational
rules to determine the authorities competent for carrying out the official tasks resulting from
the MAR and their competence. Art 22, therefore, contains in part the authorisation or the
obligation8 for the Member States to adopt further implementing measures9 and is not directly
effective regarding these aspects.10 In the context of the principle of sincere cooperation,11
Member States are thus obliged to adopt the relevant implementing acts on the basis of Art
22.12 The designated competent authority under 22 MAR in the UK is the Financial Conduct
Authority (FCA)13, in Germany the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin)14
and in France the Autorité des Marchés Financiers (AMF).15
22.008 The scope of the principle of sincere cooperation to be respected by Member States when
adopting implementing acts is laid down in Art 4 para 3 TEU. The national legislator must
amend, repeal, adopt or supplement national law in such a way that the provisions of Union
law can achieve their full practical effect (effet utile).16 The implementing acts of the Member
States, which are adopted in accordance with Art 22, may not change the scope of the MAR
– and of Art 22 in particular.17 The Member States must ensure the unrestricted applicability
of the MAR and Art 2218 and the proper application of the MAR.19 For this purpose, a formal
act of transposition only is not sufficient; the act of transposition must also sufficiently guar-
antee the actual achievement of the objectives.20 However, the principle of sincere cooperation
pursuant to Art 4 para 3 TEU also implies a duty of the Member States to refrain from taking
8 It may be difficult to identify such authorisations or obligations in a provision of a Regulation: According to the ECJ’s
case law, an authorisation or obligation does not have to be explicitly expressed by reference to the law of the Member
State, but can result from the very wording of a Union law provision (Case C-273/90 Meico-Fell v Hauptzollamt
Darmstadt [1991] ECR I-5569, para 9). The ECJ’s case law also creates additional complexity in this respect, in that
recourse to national legal provisions is generally permissible if a Regulation within the meaning of Art 288 para 2 TFEU
is incomplete; in such a case, national legal provisions may be adopted to the extent necessary to implement a Regulation
within the meaning of Art 288 para 2 TFEU (Case 39/70 Norddeutsches Vieh- und Fleischkontor GmbH v Hauptzollamt
Hamburg-St. Annen [1971] ECR 49, para 4). See in detail Theo Öhlinger and Michael Potacs, EU-Recht und staatliches
Recht (6th edn, LexisNexis 2017) 71.
9 Chalmers, Davies and Monti (n 4) 114; Craig and De Búrca (n 4) 107; Schroeder (n 4) para 46; Ruffert (n 4) para 21.
10 Öhlinger and Potacs (n 8) 71.
11 Martin Gellermann, ‘Art 291 AEUV’ in Streinz (n 4) para 5; Herwig Hofmann, ‘General principles of EU law and EU
administrative law' in Barnard and Peers (n 4) 200.
12 Chalmers, Davies and Monti (n 4) 114; Craig and De Búrca (n 4) 107; Rudolf Streinz, ‘Art 4 TEU’ in Streinz (n 4) paras
31ff.
13 s 3 The Financial Services and Markets Act 2000 (Market Abuse) Regulations 2016, SI 2016/680.
14 § 6 para 5 Wertpapierhandelsgesetz (WpHG), BGBl I 62/1998 in the version BGBl I 14/2020.
15 See competent authorities of all Member States: ESMA, List of competent authorities designated for the purposes of
Regulation (EU) No. 596/2014 on market abuse (MAR) (25 February 2020) www.esma.europa.eu/sites/default/files/mar
.pdf accessed 6 July 2020.
16 Craig and De Búrca (n 4) 107; Wolfgang Kahl, ‘Art 4 TEU’ in Calliess and Ruffert (n 4) para 55; Peter Vcelouch, ‘Art
288’ in Thomas Jäger and Karl Stöger (eds), EUV/AEUV (Manz 2017) para 37.
17 Vcelouch (n 16) para 32.
18 Craig and De Búrca (n 4) 107; Schroeder (n 4) para 47; Ruffert (n 4) para 21.
19 Streinz (n 12) para 32.
20 Case C-217/97 Commission v Germany [1997] ECR I-5087, para 31; Case C-62/00 Marks & Spencer [2002] ECR
I-6325, para 27; Kahl (n 13) para 56.
308
C. Content of the provision
or maintaining measures which could impair, alter or obstruct the practical effectiveness or the
unrestricted and uniform application of the MAR and Art 22.21
In addition to the principle of sincere cooperation with regard to the legislative implementation 22.009
of national implementing acts, Member States also have obligations with regard to the organi-
sation of the administrative enforcement of the MAR. Like the majority of the Union’s legis-
lation, the MAR is not enforced by the Union institutions but by the administrative authorities
of the Member States, which act as the administrative substructure of the Union (so-called
indirect enforcement).22 The basic principle is that, in the area of indirect enforcement of
Union law, the rules of competence and organisational provisions, as well as the administrative
procedures and administrative action, are governed by national law, unless the Union law
contains common rules (principle of national institutional autonomy and principle of national
procedural autonomy).23 If, however, the MAR lays down rules on administrative competence
or organisation or contains particular rules on administrative procedures or administrative
action, the Member States must take account of these Union law provisions not only in the area
of administrative procedure law but may also be bound by certain Union law provisions in the
area of administrative organisation.24 Therefore, Member States also have to take into account
Union law requirements in the area of administrative organisation, which result from Art 22, in
order to ensure proper (in the sense of conformity with Union law) enforcement of the MAR
by the national administrative authorities.25 Irrespective of the national procedural autonomy,
the national administrative authorities themselves are also obliged in the actual enforcement of
the MAR under Art 4 para 3 TEU to ensure the complete, uniform and effective implemen-
tation of Union law.26
C. CONTENT OF THE PROVISION
At first sight, Art 22 appears to have a limited regulatory content. If one considers solely the 22.010
wording of the provision, Art 22 contains, on the one hand, the obligation of the Member
States to designate a competent authority and, on the other hand, a definition of the material
and local competence of this competent authority. The complete content of Art 22, however,
can only be seen in conjunction with Art 23 and Arts 30–31 with regard to the concrete form
of the powers of the competent authority, and Art 2 with regard to the precise definition of
the material and local competence of the authority to be designated by the Member States in
accordance with the regulatory objectives of the MAR. For a systematic understanding of Art
22, the provisions of Directive 2014/57/EU (‘CRIM-MAD’),27 in which the competences of
the judicial authorities are regulated, must also be taken into consideration.
21 Kahl (n 13) paras 65-66; Streinz (n 12) para 34 and 68.

22 Hofmann (n 11) 201; Kahl (n 16) para 63.
23 Bobek (n 4) 169; Kahl (n 16) para 64; Öhlinger and Potacs (n 8) 149 f; Streinz (n 12) paras 52 and 56.
24 Hofmann (n 11) 200 f; Öhlinger and Potacs (n 8) 150.
25 Bobek (n 4) 169; Hofmann (n 11) 200 f; Streinz (n 12) para 50.
26 Kahl (n 13) para 65.
27 Directive 2014/57/EU of the European Parliament and of the Council of 16 April 2014 on criminal sanctions for market
abuse (market abuse directive) [2014] OJ L 173/179.
309
1. Competent authorities
22.011 Essential for the understanding of the content of the regulation of Art 22 is the term compe-
tent authority used by the Union legislators. The scope and content of the term competent
authority are significant to the extent that the Member States are obliged to comply with
certain organisational law provisions (indirectly) provided by the Union legislators (see above
para 22.009). The concept of authority under Union law in Art 22 is not necessarily the same
as that of national law, but it may coincide with it. According to the settled case law of the
ECJ, Union law is a distinct body of law28 whose concepts are to be interpreted autonomously.29
In this autonomous interpretation of Union law, particular weight is, above all, attached to
the teleological interpretation, on the basis of which provisions of Union law are interpreted
according to the meaning and purpose which the Union legislators wished to achieve through
the normative formulation.30
22.012 The wording of Art 22 first of all gives rise to an essential element for defining the concept of
authority in Union law: The authority as defined in Art 22 may not be a judicial authority.31
A comparison of the different language versions of the MAR shows that the German version
of Art 22 ‘conceals’ another characteristic of the competent authority (‘eine einzige Behörde,
die … zuständig ist’). The English version (‘a single administrative competent authority’),
the French version (‘une autorité administrative compétente unique’) and the Italian version
(‘un’unica autorità amministrativa competente’) state that the competent authority as defined
in Art 22 must be an administrative authority. In addition, Member States may only designate
one single competent administrative authority to exercise the competence pursuant to the
MAR.32 However, Union law does not define exactly what an administrative authority is.
Such a definition is difficult, also in view of the fact that the enforcement of Union law is, as
a rule, carried out by the authorities of the Member States.33 From Art 22, however, it can be
concluded, in my opinion, that Union law establishes the delimitation primarily on the actual
28 Case 6/64 Costa v ENEL [1964] ECR 585, 593; Oppermann, Classen and Nettesheim (n 4) § 9 paras 5ff.
29 Case 327/82 Ekro [1984] ECR 107, para 11; Case C-287/98 Linster [2000] ECR I‑6917, para 43 or Joined Cases
Ziolkowski (C-424/10) and Szeja (C-425/10) v Land Berlin [2011] ECR I-14035, para 32. See also Sebastian
Mock, ‘History, application, interpretation and legal sources of the Market Abuse Regulation’ in Marco Ventoruzzo
and Sebastian Mock (eds), Market Abuse Regulation (Oxford University Press 2017) 7 f; Oppermann, Classen and
Nettesheim (n 4) § 9 paras 165ff.
30 Case C-427/85 Commission v Germany [1988| ECR 1123, para 13; Oppermann, Classen and Nettesheim (n 4) §
9 para 176. According to the settled case law of the CJEU, provisions of EU legal acts should not be considered in
isolation but in cases of doubt should be interpreted and applied in the light of the other languages (Case 19/67 Sociale
Verzekeringsbank v Van der Vecht [1967] ECR 345, para 354; Case C-372/88 Milk Marketing Board v Cricket St. Thomas
[1990] ECR I-1345, para 19). Different language versions of a Community text must be given a uniform interpretation
and hence, in the case of divergence between the language versions, the provision in question must be interpreted by
reference to the purpose and general scheme of the rules of which it forms a part (Case 30/77 Regina v Bouchereau [1977]
ECR 1999, para 14). Thus, to determine the meaning and purpose of a provision of Union law, other language versions
of the same legal act are often referred to in addition to the Recitals.
31 Art 22 sent 1 (‘without prejudice to the competences of the judicial authorities’). This restriction is not only based on Art 22,
but also, in part, on Art 114 TFEU, which was used as the basis for the adoption of the MAR. Art 114 TFEU only
authorises the approximation of the laws and regulations of the Member States. The approximation of criminal law
provisions can only take place on the basis of Art 83 TFEU.
32 Of the same view Johannes Zollner, ‘Article 22: Competent authorities’ in Ventoruzzo and Mock (n 28) 440 f; cf
however Recital 63, which is likely to allow a partial departure from this requirement.
33 Kahl (n13) para 63; Oppermann, Classen and Nettesheim (n 4) § 12 para 1.
310
holder of sovereign rights and therefore – in conjunction with Art 291 TFEU – the adminis-
trative authority within the meaning of Art 22 can in principle be equated with the common
understanding of an administrative authority within the Member States, insofar as Union law
does not impose additional requirements (e.g., independence – see para 22.014 below).34
The distinction between justice and administration in Art 22 is also necessary for systematic 22.013
reasons. By introducing an explicit separation between judicial and administrative author-
ities in Art 22, the Union legislators are pursuing two main objectives. On the one hand,
this is intended to create an effective European system of authorities responsible for market
supervision under the aegis of ESMA, in order to combat and investigate cross-national and
cross-market market abuse according to the same standards in all Member States.35 On the
other hand, of course, this allows also to separate the competence of the administrative author-
ities from the competence of the judicial authorities. This demarcation is no longer relevant
only with regard to the criminal prosecution of certain economic offences, but also with regard
to the new criminal prosecution of certain serious forms of market abuse, which was added by
the CRIM-MAD.36
A further essential element of the concept of authority in Art 22 is not found in its wording, 22.014
but can be derived from Recital 62 and must therefore be observed by the Member States in
the context of their duty of loyalty under the principle of sincere cooperation (see paras 22.008
f above). In order to achieve the objectives of the MAR, which are pursued by the Union legis-
lators, the competent authority as defined in Art 22 must be independent.37 In the absence of
requirements of the Union legislators, it is up to the Member States to define this independence
in more detail. As with the question of which national authorities are administrative authorities
within the meaning of Art 22, the Member States must also organise the independence of the
designated competent authority in their national implementing measures in such a way that it
does not conflict with the regulatory purpose and objectives of the MAR.
The requirement that an (independent) administrative authority be designated by the Member 22.015
States for the supervision of financial market participants is not new. Comparable require-
ments in the area of securities supervision law also exist in the Prospectus Regulation,38 the
34 See Stefan Leible and Meinhard Schröder, ‘Art 114 TFEU’ in Streinz (n 4) paras 38ff, who assume that administrative
provisions in the sense of Union law – in connection with Art 114 TFEU – are to be understood as general, abstract
instructions to the national administrative authorities; similar Ruffert, ‘Art 197’ (n 4) paras 7ff or Gellermann (n 11)
para 8, who, in order to describe administrative law in the sense of Union law, also primarily refer to the actual holder of
sovereign rights.
35 Recitals 62 and 67.
36 cf Arts 3–5 CRIM-MAD.
37 Recital 62.
38 Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be
2003/71/EC (Prospectus Regulation) [2017] OJ L 168/12.
311
Transparency Directive,39 the UCITS Directive,40 the AIFM Directive41 and MiFID II.42 The
Union legislator has also set similar or the same requirements in other areas of financial market
law.43
2. Material and local competence
22.016 Art 22 determines, from a Union law perspective, the material and local competence of the
designated competent authority. The full extent of the competence, both in material and local
matters, can only be derived from an examination of Art 2 and other provisions of the MAR.
22.017 With regard to material competence, the Union legislators stipulate that the competent author-
ity must ‘monitor the application of the provisions of this Regulation’. Relevant for determining the
material competence are therefore not only the material mandatory or prohibitory provisions
contained in the MAR (e.g., Art 8 or Art 12), but also the scope of application of the MAR as
determined in Art 2. The material competence of the competent authority pursuant to Art 22
therefore includes the supervision of compliance with all mandatory and prohibitory provisions
of the MAR with respect to all transactions, orders and behaviour44 with respect to the financial
instruments referred to in Art 2 para 1 lit a–d and with respect to behaviour and transactions
with respect to greenhouse gas emission allowances and other auctioned items based thereon
pursuant to Art 2 para 1 subpara 2. However, the competent authority’s material competence
pursuant to Art 22 also includes the supervision of compliance with the prohibition of market
manipulation with respect to spot commodity contracts (Art 2 para 2 lit a), financial instru-
ments with which prices of spot commodity contracts can be influenced (Art 2 para 2 lit b), and
benchmarks (Art 2 para 2 lit c). The substantive competence limited to market manipulation as
defined in Art 2 para 2 is intended to cover, in particular, the interconnection of spot and deriv-
ative markets with the financial markets and the interaction between spot commodity contracts
and related financial instruments, and therefore should only be established if such interaction
exists between spot commodity contracts and related financial instruments.45
22.018 Local competence also does not derive directly from Art 22, but only from a combination with
Art 2 para 4. The scope of local competence is somewhat less clear, since both Art 2 para 4 and
Art 22 contain a certain extra-territorial element. Art 2 para 4, for example, stipulates that, in
general, all acts and omissions in the Union or third countries are subject to the requirements
39 Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of
transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated
market and amending Directive 2001/34/EC [2004] OJ L 390/38.
40 Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws,
regulations and administrative provisions relating to undertakings for collective investment in transferable securities
(UCITS) [2009] OJ L 302/32.
41 Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund
Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No 1060/2009 and (EU) No
1095/2010 [2011] OJ L 174/1.
42 Moloney (n 1) 116, 121, 148, 257, 306 and 406.
43 cf e.g., Art 4 para 4 Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access
to the activity of credit institutions and the prudential supervision of credit institutions and investment firms amending
Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC (CRD IV) [2013] OJ L 176/338.
44 Art 2 para 3.
45 Recital 20.
312
of the MAR. Art 22 is more specific in this respect, but not particularly clearer. Two groups of
local competence arise from Art 22. The first group of cases covers, in any event, all acts com-
mitted in the sovereign territory of the competent authority in respect of instruments admitted
to or dealt in on a regulated market in the sovereign territory of the competent authority or
for which such admission has been sought. It also includes all acts undertaken within the
sovereign territory of the competent authority in relation to instruments traded on an MTF or
OTF within the sovereign territory of the competent authority or for which such authorisation
has been sought. The second group of cases comprises those acts carried out abroad relating
to instruments admitted to or dealt in on a regulated market within the sovereign territory of
the competent authority or for which such admission has been sought, or which are traded on
an MTF or OTF within the sovereign territory of the competent authority or for which such
admission has been sought. It remains to be seen whether it can be deduced from the wording
of Art 22 that the Union legislators intended Art 22 to create a legal basis for extra-territorial
supervision with no connection to the sovereign territory of the competent authority under
Art 22 in the area of market abuse, in particular with regard to instruments admitted to or for
which such admission was sought on regulated markets in other EU countries. In my opinion,
this intention of the Union legislators cannot be deduced from Art 22. The strengthening of
the cross-border exchange of information and cross-border cooperation between the competent
authorities and between them and ESMA – especially Art 25 para 2 MAR – speaks against
such an interpretation of Art 22. For the local competence, therefore, there will always have
to be some connection to the sovereign territory of the competent authority pursuant to Art
22 – either with regard to the person acting, the financial instrument or the trading venue.46
Literature
Bobek M, ‘The effects of EU law in the national legal systems’ in Barnard C and Peers S (eds), European
Union Law (2nd edn, Oxford University Press 2017)
Chalmers D, Davies G and Monti G, European Union Law (4th edn, Cambridge University Press 2019)
Craig P and De Búrca G, EU Law (6th edn, Oxford University Press 2015)
Gellermann M, ‘Art 291 AEUV’ in Streinz R (ed), EUV/AEUV (3rd edn, C. H. Beck 2018)
Hofmann H, 'General principles of EU law and EU administrative law’ in Barnard C and Peers S (eds),
European Union Law (2nd edn, Oxford University Press 2017)
Kahl W, ‘Art 4 TEU’ in Calliess C and Ruffert M (eds), EUV/AEUV (5th edn, C. H. Beck 2016)
Leible S and Schröder M, ‘Art 114 TFEU’ in Streinz R (ed), EUV/AEUV (3rd edn, C. H. Beck 2018)
Mock S, ‘History, application, interpretation and legal sources of the Market Abuse Regulation’ in
Ventoruzzo M and Mock S (eds), Market Abuse Regulation (Oxford University Press 2017)
Öhlinger T and Potacs M, EU-Recht und staatliches Recht (6th edn, LexisNexis 2017)
Oppermann T, Classen C and Nettesheim M, Europarecht (8th edn, C. H. Beck 2018)
Ruffert M, ‘Art 197 | Art 288’ in Calliess C and Ruffert M (eds), EUV/AEUV (5th edn, C. H. Beck 2016)
Schroeder W, ‘Art 288 TFEU’ in Streinz R (ed), EUV/AEUV (3rd edn, C. H. Beck 2018)
Streinz R, ‘Art 4 TEU’ in Streinz R (ed), EUV/AEUV (3rd edn, C. H. Beck 2018)
Vcelouch P, ‘Art 288’ in Jäger T and Stöger K (eds), EUV/AEUV (Manz 2017)
Veil R, ‘§ 14’ in Veil R (ed), European Capital Markets Law (2nd edn, Hart Publishing 2017)
Zollner J, ‘Article 22: Competent authorities’ in Ventoruzzo M and Mock S (eds), Market Abuse
Regulation (Oxford University Press 2017)
46 Of the same opinion Moloney (n 1) 755 f or Zollner (no 29) 442 f.
313
ARTICLE 23
POWERS OF COMPETENT AUTHORITIES
Peter Jedlicka
1. Competent authorities shall exercise their functions and powers in any of the following
ways:
(a) directly;
(b) in collaboration with other authorities or with the market undertakings;
(c) under their responsibility by delegation to such authorities or to market undertakings;
(d) by application to the competent judicial authorities.
2. In order to fulfil their duties under this Regulation, competent authorities shall have, in
accordance with national law, at least the following supervisory and investigatory powers:
(a) to access any document and data in any form, and to receive or take a copy thereof;
(b) to require or demand information from any person, including those who are succes-
sively involved in the transmission of orders or conduct of the operations concerned,
as well as their principals, and if necessary, to summon and question any such person
with a view to obtain information;
(c) in relation to commodity derivatives, to request information from market participants
on related spot markets according to standardised formats, obtain reports on transac-
tions, and have direct access to traders’ systems;
(d) to carry out on-site inspections and investigations at sites other than at the private
residences of natural persons;
(e) subject to the second subparagraph, to enter the premises of natural and legal persons
in order to seize documents and data in any form where a reasonable suspicion exists
that documents or data relating to the subject matter of the inspection or investi-
gation may be relevant to prove a case of insider dealing or market manipulation
infringing this Regulation;
(f) to refer matters for criminal investigation;
(g) to require existing recordings of telephone conversations, electronic communica-
tions or data traffic records held by investment firms, credit institutions or financial
institutions;
(h) to require, insofar as permitted by national law, existing data traffic records held by
a telecommunications operator, where there is a reasonable suspicion of an infringe-
ment and where such records may be relevant to the investigation of an infringement
of point (a) or (b) of Article 14 or Article 15;
(i) to request the freezing or sequestration of assets, or both;
(j) to suspend trading of the financial instrument concerned;
314
A. Introduction
(k) to require the temporary cessation of any practice that the competent authority con-
siders contrary to this Regulation;
(l) to impose a temporary prohibition on the exercise of professional activity; and
(m) to take all necessary measures to ensure that the public is correctly informed, inter
alia, by correcting false or misleading disclosed information, including by requiring
an issuer or other person who has published or disseminated false or misleading
information to publish a corrective statement.
Where in accordance with national law prior authorisation to enter premises of natural and
legal persons referred to in point (e) of the first subparagraph is needed from the judicial
authority of the Member State concerned, the power as referred to in that point shall be
used only after having obtained such prior authorisation.
3. Member States shall ensure that appropriate measures are in place so that competent
authorities have all the supervisory and investigatory powers that are necessary to fulfil
their duties.
This Regulation is without prejudice to laws, regulations and administrative provisions
adopted in relation to takeover bids, merger transactions and other transactions affecting
the ownership or control of companies regulated by the supervisory authorities appointed
by Member States pursuant to Article 4 of Directive 2004/25/EC that impose require-
ments in addition to the requirements of this Regulation.
4. A person making information available to the competent authority in accordance with
this Regulation shall not be considered to be infringing any restriction on disclosure of
information imposed by contract or by any legislative, regulatory or administrative pro-
vision, and shall not involve the person notifying in liability of any kind related to such
notification.
OVERVIEW
A. INTRODUCTION 23.001 INVESTIGATORY POWERS 23.006

B. DIRECT APPLICABILITY AND LIMITED DIRECT D. SUPERVISORY AND INVESTIGATORY POWERS
EFFECT 23.004 23.008
C. METHOD OF EXERCISING SUPERVISORY OR
A. INTRODUCTION
Art 23 provides the Union wide legal basis for a harmonised catalogue of supervisory and 23.001
investigatory powers of the competent authorities under Art 22. This catalogue is a minimum
catalogue of powers that the competent authorities must have under Art 23.
315
Article 23 POWERS OF COMPETENT AUTHORITIES
23.002 In Art 23, the Union legislators continue along the path they have already taken with Art 12
of Directive 2003/6/EC:1 A minimum level of unified, effective supervisory and investigative
powers is intended to ensure effective supervision.2 This objective was also the basis for the
uniform catalogue of powers in Directive 2003/6/EC.3 Nominally, all competent authorities
in the Union therefore have the same supervisory and investigatory powers. This uniformity is,
however, de facto undermined by the fact that the Union legislators continue to leave Member
States some leeway as to how these powers can be exercised in practice. This ultimately thwarts
the Union legislators’ own objectives and means that the attempt to harmonise the powers of
the authorities will continue to fail because of the wide variety of different national implement-
ing measures.
23.003 Compared to Art 12 of Directive 2003/6/EC, the catalogue of powers was not completly
revised. Thus, core powers remain essentially unchanged. However, the new version of the
catalogue of powers in Art 23 has led to a number of extensions, selective amendments and
innovations.
B. DIRECT APPLICABILITY AND LIMITED DIRECT EFFECT
23.004 Although Art 23 is part of a Regulation in the sense of Art 288 para 2 TFEU, it is – like Art
22 – not directly effective (cf paras 22.004ff). Art 23 is also a provision which contains an
authorisation or an obligation for the Member States to adopt further implementing measures.4
Paras 2 and 3 stipulate that the Member States must ensure that the competent authorities have
all the supervisory and investigatory powers necessary for the fulfilment of their duties pursuant
to Art 22. When adopting the corresponding implementing acts, the Member States must be
‘loyal’ to the Union (so-called principle of sincere cooperation cf para 22.008), i.e., they must
amend, repeal, adopt or supplement national law in such a way that the provisions of Union
law can develop their full practical effectiveness (effet utile)5 and the unrestricted applicability of
the Regulation,6 the proper application of Union law7 and the actual achievement of objectives
are sufficiently guaranteed.8
23.005 Art 23 sets out the powers of investigation and supervision of the designated competent author-
ities. Such powers are normally state interventions in the positions of individuals protected by
manipulation (market abuse) [2003] OJ L 96/16.
2 Recital 62.
3 Recital 37 of Directive 2003/6/EC.
4 Damian Chalmers, Gareth Davies and Giorgio Monti, European Union Law (4th edn, Cambridge University Press
2019) 114; Paul Craig and Gráinne De Búrca, EU Law (6th edn, Oxford University Press 2015) 107; Werner Schroeder,
‘Art 288 TFEU’ in Rudolf Streinz (ed), EUV/AEUV (3rd edn, C. H. Beck 2018) para 46; Matthias Ruffert, ‘Art 288’ in
Christian Calliess and Matthias Ruffert (eds), EUV/AEUV (5th edn, C. H. Beck 2016) para 21.
5 Craig and De Búrca (n 4) 107; Wolfgang Kahl, ‘Art 4 TEU’ in Calliess and Ruffert (n ) para 55; Peter Vcelouch, ‘Art
288’ in Thomas Jäger and Karl Stöger (eds), EUV/AEUV (Manz 2017) para 37.
6 Craig and De Búrca (n 4) 107; Schroeder (n 4) para 47; Ruffert (n 4) para 21.
7 Rudolf Streinz, ‘Art 4 TEU’ in Streinz (n ) para 32.
8 Case C-217/97 Commission v Germany [1997] ECR I-5087, para 31; Case C-62/00 Marks & Spencer [2002] ECR
I-6325, para 27; Kahl (n 5) para 56.
316
C. Method of exercising supervisory or investigatory powers
fundamental rights.9 In the area of Union law, Member States are bound by the provisions of
the CFR in both legislative and administrative implementation of Union law,10 especially when
they directly enforce Regulations or implement Directives.11 Building on its judgment in the
Akerberg-Fransson case,12 in which the ECJ established the existence of a connecting factor
under Union law as a basic prerequisite for the binding of the Member State through the CFR,
the ECJ held in its subsequent case law on the scope of application of the CFR that the guaran-
tees of the CFR apply if a national provision was intended to implement Union law.13 For this
reason, Member States must also observe the relevant provisions of the CFR when adopting
implementing acts with which they anchor the powers in para 2 in national law.
C. METHOD OF EXERCISING SUPERVISORY OR INVESTIGATORY POWERS
Para 1 gives Member States several possibilities to shape the way in which the competent 23.006
authorities can exercise the supervisory or investigatory powers at their disposal. The content
and wording of para 1 correspond to Art 12 para 1 of Directive 2003/6/EC, which also pro-
vided for several options for structuring the exercise of supervisory or investigatory powers.
Member States can provide that the competent authorities may use the supervisory or investi-
gatory powers at their disposal either:
a. directly;
b. in collaboration with other authorities or with the market undertakings;
c. under their responsibility by delegation to such authorities or market undertakings; or
d. by application to the competent judicial authorities.
Para 1 does not impose any obligation on Member States to actually provide for all the pos- 23.007
sibilities for the exercise of regulatory powers provided for in that paragraph when adopting
implementing measures. The Member States are free in this regard to define the framework
conditions for the exercise of the regulatory powers determined by Union law in the context of
their respective national law. In particular, para 1 does not contain any fundamental obligation
to involve judicial authorities in the administrative enforcement of the provisions of the MAR.14
However, such integration may be required on the basis of considerations of fundamental rights
and constitutional law (cf also paras 23.013 f).15
9 See Christoph Grabenwarter and Katharina Pabel, Europäische Menschenrechtskonvention (6th edn, C. H. Beck 2016) §
18 paras 5 f.
10 For more detail see Michael Holoubek and Melina Oswald, ‘Art 51’ in Michael Holoubek and Georg Lienbacher (eds),
GRC (2nd edn, Manz 2019) paras 15ff.
11 For more detail see Holoubek and Oswald (n 10) para 20.
12 Case C-617/10 Akerberg-Fransson [2013] ECLI:EU:C:2013:105.
13 Case C-40/11 Iida [2012] ECLI:EU:C:2012:691, para 79; Case C 87/12 Ymeraga and Ymeraga Tafarshiku [2013] ECLI:
EU:C:2013:291, para 41; Case C-206/13 Siragusa [2014] ECLI:EU:C:2014:126, para 25. For more detail see Holoubek
and Oswald (n 10) paras 20ff and 28ff.
14 This results from the wording of para 1 (‘any’) and Recital 62, which, with regard to the right of application to the judicial
authorities, also refers to the necessity according to the respective national law.
15 Recital 66.
317
D. SUPERVISORY AND INVESTIGATORY POWERS
23.008 The MAR provides for a complementary system of supervisory and investigatory powers
which, on the one hand, brings about a high degree of harmonisation of certain instruments
for competent authorities in Union law, but, on the other hand, still allows Member States
a certain degree of flexibility in the design of additional supervisory or investigatory powers
which are not provided for by Union law.
23.009 Para 2 defines a minimum catalogue16 of supervisory and investigatory powers, which the com-
petent authorities must in any case have at their disposal. Such a minimum catalogue already
existed in the previous provision of Art 12 para 2 of Directive 2003/6/EC, but this catalogue
was considerably extended by the MAR.17 Although para 2 also defines a certain core content
of the individual supervisory or investigatory powers, the concrete content of these powers is
ultimately the responsibility of the Member States according to national law.18
23.010 Para 3 contains a general clause requiring Member States to ensure that appropriate measures
are in place so that competent authorities have all the supervisory and investigatory powers
that are necessary to fulfil their duties.19 Viewed in isolation, para 3 appears to fulfil no or only
a limited function. However, in conjunction with para 2, para 3, in my opinion, is to be under-
stood as an opening clause, which allows Member States to provide for further supervisory and
investigatory powers beyond the minimum set of powers laid down in para 2. In accordance
with para 3, the Member States may extend the harmonised minimum catalogue of powers to
include administrative powers if these are necessary for the fulfilment of the tasks under the
MAR.20 The necessity for the fulfilment of the objectives of the MAR also, in my opinion,
represents the extreme limit of what may be additionally provided for beyond the minimum
catalogue of supervisory and investigatory powers laid down in Union law.
23.011 In any event, Member States must provide for the following supervisory and investigatory
powers in their national law for the competent authorities:
a. to access any document and data in any form, and to receive or take a copy thereof;21
b. to require or demand information from any person;22
16 Recital 62. Of the same view Johannes Zollner, ‘Art 23: Powers of competent authorities’ in Marco Ventoruzzo and
Sebastian Mock (eds), Market Abuse Regulation (Oxford University Press 2017) 446 and 448.
17 Niamh Moloney, EU Securities and Financial Markets Regulation (3rd edn, Oxford University Press 2014) 756.
18 Recital 62 and para 2 first sentence.
19 Arriving at the same conclusion also Moloney (n 17) 756; Zollner (n 16) 448 and Lars Teigelack, ‘§ 15 Market
Manipulation’ in Rüdiger Veil (ed), European Capital Markets Law (2nd edn, Hart Publishing 2017) § 15 para 79.
20 Powers created on the basis of this authorisation are not powers of national law but rather powers of Union law. cf Case
C-52/17 VTB Bank (Austria) AG [2018] ECLI:EU:C:2018:648 para 41; in this case, the ECJ had to examine the legal
qualification of a power in the field of banking supervision law provided for in national law against the background of
Arts 65ff of Directive 2013/36/EU.
21 Art 23 para 2 lit a; implementation in France: Art 143–2 règlement général de l’autorité des marchés financiers; imple-
mentation in Germany: § 6 para 3 Wertpapierhandelsgesetz (WpHG) 1998, BGBl I p 2708; implementation in the UK:
ss 122B, 122C Financial Services and Markets Act (FSMA) 2000, SI 2000/8.
22 Art 23 para 2 lit b; implementation in France: Art L621–10 code monétaire et financier (c. mon. fin.); implementation
in Germany: § 6 para 3 WpHG; implementation in the UK: ss 122A, 122B and 122C FSMA.
318
D. Supervisory and investigatory powers
c. to summon and question persons;23

d. in relation to commodity derivatives, to request information from market participants on
related spot markets according to standardised formats, obtain reports on transactions, and
have direct access to traders’ systems;24
e. to carry out on-site inspections and investigations at sites other than at the private resi-
dences of natural persons;25
f. to enter the premises of natural and legal persons in order to seize documents and data in
any form;26
g. to refer matters for criminal investigation;27
h. to require existing recordings of telephone conversations, electronic conversations or data
traffic records held by investment firms, credit institutions or financial institutions;28
i. to require existing data traffic records held by a telecommunications operator;29
j. to request the freezing or sequestration of assets, or both;30
k. to suspend trading of the financial instrument concerned;31
l. to require the temporary cessation of any practice that the competent authority considers
contrary to this Regulation;32
m. to impose a temporary prohibition on the exercise of professional activity; and33
n. to take all necessary measures to ensure that the public is correctly informed, inter alia, by
correcting false or misleading disclosed information,34
o. requiring an issuer or other person who has published or disseminated false or misleading
information to publish a corrective statement35
23 Art 23 para 2 lit b; implementation in France: Art L621–10 c. mon. fin.; implementation in Germany: § 6 para 3
WpHG; implementation in the UK: ss 122A, 122B and 122C FSMA.
24 Art 23 para 2 lit c; implementation in Germany: § 8 para 2 WpHG.
25 Art 23 para 2 lit d; implementation in France: Art L621–10 c. mon. fin.; implementation in Germany: § 6 para 12
WpHG.
26 Art 23 para 2 lit e; implementation in France: Art L621–12 c. mon. fin.; implementation in Germany: § 6 para 12
WpHG; implementation in the UK: s 122D FSMA 2000 and EG 4.12 FCA Handbook.
27 Art 23 para 2 lit f; implementation in France: Art L621–20–1 c. mon. fin.; implementation in Germany: § 11 WpHG;
implementation in the UK: EG 12.1.2 FCA Handbook.
28 Art 23 para 2 lit g; implementation in Germany: § 7 para 2 WpHG; implementation in the UK: SYSC 10A.1 FCA
Handbook.
29 Art 23 para 2 lit h; implementation in France: Art L621–10–2 c. mon. fin.; implementation in Germany: § 7 para 1
WpHG.
30 Art 23 para 2 lit i; implementation in France: Art L621–13 c. mon. fin.; implementation in Germany: § 6 para 13
WpHG; implementation in the UK: s 381 FSMA, EG 10.3 FCA Handbook.
31 Art 23 para 2 lit j; implementation in France: Art L621–13–7 c. mon. fin.; implementation in Germany: § 6 para 2
WpHG; implementation in the UK: s 122I FSMA.
32 Art 23 para 2 lit k; implementation in Germany: § 6 para 6 WpHG; implementation in the UK: s 123B FSMA.
33 Art 23 para 2 lit l; implementation in France: Art L621–13–8 c. mon. fin.; implementation in Germany: § 6 para 8
WpHG; implementation in the UK: s 123B FSMA.
34 Art 23 para 2 lit m; implementation in France: Art L621–18 c. mon. fin.; implementation in Germany: § 6 para 2
WpHG; implementation in the UK: ss 122G, 122H FSMA.
35 Art 23 para 2 lit m; implementation in France: Art L621–18 c. mon. fin.; implementation in Germany: § 6 para 14
WpHG; implementation in the UK: ss 122G, 122H FSMA.
319
23.012 The catalogue of supervisory and investigatory powers contains supervisory powers that were
already provided for in Art 12 para 2 of Directive 2003/6/EC. Compared to the previous
Regulation, the following have been adopted unchanged:
a. power to access any document and data in any form and to receive a copy thereof pursuant
to para 2 lit a (previously Art 12 para 2 lit a Directive 2003/6/EC);
b. requiring or demanding information and the power to summon and question persons pur-
suant to para 2 lit b (previously Art 12 para 2 lit b Directive 2003/6/EG);
c. request the freezing or sequestration of assets pursuant to para 2 lit i (previously para 2 lit g
Directive 2003/6/EC);
d. the power to suspend trading of the financial instrument concerned pursuant to para 2 lit j
(previously Art 12 para 2 lit f Directive 2003/6/EC);
e. to impose a temporary prohibition on the exercise of professional activity pursuant to para
2 lit l (previously Art 12 para 2 lit h Directive 2003/6/EC).
23.013 In an amended form, but still deriving from the former provisions in Art 12 para 2 of Directive
2003/6/EC, the power to carry out on-site inspections (para 2 lit d) was included in the MAR.
In contrast to the previous legal situation under Art 12 para 2 lit c of Directive 2003/6/EC, para
2 lit d grants the competent authority the right to carry out on-site inspections and investiga-
tions only ‘at sites other than at the private residences of natural persons’. This restriction, which
was unknown in the previous Directive, reflects the development of the ECJ’s case law on the
fundamental question of the protection of fundamental rights in the area of competition law.
On several occasions, the ECJ has had to answer the question of the extent to which the guar-
antee of the protection of private life (Art 7 CFR) must be taken into account in the context
of on-site inspections or investigations in connection with similar powers of the European
Commission in competition law investigations.36 Beginning with the judgment in the Hoechst
case,37 the ECJ interpreted Art 7 CFR – also in application of the principles developed by the
ECtHR in its case law – to the effect that its scope of protection principally covers only private
premises and not business premises.38 The restriction introduced by the Union legislators in
para 2 lit e can also be explained from this case law. However, it should be noted that the ECJ
in Roquettes Frères39 also subsequently conceded that under certain circumstances business
premises may also fall within the scope of protection of Art 7 CFR.40
23.014 The distinction between private premises and business premises is essential in that it depends
on whether an on-site inspection by the competent authority pursuant to para 2 lit d may only
be carried out with the prior approval of the court. In the case of Deutsche Bahn,41 the ECJ
answered this question in the area of competition law and adopted the ECtHR’s settled case
law42 with regard to the compatibility of on-site inspections with Art 8 ECHR. According to
36 This is in particular the power according to Art 20 of Directive 1/2003 of the Council of 16 December 2002 on the
implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty [2003] OJ L 1/1.
37 Joined Cases C-46/87 and 227/88 Hoechst v Commission [1989] ECR 2859.
38 Hoechst v Comission (n 37) para 18.
39 Case C-94/00 Roquette Frères SA [2002] ECR I-09011.
40 For more detail on the development of the ECJ's case law in the area of competition law see Alison Jones, Brenda Sufrin
and Niamh Dunne, EU Competition Law (7th edn, Oxford University Press 2019) 906ff.
41 Case C-583/13 P Deutsche Bahn and others v Commission [2015] ECLI:EU:C:2015:404.
42 Harju v Finland, App no 56716/09 (ECtHR, 15 February 2011). For more detail on the ECtHR’s case law on Art 8 of
the Convention see Christoph Grabenwarter, European Convention on Human Rights (C. H. Beck 2014) paras 25 and 37
320
the ECJ’s ruling, there is therefore no need for prior judicial approval for on-site inspections on
business premises, even under Art 7 of the CFR, as long as the existence of a subsequent judi-
cial review is ensured, in which a comprehensive examination of the legality of the intervention
is carried out, covering both legal and factual issues.43 The basic principles of this ruling will,
in my opinion, also have to be applied to the power to carry out on-site inspections pursuant
to para 2 lit d, also because the Union legislature itself refers to this by distinguishing between
private premises and business premises.
House searches and seizures were newly included in the catalogue of para 2 (para 2 lit e). 23.015
Although similar in some respects to on-site inspections, there are substantial differences. First
of all, it is noteworthy that the power to search and seize houses does not distinguish between
private and business premises. In this respect too, the Union legislators oriented themselves on
a model from competition law, namely Art 21 of Regulation 1/2003.44 In principle, the compe-
tent authority can therefore carry out house searches and seizures both in private premises and
in business premises. However, the distinction between private and business premises also plays
an essential role in this new power, as the same fundamental rights considerations apply here
as in the case of the power to carry out on-site inspections (see above para 23.014). However,
because the Union legislators did not restrict the power of house searches and seizures to
business premises from the outset, Art 23 subsequently provides in both para 2 lit e and para
2 subpara 2 that if judicial approval is required, this power may only be exercised after such
has been obtained. A further difference to the on-site inspection is that the power to carry out
a house search and seizure may only be exercised if the person concerned is under investigation
on suspicion of insider dealing or market manipulation. In addition, there must be a reasonable
suspicion that documents and data in any form seized during the house search may be relevant
as evidence in the investigations.
The power to obtain information from participants on spot markets and the right of access to 23.016
their systems in relation to commodity derivatives (para 2 lit c) is an innovation of the MAR
which results from the extension of the scope of applicability of the MAR and the competence
of the designated competent authorities with respect to certain spot commodity contracts (cf
para 22.017). Para 2 lit c also includes the power to impose reporting obligations on partici-
pants in spot markets with respect to the transactions concluded by them.
The power to refer a case to judicial authorities for criminal investigation (para 2 lit f) is also 23.017
an innovation of the MAR. Even if this power does not qualify as a supervisory or investigatory
power stricto sensu, the forwarding of facts to the judicial authorities must in itself be seen
against the background of the new regulatory system. While Directive 2003/6/EC only pro-
vided that the Member States had to ensure the necessary administrative measures and admin-
istrative sanctions to sanction violations of the requirements or prohibitions of this Directive,45
the Union legislators have, with the MAR, created a sanctions system that not only provides for
administrative sanctions but also, with the CRIM-MAD, for judicial sanctions for particularly
or Bernadette Rainey, Elizabeth Wicks and Clare Ovey, The European Convention on Human Rights (7th edn, Oxford
University Press 2017) 408ff.
43 Deutsche Bahn and others v Commission (n 41).
44 For more detail see Jones, Sufrin and Dunne (n 40) 908ff.
45 Art 14 para 1 Directive 2003/6/EG.
321
serious forms of market manipulation or insider dealing. In this respect, the effective imple-
mentation of the MAR/CRIM-MAD sanctions system requires a certain flow of information
between the administrative authorities and the judicial authorities in order to ensure effective
criminal prosecution even in those cases in which a suspicion of a criminal offence as defined by
the CRIM-MAD arises in the course of the administrative investigation procedure.
23.018 The power to request existing recordings of telephone conversations, which already existed under
Art 12 para 2 lit d of Directive 2003/6/EC, in principle, was retained (para 2 lit g). Compared to
the previous provision, this power was extended to existing electronic communications and data
traffic records. Whereas the Union legislators had previously provided for this power without any
restrictions and without differentiating the group of addressees, this power has been substan-
tially restricted and differentiated by the new codification of the MAR: para 2 lit g allows the
competent authorities (only) to request existing recordings of telephone conversations, electronic
communications and data traffic records held by investment firms pursuant to Art 3 para 1 (2),
credit institutions pursuant to Art 3 para 1 (3) or financial institutions pursuant to Art 3 para 1
(4). Thus, the scope of application of this power is limited to those telephone conversations or
electronic communications and data traffic records that credit institutions, investment firms or
financial institutions are required to keep in the context of their obligation to keep records of their
services, activities and transactions pursuant to Art 16 paras 6 and 7 MiFID II.46
23.019 This is to be distinguished from the power to request existing data traffic records (para 2 lit
h) from telecommunications operators. This power is limited by Union law in two ways: On
the one hand, it can only be exercised if there is a reasonable suspicion of market manipulation
or insider dealing, although with regard to insider dealing, this power can only be exercised in
the cases of Art 14 lit a and b. On the other hand, this power may not include access to the
content of telephone conversations.47 In addition, this power is also subject to admissibility
under national law. Therefore, Member States may further limit the scope of this power.
However, an extension of this power to the content of telephone conversations within the scope
of transposition in the national law or the complete non-transposition is, in my opinion, not
permissible under Union law.
23.020 The catalogue of Art 12 para 2 of Directive 2003/6/EC did not include the power to require the
temporary cessation of any practice that is contrary to the MAR (para 2 lit k). From a Union law
perspective, this power primarily comprises a prohibition of illegal activities that is additionally
limited in time (‘temporary’). The temporal component must not, of course, be overstretched:
Although the wording of this power may not include an unlimited prohibition, the competent
authority may well be allowed to issue a prohibition until the unlawful conduct or behaviour has
ceased. Therefore, this power is, in my opinion, similar to the powers of competent authorities
known from the field of prudential supervision, for example, of credit institutions or insurance
companies, to require licensed institutions to restore compliance with prudential requirements.
Even if it is not a positive official order, but a prohibition, which is also linked to a temporal
element that is not quite usual for the official order for restoring compliance with prudential
requirements, the power, in my opinion, does not differ substantially in its factual effect from
the aforementioned powers in the field of prudential supervision. The prohibition pursuant
46 Recital 65.
47 Recital 65.
322
to para 2 lit k is also based on an assessment by the competent authority of the lawfulness of
a certain conduct or a certain action of the addressee and leads to the addressee of the official
action being required to change its conduct.
Completely new is the power of the competent authorities to take all necessary measures to 23.021
ensure that the public is correctly informed pursuant to para 2 lit m. The Union legislators
explicitly leave open (‘all necessary measures’) which official actions this power may include.
However, the Union legislators mention the correction of false or misleading disclosed
information as an example of official action falling within this power. This correction can
be made either by the competent authority itself or by the issuer that has disclosed false or
misleading information after the competent authority has given it a corresponding order to
correct. However, para 2 lit m does not limit this power to these two forms of regulatory action;
therefore, Member States have the possibility to provide for other measures, in addition to the
correction by the authority or the power to order the correction, that lead to the correction of
misleading or false disclosed information.
Literature
Grabenwarter C, European Convention on Human Rights (C. H. Beck 2014)

Grabenwarter C and Pabel K, Europäische Menschenrechtskonvention (6th edn, C. H. Beck 2016)
Holoubek M and Oswald M, ‘Art 51’ in Holoubek M and Lienbacher G (eds), GRC (2nd edn, Manz
2019)
Jones A, Sufrin B and Dunne N, EU Competition Law (7th edn, Oxford University Press 2019)
Rainey B, Wicks E and Ovey C, The European Convention on Human Rights (7th edn, Oxford University
Press 2017)
Teigelack L, ‘§ 15 Market Manipulation’ in Veil R (ed), European Capital Markets Law (2nd edn, Hart
Publishing 2017)
Zollner J, ‘Art 23: Powers of Competent Authorities’ in Ventoruzzo M and Mock S (eds), Market Abuse
See also Literature on Art 22 MAR.
323
ARTICLE 24
COOPERATION WITH ESMA
Alfred Schramm
1. The competent authorities shall cooperate with ESMA for the purposes of this Regulation,
in accordance with Regulation (EU) No 1095/2010.
2. The competent authorities shall, without delay, provide ESMA with all information
necessary to carry out its duties, in accordance with Article 35 of Regulation (EU) No
1095/2010.
draft implementing technical standards to determine the procedures and forms for
exchange of information as referred to in paragraph 2.
ESMA shall submit those draft implementing technical standards to the Commission by
3 July 2016.
1095/2010.
OVERVIEW
A. INTRODUCTION 24.001 C. IMPLEMENTATION AUTHORISATIONS 24.008

B. COOPERATION OBLIGATION 24.006
A. INTRODUCTION
24.001 Art 24 sets out in paras 1 and 2 an obligation for the competent supervisory authorities to
cooperate with the European Securities and Markets Authority (ESMA) and obliges the
supervisory authorities to provide ESMA with all information necessary to carry out its duties
pursuant to Art 35 ESMA Regulation. Para 3 empowers ESMA to develop implementing
technical standards (ITS) pursuant to Art 15 ESMA Regulation, which the Commission is to
adopt as an Implementing Regulation pursuant to Art 291 TFEU.
324
Alfred Schramm - 9781800882249
A. Introduction
An obligation of the supervisory authorities to cooperate with ESMA is also laid down else- 24.002
where in the Regulation, namely in Art 25 para 1. In addition to the conspicuous redundancy
of the provisions, it should be noted that Art 24 para 1 provides for cooperation between the
supervisory authorities and ESMA, while Art 25 para 1 also contains an obligation to cooperate
with the supervisory authorities of the other Member States and other institutions (see Art
25 for details). Hence, one must assume from the context of the provision that Art 24 para 1
lays down a general obligation of cooperation, which is defined more precisely with regard to
ESMA in Art 25,1 whereas the obligation to provide information is sufficiently specified in
Art 24 para 2 itself.
Art 15a of the MAD 2003 already contained an obligation of cooperation between the national 24.003
financial market supervisory authorities and ESMA (with the exception of the authorisation
to develop implementing standards). An almost identical obligation to cooperate can also be
found in Art 87 MIFID II; here, too, the previous provision already provided for such an
obligation.2
ESMA was founded by Regulation 1095/2010 and is one of three European Supervisory 24.004
Authorities (also referred to as ESAs; in addition, there are the European Banking Authority
(EBA) and the European Insurance and Occupational Pensions Authority [EIOPA] as well
as a European Systemic Risk Board (ESRB)) in the framework of the European System of
Financial Supervisors (ESFS). This supervisory system, which was established in the light of the
experience gained during the financial crisis of 2009 and which includes the above-mentioned
ESAs and the competent supervisory authorities, was designed to ensure a closer and more
coordinated (coherent) supervision of the financial market at European level, while leaving
the direct supervision of financial service providers to the authorities in the Member States
and giving the ESAs coordinating competences. In addition to preparing peer reviews and
coordinating supervisory policies (Art 8 para 4 and Art 31 ESMA Regulation), the ESAs have
direct supervisory functions only in exceptional cases. ESMA has so far been entrusted with
such functions in two cases (the authorisation of CCPs and the ongoing supervision of credit
rating agencies3).
The essential and central competences of the ESAs – and thus also of ESMA – are the draft- 24.005
ing of implementing standards on the basis of secondary Union law (regulatory standards
pursuant to Arts 10–14 ESMA Regulation and implementing standards pursuant to Art 15
ESMA Regulation), which are adopted by the Commission as an Implementing Regulation/
Implementing Directive pursuant to Art 290 TFEU or as a Delegated Regulation/Delegated
Directive pursuant to Art 291 TFEU. In addition, ESMA independently develops guidelines
and recommendations (Art 16 ESMA Regulation). The ESAs have specific competences to
regulate dispute settlements between EU supervisory authorities (Art 19 ESMA Regulation),
1 Johannes Zollner, ‘Article 24: Cooperation with ESMA’ in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse
2 Arts 25 and 62a MIFID I. The cooperation with ESMA was e.g., implemented in § 105 Austrian WAG 2018 and in §
7a German Securities Trading Act (WpHG).
3 Niamh Moloney, EU Securities and Financial Market Regulation (3rd edn, Oxford University Press 2014) 649ff. Due to
the latest amendments to the ESMA Regulation from January 2022, ESMA will also be responsible for the direct super-
vision of EU critical benchmarks, the recognition of third-country benchmarks and the authorisation and supervision of
different types of data service providers.
325
Article 24 COOPERATION WITH ESMA
to take measures in the event of a crisis (Art 18 ESMA Regulation) and in the event of viola-
tions of EU law (Art 17 ESMA Regulation); measures (decisions) directly applicable to indi-
vidual financial market participants may be adopted by the ESAs in an escalation procedure as
a last resort.4 For all these supervisory and coordination activities, ESMA requires information
which the competent EU supervisory authorities must make available.
A first major revision of the ESAs Regulations came into force on 1 January 2020 by Reg (EU)
2019/2175. However, the changes and the additional tasks of ESMA introduced under this
amendment do not alter the system of information exchange already established under Arts 24
to 29 MAR. It may only be added here that, according to the newly introduced Art 31 ESMA
Regulation, ESMA shall establish a system of information exchange regarding information
relevant for the assessment of the fitness and propriety of holders of qualifying holdings and
directors and key function holders of financial institutions together with EIOPA and EBA.
B. COOPERATION OBLIGATION
24.006 According to Art 35 of the ESMA Regulation, the national supervisory authorities are obliged
to provide ESMA, on request, with all information necessary for it to carry out its tasks.5 Para
1 must be understood as a general obligation, as the more precise information and cooperation
obligations result from the range of tasks according to the ESMA Regulation (see in general
paras 24.004 and 24.005 above).6 ESMA may request information from the authorities either
in individual cases or at regular intervals.7
24.007 The purpose of this provision is to ensure that a sufficient flow of information is established
between ESMA and the supervisory authorities. Art 35 ESMA Regulation provides that
ESMA may at any time request the information necessary for its activities, which means that
ESMA is limited to the scope of its tasks according to the ESMA Regulation when request-
ing such information.8 The request to the supervisory authorities also presupposes that the
information was obtained lawfully9 by these authorities. They must transmit this information
without delay, although the precise meaning of ‘without delay’ is open for discussion, especially
if this information must still be requested from the supervised entities. Sometimes ‘without
delay’ is understood as ‘without undue delay’,10 which means that the question of when infor-
mation is to be transmitted in good time cannot be answered generally, but only in individual
cases. If ESMA does not receive the requested information from the competent supervisory
authorities in a timely manner, or if the information is not available from the authority, ESMA
4 Art 17 para 6, Art 18 para 4 and Art 19 para 4 ESMA Regulation.

5 See Zollner (n 1) para B.24.06.
6 See Jörn Axel Kämmerer, ‘Arts 24, 25, 26 MAR’ in Matthias Lehmann and Christoph Kumpan (eds), European
Financial Services Law (Beck–Hart–Nomos 2019) Arts 25, 26 MAR para 5.
7 Art 35 para 2 ESMA Regulation; Zollner (n 1) para B.24.07.
8 Zollner (n 1) para B.24.07.
9 Volke Schlette and Martin Bouchon, '§ 7: Zusammenarbeit mit zuständigen Stellen im Ausland’ in Andreas Fuchs (ed),
Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016) para 7.
10 Schlette and Bouchon (n 9) para 8.8.
326
C. Implementation authorisations
may call upon other supervisory authorities to transmit the information11 and, if that fails too,
may ultimately request the necessary information from the supervised entities.12
C. IMPLEMENTATION AUTHORISATIONS
Para 3 provides that ESMA shall develop corresponding draft implementing technical stand- 24.008
ards for the exchange of information between ESMA and the competent authorities. These
technical standards should establish standard procedures and standard forms for the exchange
of information between supervisory authorities and ESMA, in order to ensure that information
is exchanged under standardised and uniform conditions. The technical implementing stand-
ards are to be adopted in accordance with the procedure set out in Art 15 ESMA Regulation,
whereby ESMA is responsible for drafting them and submitting a proposal to the Commission,
and the Commission – due to the context of the provision – will adopt these standards in the
form of an Implementing Regulation pursuant to Art 291 TFEU.
After the specified date of 3 July 2016 had passed, ESMA published the implementing techni- 24.009
cal standards in February 201813 and submitted them to the Commission for a resolution.14 The
Commission issued the Implementing Regulation 1406/2020 in October 2020.15 It defines
ESMA’s information requirements for the competent supervisory authorities pursuant to Art
24 para 2 and the corresponding forms for information requests and responses to be used by
ESMA and the supervisory authorities.
NOTE
The views expressed here are solely those of the author and do not express the views of the
Austrian Financial Market Authority.
Literature
Kämmerer JA, ‘Arts 24, 25, 26 MAR’ in Lehmann M and Kumpan C (eds), European Financial Services
Law (Beck–Hart–Nomos 2019)
11 Art 35 para 5 ESMA Regulation.

12 Art 35 para 6 ESMA Regulation.
13 ESMA, ‘Final Report Draft Implementing Technical Standards on forms and procedures for cooperation under Article
24 and 25 of Regulation (EU) No 596/2014 on market abuse’, ESMA70–145–398, 6 February 2018.
14 ESMA, ‘ESMA provides standards on supervisory cooperation for market abuse investigations’ press release, 6 February
2018 https://www.esma.europa.eu/press-news/esma-news/esma-provides-standards-supervisory-cooperation-market
-abuse-investigations accessed on 1 August 2020.
15 Commission Implementing Regulation (EU) 2020/1406 of 2 October 2020 laying down implementing technical stand-
ards with regard to procedures and forms for exchange of information and cooperation between competent authorities,
ESMA, the Commission and other entities under Articles 24 (2) and 25 of Regulation (EU) No 596/2014 of the
European Parliament and of the Council on market abuse [2020] OJ L 325/7, entered into force on 27 October 2020.
327
Article 24 COOPERATION WITH ESMA
Schlette V and Bouchon M, ‘§ 7: Zusammenarbeit mit zuständigen Stellen im Ausland’ in Fuchs A (ed),
Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016)
Zollner J, ‘Article 24: Cooperation with ESMA’ in Ventoruzzo M and Mock S (eds), Market Abuse
Regulation (Oxford University Press 2017).
328
ARTICLE 25
OBLIGATION TO COOPERATE
Alfred Schramm
1. Competent authorities shall cooperate with each other and with ESMA where necessary
for the purposes of this Regulation, unless one of the exceptions in paragraph 2 applies.
Competent authorities shall render assistance to competent authorities of other Member
States and ESMA. In particular, they shall exchange information without undue delay and
cooperate in investigation, supervision and enforcement activities.
The obligation to cooperate and assist laid down in the first subparagraph shall also apply
as regards the Commission in relation to the exchange of information relating to commod-
ities which are agricultural products listed in Annex I to the TFEU.
The competent authorities and ESMA shall cooperate in accordance with Regulation
(EU) No 1095/2010, in particular Article 35 thereof.
Where Member States have chosen, in accordance with Article 30(1), second sub-
paragraph, to lay down criminal sanctions for infringements of the provisions of this
Regulation referred to in that Article, they shall ensure that appropriate measures are in
place so that competent authorities have all the necessary powers to liaise with judicial
authorities within their jurisdiction to receive specific information related to criminal
investigations or proceedings commenced for possible infringements of this Regulation
and provide the same to other competent authorities and ESMA to fulfil their obligation
to cooperate with each other and ESMA for the purposes of this Regulation.
2. A competent authority may refuse to act on a request for information or a request to coop-
erate with an investigation only in the following exceptional circumstances, namely where:
(a) communication of relevant information could adversely affect the security of the
Member State addressed, in particular the fight against terrorism and other serious
crimes;
(b) complying with the request is likely adversely to affect its own investigation, enforce-
ment activities or, where applicable, a criminal investigation;
(c) judicial proceedings have already been initiated in respect of the same actions and
against the same persons before the authorities of the Member State addressed; or
(d) a final judgment has already been delivered in relation to such persons for the same
actions in the Member State addressed.
3. Competent authorities and ESMA shall cooperate with the Agency for the Cooperation
of Energy Regulators (ACER), established under Regulation (EC) No 713/2009 of the
329
Article 25 OBLIGATION TO COOPERATE
European Parliament and of the Council,1 and the national regulatory authorities of the
Member States to ensure that a coordinated approach is taken to the enforcement of the
relevant rules where transactions, orders to trade or other actions or behaviours relate to
one or more financial instruments to which this Regulation applies and also to one or more
wholesale energy products to which Article 3, 4 and 5 of Regulation (EU) No 1227/2011
apply. Competent authorities shall consider the specific characteristics of the definitions
of Article 2 of Regulation (EU) No 1227/2011 and the provisions of Article 3, 4 and 5 of
Regulation (EU) No 1227/2011 when they apply Articles 7, 8 and 12 of this Regulation to
financial instruments related to wholesale energy products.
4. Competent authorities shall, on request, immediately supply any information required for
the purpose referred to in paragraph 1.
5. Where a competent authority is convinced that acts contrary to the provisions of this
Regulation are being, or have been, carried out on the territory of another Member State or
that acts are affecting financial instruments traded on a trading venue situated in another
Member State, it shall give notice of that fact in as specific a manner as possible to the
competent authority of the other Member State and to ESMA and, in relation to whole-
sale energy products, to ACER. The competent authorities of the various Member States
involved shall consult each other and ESMA and, in relation to wholesale energy products,
ACER, on the appropriate action to take and inform each other of significant interim
developments. They shall coordinate their action, in order to avoid possible duplication
and overlap when applying administrative sanctions and other administrative measures to
those cross-border cases in accordance with Articles 30 and 31, and shall assist each other
in the enforcement of their decisions.
6. The competent authority of one Member State may request assistance from the competent
authority of another Member State with regard to on-site inspections or investigations.
A requesting competent authority may inform ESMA of any request referred to in the
first subparagraph. In the case of an investigation or an inspection with cross-border effect,
ESMA shall, if requested to do so by one of the competent authorities, coordinate the
investigation or inspection.
Where a competent authority receives a request from a competent authority of another
Member State to carry out an on-site inspection or an investigation, it may do any of the
following:
(a) carry out the on-site inspection or investigation itself;
(b) allow the competent authority which submitted the request to participate in an
on-site inspection or investigation;
(c) allow the competent authority which submitted the request to carry out the on-site
inspection or investigation itself;
(d) appoint auditors or experts to carry out the on-site inspection or investigation;
(e) share specific tasks related to supervisory activities with the other competent
authorities.
Competent authorities may also cooperate with competent authorities of other Member
States with respect to facilitating the recovery of pecuniary sanctions.
1 Regulation (EC) No 713/2009 of the European Parliament and of the Council of 13 July 2009 establishing an Agency
for the Cooperation of Energy Regulators (OJ L 211, 14.8.2009, p. 1).
330
7. Without prejudice to Article 258 TFEU, a competent authority whose request for infor-
mation or assistance in accordance with paragraphs 1, 3, 4 and 5 is not acted upon within
a reasonable time or whose request for information or assistance is rejected may refer that
rejection or absence of action within a reasonable timeframe to ESMA.
In those situations, ESMA may act in accordance with Article 19 of Regulation (EU) No
1095/2010, without prejudice to the possibility of ESMA acting in accordance with Article
17 of Regulation (EU) No 1095/2010.
8. Competent authorities shall cooperate and exchange information with relevant national
and third-country regulatory authorities responsible for the related spot markets where
they have reasonable grounds to suspect that acts, which constitute insider dealing,
unlawful disclosure of information or market manipulation infringing this Regulation, are
being, or have been, carried out. Such cooperation shall ensure a consolidated overview of
the financial and spot markets, and shall detect and impose sanctions for cross-market and
cross-border market abuses.
In relation to emission allowances, the cooperation and exchange of information pro-
vided for under the first subparagraph shall also be ensured with:
(a) the auction monitor, with regard to auctions of emission allowances or other
auctioned products based thereon that are held pursuant to Regulation (EU) No
1031/2010; and
(b) competent authorities, registry administrators, including the Central Administrator,
and other public bodies charged with the supervision of compliance under Directive
2003/87/EC.
ESMA shall perform a facilitation and coordination role in relation to the coop-
eration and exchange of information between competent authorities and regulatory
authorities in other Member States and third countries. Competent authorities shall,
where possible, conclude cooperation arrangements with third-country regulatory
authorities responsible for the related spot markets in accordance with Article 26.
exchange of information and assistance as referred to in this Article.
by 3 July 2016.
1095/2010.
OVERVIEW
A. INTRODUCTION 25.001 AND EMISSION ALLOWANCES TRADE 25.013

B. COOPERATION AMONG SUPERVISORY G. OBTAINING INFORMATION FROM JUDICIAL
AUTHORITIES 25.003 AUTHORITIES 25.014
C. COOPERATION WITH ESMA 25.009 H. NOTIFICATIONS OF MAR INFRINGEMENTS 25.015
D. COOPERATION WITH ACER 25.010 I. CONCILIATION PROCEDURE 25.016
E. COOPERATION WITH THE COMMISSION 25.012 J. COOPERATION AGREEMENTS (MOU) 25.020
F. COOPERATION AS REGARDS SPOT MARKETS K. IMPLEMENTATION AUTHORISATIONS 25.022
331
A. INTRODUCTION
25.001 Art 25 contains a comprehensive obligation to cooperate and to render assistance for the
supervisory purposes of the MAR. This includes the exchange of information and other forms
of cooperation (on-site inspections, investigations, interviews, collection of financial penalties).
The obligation to cooperate covers the competent supervisory authorities and certain Union
authorities (ESMA, ACER, the Commission) as well as other designated national authorities
and bodies. The provision also provides for narrowly defined exemptions under which supervi-
sory authorities may refuse to cooperate. Art 16 of the MAD 2003 contained a corresponding
– but in some points not yet so far-reaching – obligation to cooperate.2
25.002 Accordingly, an obligation to cooperate is foreseen:

● between the competent supervisory authorities (paras 1, 2, 4, 6);
● between the competent supervisory authorities and ESMA3 (para 1 subpara 3), ACER
(including national energy regulatory authorities) (para 3), the Commission (para 1 subpara
2), the regulators of spot markets (para 8 subpara 1), and the authorities and bodies respon-
sible in the context of emission allowances trading (para 8 subpara 2); and
● between ESMA and ACER (including the national energy regulatory authorities) (para 3).
Cooperation may also include supervisory authorities and regulators of spot markets in third
countries.
B. COOPERATION AMONG SUPERVISORY AUTHORITIES
25.003 Art 25 first of all obliges the competent supervisory authorities to cooperate with each other
and with ESMA, with the obligation of cooperation extending to all supervisory purposes of
the MAR in a broader sense. This includes not only a comprehensive exchange of information
pursuant to para 1 (which covers the transmission of all information required for the super-
visory purposes of the MAR), but also rendering assistance, which, pursuant to para 6, may
include on-site inspections, investigations, interviews and the recovery of pecuniary sanctions.
25.004 When cooperating, the supervisory authorities must make use of the forms provided by
Implementing Regulation 292/2018, esp Annex I to III (which standardise the request for
assistance, the acknowledegment of receipt of the request and the reply to the request).
2 A corresponding and indeed almost identical obligation to cooperate in the context of securities supervision can also
be found in Art 79 MiFID II. For the development of the provision see Johannes Zollner, ‘Article 25: Obligation to
Cooperate’ in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse Regulation (Oxford University Press 2017)
paras B.25.04ff.
3 Which has a coordinating role; see Jörn Axel Kämmerer, ‘Arts 24, 25, 26 MAR’ in Matthias Lehmann and Christoph
Kumpan (eds), European Financial Services Law (Beck–Hart–Nomos 2019) Arts 25, 26 MAR para 6.
332
B. Cooperation among supervisory authorities
Cooperation may be refused by the requested authority only on the grounds referred to in para 25.005
2. Para 2 provides exhaustively4 for four grounds for refusal where:
● communication of relevant information could adversely affect the security of the Member
State addressed, in particular the fight against terrorism and other serious crimes;
● complying would be likely5 to adversely affect the own investigation, enforcement activities
or criminal investigation of the Member State addressed;
● judicial proceedings have already been initiated in respect of the same actions and against
the same persons before the authorities of the Member State addressed;6 or
● a final judgment has already been delivered in relation to such persons for the same actions
in the Member State addressed.7
Any such refusal must be notified to the applicant authority within a reasonable time using
the forms provided, together with the corresponding reasons for the refusal (Art 5 para 3
Implementing Regulation 292/2018). If assistance is wrongfully refused (in particular if there is
no reason for refusal as set out in para 2), the requesting authority may turn to ESMA accord-
ing to Art 25 para 7 (see below para 25.016/19).
The supervisory authority addressed shall supply information immediately upon a request by 25.006
a supervisory authority8 pursuant to para 4. The MAR does not contain any precise definition
of ‘immediately’. For that reason, according to the relevant literature, a reply must be made
without undue delay, i.e., without delaying culpably.9
Para 6 contains provisions for the execution of requests for assistance (requests for on-site 25.007
inspections, investigations, interviews). The requested authority has options as regards the
procedure to be followed. It can:
● carry out the on-site inspection or investigation itself;

● allow the competent authority which submitted the request to participate in an on-site
inspection or investigation;
● allow the competent authority which submitted the request to carry out the on-site inspec-
tion or investigation itself;
● appoint auditors or experts to carry out the on-site inspection or investigation;
● share specific tasks related to supervisory activities with the other competent authorities.
According to Art 8 of Regulation 2018/292, the requesting and requested authorities shall
consult with each other and determine, on the basis of the additional criteria listed in the
Regulation, which of the above-mentioned procedures is the most appropriate.

5 Certainty is not required; see Zollner (n 2) para B.25.18. See also Kämmerer (n 3) Arts 25, 26 MAR para 6.
6 See Zollner (n 2) para B.25.19: intended to comply with ne bis in idem; cf, however, Kämmerer (n 3) Arts 25, 26 MAR
para 6: ne bis in idem does not apply to sanctions imposed by different Member States.
7 Not in another Member State; see Zollner (n 2) para B.25.20.
8 Judicial authorities are not mentioned; see Zollner (n 2) para B.25.24.
9 See also Volke Schlette and Martin Bouchon, ‘§ 7a: Zusammenarbeit mit der Europäischen Wertpapier- und
Marktaufsichtsbehörde’ in Fuchs (ed), Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016) § 7a para 8; Zollner (n 2)
para B.25.12 (‘within a reasonable time’). See also para 24.007.
333
25.008 According to para 6 last sentence, cooperation can also include the recovery of pecuniary
sanctions. While the Recitals remain silent on this matter, Art 9 Implementing Regulation
2018/292 provides that the requesting and requested authorities must agree on the most appro-
priate approach. In doing so, the measures already taken by the requesting authority on its sov-
ereign territory and the legal provisions applicable to recovery on the territory of the requested
authority must be taken into account. The requested authority shall act in accordance with
the relevant national legislation. If the assistance requested cannot be provided, the requesting
authority may be referred to another authority.
C. COOPERATION WITH ESMA
25.009 Paras 1 and 4, in addition to Art 24, provide for cooperation between the competent super-
visory authorities (transmission of information) and ESMA. The conditions for cooperation
between the supervisory authorities in the exchange of information and with regard to the
refusal to provide information apply mutatis mutandis (see paras 25.005 f). Para 1 subpara 3 is
redundant, especially since cooperation as to information is already specifically regulated in Art
24. For details, also on the forms to be used, see Implementing Regulation 1406/2020, which
contains rules and forms similar to Implementing Regulation 292/2018.
D. COOPERATION WITH ACER
25.010 Regulation (EU) 1227/2011 (REMIT),10 which regulates the integrity and transparency of
the market in wholesale energy products,11 contains in Arts 3–5 a prohibition of market abuse
in the trading of energy allowances. This prohibition is monitored by ACER (Agency for the
Cooperation of Energy Regulators)12 and the national energy regulators according to Art 7
REMIT. Art 10 REMIT provides for cooperation between ACER and, among others, ESMA
and the competent supervisory authorities.13
25.011 Para 3 provides that the competent supervisory authorities and ESMA shall cooperate with
ACER with regard to the supervision of the prohibition of market abuse. This cooperation
shall include the exchange of information as well as specific other agendas. This corresponds to
Art 16 REMIT, whereby the competent supervisory authorities, the national energy regulators,
ACER and ESMA inform each other of violations of the market manipulation prohibitions
under the MAR and REMIT. Again, details can be found in Implementing Regulation
1406/2020. In addition, a (possible) participation of the competent supervisory authorities in
a cross-border investigatory group pursuant to Art 16 para 4c REMIT is provided for in Art
10 Implementing Regulation 1406/2020. Such an investigatory group will examine whether
REMIT has been violated and in which Member State the violation was committed. In addi-
tion, according to Art 10 Implementing Regulation 1406/2020, for the purposes of ensuring
10 Regulation (EU) No 1227/2011 of the European Parliament and of the Council of 25 October 2011 on wholesale energy
11 On the definition of wholesale energy products, see paras 3.050 f.
12 https://acer.europa.eu accessed on 29 December 2020.
334
G. Obtaining information from judicial authorities
a consistent approach to the enforcement of relevant rules ESMA and ACER shall consult
each other regularly.
E. COOPERATION WITH THE COMMISSION
Para 1 subpara 2 also provides for cooperation with the Commission, although this explicitly 25.012
only extends to the exchange of information. In this context, the competent supervisory
authorities are obliged to transmit information on commodities which are agricultural products
according to Annex I to the TFEU14 to the Commission. Pursuant to para 4, the competent
supervisory authorities shall supply this information immediately (see para 25.006); in addition,
pursuant to para 2, the competent supervisory authorities may refuse to act on a request for
information for the reasons set forth therein (see para 25.005). For details, also on the forms to
be used, see Implementing Regulation 1406/2020.
F. COOPERATION AS REGARDS SPOT MARKETS AND EMISSION ALLOWANCES

TRADE
Para 8 provides for cooperation through the exchange of information between the competent 25.013
supervisory authorities and the regulatory authorities on spot markets15 and also with other
institutions listed in para 8 lit a and lit b in the framework of auctions of emission allowances.16
In the event of suspected violations of the MAR, this cooperation is to take place not only with
the competent authorities, but also extends to third-country regulatory authorities, which is,
among others, also intended to enable appropriate sanctions.
According to the wording of para 8 subpara 3, an exchange of information with third-country

regulatory authorities and institutions can also take place without concluding an MoU
(Memorandum of Understanding). However, para 8 subpara 3 stipulates that competent
authorities shall, where possible, conclude MoU. ESMA shall coordinate and facilitate the
cooperation between competent authorities and third-country regulatory authorities or bodies.
G. OBTAINING INFORMATION FROM JUDICIAL AUTHORITIES
Para 1 subpara 4 provides that the Member States in which criminal sanctions for infringe- 25.014
ments of the MAR have been introduced in accordance with Art 30 should ensure that the
competent supervisory authorities can also cooperate with the judicial authorities accordingly.
The respective competent supervisory authorities should be able to receive specific and neces-
sary information on criminal investigations and proceedings commenced and to exchange this
14 Annex I of the TFEU https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:12012E/TXT&from=

EN accessed on 29 December 2020.
15 With regard to spot markets, see also para 2.012 and para 3.039.
16 With regard to emission allowances, see also para 2.009 and para 3.044.
335
information with the competent supervisory authorities in the Member States and with ESMA
in order to enable them to fulfil their obligations under the MAR.
H. NOTIFICATIONS OF MAR INFRINGEMENTS
25.015 Para 5 sent 1 provides for a special type of notification between the competent supervisory
authorities, ESMA and ACER. If a competent supervisory authority is convinced or has
information that the MAR is being or has been infringed in another Member State, it should
notify the respective competent authority in that other Member State, ESMA and ACER
(where relevant and necessary) and provide all available information.17 Art 10 and Annex IV
Implementing Regulation (EU) 292/2018 provide for appropriate forms for this purpose.
For such cases, para 5 sents 2 and 3 provide rules on cooperation between the competent
supervisory authorities in cross-border proceedings to pursue cases of market abuse (and to
apply administrative measures and administrative sanctions).18 Within the framework of the
procedures to be carried out, the respective competent supervisory authorities concerned should
inform each other about the necessary steps (and presumably also about the progress of the
respective proceedings), coordinate them and render each other assistance. This also refers to
the obligation to cooperate in paras 1 and 4 (obligation to exchange information) and para 6
(on-site inspections). The purpose of this coordination is to avoid, as far as possible, any dupli-
cation of work that could arise for the competent authorities in the case of non-coordinated
investigations and any overlapping of administrative sanctions and other administrative meas-
ures19 in proceedings in cross-border cases involving the imposition of administrative sanctions
and measures.20
I. CONCILIATION PROCEDURE
25.016 ESMA may be called upon by a requesting supervisory authority where its requests for infor-
mation or assistance have not been acted upon within a reasonable time or have been rejected.
On the basis of such a request, ESMA may initiate conciliation proceedings pursuant to Art
19 ESMA Regulation. While para 7 only refers to requests for assistance and information
pursuant to paras 1, 3, 4 and 5 explicitly, one must conclude from the regulatory context that
the provision also covers requests for assistance pursuant to para 6,21 particularly since para 1
explicitly mentions – apart from requests for information (regulated in more detail in paras 3,
4 and 5) – requests for assistance (regulated in more detail in para 6). The omission of para 6
from the list in para 7 is most probably an editorial error. On the other hand, other authorities
such as the Commission and ACER cannot turn to ESMA, since Art 19 ESMA Regulation
only provides supervisory authorities with the right to submit applications.
17 Art 79 para 4 MiFID II contains a corresponding information obligation.

18 Art 31 para 2 also contains a corresponding obligation to cooperate.
19 Art 31 para 2 rightly refers to the prohibition of duplication of sanctions. See also Zollner (n 2) para B.25.31.
20 With regard to these procedures, see Arts 30 und 31.
21 See also Zollner (n 2) para B.25.34.
336
J. Cooperation agreements (MoU)
Within the framework of the conciliation procedure pursuant to Art 19 ESMA Regulation, 25.017
ESMA may set time limits for the conciliation of disagreements between the competent super-
visory authorities concerned, depending, among other things, on the urgency and complexity of
the matter (conciliation phase). If the authorities concerned fail to reach an agreement, ESMA
can reach a decision with binding effect, obliging the competent authorities to take or refrain
from taking certain measures to ensure compliance with Union law (in the given context that
is the MAR).
Independently of the conciliation procedure, ESMA may also conduct a parallel procedure 25.018
pursuant to Art 17 ESMA Regulation to determine a non-application or breach of EU law.
In this case, after an examination phase, ESMA will issue a recommendation to the competent
supervisory authority, which defines the measures to be taken, thereby restoring compliance
with EU law. If the supervisory authority concerned does not comply with this recommenda-
tion within one month, ESMA shall inform the Commission, which shall issue a corresponding
formal opinion. In the event of further non-compliance by the supervisory authority concerned,
ESMA may adopt binding decisions requiring specific action or omissions by individual super-
visory subjects in order to enforce the Commission opinion in accordance with Union law.
In addition to the remedy pursuant to para 7 in conjunction with Arts 17 and 19 ESMA 25.019
Regulation, the Commission may also initiate infringement proceedings pursuant to Art 258
TFEU.22
J. COOPERATION AGREEMENTS (MOU)
Para 8 last subparagraph also stipulates that competent authorities shall conclude cooperation 25.020
agreements (MoU) with third-country regulatory authorities responsible for the related spot
markets ‘where possible’. Both the wording and the systematic context suggest that the con-
clusion of an MoU is not a prerequisite for cooperation with third-country authorities. First,
according to the wording of para 8 sent 1, an exchange of information with third-country
regulatory authorities can obviously take place without the conclusion of an MoU.23 Second,
according to para 8 last subparagraph, ESMA is also obliged to promote cooperation between
the supervisory authorities and the third-country regulatory authorities per se.
The conclusion of an MoU must be subject to the conditions of Art 26: A prerequisite for the 25.021
conclusion of an MoU is an equivalent regime of professional secrecy in the cooperation state
(see Arts 26 and 27).

23 The wording states in the imperative: ‘shall … cooperate … and exchange information with … third-country regulatory
authorities’.
337
K. IMPLEMENTATION AUTHORISATIONS
25.022 Para 9 empowers ESMA to develop implementing standards, including standard forms for
the exchange of information for the cooperation as referred to in Art 25, and the Commission
to adopt them as an implementing regulation. In a first final report in May 2017, ESMA
published the implementing standards with regard to the competent supervisory authorities’
obligation to cooperate with each other and submitted them to the Commission for approv-
al.24 In February 2018, the Commission issued the corresponding Implementing Regulation
292/2018.25 ESMA published Implementing Standards for the other forms of cooperation
described in Art 25 in a second report in February 2018 and submitted it to the Commission
for a decision.26 Only in October 2020, the Commission issued the Implementing Regulation
1406/2020.27
NOTE
Literature
ESMA, Final Report Draft Implementing Technical Standards on forms and procedures for coop-
eration between competent authorities under Regulation (EU) No 596/2014 on market abuse,
ESMA70–145–100, 30 May 2017
ESMA, Final Report Draft Implementing Technical Standards on forms and procedures for cooperation
under Article 24 and 25 of Regulation (EU) No 596/2014 on market abuse, ESMA70–145–398, 6
February 2018
Kämmerer J A, ‘Arts 24, 25, 26 MAR’ in Lehmann M and Kumpan C (eds), European Financial Services
Raschauer B, Finanzmarktaufsichtsrecht (Verlag Österreich 2015)
Schlette V and Bouchon M, ‘§ 7a: Zusammenarbeit mit der Europäischen Wertpapier- und
Marktaufsichtsbehörde’ in Fuchs (ed), Wertpapierhandelsgesetz (2nd edn, C. H. Beck 2016)
24 ESMA, Final Report Draft Implementing Technical Standards on forms and procedures for cooperation between
competent authorities under Regulation (EU) No 596/2014 on market abuse, ESMA70–145–100, 30 May 2017.
25 Commission Implementing Regulation (EU) 2018/292 of 26 February 2018 laying down implementing technical
standards with regard to procedures and forms for exchange of information and assistance between competent authorities
according to Regulation (EU) No 596/2014 of the European Parliament and of the Council on market abuse [2018] OJ
L 55/34, entered into force on 28 February 2018.
26 ESMA, Final Report Draft Implementing Technical Standards on forms and procedures for cooperation under Article
24 and 25 of Regulation (EU) No 596/2014 on market abuse, ESMA70–145–398, 6 February 2018.
27 Commission Implementing Regulation (EU) 2020/1406 of 2 October 2020 laying down implementing technical stand-
ards with regard to procedures and forms for exchange of information and cooperation between competent authorities,
ESMA, the Commission and other entities under Articles 24 (2) and 25 of Regulation (EU) No 596/2014 of the
European Parliament and of the Council on market abuse [2020] OJ L 325/7, entered into force on 27 October 2020.
338
K. Implementation authorisations
Schramm A, ‘§ 104: Kontaktstelle und Informationsaustausch’ in Brandl E and Saria G (eds), Kommentar
zum Wertpapieraufsichtsgesetz (2nd edn, Verlag Manz 2018)
Zollner J, ‘Article 25: Obligation to Cooperate’ in Ventoruzzo M and Mock S (eds), Market Abuse
339
ARTICLE 26
COOPERATION WITH THIRD COUNTRIES
Alfred Schramm
1. The competent authorities of Member States shall, where necessary, conclude cooperation
arrangements with supervisory authorities of third countries concerning the exchange of
information with supervisory authorities in third countries and the enforcement of obli-
gations arising under this Regulation in third countries. Those cooperation arrangements
shall ensure at least an efficient exchange of information that allows the competent author-
ities to carry out their duties under this Regulation.
A competent authority shall inform ESMA and the other competent authorities where
it proposes to enter into such an arrangement.
2. ESMA shall, where possible, facilitate and coordinate the development of cooperation
arrangements between the competent authorities and the relevant supervisory authorities
of third countries.
In order to ensure consistent harmonisation of this Article, ESMA shall develop draft
regulatory technical standards containing a template document for cooperation arrange-
ments that are to be used by competent authorities of Member States where possible.
July 2015.
referred to in the second subparagraph in accordance with Articles 10 to 14 of Regulation
(EU) No 1095/2010.
ESMA shall also, where possible, facilitate and coordinate the exchange between com-
petent authorities of information obtained from supervisory authorities of third countries
that may be relevant to the taking of measures under Articles 30 and 31.
3. The competent authorities shall conclude cooperation arrangements on exchange of infor-
mation with the supervisory authorities of third countries only where the information dis-
closed is subject to guarantees of professional secrecy which are at least equivalent to those
set out in Article 27. Such exchange of information must be intended for the performance
of the tasks of those competent authorities.
340
B. Cooperation agreements
OVERVIEW
A. INTRODUCTION 26.001 D. ESMA 26.012

B. COOPERATION AGREEMENTS 26.003 E. IMPLEMENTATION AUTHORISATIONS 26.016
C. PROFESSIONAL SECRECY 26.009 F. IOSCO MMOU 26.018
A. INTRODUCTION
Art 26 lays down rules for cooperation with competent supervisory authorities of third 26.001
countries on the basis of cooperation agreements. According to the wording of this provision,
the EU supervisory authorities should conclude Memoranda of Understanding (MoU) with
third-country authorities ‘where necessary’ in order to achieve at least a sufficient exchange of
information between the authorities involved. Under para 3, MoU may only be concluded if
an equivalent professional secrecy regime exists in the third country. To this end, ESMA is
to prepare uniform standard procedures and standard forms for such cooperation agreements
pursuant to para 2 and the Commission is to adopt them as an Implementing Regulation. In
addition, ESMA also has a coordinating function in the exchange of information between
supervisory authorities.
Accordingly, Art 26 regulates the following: 26.002
● the substantive conditions under which MoU may be concluded with third-country
authorities;
● the level of protection with regard to professional secrecy required for this purpose;
● the involvement of ESMA in supervisory cooperation with third-country authorities and in
the development of standard procedures and standard forms for MoU;
● other substantive conditions of supervisory cooperation with third countries.
B. COOPERATION AGREEMENTS
The need for cross-border cooperation and for the conclusion of cooperation agreements 26.003
between supervisory authorities has become increasingly clear over the last decade, due to the
increasing cross-border activities of all types of financial market actors.1 Various supervisory
standards in financial market law therefore also provide – in addition to the mandatory cooper-
ation between the Member States’ authorities and the ESAs – for the possibility of cooperation
with supervisory authorities of third countries and the conclusion of cooperation agreements
for that purpose. For example, the EU legislator has provided the possibility to conclude coop-
eration agreements, in the context of banking supervision, in Art 55 CRD IV and Art 33 EBA
1 Doris Döhmel, ‘§ 7: Zusammenarbeit mit zuständigen Stellen im Ausland’ in Heinz-Dieter Assmann and Uwe
Schneider (eds), Wertpapierhandelsgesetz (6th edn, Otto Schmidt 2012) para 7. See also para 26.017 with regard to the
IOSCO MMoU.
341
Article 26 COOPERATION WITH THIRD COUNTRIES
Regulation and, in the area of securities supervision, in Art 88 MiFID II and Art 33 ESMA
Regulation. The MAD 2003 did not provide for such a possibility.
26.004 While international treaties are normatively binding agreements between two sovereign states,
MoU – as in the present case – are usually not normatively binding agreements between
supervisory authorities. Rather, in these MoU the supervisory authorities agree that they will
cooperate with each other in specific areas. The authorities reach that agreement on the basis
of the existing legal situation and after a mutual assessment of the respective legal situation
(which, above all, includes an examination of the equivalence of the professional secrecy regime
of the other supervisory authority), as long as no change in the legal situation requires a change
in the form of cooperation. This cooperation regularly involves transmitting confidential
information required for supervision, but often also the possibility of conducting on-site
inspections of branches in the other sovereign territory (regularly upon notification and possi-
bly upon approval by the local competent supervisory authority). In this context, the supervisory
authorities agree to maintain confidentiality regarding the information received. In principle,
the exchange of information may only take place for supervisory purposes; it must therefore be
necessary for the respective supervisory purpose.
26.005 The advantage of a non-binding MoU is thus the mutual assurance of the equivalence of the
cooperation arrangements and a certain standardisation of the exchange of information as well
as the simplified possibility of conclusion compared with international contracts. However,
supervisory cooperation is always based on the prevailing legal situation, and the MoU are only
a facilitator in this context.
26.006 Art 26 foresees that cooperation agreements will be concluded ‘where necessary’,2 which, in the
context of the provision, should be understood as meaning that in the event that it becomes
necessary to exchange confidential information with certain third country authorities, the
supervisory authorities of the Member States can3 conclude MoU in order to further specify
the modalities of cooperation within the framework of the MAR. The wording does not imply
that information can only be exchanged with third countries if an MoU is in place. Neither do
the Recitals contain anything to the contrary. Hence, Art 26 does not couple the exchange of
information with third countries to the conclusion of an MoU,4 but rather promotes the con-
2 What is meant by ‘where necessary’ is not clear. Similar provisions (such as Art 88 MIFID II, Art 33 ESMA Regulation)
do not contain such ambiguous wording and allow the conclusion of MoU, using the word ‘may’. Recital 69 speaks
of ‘ensur[ing] exchanges of information and cooperation with third-countries’, which suggests that an MoU should
ensure and further regulate the possible exchange of information with third countries through the mutual declaration
of intent of the supervisory authorities – provided that the professional secrecy regimes are equivalent – while it does
not imply that the MoU is a prerequisite for cooperation; cf, however, Johannes Zollner, ‘Article 24: Cooperation with
ESMA’ in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse Regulation (Oxford University Press 2017) para
B.26.02. It may be added that in its Final Report Draft Regulatory Technical standards on cooperation arrangements
(ESMA70–145–457, 8 October 2019, at 10), ESMA interprets the term ‘where necessary’ in order to propose a flexible
approach upon which the Member States, when concluding an MoU with a third-country supervisor, may take just any
part of the template document they deem necessary, for instance to execute complementary cooperation agreements
covering areas not currently included in the IOSCO MMoU.
3 See Jörn Axel Kämmerer, ‘Arts 24, 25, 26 MAR’ in Matthias Lehmann and Christoph Kumpan (eds), European
Financial Services Law (Beck–Hart–Nomos 2019) Arts 25, 26 MAR para 7: supervisory authorities’ to enter into such
agreements remains unfettered.
4 cf, however, Zollner (n 2) para B.26.02.
342
C. Professional secrecy
clusion of an MoU in the context of possible cooperation with third countries.5 The wording
suggests that information may be exchanged with third countries merely on the basis of an
equivalent legal situation (in particular with regard to the provisions on professional secrecy),
since para 2 last sentence obviously also provides for an exchange of information with third
countries even without a previously concluded MoU.
Para 1 sent 2 also regulates the substantive conditions for an MoU: The MoU must at least 26.007
‘ensure’ an ‘efficient’ exchange of information between the EU and third-country supervisory
authorities involved in order to fulfil their duties under the MAR. This sentence is ambiguous
in that an MoU can never ensure an exchange of information, but can only assure it on the basis
of the legal situation of the cooperation partners. However, the provision at least regulates
a minimum level of content (namely the exchange of information) for an MoU.
In addition to the written exchange of information, further forms of cooperation can be agreed 26.008
upon, provided that this corresponds to the legal situation of both cooperation partners. Para 1
sent 1 speaks additionally of the enforcement of obligations arising from the MAR in the third
country. Thus, it is also possible (as a typical content of an MoU) to agree on the performance
of on-site inspections at branches of supervisory objects in the jurisdiction of the other coop-
eration partner (whether jointly with the branch supervisory authority or independently by the
domestic authority).
C. PROFESSIONAL SECRECY
An essential prerequisite for any exchange of information, and thus also for a cooperation 26.009
agreement, is a certain level of professional secrecy, which must be observed by the signatories
of the MoU. Para 3 refers to the relevant provisions on professional secrecy in Art 27 (see para
27.001 ff in more detail). In the EU Member States, this level can be assumed without hesita-
tion due to the direct applicability of the MAR, whereas in third countries different regulations
may apply. This means that the respective supervisory authority wishing to conclude an MoU
with a third country must first examine the legal situation of this third country to determine
whether its professional secrecy provisions are equivalent to the level of protection under the
MAR.
In this respect, the coordinating function of ESMA pursuant to para 2 sent 1 (see para 26.012 26.010
ff) indicates that ESMA could also assume and carry out such equivalence assessments for the
EU supervisory authorities.
Para 3 also provides that the exchange of information in the context of an MoU must serve 26.011
the performance of the tasks of the supervisory authorities. This provision thus provides for
a purpose limitation, according to which the information to be transmitted must be required
for the supervisory purposes of the authorities in the broadest sense as regulated in the MAR,
and the exchange of information must therefore serve supervisory purposes in connection with
5 This also applies to Art 33 ESMA Regulation or Art 55 CRD IV, which allow the agreement of further modalities of
information exchange with competent third-country authorities through MoU and do not make the exchange of infor-
mation subject to the conclusion of an MoU with the third-country authority.
343
this Regulation in the broadest sense. The use of transmitted supervisory information for other
(supervisory) purposes is in principle not permitted, but may be allowed by the transmitting
supervisory authority pursuant to Art 27 para 2 (which must be done explicitly).
D. ESMA
26.012 The involvement of ESMA in the conclusion of an MoU is regulated in para 1 last sentence
and in para 2. First, pursuant to para 1 last sentence, ESMA – in addition to the other EU
supervisory authorities – must be informed about upcoming negotiations on an MoU with
a third-country authority. The wording indicates that this should already be done at the stage
of the proposal to the third country to conclude an MoU6 (i.e., the receipt of a proposal to an
EU supervisory authority would not have to be reported e contrario).
26.013 Secondly, para 2 empowers ESMA to facilitate and coordinate the development of MoU.
One coordinating task that ESMA could assume in this regard is to conduct assessments of
the equivalence of the professional secrecy and information regimes of third countries with the
professional secrecy provisions of the MAR.
26.014 A further coordinating function of ESMA pursuant to para 2 sent 2 consists in the authorisa-
tion to draw up template agreements for MoU with third countries (see below para 26.016).
26.015 Finally, para 2 last sentence also defines a coordinating function of ESMA, according to which
it shall facilitate and coordinate the exchange of information between EU and third-country
supervisory authorities with regard to measures to be taken pursuant to Arts 30 and 31. This
may take several forms:7 The wording suggests that such facilitation and coordination measures
by ESMA should not only take place when drafting MoU or when exchanging information
on MoU that have already been concluded, but also when MoU have not yet been concluded.
E. IMPLEMENTATION AUTHORISATIONS
26.016 Para 2 subparas 2 to 4 empowers ESMA and the Commission to develop templates for MoU
for the exchange of information between EU and third-country supervisory authorities pursu-
ant to the MAR. The purpose of these templates is to ensure that once they have become legally
binding, MoU will only be concluded with third-country authorities on this uniform basis. Para
2 authorises ESMA to develop such MoU templates as regulatory standards pursuant to Arts
10–14 ESMA Regulation, which ESMA is to submit to the Commission for a decision by
a specified date. The Commission shall adopt these templates in accordance with the procedure
in Arts 10–14 ESMA Regulation as Delegated Regulations pursuant to Art 290 TFEU.8 In
its Draft Regulatory Technical Standards on cooperation arrangements under Regulation (EU)
No 596/2014 on Market Abuse of 8 October 2019 (ESMA70-145-457), ESMA delivered the
6 See also Zollner (n 2) para B.26.06: intended to enable ESMA to fulfil its function as coordinator.
8 As of 29 December 2020 the approval of the Implementing Standards by the Commission was still pending.
344
F. IOSCO MMoU
Draft RTS containing a template document for cooperation arrangements for cooperation with
supervisory authorities of third countries, and – in order to comply with the GDPR – a tem-
plate document for an administrative arrangement between NCAs and supervisory authorities
of third countries for the transfer of personal data (see below para 26.018). Since most of the
supervisors are signatories to the IOSCO MMoU (see below para 26.017), the need for these
templates will be rather limited.
In order to meet the provisions of the General Data Protection Regulation (GDPR9 which 26.017
came into force in May 2018) for exchanging personal data, ESMA and IOSCO have agreed
on an Administrative Arrangement on data protection10 which, according to the European
Data Protection Board, displays appropriate safeguards according to Art 46 GDPR.11 This
arrangement has received the approval of the European Data Protection Board and of the rele-
vant national Data Protection Boards, and was signed by 29 EEA NCAs and 21 third-country
supervisors as of 1 August 2020.12 Until such time as the Commission publishes an adequacy
decision13 on the data protection regime of a certain country according to Art 45 GDPR, this
Administrative Agreement shall apply as an Annex to the IOSCO MMoU.
F. IOSCO MMOU
In practice, the exchange of information with third-country supervisory authorities is 26.018

largely based on the Multilateral Memorandum of Understanding concerning Cooperation
and Consultation and the Exchange of Information14 (IOSCO MMoU) initiated by the
International Organization of Securities Commissioners15 (IOSCO), to which 124 supervi-
sory authorities16 (including the European ones) have acceded. The criteria for the exchange
of information provided for in the MMoU and to be fulfilled by the signatories meet the
requirements set forth in Arts 26 and 27 (among others, regarding professional secrecy, purpose
limitation, confidentiality, use and disclosure of supervisory information).
9 Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural
persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive
95/46/EC [2016] OJ L 119/1.
10 Text of the Administrative Arrangement: https://www.bafin.de/SharedDocs/Veroeffentlichungen/EN/Anlage/
Datenschutz/anlage_informationen_dv_iosco_verwaltungsvereinbarung_en.html accessed on 29 December 2020.
11 Opinion of the EDPB: https://edpb.europa.eu/sites/edpb/files/files/file1/2019–02–12-opinion_2019–4_art.60_esma
_en.pdf accessed on 29 December 2020.
12 List of signatories to the Arrangement: https://www.iosco.org/about/?subsection=administrative_arrangement accessed
on 29 December 2020.
13 List of countries: https://ec.europa.eu/info/law/law-topic/data-protection/international-dimension-data-protection/
adequacy-decisions_en accessed on 29 December 2020.
14 Text of MMoU accessible at: https://www.iosco.org/publications/?subsection=public_reports&publicdocid=386
accessed on 29 December 2020.
15 https://www.iosco.org/accessed on 29 December 2020.
16 List of the IOSCO MMoUs signatories (as of January 2021): https://www.iosco.org/about/?subSection=mmou&
subSection1=signatories accessed on 15 January 2021.
345
NOTE
Literature
Döhmel D, ‘§ 7: Zusammenarbeit mit zuständigen Stellen im Ausland’ in Assmann H-D and Schneider
U (eds), Wertpapierhandelsgesetz (6th edn, Otto Schmidt 2012)
Schramm A, ‘§ 77a: Internationale Abkommen’ in Laurer R and others (eds), Kommentar zum
Bankwesengesetz (4th edn, Verlag Manz 2018)
Zollner J, ‘Article 24: Cooperation with ESMA’ in Ventoruzzo M and Mock S (eds), Market Abuse
Regulation (Oxford University Press 2017).
346
ARTICLE 27
PROFESSIONAL SECRECY
Alfred Schramm
1 Any confidential information received, exchanged or transmitted pursuant to this

Regulation shall be subject to the conditions of professional secrecy laid down in para-
graphs 2 and 3.
2. All the information exchanged between the competent authorities under this Regulation
that concerns business or operational conditions and other economic or personal affairs
shall be considered to be confidential and shall be subject to the requirements of profes-
sional secrecy, except where the competent authority states at the time of communication
that such information may be disclosed or such disclosure is necessary for legal proceedings.
3. The obligation of professional secrecy applies to all persons who work or who have worked
for the competent authority or for any authority or market undertaking to whom the com-
petent authority has delegated its powers, including auditors and experts contracted by the
competent authority. Information covered by professional secrecy may not be disclosed to
any other person or authority except by virtue of provisions laid down by Union or national
law.
OVERVIEW
A. INTRODUCTION 27.001 C. DATA PROTECTION 27.011

B. PROFESSIONAL SECRECY 27.004
A. INTRODUCTION
In line with the current EU practice in financial markets legislation, the MAR also provides 27.001
that supervisory information shall be subject to professional secrecy and that the disclosure of
such information shall follow certain rules and shall only happen in the pursuit of supervisory
purposes. Art 13 MAD 2003 already contained a provision on professional secrecy, which
largely corresponded to para 3.
347
Article 27 PROFESSIONAL SECRECY
27.002 In addition, Arts 28 and 29, like other Union provisions on financial market supervision, lay
down the conditions for the processing of personal data by the competent authorities and by
ESMA as well as for the transfer of personal data to authorities of third countries.
27.003 However, contrary to current EU legislative practice1 the provision adopts other provisions,
especially Art 76 MiFID II only cursorily and partially. Hence, it does not adequately regulate
the interplay between the general requirement for professional secrecy (or confidentiality) and
the authorisation to disclose under certain circumstances (as exemptions from the general
requirement). Without need, the provision is difficult to understand.
B. PROFESSIONAL SECRECY
27.004 In general, professional secrecy rules regularly contain a specific confidentiality requirement
(or prohibition of disclosure) with exemptions depending on the subject matter. In principle,2
professional secrecy obliges all current and former employees of the competent supervisory
authorities3 as well as all persons who are or were otherwise active for the supervisory authori-
ties (persons entrusted with confidential information) not to disclose to third parties informa-
tion that has become known to them only as a result of their supervisory activities (and is not
already public) without special authorisation (exemption) (general principle in Art para 3 sent
1).4 Depending on the details of the applicable legal norm, the possibility of disclosing super-
visory information to certain and, in part, explicitly specified persons is more or less restricted.
27.005 In the context of the MAR, Art 27 para 3 lays down the general principle that all information
acquired in the course of supervision is subject to professional secrecy and, in principle, may
not be transferred or disclosed to third parties unless exemptions allow this. Thus, basically all
supervisory information is confidential, unless an exemption allows the transfer/disclosure for
specific purposes.5
27.006 All current and former employees of EU supervisory authorities,6 but also all persons who are
or were active for these authorities in any other way within the scope of supervision (experts,
actuaries, auditors, etc., contracted by the supervisory authority) are considered to be persons
entrusted with confidential information and, hence, bound by professional secrecy.
1 See e.g., Art 54 CRD IV, Art 76 MiFID II, Art 63 Solvency II.
2 For a basic rule, which can be found in the vast majority of professional secrecy regulations, see Art 76 para 1 MiFID II,
Art 54 para 1 CRD IV, and Art 63 Solvency II.
3 But, at least according to the wording, not ESMA or ACER; see Jörn Axel Kämmerer, ‘Arts 27, 28, 29 MAR’ in
Matthias Lehmann and Christoph Kumpan (eds), European Financial Services Law (Beck–Hart–Nomos 2019) Art 28
para 3.
4 See Art 54 para 1 CRD IV, Art 76 para 1 MiFID II, and Art 63 para 1 Solvency II.
5 cf Johannes Zollner , ‘Article 27: Professional Secrecy’ in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse
6 See also Zollner, ‘Article 27’ (n 5) para B.27.07.
348
B. Professional secrecy
The first exemption to this basic rule – as indicated in the last sentence of Art 27 para 3 – results 27.007
from Union or national law. Para 3 last sentence thus refers to regulatory authorisations for the
exchange of information which, according to other financial market supervisory standards of
the Union or in Member States’ provisions, enable the transmission of confidential informa-
tion to third parties. Under this provision, for example, MAR-relevant information obtained
and required in the course of credit institution supervision may be transmitted for supervisory
purposes within the scope of the exchange authorisations regulated in the CRD IV (Arts 53ff
CRD IV). However, this only provides for what is self-evident: Supervisory information may
be transmitted or used for the pursuit of supervisory purposes (regulated in various supervisory
standards) under the conditions laid down therein.
A second exemption exists under Art 27 para 2 for information exchanged between competent 27.008
authorities within the framework of the MAR: Insofar as this information ‘concerns business
or operating conditions and other economic or personal affairs’, it shall be considered to be
confidential and shall be subject to the requirements of professional secrecy (Art 27 para 3),
i.e., in principle it may not be disclosed to third parties. If the basic rule in Art 27 para 3 is
taken as a yardstick (according to which all information obtained by the supervisory authority
is in principle subject to professional secrecy), this provision is to be understood as meaning
that information obtained from other EU supervisory authorities, if it meets the mentioned
criteria:
● may be disclosed to third parties or used for purposes other than those specified in the
request only with the prior consent of the informing authority7 and
● may be used without consent in judicial proceedings.
If the information transmitted does not meet the criteria mentioned above, it is obviously not 27.009
confidential and may therefore be passed on to third parties or used in legal proceedings at any
time (it is questionable, however, which types of information do not meet the criteria of Art
27 para 2).8 It is striking that – in contrast to the usual EU legislative practices – Art 27 para
2 does not impose any restrictions on the disclosure/use of supervisory information in certain
court proceedings.9
Art 27 para 1 also states that confidential information ‘received, exchanged or transmitted’ pur- 27.010
suant to the MAR is subject to the conditions of professional secrecy laid down in Art 27 paras
2 and 3. This wording, which is misleading in the context of the provision, must not lead to the
assumption that – e contrario – otherwise supervisory information in general is not subject to
professional secrecy and, unless it has been disclosed to a person bound by professional secrecy
in accordance with the above-mentioned conditions, would therefore not be protected. On
the basis of Art 27 para 3 (confidentiality requirement), Art 27 para 1 is apparently intended
7 For a narrow interpretation Kämmerer (n 3) Art 27 para 4.

8 On which, unfortunately, the Recitals are silent.
9 See, however, e.g., Art 76 MiFID II, Arts 54ff CRD IV, Arts 63ff Solvency II.
349
Article 27 PROFESSIONAL SECRECY
to clarify that information originating from other EU supervisory authorities is subject to

confidentiality as well. Thus, the exchange of information does not authorise the lifting of the
confidentiality obligation, but the provisions described in para 27.008 must be followed when
disclosing information to third parties.10
C. DATA PROTECTION
27.011 In addition to professional secrecy, Art 28 also regulates the protection of personal data (or
information).11 However, the provisions have not yet been adapted to the new EU data pro-
tection regime.12 With regard to the processing of personal data in the context of supervisory
proceedings, it is stipulated that the competent authorities shall carry out their MAR tasks in
accordance with Directive 95/46/EC (now Regulation (EU) 2016/679, GDPR). As with the
provisions on professional secrecy, the transmission of information originating from one EU
supervisory authority to a third-country authority is subject to the consent of the transmitting
supervisory authority. ESMA complies with the provisions of Regulation 45/2001 (now
Regulation [EU] 1725/2018) with regard to the processing of personal data in the MAR. In
addition, personal data will not be retained for longer than five years.
27.012 With regard to the transfer of personal data to third country authorities, the competent
authorities shall comply with the requirements of Directive 95/46/EC (now Regulation [EU]
2016/679) in accordance with Art 29.13
NOTE
10 Implementing Regulation 292/2018, which regulates the exchange of information between the competent supervisory
authorities in accordance with Art 25, contains information in its forms on the obligation to maintain secrecy and on the
procedure for granting consent to the transmission to third parties or the use of the information obtained.
11 I.e., information relating to an identified or identifiable natural person (Art 4 (1) GDPR); see Zollner (n 5) para B.28.05.
12 Directive 95/46/EC (Data Protection Directive) was repealed when Regulation (EU) 2016/679 (General Data
Protection Regulation) came into force on 28 May 2018. According to Art 94 Regulation (EU) 2016/679, any reference
to the old Directive is considered a reference to the new Regulation. In addition, Regulation 45/2001 was repealed
when Regulation (EU) 1725/2018 entered into force on 11 December 2018. According to Art 99 of Regulation (EU)
1725/2018, any reference to the old Regulation is deemed to be a reference to the new Regulation.
13 See Johannes Zollner, ‘Article 29: Disclosure of Personal Data To Third Countries’ in Ventoruzzo and Mock (n 5) paras
B.29.06ff; Kämmerer (n 3) Art 29 MAR para 3.
350
C. Data protection
Literature
Schramm A, ‘§ 77a: Internationale Abkommen’ in Laurer R and others (eds), Kommentar zum
Bankwesengesetz (4th edn, Verlag Manz 2018)
Zollner J, ‘Article 27: Professional Secrecy’ in Ventoruzzo M and Mock S (eds), Market Abuse Regulation
Zollner J, ‘Article 28: Data Protection’ in Ventoruzzo M and Mock S (eds), Market Abuse Regulation
Zollner J, ‘Article 29: Disclosure of Personal Data to Third Countries’ in Ventoruzzo M and Mock S
(eds), Market Abuse Regulation (Oxford University Press 2017)
351
ARTICLE 28
DATA PROTECTION
Alfred Schramm
With regard to the processing of personal data within the framework of this Regulation, com-
petent authorities shall carry out their tasks for the purposes of this Regulation in accordance
with the national laws, regulations or administrative provisions transposing Directive 95/46/
EC. With regard to the processing of personal data by ESMA within the framework of this
Regulation, ESMA shall comply with the provisions of Regulation (EC) No 45/2001.
Personal data shall be retained for a maximum period of five years.
OVERVIEW
A. NOTE 28.001
A. NOTE
28.001 See Art 27 Commentary for further elaboration.
352
ARTICLE 29
DISCLOSURE OF PERSONAL DATA TO THIRD
COUNTRIES
Alfred Schramm
1. The competent authority of a Member State may transfer personal data to a third country
provided the requirements of Directive 95/46/EC are fulfilled and only on a case-by-case
basis. The competent authority shall ensure that the transfer is necessary for the purpose
of this Regulation and that the third country does not transfer the data to another third
country unless it is given express written authorisation and complies with the conditions
specified by the competent authority of the Member State.
2. The competent authority of a Member State shall only disclose personal data received
from a competent authority of another Member State to a supervisory authority of a third
country where the competent authority of the Member State concerned has obtained
express agreement from the competent authority which transmitted the data and, where
applicable, the data is disclosed solely for the purposes for which that competent authority
gave its agreement.
3. Where a cooperation agreement provides for the exchange of personal data, it shall comply
with the national laws, regulations or administrative provisions transposing Directive
95/46/EC.
OVERVIEW
A. NOTE 29.001
A. NOTE
See Art 27 Commentary for further elaboration. 29.001
353
ARTICLE 30
ADMINISTRATIVE SANCTIONS AND OTHER
ADMINISTRATIVE MEASURES
1. Without prejudice to any criminal sanctions and without prejudice to the supervisory
powers of competent authorities under Article 23, Member States shall, in accordance
with national law, provide for competent authorities to have the power to take appropriate
administrative sanctions and other administrative measures in relation to at least the fol-
lowing infringements:
(a) infringements of Articles 14 and 15, Article 16(1) and (2), Article 17(1), (2), (4) and
(5), and (8), Article 18(1) to (6), Article 19(1), (2), (3), (5), (6), (7) and (11) and Article
20(1); and
(b) failure to cooperate or to comply with an investigation, with an inspection or with
a request as referred to in Article 23(2).
Member States may decide not to lay down rules for administrative sanctions as referred
to in the first subparagraph where the infringements referred to in point (a) or point (b) of
that subparagraph are already subject to criminal sanctions in their national law by 3 July
2016. Where they so decide, Member States shall notify, in detail, to the Commission and
to ESMA, the relevant parts of their criminal law.
By 3 July 2016, Member States shall notify, in detail, the rules referred to in the first and
second subparagraph to the Commission and to ESMA. They shall notify the Commission
and ESMA without delay of any subsequent amendments thereto.
2. Member States shall, in accordance with national law, ensure that competent authorities
have the power to impose at least the following administrative sanctions and to take at least the
following administrative measures in the event of the infringements referred to in point (a)
of the first subparagraph of paragraph 1:
(a) an order requiring the person responsible for the infringement to cease the conduct
and to desist from a repetition of that conduct;
(b) the disgorgement of the profits gained or losses avoided due to the infringement
insofar as they can be determined;
(c) a public warning which indicates the person responsible for the infringement and the
nature of the infringement;
(d) withdrawal or suspension of the authorisation of an investment firm;
(e) a temporary ban of a person discharging managerial responsibilities within an invest-
ment firm or any other natural person, who is held responsible for the infringement,
from exercising management functions in investment firms;
354
Michael Rohregger and Nina Palmstorfer - 9781800882249
Article 30 ADMINISTRATIVE SANCTIONS AND OTHER ADMINISTRATIVE MEASURES
(f) in the event of repeated infringements of Article 14 or 15, a permanent ban of any
person discharging managerial responsibilities within an investment firm or any other
natural person who is held responsible for the infringement, from exercising manage-
ment functions in investment firms;
(g) a temporary ban of a person discharging managerial responsibilities within an invest-
ment firm or another natural person who is held responsible for the infringement,
from dealing on own account;
(h) maximum administrative pecuniary sanctions of at least three times the amount of
the profits gained or losses avoided because of the infringement, where those can be
determined;
(i) in respect of a natural person, maximum administrative pecuniary sanctions of at
least:
(i) for infringements of Articles 14 and 15, EUR 5 000 000 or in the Member States
whose currency is not the euro, the corresponding value in the national currency
on 2 July 2014;
(ii) for infringements of Articles 16 and 17, EUR 1 000 000 or in the Member States
whose currency is not the euro, the corresponding value in the national currency
on 2 July 2014; and
(iii) for infringements of Articles 18, 19 and 20, EUR 500 000 or in the Member
States whose currency is not the euro, the corresponding value in the national
currency on 2 July 2014; and
(j) in respect of legal persons, maximum administrative pecuniary sanctions of at least:
(i) for infringements of Articles 14 and 15, EUR 15 000 000 or 15 % of the total
annual turnover of the legal person according to the last available accounts
approved by the management body, or in the Member States whose currency is
not the euro, the corresponding value in the national currency on 2 July 2014;
(ii) for infringements of Articles 16 and 17, EUR 2 500 000 or 2 % of its total annual
turnover according to the last available accounts approved by the management
body, or in the Member States whose currency is not the euro, the corresponding
value in the national currency on 2 July 2014; and
(iii) for infringements of Articles 18, 19 and 20, EUR 1 000 000 or in the Member
States whose currency is not the euro, the corresponding value in the national
currency on 2 July 2014.
References to the competent authority in this paragraph are without prejudice to the
ability of the competent authority to exercise its functions in any ways referred to in
Article 23(1).
For the purposes of points (j)(i) and (ii) of the first subparagraph, where the legal
person is a parent undertaking or a subsidiary undertaking which is required to
prepare consolidated financial accounts pursuant to Directive 2013/34/EU,1 the
relevant total annual turnover shall be the total annual turnover or the correspond-
ing type of income in accordance with the relevant accounting directives – Council
1 Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial
statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive
2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/
EEC (OJ L 182, 29.6.2013, p. 19).
355
Directive 86/635/EEC2 for banks and Council Directive 91/674/EEC3 for insurance
companies – according to the last available consolidated accounts approved by the
management body of the ultimate parent undertaking.
3. Member States may provide that competent authorities have powers in addition to those
referred to in paragraph 2 and may provide for higher levels of sanctions than those estab-
lished in that paragraph.
OVERVIEW
A. SUBJECT OF THE PROVISION 30.001 1. Administrative fines 30.006

B. OBJECTIVE OF THE PROVISION 30.004 2. Other administrative measures 30.009
C. PROVISIONS FOR NATIONAL SANCTIONS D. NEED FOR IMPLEMENTATION AND
REGIMES 30.006 IMPLEMENTATION 30.010
A. SUBJECT OF THE PROVISION
30.001 Art 30 provides a catalogue of administrative sanctions and measures which must be available
to the national authorities at least to sanction certain infringements of the MAR. Nevertheless,
Member States are still free to make breaches of capital market law subject to judicial sanc-
tions,4 but otherwise administrative sanctions are mandatory.
30.002 This mandatory minimum level of administrative sanctioning is intended only for certain
infringements of Union law. It follows from Art 30 that administrative sanctions must be
imposed in the event of violations of the prohibition of insider dealing and unlawful disclosure
of inside information (Art 14), the prohibition of market manipulation (Art 15), disclosure
requirements (Art 17 paras 1, 2, 4, 5 and 8), requirements regarding insider lists (Art 18 paras
1–6) and own-account trading (Art 19 paras 1, 2, 3, 5, 6, 7 and 11) as well as due diligence
requirements for investment recommendations (Art 20 para 1). Similarly, sanctions must be
imposed for failure to cooperate in the framework of investigations by the competent authority.
30.003 In detail, there are provisions available to a supervisory authority for imposing financial sanc-
tions, on the one hand (see para 30.006), and taking other measures on the other (see para
30.009).
2 Council Directive 86/635/EEC of 8 December 1986 on the annual accounts and consolidated accounts of banks and
other financial institutions (OJ L 372, 31.12.1986, p. 1).
3 Council Directive 91/674/EEC of 19 December 1991 on the annual accounts and consolidated accounts of insurance
undertakings (OJ L 374, 31.12.1991, p. 7).
4 For particularly ‘serious’ cases, there is even an obligation under Union law to do so under Arts 3, 4, 5 MiFID II.
356
C. PROVISIONS FOR NATIONAL SANCTIONS REGIMES
B. OBJECTIVE OF THE PROVISION
Art 30 aims at harmonising5 the differences in national regulatory regimes that previously 30.004
existed within the Union. A further objective is the toughening of sanctions for misconduct
under capital market law.6
The reform project was based on the Commission’s statement in 2011, according to which the 30.005
national supervisory authorities were neither equipped with sufficient powers to act nor could
they resort to equally deterring sanctions for capital market offences.7 As a result, the common
sanctions regime became the focus of the reform of market abuse law in recent years. In order
to achieve this goal, the emphasis was placed on strengthening public enforcement, as Art 30
shows.8
C. PROVISIONS FOR NATIONAL SANCTIONS REGIMES
1. Administrative fines
All Member States are required to impose fines (‘pecuniary sanctions’) for infringements of 30.006
the MAR mentioned in para 30.002 above. Art 30 stipulates the maximum penalties to be
provided for. The basic rule is that if the profit or avoided loss resulting from the violation
can be quantified, three times this amount constitutes the maximum penalty to be imposed
(disgorgement).9
Otherwise, a distinction must be made between natural persons and legal persons, on the one 30.007
hand, and the respective infringement, on the other, with regard to the scope of penalties: The
penalty for legal persons is correspondingly higher than that for natural persons. The Union
legislator assesses market abuse most severely (penalties of up to € 5,000,000 for natural persons
and € 15,000,000 for legal persons), followed by violations of structural and organisational
provisions against market abuse and disclosure obligations (€ 1,000,000 and € 2,500,000
respectively) and obligations regarding insider lists, trading on own account and investment
recommendations (€ 500,000 and € 1,000,000 respectively).
5 On the Europe-wide differences that existed before the MAR Fabian Walla, ‘Kapitalmarktaufsicht in Europa’ in
Rüdiger Veil (ed), Europäisches Kapitalmarktrecht (2nd edn, Mohr Siebeck 2014) § 11 para 22.
6 In particular Recital 71 MAR. See also Walla (n 5) § 11 para 24, § 12 paras 23ff.
7 Commission, ‘Towards an EU Criminal Policy: Ensuring the effective implementation of EU policies through
criminal law’ (Communication) COM (2011) 573 final; to that Fritz Zeder, ‘Die neuen Strafbestimmungen gegen
Marktmissbrauch: Europäische Vorgaben (MAR und MAD) und ihre Umsetzung im österreichischen Börsegesetz’
(2017) 2 NZWiSt 41, 42. See also Commission, ‘Reinforcing sanctioning regimes in the financial services sector’
(Communication), COM (2010), 716; Walla (n 5) § 12 paras 23ff, § 11 para 24; Sophie Cools, ‘Article 30:
Administrative Sanctions and Other Administrative Measures’ in Marco Ventoruzzo and Sebastian Mock (eds), Market
Abuse Regulation (Oxford University Press 2017) 481 f.
8 cf Klaus Schmolke, ‘Verlangt das Effektivitätsgebot des Art 4. III EUV eine Schadensersatzhaftung bei Verstoß gegen
Art. 15 MAR?’ (2016) 19 NZG 721, 722 f.
9 Art 30 para 2 lit h.
357
30.008 In the case of legal persons, the penalty is also turnover-related:10 The maximum penalty to be
imposed is based on the (if higher) total annual turnover. In the case of group companies, the
total turnover is decisive, as it results from the consolidated financial accounts of the ultimate
parent undertaking.11
2. Other administrative measures
30.009 In addition to the imposition of financial sanctions, the measures listed in Art 30 para 2 lit a to
lit g must be transferred to the national supervisory authority within its area of responsibility.
These measures are aimed in particular at decision-makers of investment firms; among other
things, the authority has the power to impose a prohibition on the performance of management
tasks within investment firms.
D. NEED FOR IMPLEMENTATION AND IMPLEMENTATION
30.010 The provisions of Art 30 require implementation. By their very nature, sanctioning provisions
are generally excluded from the principle of direct applicability of a Regulation (Art 288 para 2
TFEU).12 Accordingly, Art 30 para 1 also provides that the Member States ‘in accordance with
national law’ shall ‘provide’ for competent authorities to have the power to take appropriate
administrative sanctions.13
30.011 The implementation obligation exists insofar as this is necessary to achieve the minimum sanc-
tions set out in Art 30 in the respective Member States; other (or even stricter) administrative
measures are, in principle, open to the Member States.14 Art 30 para 1 subpara 2 authorises
Member States not to apply administrative sanctions to those infringements that are already
subject to criminal sanctions.15
30.012 Art 30 para 1 lit a has been implemented in France by means of Arts L465–1 to Art L465–3–3
code monétaire et financier (c. mon. fin.). Art 30 para 2 lit a and lit c were implemented by
L621–14 c. mon. fin., lit e to lit g by Art L621–15 c. mon. fin. lit h to lit j by Arts L456–1 ff and
L621–15 c. mon. fin.. Art 30 para 1 was not transposed into German law due to the fact that
fines according to OWiG16 can be qualified as criminal sanctions in the context of European
10 Art 30 para 2 lit j sublit i and ii (infringements of Arts 18, 19 and 20 MAR are therefore not necessarily covered by the
turnover-related sanctions).
11 Para 2 subpara 3. See also Klaus von der Linden, ‘Das neue Marktmissbrauchsrecht im Überblick’ (2016) 18 DStR 1036,
1041; Cools (n 7) 484 ff.
12 cf Lars Teigelack and Christian Dolff, ‘Kapitalmarktrechtliche Sanktionen nach dem Regierungsentwurf eines
Ersten Finanzmarktnovellierungsgesetzes – 1. FimanoG’ (2016) 7 BB 387. See also Zeder (n 7) 41, 44; also
Michael Potacs and Bernhard Raschauer, ‘Zur Problematik hoher Geldbußen im Unionsrecht – am Beispiel der
Datenschutzgrundverordnung’ (2017) 2 ÖZW 54, 55.
13 Zeder (n 7) 41, 44. See also Art 39 para 3.
14 Recital 71 last sent MAR.
15 On this and the underlying idea of avoiding double sanctioning see Zeder (n 7) 41, 45.
16 Gesetz über Ordnungswidrigkeiten 1987, BGBl I 602.
358
D. Need for implementation and implementation
law (Art 30 para 1 subpara 2).17 Art 30 para 2 lit a was implemented by § 6 para 6 WpHG,18
lit b by § 6 para 13 WpHG, lit c by § 6 para 9 WpHG, lit d by § 35 para 2 KWG,19 lit e and
lit f by § 36 para 2 and § 36a para 1 KWG, lit g by § 6 para 7 WpHG and lit h to j by § 120
paras 14, 15 and 18 WpHG. Art 30 para 1 lit a was implemented in the UK by means of s 123
FSMA,20 Art 30 para 2 lit b was implemented by DEPP 6.5 and 6.5A FCA Handbook, lit d
by s 55J para 7ZB FSMA, lit e to lit g by s 123A FSMA and lit h to lit j by s 123 FSMA. Art
30 para 1 lit a, first half of the sentence, was transposed into Austria by § 154 BörseG 2018,21
while the remaining provisions of Art 30 para 1 lit a, lit b and para 2 lit h and lit i sublit ii and iii
were implemented by § 155 para 1 BörseG 2018. Art 30 para 2 lit a to lit g and para 2 lit h and
lit j were implemented by § 157 and § 156 BörseG 2018.22 In terms of the range of sanctions,
there was thus a significant increase in accordance with Art 30; the maximum sanctions under
EU law were adopted in the aforementioned provisions of the BörseG 2018.
Literature
Cools S, ‘Article 30: Administrative Sanctions and Other Administrative Measures’ in Ventoruzzo M and
Mock S (eds), Market Abuse Regulation (Oxford University Press 2017)
Klöhn L, ‘Einleitung’ in Klöhn L (ed), Marktmissbrauchsverordnung (C. H. Beck 2018)
Potacs M and Raschauer B, ‘Zur Problematik hoher Geldbußen im Unionsrecht – am Beispiel der
Datenschutzgrundverordnung’ (2017) 2 ÖZW 54
Schmolke K, ‘Private Enforcement und institutionelle Balance’ (2016) 19 NZG 721
Schmolke K, ‘Verlangt das Effektivitätsgebot des Art 4. III EUV eine Schadensersatzhaftung bei Verstoß
gegen Art. 15 MAR?’ (2016) 19 NZG 721, 722 f.
Teigelack L and Dolff C, ‘Kapitalmarktrechtliche Sanktionen nach dem Regierungsentwurf eines Ersten
Finanzmarktnovellierungsgesetzes’ (2016) 7 BB 387
von der Linden K, ‘Das neue Marktmissbrauchsrecht im Überblick’ (2016) 18 DStR 1036
Walla F, ‘Kapitalmarktaufsicht in Europa’ in Veil R (ed), Europäisches Kapitalmarktrecht (2nd edn, Mohr
Siebeck 2014)
Zeder F, ‘Die neuen Strafbestimmungen gegen Marktmissbrauch: Europäische Vorgaben (MAR und
MAD) und ihre Umsetzung im österreichischen Börsegesetz’ (2017) 2 NZWiSt 41
17 Lars Klöhn, ‘Einleitung‘ in Lars Klöhn (ed), Marktmissbrauchsverordnung (C. H. Beck 2018) para 78.
22 ErlRV 1186 BlgNR 25. GP 3.
359
APPENDIX 30A
APPENDIX TO ART 30 MAR – PRIVATE
ENFORCEMENT
Chris Thomale
OVERVIEW
A. INTRODUCTION 30A.001 4. Portugal: Special liability clause for ad hoc

1. MAR refrains from harmonising private disclosure obligations, yet little practical
enforcement30A.001 relevance30A.036
2. Capital market tort law relies on 5. France, Italy and Spain: General tort law
non-harmonised national tort laws 30A.002 clauses provide private cause of action for
3. EU by choice refrains from regulating false or misleading ad hoc disclosure 30A.037
private enforcement in the MAR 30A.005 (a) France 30A.037
(a) EU has legislative jurisidiction to (b) Italy 30A.038
regulate private enforcement of capital (c) Spain 30A.039
markets law under Art 114 para 1 TFEU 6. Austria and the Netherlands: Art 17 MAR
30A.005 implemented as a ‘protective’ rule within
(b) Private enforcement of capital markets national law of torts 30A.040
law is not required by the effet utile (b) The Netherlands 30A.041
principle30A.010 7. Ireland and Sweden: Focus on public
4. Conclusion: private international law as enforcement and no civil issuer liability
a minimum harmonisation 30A.016 30A.042
B. NATIONAL CIVIL LIABILITY REGIMES FOR (a) Ireland 30A.042
INFRACTIONS OF ART 17 MAR 30A.017 (b) Sweden 30A.043
1. US: Civil enforcement of wrongful ad hoc C. INTERNATIONAL JURISDICTION IN SECURITIES
disclosure only in cases of intentional LITIGATION FOR MARKET ABUSE 30A.044
market manipulation 30A.018 1. Introduction 30A.044
(a) Introduction 30A.018 2. Art 4 para 1, Art 63 para 1 Brussels
(b) SEC Rule 10b-5 30A.020 Ia-Regulation: Domicile 30A.045
2. United Kingdom: Restrictions on 3. Art 17 para 1, Art 18 para 1 Brussels
civil liability for wrongful continuous Ia-Regulation: Place of domicile of the
disclosure, focus on corporate governance consumer investor 30A.047
30A.025 4. Art 7 (2) Brussels Ia-Regulation: Special
(a) Introduction 30A.025 jurisdiction for torts 30A.050
(b) Section 90A FSMA 30A.027 (a) General aspects 30A.050
3. Germany: Civil liability even in cases of (b) Place where the damage occurred
gross negligence, combined with broad (locus damni) 30A.054
attribution of knowledge in company (c) Place of the event giving rise to the
structures30A.031 damage (locus delicti commissi) 30A.063
(a) Introduction 30A.031 5. Summary: Default venues of jurisdiction
(b) Sections 97 and 98 WpHG 30A.032 for capital market torts by issuers 30A.065
360
Chris Thomale - 9781800882249
A. Introduction
D. APPLICABLE LAW IN SECURITIES LITIGATION (b) Art 4 para 3 Rome II-Regulation:

FOR MARKET ABUSE 30A.066 lex societatis or lex auctoritatis
1. Introduction 30A.066 competentis30A.077
2. Applicability of the Rome II-Regulation 5. Summary 30A.080
30A.067 E. CHOICE OF COURT AND CHOICE OF LAW
(a) Non-contractual obligations in civil AGREEMENTS IN SECURITIES LITIGATION FOR
and commercial matters 30A.067 MARKET ABUSE 30A.081
(b) ‘Negotiable instrument’ under Art 1 1. Introduction 30A.081
para 2 lit c Rome II-Regulation 30A.068 2. Choice of court clauses under Art 25 para
(c) ‘Law of companies’ under Art 1 para 2 1 Brussels Ia-Regulation 30A.082
lit d Rome II-Regulation 30A.069 (a) General scope of application 30A.082
(d) Evictive supremacy over national (b) Charter clause 30A.083
conflict of laws rules 30A.070 (c) Prospectus clause 30A.084
3. General rule: Art 4 para 1 Rome 3. Choice of law clauses under Art 14 para 1
II-Regulation (lex loci damni) 30A.071 lit b Rome II-Regulation 30A.087
4. Alternative connecting factors: Art 4 paras (a) General scope of application 30A.087
2 and 3 Rome II-Regulation 30A.075 (b) Choice of law agreements in the
(a) Art 4 para 2 Rome II-Regulation: lex issuer’s charter or the prospectus 30A.088
domicilii communis 30A.076 4. Summary 30A.091
A. INTRODUCTION1
1. MAR refrains from harmonising private enforcement
Establishing a common legal framework for the European capital market has been a corner- 30A.001
stone of the European Commission’s goal to establish an integrated single market for capital.2
To date, the greater part of primary capital markets law has been harmonised throughout the
EU.3 However, the EU appears amazingly hesitant to regulate the private enforcement of its
1 I thank the editors for allowing this chapter to be added to the English edition. I am particularly grateful to Vera
Vogelauer for her intellectual input. Teodora Govoreanu-Constantinescu and Moritz Eichmair took care of proofreading and
layout. While I thank them all for their kind support, any mistakes, shortcomings and inaccuracies remain mine entirely.
2 Commission, ‘Action Plan on Building a Capital Markets Union’ (Communication) COM (2015) 468 final. See Chris
Thomale, ‘Rechtsquellen des Kapitalmarktrechts – Eine Neuvermessung’ (2020) 23 NZG 328. For further analysis on
various aspects of the European Capital Markets Union, see Lachlan Burn, ‘Capital Markets Union and regulation of the
EU’s capital markets’ (2016) 11/3 CMLJ 352, 353ff; Miriam Parmentier, ‘Capital Markets Union – One Year On From
the Action Plan’ (2017) 14/2 ECFR 242, 243ff; Hendric Labonté, ‘Third-Party Effects of the Assignment of Claims:
New Momentum from the Commission’s Capital Markets Union Action Plan and the Commission’s 2018 Proposal’
(2018) 14/2 JPIL 319, 321 f; Christoph Kumpan, ‘Market-Based Financing in the Capital Markets Union: The
European Commission’s Proposals to Foster Financial Innovation in the EU’ (2017) 14/2 ECFR 336, 337ff; Nicholas
Dorn, ‘Capital Cohabitation: EU Capital Markets Union as Public and Private Co-Regulation’ (2016) 11/3 CMLJ 84,
91 f; Chris Thomale, ‘Keep Calm and Carry on ... with Small Steps!’ in Franklin Allen and others (eds), Capital Markets
Union and Beyond (MIT Press 2019) 353ff.
3 See, e.g., Rüdiger Veil, European Capital Markets Law (2nd edn, Hart Publishing 2017) 3, 4ff; On recent developments
see Chris Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (2020) 49/2–3 ZGR 332, 333ff; Danny Busch,
Emilios Avgouleas, and Guido Ferrarini, Capital Markets Union in Europe (Oxford University Press 2018). For further
analysis: Christopher P Buttigieg, ‘EU Regulation and Supervision of Securities Business: A Critical Analysis of the
Challenges Faced by the National Competent Authorities of Small EU and EEA/EFTA Member States’ (2020)
14/1 L & Fin Mkts Rev 5, 6; Alexander Kern and Vladimir Maly, ‘The New EU Market Abuse Regime and the
Derivatives Markets’ (2015) 9/4 L & Fin Mkts Rev 243, 243ff; Philipp Fidler, ‘Private Enforcement – Rechtstheorie
361
Appendix 30a APPENDIX TO ART 30 MAR – PRIVATE ENFORCEMENT
own financial market regime.4 This includes the MAR: despite the widely recognised impor-
tance of consistent and effective enforcement as a prerequisite to a well-functioning market
abuse regime,5 the MAR does not regulate private enforcement via the law of torts.6 Instead,
together with the CRIM-MAD,7 it maps out minimum8 harmonisation requirements for
Member States’ public enforcement in terms of administrative and criminal law.9 By contrast,
the private enforcement of capital market tort law is left almost entirely to the Member States,
whose national civil liability regimes differ widely, as will be shown in more detail.10
2. Capital market tort law relies on non-harmonised national tort laws
30A.002 The EU legislator’s reticence to regulate private enforcement is primarily due to a structural
feature of capital market tort law11 for the legal regime regulating the liability for false or
misleading capital market information, as laid out in the MAR, is simultaneously subject to
EU and Member State regulatory competence. While primary capital market law and conflict
of laws rules on capital market offences are harmonised throughout the EU,12 the substantive
und Rechtswirklichkeit im Wettbewerbs- und Kapitalmarktrecht’ (2018) 3 JBl 152, 155ff; Jesper Hansen, ‘Market
Abuse Case Law –Where Do We Stand With MAR?’ (2017) 14/2 ECFR 367, 369ff; Niamh Moloney, EU Securities
and Financial Markets Regulation (3rd edn, Oxford University Press 2014) 762ff.
4 Thomale, ‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 328 f. Today’s focus on private law enforcement in general con-
stitutes a rather recent development. See, e.g., Folkert Wilman, ‘The End of The Absence? The Growing Body of EU
Legislation on Private Enforcement and the Main Remedies It Provides for’ (2016) 53/4 CML Rev 887, 889ff.
5 Folkert Wilman, Private Enforcement of EU Law Before National Courts (Edward Elgar Publishing 2015) paras
10.03ff; Vassilios Tountopoulos, ‘Pecuniary Sanctions against Issuers in European Capital Market Law: Harming the
Protected Investors?’ (2019) 20/4 EBOR 695, 695 f; Martin Gelter, ‘Global Securities Litigation and Enforcement’ in
Pierre-Henri Conac and Martin Gelter (eds), Global Securities Litigation and Enforcement (Cambridge University Press
2019) 13, 92ff; Moloney (n 3) 762; John Armour and others, Principles of Financial Regulation (Oxford University Press
2016) 51 f; Kern and Maly (n3) 244 f. On the limits of private enforcement see Howell Jackson and Mark Roe, ‘Public
and Private Enforcement of Securities Laws: Resource-Based Evidence’ (2009) 93/2 JFE 207, 209 f.
6 As laid out in Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 333 f. See also Moloney (n 3) 762ff;
Gelter (n 5) 3, 13, 46ff, 51. On the importance of the enforcement of EU laws on the national and European level,
for businesses in particular, see Jacques Pelkmans and Anabela Correia de Brito, Enforcement in the EU Single Market
(Centre for European Policy Studies 2013) 3ff. On public vs private enforcement in capital market law, see Jackson
and Roe (n 5) 207; Philipp Maume, ‘Staatliche Rechtsdurchsetzung im deutschen Kapitalmarktrecht: eine kritische
Bestandsaufnahme’ (2016) 180 ZHR 358, 360. On capital markets law’s regulatory aims, see, e.g., Christoph Benicke,
‘Prospektpflicht und Prospekthaftung bei grenzüberschreitenden Emissionen’ in Heinz-Peter Masel and others (eds),
Festschrift für Erik Jayme (Seiller 2004) 25ff.
7 Directive 2014/57/EU of the European Parliament and of the Council of 16 April 2014 on criminal sanctions for market
abuse (market abuse directive – CRIM-MAD) [2014] OJ L 173/179.
8 Under Art 30 para 2 MAR Member States are required to provide competent authorities with ‘the power to impose
at least the following administrative sanctions’. See also Fabian Walla ‘§ 4 Process and Strategies of Capital Markets
Regulation in Europe’ in Veil (n 3) 39, 54 f.
9 See, e.g., Andrea Perrone, ‘EU Market Abuse Regulation: The Puzzle of Enforcement’ (2020) 21/2 EBOR 379, 380ff;
Hansen (n 2) 367, 388ff; Thomale, ‘Rechtsquellen des Kapitalmarktrechts’ (n 3) 329.
10 Gelter (n 5) 3, 24, 52; Tountopoulos (n 5) 696 f; Chris Thomale, Der gespaltene Emittent (Mohr Siebeck 2018) 79ff;
Chris Thomale and Marc-Philippe Weller‚ ‘Ad hoc-Publizitätshaftung – § 97 WpHG im Rechtsvergleich’ in Michael
Hoffmann-Becking and Peter Hommelhoff (eds), Festschrift für Gerd Krieger zum 70. Geburtstag (C. H. Beck 2020).
11 In detail Thomale, ‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 329 f; Thomale, ‘Internationale
Kapitalmarktinformationshaftung’ (n 3) 333 f.
12 For an overview, see Veil, ‘§ 1 History’ in Veil (n 3) 3, 4ff.
362
A. Introduction
private law of capital market offences, falling into the category of the law of torts, is left to
legislative jurisdiction or regulatory competence of the Member States.13
In the past, some efforts to harmonise the European law of torts were made, focusing primar- 30A.003
ily on specific subject areas.14 A partial harmonisation process has led to a fragmentation of
tort law in Member States, with EU directives, regulations and CJEU judgments infiltrating
Member States’ jurisdictions with legal concepts that are often alien to their native legal tra-
ditions.15 However, by and large, the EU still lacks a common European law of torts as much
as it lacks a common European Civil or Commercial Code.16 As a result, each Member State
maintains its individual law of torts, including capital market tort law by default.17
The fragmentation outlined above between EU and Member State law goes beyond a mere lack 30A.004
of coordination and integration of legislative competence. For, as divided as Member State law
of torts regimes and especially capital market tort law regimes are, so are the legal traditions
they belong to. Thus, it is unfeasible to draw upon an acquis communautaire of common prin-
ciples of European capital market tort law, because, until today, no such common principles
have transpired from the especially fragmented and specific Member State solutions to civil
liability in capital market law.18 Even in the rare cases where EU secondary law chooses to posit
civil liability claims,19 these claims need to rely on legal concepts germane to the (national) law
of torts such as ‘causation’ or ‘damages’.20 Consequently, European capital market law, when
regulating private law enforcement, finds itself in a semantic emergency: being forced to use
terms it does not and cannot provide by itself, it has to employ an implicit conflict-of-laws
rule referring back to Member State law in order to clothe the causes of action it grants with
justiciable meaning.21 This goes to show that the recourse to national law of torts, in dealing
13 See, e.g., Mauro Bussani and Marta Infantino, ‘Harmonization of Tort Law in Europe’ in Alain Marciano and Giovanni
Battista Ramello (eds), Encyclopedia of Law and Economics Volume 2 (Springer 2019) 1030ff.
14 Bussani and Infantino, ‘Harmonization of Tort Law’ in Marciano and Ramello (n 13) 1029, 1033ff.
15 Rafał Mańko, ‘EU Competence in Private Law: The Treaty Framework for a European Private Law and Challenges
for Coherence’ [2015] European Parliamentary Research Service 14 f; Helmut Koziol, Harmonisation and Fundamental
Questions of European Tort Law (Jan Sramek Verlag 2017) 35; Wilman, Private Enforcement of EU Law (n 5) paras
10.42f.
16 Mańko (n 15) 1, 15, 19f. See also ESMA, ‘Comparison of Liability Regimes in Member States in Relation to the
Prospectus Directive’, ESMA/2013/619, 30 March 2013. See also Olha O Cherednychenko, ‘Rediscovering the Public/
Private Divide in EU Private law’ [2019] ELJ 1, 6ff; Gerrit Betlem, ‘Torts, a European “Ius Commune” and the Private
Enforcement of Community Law’ (2005) 64/1 CLJ 126, 130ff. In detail Bussani and Infantino, ‘Harmonization of Tort
Law in Europe’ in Marciano A and Ramello G B (eds) (n 13); Walter van Gerven, ‘Harmonization of Private Law: Do
We Need It?’ (2004) 41/2 CML Rev 505, 506; Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 333
f. On European tort law in general Helmut Koziol (ed), Basic Questions of Tort Law from a Comparative Perspective (Jan
Sramek Verlag 2015).
17 Koziol (ed), Basic Questions of Tort Law (n 16); see also ESMA (n 16).
18 For a detailed analysis, see the country reports in Koziol (ed), Basic Questions of Tort Law (n 16).
19 cf Art 35a Regulation (EU) No 462/2013 of the European Parliament and of the Council of 21 May 2013 amending
Regulation (EC) No 1060/2009 on credit rating agencies (Rating Agency Regulation) [2013] OJ L 146/1; Art 11
Regulation (EU) No 1286/2014 of the European Parliament and of the Council of 26 November 2014 on key informa-
tion documents for packaged retail and insurance-based investment products (PRIIPs Regulation) [2014] OJ L 352/1.
20 Thomale, ‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 329.
21 Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 333 f; On the difficulty of having to apply general
principles of tort law to civil liability for false and misleading capital market information, see Gelter (n 5) 3, 13, 51.
363
with private enforcement of capital market law both in terms of legislative competence and in
terms of sheer operationality, is inevitable.
3. EU by choice refrains from regulating private enforcement in the MAR
(a) EU has legislative jurisidiction to regulate private enforcement of capital markets law under Art
114 para 1 TFEU
30A.005 Art 114 para 1 TFEU provides the main legal basis for the EU regulating the internal market.22
This includes the harmonisation of the European capital market, and, by implication, any
enforcement mechanisms in public or private law.23 Strictly speaking, harmonising measures
may only be adopted if diverging Member State laws would have a damaging effect on the
internal market.24 The CJEU, however, prefers a broad reading of Art 114 para 1 TFEU,25
according to which, all measures designed to ‘improve the conditions of its [the internal
market’s] functioning’ are covered.26 Uneven levels and uncoordinated measures of enforce-
ment, including private law enforcement, limit the effectiveness of the internal European
market of capital,27 thus hampering the proper functioning of the European internal market.
Consequently, the EU may, in principle, assume legislative jurisdiction for the private enforce-
ment of capital market law in accordance with Art 114 para 1 TFEU.28
30A.006 European legislative acts regulating capital market liability must not violate the principle of
subsidiarity under Art 5 para 3 TEU, which states that European institutions may only act
if and insofar as the objectives of the proposed action cannot be sufficiently and adequately
achieved by the Member States, but can be better regulated at a Union level.29 Harmonising
capital markets law is central to establishing a coherent European capital markets union30 and
can only be achieved at the European, not at the national level. Hence, the EU’s legislative
harmonisation of capital market law does not violate the principle of subsidiarity.
22 See, e.g., Wilman, Private Enforcement of EU Law (n 5) paras 10.02ff; Cherednychenko (n 16) 2 f; Mańko (n 15) 5
f; Wilman, ‘EU Legislation on Private Enforcement’ (n 4) 927 f; Stephen Weatherill, ‘The Several Internal Markets’
(2017) 36 YEL 125, 146ff. On the historical development of Art 114 TFEU, see Matthias Korte, ‘Art 114 AEUV’
in Christian Calliess and Matthias Ruffert (eds), EUV/AEUV (5th edn, C. H. Beck 2016) paras 3ff; Thomale,
‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 330.
23 Arts 51ff and Art 62 TFEU contain specific provisions on harmonisation competences in the area of the freedom of
establishment and the freedom to provide services. Yet, as neither provision applies to the free movement of capital under
Arts 63ff, they do not supersede Art 114 TFEU.
24 Weatherill (n 22) 146.
25 Weatherill (n 22) 146 f, 150 f.
26 Case C-270/12 UK and Northern Ireland v EP and Council [2014] ECLI:EU:C2014:18, para 114.
27 See, e.g., Moloney (n 3) 762 f.
28 As laid out in Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 335 f; Thomale, ‘Rechtsquellen des
Kapitalmarktrechts’ (n 2).
29 Wilman, Private Enforcement of EU Law (n 5) paras 10.07 f. For a detailed analysis, see Serafín Pazos-Vidal, Subsidiarity
and EU Multilevel Governance: Actors, Networks and Agendas (Routledge 2019) 23ff; Jacob Öberg, ‘Subsidiarity as a Limit
to the Exercise of EU Competences’ (2017) 36 YEL 391, 393ff. On the history and institutional function of the principle
of subsidiarity, see Gráinne de Búrca, ‘The Principle of Subsidiarity and the Court of Justice as an Institutional Actor’
(1998) 36/2 JCMS 216, 218ff; Nicolas Bernard, ‘The Future of European Economic Law in the Light of the Principle of
Subsidiarity’ (1996) 33/4 CML Rev 633, 640ff. For a critical review of the principle of subsidiarity, see Garreth Davies,
‘Subsidiarity: The Wrong Idea, in the Wrong Place, at the Wrong Time’ (2006) 43/1 CML Rev 63, 67ff.
30 See, e.g., Buttigieg (n 3) 6 f. On the importance of legislation in combination with soft law see, e.g.g, Parmentier (n 2)
244 f.
364
A. Introduction
As regards capital market law, the CJEU stated that Art 114 para 1 TFEU allows for legal 30A.007
consequences ordered by ESMA vis-à-vis individual market participants.31 Faced with serious
threats to the orderly functioning and integrity of the financial markets or the stability of the
financial system in the EU, the EU legislator enjoys the competence to adopt measures which
may take the form of decisions directed at private market participants.32 While such measures
may only be adopted as a means of last resort and under very specific circumstances,33 the legal-
ity of decisions directed against private parties highlights that, in general, the EU is competent
to regulate enforcement.
The EU legislator already commonly uses its competence to harmonise the internal market 30A.008
under Art 114 para 1 TFEU or former versions of it to regulate private law enforcement,34 for
example, as regards private law sanctions in the context of the Product Liability Directive35 and
of the Cartel Damages Directive.36 Just like the MAR, both Directives are based on internal
market harmonisation. However, while the two Directives cover private liability claims, the
MAR does not. Thus, the MAR must be seen as deliberately choosing not to harmonise
private law sanctions: under Art 114 para 1 TFEU and Art 5 para 3 TEU, the EU legislator
could have enacted provisions similar to, for example, Art 35a Rating Agency Regulation and
Art 11 PRIIPS Regulation, but for reasons of policy, it preferred not to.37
Some scholars have expressed doubts as to whether the EU has any legislative jurisdiction in the 30A.009
field of private law enforcement.38 There is, however, no real evidence to support this: as laid
out above, the Union legislator, for one, undoubtedly assumes such a competence.39 Apart from
this legal realist fact, EU constitutional law, as could be shown, suggests no such restriction,
neither in its wording nor in its spirit.
(b) Private enforcement of capital markets law is not required by the effet utile principle
The principle of effet utile, as stipulated in Art 4 para 3 TEU, is a central concept of EU law. It 30A.010
prescribes that neither Member States nor private legal bodies may put into jeopardy or other-
31 UK and Northern Ireland v EP and Council (n 25) paras 106ff. In the case, the ESMA power under Art 28 Regulation
(EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects
of credit default swaps [2012] OJ L 86/1 was at issue.
32 Ibid., para 108.
33 Ibid., para 108.
34 Wilman, ‘EU Legislation on Private Enforcement’ (n 4) 927ff.
35 Council Directive 85/374/EEC of 25 July 1985 on the approximation of the laws, regulations and administrative pro-
visions of the Member States concerning liability for defective products [1985] OJ L 210/29. See also Cherednychenko
(n 16) 11 f; Wilman, Private Enforcement of EU Law (n 5) para 5.25.
36 Directive 2014/104/EU of the European Parliament and of the Council of 26 November 2014 on certain rules governing
actions for damages under national law for infringements of the competition law provisions of the Member States and of
the European Union [2014] OJ L 349/1.
37 See Thomale, ‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 329.
38 See Thomas M J Möllers and Franz Clemens Leisch, ‘§§ 37b, c WpHG’ in Heribert Hirte and Thomas M J Möllers
(eds), Kölner Kommentar zum WpHG (2nd edn, Carl Heymanns Verlag 2014) paras 18ff, in particular 43; Matthias
Casper, ‘The Significance of the Law of Tort with the Example of the Civil Liability for Erroneous Ad Hoc Disclosure’
in Reiner Schulze (ed), Compensation of Private Losses. The Evolution of Torts in European Business Law (Sellier European
Law Publishers 2011) 91, 93.
39 Wilman, ‘EU Legislation on Private Enforcement’ (n 4) 929.
365
wise diminish the effectiveness of EU law.40 According to certain proponents in legal doctrine,
this principle forces Member States to provide private law enforcement, even when this is not
expressly prescribed by secondary law.41 As laid out in detail below, this claim is without merits.
30A.011 First, the CJEU, to be sure, has emphasised in the Courage and Muñoz judgments that private
enforcement remedies can enhance the effectiveness of EU law on competition, antitrust and
the free movement of goods.42 This is, in fact, hardly surprising as, since Francovich43 the CJEU
has been using this very effet utile argument in order to justify its stance on Member State
liability for the failure to implement directives.44 However, it does not follow, and has not been
posited by the CJEU either, that Art 4 para 3 TEU prescribes private law enforcement across
the board for any violation of EU law. Referencing the effet utile principle in this apodictic
manner is thus, to start with, question-begging.
30A.012 Second, such a broad interpretation of Art 4 para 3 TEU would ignore the carefully calibrated
degrees of differentiation in secondary capital markets law. The EU legislator has voluntarily
and intentionally opted for fragmentation in terms of private law enforcement.45 This means
that for each and every act of secondary law, the question of private law enforcement needs to
be assessed separately. Notably, where the EU legislator considers private enforcement to be
a necessary prerequisite for the effectiveness of a secondary act in the field of capital markets
law, a given act will contain explicit private law enforcement clauses:46
30A.013 There are several examples of the EU legislator’s differentiated approach sketched out above.47
Explicit private enforcement in the form of a specific cause of action for damages is provided
by Art 11 para 2 PRIIPs Regulation48 and Art 35a para 1 Credit Rating Agencies Regulation.49
Here, the question if private law enforcement should be granted is answered affirmatively by
EU law, while Member States may only flesh out the details and elements of such claims.
40 Definition by Sybe de Vries and Robert van Mastrigt, ‘Chapter 11: The Horizontal Direct Effect of the Four Freedoms:
From a Hodgepodge of Cases to a Seamless Web of Judicial Protection in the EU Single Market?’ in Ulf Bernitz, Xavier
Groussot and Felix Schulyok (eds), General Principles of EU Law and European Private Law (Kluwer Law International
2013) 249, 264. On the effet utile, see also Phedon Nicolaides and Maria Geilmann, ‘What is Effective Implementation
of EU Law?’(2012) 19/3 MJ 383, 286ff.
41 e.g., AlexanderHellgardt, ‘Europarechtliche Vorgaben für die Kapitalmarktinformationshaftung’ (2012) 5 AG 154,
154; Christoph H Seibt, ‘Europäische Finanzmarktregulierung zu Insiderrecht und Ad hoc-Publizität’ (2013) 177
ZHR 388, 424 f; Christoph H Seibt and Bernward Wollenschläger, ‘Revision des Marktmissbrauchsrechts durch
Marktmissbrauchsverordnung und Richtlinie über strafrechtliche Sanktionen für Marktmanipulation’ [2014] AG, 593,
607; Andreas Engel,Internationales Kapitalmarktdeliktsrecht(Mohr Siebeck 2019) 36. Agreeing in principle Peter O
Mülbert, ‘Anlegerschutz und Finanzmarktregulierung – Grundlagen’ (2013) 177 ZHR 160, 194ff.
42 Case C-453/99 Courage [20.9.2001] ECR-I 6297, para 26; Case C-253/00 Muñoz [2002] ECR I-7289, paras 30 f.
43 Joined Cases C-6/90 Francovich and C-9/90 Bonifaci [1991] ECR I-5357, para 35.
44 For details see Andrea Biondi and Martin Farley, The Right to Damages in European Law (Wolters Kluwer 2009).
45 Gelter (n 5) 3, 13, 51.
46 See, e.g., Wilman, ‘EU Legislation on Private Enforcement’ (n 4) 894ff.
47 Thomale, ‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 329 f.
48 Regulation (EU) No 1286/2014 of the European Parliament and of the Council of 26 November 2014 on key informa-
tion documents for packaged retail and insurance-based investment products (PRIIPs) [2014] OJ L 352/1.
49 Regulation (EU) No 462/2013 of the European Parliament and of the Council of 21 May 2013 amending Regulation
(EC) No 1060/2009 on credit rating agencies [2013] OJ L 146/1.
366
A. Introduction
Art 11 para 2 Prospectus Regulation50 chooses a more self-restrained approach, providing only
a very general framework for private enforcement, but leaving its concrete implementation
almost entirely to the Member States. Finally, there are acts like the MAR or the Transparency
Directive,51 in which the EU legislator does not even care to comment on private enforcement,
but instead only references public sanctions. It seems perfectly in line with general rules of
statutory construction to take this silence at face value: if the EU legislator was intending to
prescribe private remedies, it would say so. As a result, abstaining from the topic entirely in the
MAR, it follows that both the availability and the degree of private enforcement by choice is
entirely left to the Member States. Consequently, a given Member State’s choice in this regard
is made with the blessing of EU secondary law and cannot be second-guessed by effet utile.
In addition, using the effet utile principle in the way laid out above in cases like the MAR, where 30A.014
the EU legislator does not comment on private enforcement, could harm the institutional
balance52 between private enforcement and public as well as criminal enforcement measures.
The ultimate goal is efficient rather than merely effective enforcement.53 In that enterprise,
public and private enforcement are not independent variables that can simply be increased ad
infinitum in order to ensure maximum deterrence. Rather, in order to avoid structural disso-
nance, the EU legislator needs to balance public and private enforcement with extreme care.
Blindly increasing private enforcement levels may thus, in a worst case scenario, lead to less
efficient and sometimes even less effective enforcement overall.54
Finally, the broad application of the effet utile principle is questionable in terms of legal 30A.015
policy.55 One could sensibly discuss a broader recourse to the effet utile principle if the consol-
idated level of enforcement in the EU were completely inadequate. This, however, is hardly
the case.56 Neither is the qualitative argument compelling in and of itself, for excessive private
enforcement, as already pointed out, brings with it the danger of over-deterrence.57 In the
case of liability for false or misleading capital markets information, private enforcement may
also have harmful distributive side effects, such as a redistribution in favour of short-term,
under-diversified investors.58 The delicate threshold and trade-off issues involved need to be
50 Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to
be published when securities are offered to the public or admitted to trading on a regulated market, and repealing
Directive 2003/71/EC [2017] OJ L 168/12.
51 Directive 2013/50/EU of the European Parliament and of the Council of 22 October 2013 amending Directive
2004/109/EC of the European Parliament and of the Council on the harmonisation of transparency requirements in
relation to information about issuers whose securities are admitted to trading on a regulated market, Directive 2003/71/
EC of the European Parliament and of the Council on the prospectus to be published when securities are offered to the
public or admitted to trading and Commission Directive 2007/14/EC laying down detailed rules for the implementation
of certain provisions of Directive 2004/109/EC [2013] OJ L 294/13. The Directive only lays out general rules for
administrative measures and sanctions in Arts 28–28c.
52 Term used by Klaus Ulrich Schmolke, ‘Private Enforcement und institutionelle Balance’ (2016) 19 NZG 721, 726ff.
53 Ibid., 727 f.
54 Ibid., 727 f; Tomáš Dumbrovský, ‘Effet Utile as a Unifying Doctrine in a Constitutionally Pluralist Europe’ in Luboš
Tichý, Michael Potacs and Tomáš Dumbrovský (eds), Effet utile (Charles University Prague 2014) 93.
56 For further analysis, see Thomale, Der gespaltene Emittent (n 10) 84; Engel (n 41) 43ff; Wilman, ‘EU Legislation on
Private Enforcement’ (n 4) 889ff.
57 See e.g., Richard A Bierschbach and Alex Stein, ‘Overenforcement’ (2005) 93/6 GLJ 1743.
58 Jackson and Roe (n 5) 207, 209 f; Gelter (n 5) 3, 10, 38, 49 f. On the relationship between pecuniary administrative
sanctions against the issuer and private enforcement, see Tountopoulos (n 5) 722ff.
367
carefully assessed. The adequate fora for that are EU and Member State legislatures. Legal
doctrine can support and conduct this analysis. However, it should refrain from relying on
anecdotal evidence in order to second-guess incumbent regulation and advocate for what
oftentimes simply amounts to statutory interpretation contra legem.
4. Conclusion: private international law as a minimum harmonisation
30A.016 In accordance with Art 114 para 1 TFEU, the EU may assume legislative competence regard-
ing private enforcement of capital markets law.59 This includes liability for false or misleading
capital market information. Yet, in the MAR, the EU legislator opts for differentiated harmo-
nisation, leaving private enforcement entirely to the Member States and their law of torts (see
B.). Having said that, the choice, which of those substantive Member State laws should be
designated to govern a given case, is harmonised by EU private international law in the Rome
II-Regulation (D). Internationally competent courts are determined by Brussels Ia-Regulation
(C). The altering rules, by which those default norms on conflict of laws and international juris-
diction can be contracted around through choice of law and choice of court, are also governed
by EU law (E).
B. NATIONAL CIVIL LIABILITY REGIMES FOR INFRACTIONS OF ART 17 MAR
30A.017 National private enforcement regimes, providing liability claims for false or misleading capital
market information under the MAR, are embedded in Member States’ tort laws, and thus vary
greatly.60 In addition, depending on economic, political and legal circumstances, state laws may
also differ in their sanctions for individual offences. This is particularly true for damage result-
ing from the issuer’s failure to comply with his obligation to ad hoc disclose inside information,
as laid out in Art 17 MAR.61 That provision, at the same time, constitutes a central cornerstone
of the MAR and enjoys great practical relevance.62 Hence, in the following chapter, it shall
serve as a paradigm for transparency offences under the MAR in general. National legislative
approaches for private enforcement of ad hoc disclosure are extremely diverse, demonstrating
yet again the influence of national tort law traditions. The following sections will briefly intro-
duce the US (1) and the UK (2) approach, as well as several European liability regimes (3–7).
1. US: Civil enforcement of wrongful ad hoc disclosure only in cases of intentional market
manipulation
(a) Introduction
30A.018 The US model for enforcing securities law relies on a strong, independent regulatory authority,
found in the Securities Exchange Commission (SEC)63 in combination with extensive ‘entre-

60 For a detailed analysis, see Thomale, Der gespaltene Emittent (n 10) 79ff; Thomale and Weller (n 10).
61 Thomale and Weller (n 10); Thomale, Der gespaltene Emittent (n 10) 27ff, 76ff.
62 See, e.g., Moloney (n 3) 762 f.
63 On the SEC’s role, see Donald C Langevoort, ‘The SEC as a Lawmaker: Choices about Investor Protection in the Face
of Uncertainty’ (2006) 84/7 Wash U L Rev 1591, 1597 f, 1619ff; Mark Walsh and Michael Hyatte, ‘United States’ in
368
B. National civil liability regimes for infractions of Art 17 MAR
preneurial’64 shareholder litigation.65 The US Supreme Court’s landmark ruling Basic Inc. v
Levinson66 paved the way for securities class actions. In said ruling, the US Supreme Court
stressed the importance of private enforcement as an essential tool for the functioning of an
effective capital market information regime.67 Since then, the US has become the pioneer and
ultimate comparative source in recognising civil liability claims against the issuer for the failure
to comply with capital market information duties.68
In the US, today’s federal securities disclosure statutes, most notably the Securities Act 30A.019
(1933) and the Securities Exchange Act (1934), were introduced in the New Deal era and
have remained in force since then.69 Rule 10b-5 was promulgated by the SEC based on the
authorisation of Sec 10(b) Securities Exchange Act (1934)70 and serves as the legal basis71 for
civil liability claims against the issuer for the issuer’s failure to comply with capital market
information obligations.72
(b) SEC Rule 10b-5

(aa) Legal text
Rule 10b-5: Employment of manipulative and deceptive devices 30A.020
It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of
interstate commerce, or of the mails or of any facility of any national securities exchange, […]
(b) To make any untrue statement of a material fact or to omit to state a material fact necessary in
order to make the statements made, in the light of the circumstances under which they were
made, not misleading, […]
in connection with the purchase or sale of any security.
Jeffrey Golden (ed), The International Capital Markets Review (9th edn, Law Business Research Ltd 2019) 303, 303ff.
64 See, e.g., John C Coffee Jr, ‘The Regulation of Entrepreneurial Litigation: Balancing Fairness and Efficiency in the
Large Class Action’ (1987) 54/3 UCLR 877, 877ff; John C Coffee Jr, Entrepreneurial Litigation (Harvard 2015) 56ff;
Agnes Cheng and others, ‘Institutional Monitoring through Shareholder Litigation’ (2010) 95/3 JFE 356, 364ff.
65 Merrit B Fox, ‘Civil Liability and Disclosure’ (2009) 109 CLR 237, 241ff; Gelter (n 5) 3, 9, 17, 118ff; William Savitt
and Noah B Yavitz, ‘United States’ in William Savitt (ed), The Securities Litigation Review (6th edn, Law Business
Research Ltd 2020) 288, 292ff. On recent developments as regards extraterritoriality, see e.g., Joshua L Boehm, ‘Private
Securities Fraud Litigation after Morrison v National Australia Bank: Reconsidering a Reliance-Based Approach to
Extraterritoriality’ (2012) 53 HarvIntlLJ 249, 257ff; Hannah L Buxbaum, ‘Multinational Class Actions under Federal
Securities Law: Managing Jurisdictional Conflict’ (2007) 46 CJTL 14, 26ff; Hannah L Buxbaum, ‘Remedies for Foreign
Investors under U.S. Federal Securities Law’ (2012) 75 LCP 161, 162 ff.
66 Basic Inc v Levinson 485 US 224 (1988) 983, 485.
67 Ibid., 983, 485
68 Gelter (n 5) 3, 5, 12. The point is laid out in detail in Thomale, Der gespaltene Emittent (n 10) 90ff. For further analysis
of public and private firms’ capital market information duties in the US, see Elisabeth de Fontenay, ‘The Deregulation of
Private Capital and the Decline of the Public Company’ (2017) 68 HLJ 445, 473ff. See also Thomale and Weller (n 10).
69 Savitt and Yavitz (n 65) 289; Fox, ‘Civil Liability and Mandatory Disclosure’ (n 65) 241; Gelter (n 5) 3, 13; Franklin
A Gevurtz, ‘United States: The Protection of Minority Investors and Compensation of their Losses’ in Conac and Gelter
(n 5) 114ff; Boehm (n 65) 252; Frederick C Dunbar and Dana Heller, ‘Fraud on the market meets behavioral finance’
(2006) 31/2 DJCL 455, 458ff.
70 Gevurtz (n 69) 113.
71 Gelter (n 5) 3, 53; Boehm (n 65) 252.
72 For an overview of mandatory disclosure duties by issuers and its role in the US capital markets system, see de Fontenay
(n 68) 473ff.
369
(bb) Key aspects

30A.021 Section 10(b) Securities Exchange Act (1934) does not refer to private enforcement explicitly.
Nonetheless, since the 1970s, US courts have interpreted s 10(b) to imply a private right of
action for investors injured by the violation of Rule 10b-5.73 Hence, civil liability claims can be
based on this provision.74 However, US courts have stressed that private securities fraud actions
must be adequately contained in order to avoid their abuse, which may impose substantial costs
on companies and individuals.75
30A.022 Rule 10b-5 broadly prohibits securities fraud by sanctioning false statements of material facts or
the omission of material facts that render statements misleading.76 US courts have continuously
narrowed Rule 10b-5’s applicability.77 The US Supreme Court has interpreted securities fraud
under Sec 10(b) Securities Exchange Act (1934) to require a false or misleading statement and,
in addition, a concrete duty to speak.78 Disclosure is not required simply because an investor
might find the information relevant or of interest.79 Similarly, the US Supreme Court and
several US courts have ruled that the omission of capital market information is actionable
only when the issuer is subject to a concrete duty to disclose the omitted facts.80 Silence, in
the absence of a concrete duty to disclose, is not considered misleading under Rule 10b–5.81
A duty to disclose may arise either expressly pursuant to an independent statute or as a result of
the ongoing duty to avoid rendering pre-existing statements misleading by failing to disclose
material facts.82
30A.023 Issuers cannot be held accountable for false or misleading ad hoc disclosure, even if their actions
were grossly negligent, unless the issuer’s actions constitute a use of manipulative and deceptive
devices.83 The Securities Exchange Act (1934) does not define a standard of mens rea for civil
liability claims under Rule 10b–5. Rather, this question is left to the discretion of the courts,
which have continuously ruled that liability may only be assigned to the issuer if the act in ques-
73 Gevurtz (n 69) 109, 110 f, 120; Savitt and Yavitz (n 65) 297. See also, e.g., Superintendent of Ins of State of N Y v Bankers
Life & Cas. Co., 404 US 6 (1971): ‘It is now established that a private right of action is implied under s 10(b)’, cited
in Louis Loss, Fundamentals of Securities Regulation, (2nd edn, Little Brown 1961). See also Thomale, ‘Internationale
Kapitalmarktinformationshaftung’ (n 3) 334.
74 Superintendent of Ins of State of N Y (n 73). See also Savitt and Yavitz (n 65) 292 f; Boehm (n 65) 252.
75 Tellabs Inc v Makor Issues & Rights Ltd, 551 US 308 (2007) 313. In particular, meritless securities fraud class actions, in
which shareholders acting as plaintiffs effectively sue themselves, could otherwise lead to market disruption. See also Fox,
‘Civil Liability and Mandatory Disclosure’ (n 65) 246ff; John C Coffee Jr, ‘Reforming the Securities Class Action: On
Deterrence and its Implementation’ (2006) 106 CLR, 1534, 1557ff. Gevurtz (n 69) 109, 112 f; on alternative models for
shareholder class actions, see David Webber, ‘Shareholder Litigation without Class Actions’ (2015) 57 ALR 201, 224 ff;
see also Jackson and Roe (n 5) 209 f.
76 Gevurtz (n 69) 109, 121; Buxbaum, ‘Multinational Class Actions under Federal Securities Law: Managing Jurisdictional
Conflict’ (n 65) 18 f. As laid out in detail in Thomale, Der gespaltene Emittent (n 10) 90ff.
77 US courts have done so, e.g., by introducing certain requirements for the standing to sue, most notably in the Birnbaum
Doctrine’s purchaser–seller limitation (Birnbaum v Newport Steel Corp, 193 F.2d 461 (2d Cir 1952) cert denied, 343 US
956 (1952)). See also the landmark ruling Blue Chip Stamps v Manor Drug Stores, 421 US 723 (1975).
78 Santa Fe Indus Inc v Green, 430 US 462 (1977), as cited in Gevurtz (n 69) 109, 121.
79 BioScrip, Inc Securities Litigation, 95 F.Supp.3d 711 (2015) 727. On the requirement of the materiality of information,
Janis Sarra, ‘Disclosure as a Public Policy Instrument in Global Capital Markets’ (2007) 42/3 TILJ 875, 888, 890.
80 BioScrip (n 79) 727.
81 Basic Inc (n 66).
82 BioScrip (n 79) 727.
83 Ernst & Ernst v. Hochfelder, 425 US 185 (1976) 197.
370
tion was carried out with ‘scienter’.84 The US Supreme Court defines ‘scienter’ as a mental state
embracing intent to deceive, manipulate, or defraud.85 The element of scienter is not fulfilled
if the issuer merely acts negligently or even recklessly, the narrow exception to that rule being
certain cases of deliberate86 recklessness.
Investors in the US enjoy a significant advantage as regards the burden of proof for causality. 30A.024
In Basic Inc v Levinson,87 the US Supreme Court endorsed the fraud-on-the-market theory.88
Under that rule, plaintiffs do not have to prove individual reliance on false or misleading
capital market disclosures in a civil liability suit.89 Instead, essentially, it suffices for them to
have traded during the period in which the security’s pricing was distorted by the respective
wrongful disclosure.90 In other words: under the fraud-on-the-market theory, it is presumed
that the investor relied on the integrity of the market price, irrespective of his or her personal
awareness of the faulty statement.91
84 Ibid., 197; Tellabs Inc v Makor Issues & Rights Ltd (n 74) 313. See also Stoneridge Inv Partners, LLC v Scientific-Atlanta,
552 US 148 (2008) 157:
In a typical § 10(b) private action a plaintiff must prove:
1. a material misrepresentation or omission by the defendant;
2. scienter;
3. a connection between the misrepresentation or omission and the purchase or sale of a security;
4. reliance upon the misrepresentation or omission;
5. economic loss; and
6. loss causation.
See also Gevurtz (n 69) 109, 125 f; Fox, ‘Civil Liability and Mandatory Disclosure’ (n 65) 246. See also Thomale, Der
gespaltene Emittent (n 10) 91 f.
85 Ernst & Ernst (n 83); see also Tellabs Inc (n 5) 313; Stoneridge Inv Partners, LLC (n 84) 157.
86 Matrixx Initiatives, Inc v Siracusano, 563 US 27 (2011) 48.
87 Basic Inc (n 66).
88 For a detailed analysis, see HLRA, ‘The Fraud-on-the-Market Theory’ (1982) 95/5 HLR 1143, 1143ff; see also Gelter
(n 5) 3, 68ff; Merritt B Fox, ‘Securities Class Actions against Foreign Issuers’ (2012) 64 SLR 1174, 1176; Dunbar and
Heller (n 69) 458 f; Savitt and Yavitz (n 65) 298.
89 Dunbar and Heller (n 69) 465 f; Savitt and Yavitz (n 65) 298. The exact rationale is slightly ambiguous. In its most
principled version, fraud-on-the-market theory presupposes, based on the semi-strong efficient capital market hypothe-
sis, that participants do not take any rational cognisance of publicly available information, as this information is already
restated in the price itself. As a result, one has to abstract from individual participants entirely and simply appreciate
that market pricing in general is affected by wrongful disclosure. The Supreme Court, however, seems to lean towards
a slightly weaker and more flexible reliance approach, in that participants are rebuttably presumed to rely on the orderly
functioning of market pricing when transacting on a given market.
90 Fox, ‘Securities Class Actions against Foreign Issuers’ (n 88) 1176; HLRA (n 88) 1143–1161; Gelter (n 5) 3, 68ff.
91 Gevurtz (n 69) 128.
371
2. United Kingdom: Restrictions on civil liability for wrongful continuous disclosure, focus
on corporate governance
(a) Introduction
30A.025 In the UK, private securities litigation is rare.92 The UK has traditionally been highly sceptical
of utilising private enforcement in order to strengthen capital market efficiency.93 Therefore,
legal tradition neither recognises the investor-friendly fraud-on-the-market theory, nor does
it provide an equivalent to US securities class actions.94 Thus, the protection of minority
investors in the UK is mainly achieved ex ante, through corporate governance,95 rather than by
means of civil liability ex post.96 In addition, the Financial Conduct Authority (FCA) assumes
responsibility as a strong, independent regulatory body for public enforcement of capital market
disclosure obligations.97
30A.026 Section 90A of the Financial Services and Markets Act (FSMA) 2000 and the accompanying
Schedule 10A provide the legal basis for civil liability claims against the issuer for the violation
of continuous disclosure requirements.98 Schedule 10A was first introduced in 2010. Before
that, the UK legislator had refrained from providing investors with any liability provisions
against issuers for violations of continuous disclosure obligations.99 An earlier version of s 90A
FSMA 2000 had served as a legal basis for liability claims against the issuer for disclosing
misleading statements required by provisions implementing the Transparency Directive.100
However, these provisions did not apply to cases of continuous disclosure obligations.101
92 Iris Chiu, ‘United Kingdom: A Confidence Trick: Ex Ante versus Ex Post Frameworks in Minority Investor Protection’
in Conac and Gelter (n 5) 627, 642 f; Eilis Ferran, ‘Are US-Style Investors Suits Coming to the UK?’ [2009] JCLS 315.
For a detailed analysis, see also Thomale, Der gespaltene Emittent (n 10) 94ff.
93 Chiu (n 92) 627, 642 f; Paul Davies, Davies Review of Issuer Liability (The Crown 2007). As laid out in Thomale and
Weller (n 10).
94 See, e.g., Harry Edwards and Jon Ford, ‘England and Wales’ in Savitt (n 65) 85, 90, 94.
95 Chiu (n 92) 627, 645ff; John Armour, ‘Enforcement Strategies in UK Corporate Governance: A Roadmap and
Empirical Assessment’ in Alessio M Pacces (ed), The Law and Economics of Corporate Governance. Changing Perspectives
(Edward Elgar Publishing 2010) 213, 214ff. On the functioning of the UK corporate governance system, see Martin
Winner, ‘Der UK Corporate Governance Code’ (2012) 41/2–3 ZGR 246, 258ff.
96 HM Treasury, ‘Extension of the statutory regime for issuer liability: a response to consultation’ [2010] https://webarchive
.nationalarchives.gov.uk/+/http:/www.hm-treasury.gov.uk/d/consult_issuerliability_response.pdf 7ff accessed on 4
October 2021.
97 On the FCA’s role, see Delgado A and others, ‘United Kingdom’ in Golden (n 63) 292; Chiu (n 92) 627, 639ff; Edwards
and Ford (n 94) 85, 86. For further analysis see Stefano Lombardo and Frederico M Mucciarelli, ‘Market Soundings:
The Interaction between Securities Regulation and Company Law in the United Kingdom and Italy’ (2019) 16/3 ECFR
310, 314, 340ff.
98 Edwards and Ford (n 94) 85, 86 f.
99 Chiu (n 92) 627, 643. See also Davies, Davies Review of Issuer Liability (n 93) paras 23ff. On possible political
reasons for the legislator’s reticence, see Barry A K Rider, ‘Civilising the Law — The Use of Civil and Administrative
Proceedings to Enforce Financial Services Law’ (1995) 3/1 J Fin Crim 11, 23 f; Patrick C Leyens, ‘Prospekt-und
Kapitalmarktinformationshaftung: Länderbericht England’ in Klaus J Hopt and Hans-Christoph Voigt (eds), Prospekt-
und Kapitalmarktinformationshaftung: Recht und Reform in der Europäischen Union, der Schweiz und den USA (Mohr
Siebeck 2004) 498, 548.
100 Rüdiger Veil and Malte Wundenberg, Englisches Kapitalmarktrecht (Carl Heymanns Verlag 2010) 153 f.
101 Explanatory Notes to s 1270 of the Companies Act 2006, para 1644:
Subsection (1)(a) of new section 90A provides that the civil liability regime set out in that section applies to those
reports and statements required by provisions implementing Articles 4 to 6 of the Directive 2013/50/EU of the
European Parliament and of the Council of 22 October 2013 amending Directive 2004/109/EC of the European
372
(b) Section 90A FSMA

(aa) Legal text
Sec 90A FSMA 30A.027
Liability of issuers in connection with published information
Schedule 10A makes provision about the liability of issuers of securities to pay compensation to
persons who have suffered loss as a result of—
(a) a misleading statement or dishonest omission in certain published information relating to the
securities, or
(b) a dishonest delay in publishing such information.
Schedule 10A: 30A.028
[…] PART 2 – LIABILITY IN CONNECTION WITH PUBLISHED INFORMATION

3. Liability of issuer for misleading statement or dishonest omission
(1) An issuer of securities to which this Schedule applies is liable to pay compensation to a person
who—
(a) acquires, continues to hold or disposes of the securities in reliance on published information
to which this Schedule applies, and
(b) suffers loss in respect of the securities as a result of—
(i) any untrue or misleading statement in that published information, or
(ii) the omission from that published information of any matter required to be included in
it.
(2) The issuer is liable in respect of an untrue or misleading statement only if a person discharging
managerial responsibilities within the issuer knew the statement to be untrue or misleading or
was reckless as to whether it was untrue or misleading.
(3) The issuer is liable in respect of the omission of any matter required to be included in published
information only if a person discharging managerial responsibilities within the issuer knew the
omission to be a dishonest concealment of a material fact.
(4) A loss is not regarded as suffered as a result of the statement or omission unless the person
suffering it acquired, continued to hold or disposed of the relevant securities—
(a) in reliance on the information in question, and
(b) at a time when, and in circumstances in which, it was reasonable for him to rely on it.
6. Meaning of dishonesty
For the purposes of paragraphs 3(3) […] a person's conduct is regarded as dishonest if (and
only if)—
(a) it is regarded as dishonest by persons who regularly trade on the securities market in question,
and
(b) the person was aware (or must be taken to have been aware) that it was so regarded.
Parliament and of the Council on the harmonization of transparency requirements in relation to information about
issuers whose securities are admitted to trading on a regulated market, Directive 2003/71/EC of the European
Parliament and of the Council on the prospectus to be published when securities are offered to the public or admitted
to trading and Commission Directive 2007/14/EC laying down detailed rules for the implementation of certain pro-
visions of Directive 2004/109/EC [2013] OJ L 294/13 (‘Transparency Directive’). Depending on transparency rules,
we would expect this to include annual and half yearly financial statements and management reports, the sign-off by
directors or other responsible parties, as well as interim management statements.
For a more detailed analysis, see Davies, Davies Review of Issuer Liability (n 93) paras 40ff, 78; Ferran (n 92) 318ff.
373
(bb) Key aspects

30A.029 Under s 90A FSMA, an issuer of securities can be held liable for the publication of untrue or
misleading statements and for a dishonest delay in publishing certain information.102 § 3 (3)
Schedule 10A further states that an issuer’s liability is only assumed if a person discharging
managerial responsibilities (PDMR)103 ‘within’ the issuer knew a statement to be untrue or
misleading or was reckless as to whether it was untrue or misleading.104 Thus, the PDMR must
act with intent.
30A.030 The UK legislator’s restrictive approach becomes particularly apparent when looking at omis-
sions to publish information. An omission must be dishonest in order to serve as a basis for
civil liability claims. The issuer is considered to act dishonestly when publishing a statement
that includes some, but intentionally omits other information that for contextual reasons would
have to be published as well.105 Yet, an issuer failing to make any statement at all is not liable
under s 90A FSMA.106
3. Germany: Civil liability even in cases of gross negligence, combined with broad
attribution of knowledge in company structures
(a) Introduction
30A.031 Germany’s current civil liability regime for inadequate capital market disclosure is very strict.107
This has not always been the case. Until the early 2000s, German courts had to revert to the
ill-fitting s 826 of the BGB (German Civil Code) and general principles of tort law in order
to construct civil liability for inadequate ad hoc disclosure.108 In 2002, the German legisla-
tor addressed this issue by introducing special provisions,109 notably ss 97 and 98110 of the
Wertpapierhandelsgesetz (WpHG, Securities Trading Act), which provide the legal basis for
claims against the issuer because of wrongful ad hoc disclosure of inside information.111
102 Edwards and Ford (n 94) 85, 89 f. In further detail, see Thomale, Der gespaltene Emittent (n 10) 95ff.
103 Defined in Art 19 MAR as a director or any other senior executive who has regular access to inside information, relating
directly or indirectly, to the company and the power to take managerial decisions affecting the company’s future devel-
opments and business prospects. For a detailed analysis see, e.g., Mårten Knuts, ‘The Optimal Scope of Disclosure by
Association Regime under MAR’ (2016) 13/3 ECFR 495, 507ff.
104 Edwards and Ford (n 4) 85, 90.
105 Davies, Davies Review of Issuer Liability (n 93) para 85 as well as para 54 on common law; Ferran (n 92) 324 f.
106 Davies, Davies Review of Issuer Liability (n 93) para 85: ‘The section contemplates liability only for omissions from the
statement which is made (“omission from any such publication of any matter to be included in it”) rather than liability
for failure to make any statement at all.’
107 As argued in Thomale and Weller (n 10). See e.g., Dirk Verse, ‘Germany: Liability for Incorrect Capital Market
Information’ in Conac and Gelter (n 5) 363, 364ff; Gelter (n 5) 3, 24, 58.
108 Verse (n 107) 363, 383; Lars Röh and Tobias de Raet, ‘Germany’ in Savitt (n 65) 122, 124.
109 Verse (n 107) 363, 383; Röh and de Raet (n 108) 122, 125.
110 Ss 97 and 98 WpHG corresponded to ss 37b and 37c, respectively, before 3 January 2018.
111 On the WpHG, see Stefan Henkelmann and Lennart Dahmen, ‘Germany’ in Golden (n 63) 89, 90f. See also
Marc-Philippe Weller, ‘Fehlerhafte Kapitalmarktinformation zwischen Freiheit und Haftung’ in Gerd Krieger, Marcus
Lutter and Karsten Schmidt (eds), Festschrift für Michael Hoffmann-Becking zum 70. Geburtstag (C. H. Beck 2013)
1341ff; Gudula Deipenbrock, ‘Private Enforcement in the Realm of European Capital Markets Law Revisited and the
Case of Credit Rating Agencies from the Perspective of European and German Law’ (2018) 29/4 EBLR 549, 552 f.
374
(b) Sections 97 and 98 WpHG

(aa) Legal text
Section 97: Liability for damages due to failure to publish inside information without undue delay112
(1) If an issuer whose financial instruments have been admitted to trading on a trading venue in
Germany or who has applied for the financial instruments to be admitted to trading on a reg-
ulated market or multilateral trading facility in Germany fails to publish, without undue delay,
inside information that directly relates to that issuer in accordance with Article 17 of Regulation
(EU) No. 596/2014, that issuer is liable to compensate a third party for losses arising from the
failure to publish if that third party:
1. bought the financial instruments after the failure to publish and still owns the
financial instruments when the inside information becomes known, or
2. bought the financial instruments before the event triggering the inside information
and sells them after failure to publish that information.
(2) Issuers who can prove that the failure to publish was not deliberate or an act of gross negligence
are not liable for damages under subsection (1).
(3) Claims for damages under subsection (1) cannot be asserted if, in the case of subsection (1)
number 1, the third party knew the inside information at the time of purchase or, in the case of
subsection (1) number 2, at the time of sale.
(4) This is without prejudice to further contractual claims or claims for intentional tort that may be
asserted under the provisions of civil law.
(5) Any agreement that reduces or waives in advance claims by an issuer against members of its
board of management due to claims asserted against the issuer under subsection (1) is invalid.
Section 98: Liability for damages due to publication of untrue inside information113
(1) If an issuer whose financial instruments have been admitted to trading on a trading venue in
Germany or who has applied for the financial instruments to be admitted to trading on a regu-
lated market or multilateral trading facility in Germany publishes untrue inside information that
directly relates to that issuer in a disclosure under Article 17 of Regulation (EU) No. 596/2014,
that issuer is liable to compensate a third party for losses arising from the fact that the third party
relied on the accuracy of the inside information, if that third party
1. bought the financial instruments after publication and still owns the financial
instruments when it becomes known that the information was inaccurate or
2. bought the financial instruments before publication and sells them before it
becomes known that the information was inaccurate.
(2) Issuers who can prove that they were not aware of the inaccuracy of the inside information
and that the lack of awareness does not constitute an act of gross negligence are not liable for
damages under subsection (1).
(3) Claims under subsection (1) cannot be asserted if, in the case of subsection (1) number 1, the
third party knew that the inside information was inaccurate at the time of purchase or, in the
case of subsection (1) number 2, at the time of sale.
(4) This is without prejudice to further contractual claims or claims for intentional tort that may be
asserted under the provisions of civil law.
(5) Any agreement that reduces or waives in advance claims by an issuer against members of its
board of management due to claims asserted against the issuer under subsection (1) is invalid.
112 Translation by Germany’s Federal Financial Supervisory Authority (BaFin), ‘Securities Trading Act
(Wertpapierhandelsgesetz, WpHG)’, 16 May 2019 https://www.bafin.de/SharedDocs/Veroeffentlichungen/EN/
Aufsichtsrecht/Gesetz/WpHG_en.html accessed on 12 October 2020.
113 Ibid.
375
(bb) Key aspects

30A.032 Under ss 97 and 98 of the WpHG114 an issuer can be held liable for the investor’s damage
caused by the issuer’s failure to publish inside information without undue delay115 or for the
investor’s damage caused by the issuer’s publication of incorrect inside information.116
30A.033 Compared to their US, UK and European counterparts,117 ss 97 and 98 of the WpHG are
anomalies.118 The German legislator allows civil liability claims against the issuer not only in
cases of deliberate market manipulation, as prescribed by Art 12 and Art 15 MAR. Rather,
under s 97 para 2, issuers are also liable if their failure to publish inside information was com-
mitted merely out of gross negligence.119 In analogy to this provision, s 98 para 2 stipulates
that issuers may also be held liable for being grossly negligently unaware that the published
information was inaccurate.120
30A.034 As regards damages, the German Federal Supreme Court allows investors to choose between
two different calculation methods under ss 97 and 98 of the WpHG.121 First, investors may
choose to claim the difference between the financial instrument’s actual purchase price and its
114 As laid out by Weller, ‘Fehlerhafte Kapitalmarktinformation zwischen Freiheit und Haftung’ (n 111) 1341ff.
115 Lars Klöhn, ‘Die Haftung wegen fehlerhafter Ad-hoc-Publizität gem §§ 37b, 37c WpHG nach dem IKB-Urteil des
BGH’ [2012] AG 345, 353; Gerald Spindler, ‘Haftung für fehlerhafte und unterlassene Kapitalmarktinformationen –
ein (weiterer) Meilenstein’ (2012) 15 NZG 575, 576 f.
116 BGH, IKB, 13.12.2011, BGHZ 192, 90; Weller, ‘Fehlerhafte Kapitalmarktinformation zwischen Freiheit und
Haftung’ (n 111) 1341ff. For further analysis, see Dörte Poelzig, ‘Private enforcement im deutschen und europäischen
Kapitalmarktrecht’ (2015) 44/6 ZGR 801–848; Engel (n 41) 22ff, 35–38.
118 For further analysis, see Holger Fleischer, ‘§ 6 Haftung für fehlerhafte Kapitalmarktkommunikation’ in Heinz-Dieter
Assmann, Rolf A Schütze and Petra Buck-Heeb (eds), Handbuch des Kapitalanlagerechts (5th edn, C. H. Beck 2020)
paras 40–58; Daniel Zimmer and Philipp Steinhäuser, ‘§ 97 Schadenersatz wegen unterlassener unverzüglicher
Veröffentlichung von Insiderinformation’ in Eberhard Schwark and Daniel Zimmer (eds), Kapitalmarktrechts-Kommentar
(5th edn, C. H. Beck 2020); Daniel Bergdolt, ‘§ 98 Schadenersatz wegen Veröffentlichung unwahrer Insiderinformation’
in Eberhard Schwark and Daniel Zimmer (n 118) paras 1–8.
119 Verse (n 107) 363, 383; Röh and de Raet (n 108) 122, 125. For further analysis, see Chris Thomale, ‘Zum
subjektiven Tatbestand der Unterlassungshaftung nach § 97 WpHG’ (2019) 64/6 AG 189; Chris Thomale,
‘Kapitalmarktinformationshaftung ohne Vorstandswissen’ (2018) 21 NZG 1007; David Markworth,
‘Kapitalmarktinformationshaftung wegen Bilanzmanipulationen’ (2020) 9 BKR 438; Lars Klöhn, ‘Die (Ir-)Relevanz
der Wissenszurechnung im neuen Recht der Ad-hoc-Publizität und des Insiderhandelsverbots’ (2017) 20 NZG 1285;
Zimmer and Steinhäuser (n 118); Alexander Hellgardt, ‘§ 97 WpHG: Schadenersatz wegen unterlassener unverzügli-
cher Veröffentlichung von Insiderinformationen’ in Heinz-Dieter Assmann, Uwe H Schneider and Peter O Mülbert
(eds), Wertpapierhandelsrecht (7th edn, Otto Schmidt 2019).
120 The German Federal Supreme Court defines gross negligence as a particularly severe failure to exercise reasonable care,
hence, the defendant must have acted in a way that was not reasonably careful. As regards capital market information
liability, an issuer’s failure to recognise his obligation to publish an ad hoc statement would already constitute gross neg-
ligence, as would his failure to recognise the likelihood of information having a significant effect on the financial instru-
ment’s market price in accordance with Art 11 MAR. See Verse (n 107) 363, 368. On the German Federal Supreme
Court’s longstanding case law on ‘gross negligence’, see Klaus F Röhl, ‘Zur Abgrenzung der groben von der einfachen
Fahrlässigkeit’ (1974) 17 JZ 521, 522 f; Christoph Kumpan, ‘§ 97 WpHG’ in Adolf Baumbach and Klaus J Hopt (eds),
Kommentar Handelsgesetzbuch (40th edn, C. H. Beck 2021) para 5; Bergdolt (n 118) paras 1–8; Alexander Hellgardt,
‘§ 98 WpHG: Schadenersatz wegen Veroffentlichung unwahrer Insiderinformationen’ in Assmann, Schneider and
Mülbert (n 119).
121 Verse (n 107) 363, 387. See BGH (n 116); Oliver Seggewiße, ‘§ 97: Schadenersatz wegen unterlassener unverzüglicher
Veröffentlichung von Insiderinformation’ in Thomas Heidel (ed), Aktienrecht und Kapitalmarktrecht (5th edn, Nomos
2020) paras 8–10; Bergdolt (n 118) paras 14–16.
376
hypothetical purchase price at which the investor would have either bought or sold the respec-
tive financial instrument, had the issuer not violated ad hoc disclosure obligations (out-of-pocket
loss, Kursdifferenzschaden).122 Second, investors may demand in rem restitution and have the
financial instrument’s actual purchase price reimbursed in exchange for the return of the secu-
rity (rescissory damages, Vertragsabschlussschaden).123
Apart from the element of gross negligence or intent, which is rebuttably presumed unless the 30A.035
issuer can prove the contrary, investors in Germany bear the burden of proof for the other ele-
ments of ss 97 and 98 WpHG.124 Notably, they must prove that the investor failed to adequately
fulfil his ad hoc disclosure obligations.125 For rescissory damages, investors must additionally
prove that there is a causal link between the issuer’s breach of his ad hoc disclosure obligation
and the investor’s respective investment decision (transaction causality).126 The investor must
prove that his own decision-making as an individual purchaser was affected by the issuer’s
breach of ad hoc disclosure obligations. However, providing conclusive evidence regarding an
investor’s individual decision-making process is difficult in practice and hence a requirement
that plaintiffs often fail to meet.127 This is why the usual remedy will be out-of-pocket loss: in
order to claim out-of-pocket loss, it is sufficient to show that wrongful disclosure had a detri-
mental impact on the market price at the time of the transaction (price causality).128 This can
typically be derived from circumstantial evidence, such as significant price changes after a piece
of information has come to light.129 That being said, as a general rule, German courts do not
follow the fraud-on-the-market theory. Hence, it does not suffice for the investor to prove that
the inadequate ad hoc disclosure had a global effect on the market as a whole.130
4. Portugal: Special liability clause for ad hoc disclosure obligations, yet little practical
relevance
Portugal is noteworthy for its specialised securities litigation regime.131 The Portuguese secu- 30A.036
rities law, the Código dos Valores Mobiliários (CVM) entered into force in 2000 and created
123 If the investor has already sold the respective financial instrument, the investor may demand in rem restitution nonethe-
less. In this case this amounts to the difference between his original purchase price and the sales price. The underlying
assumption of in rem restitution is, in analogy to damages claimed under prospectus liability, that the investor would
not have acquired the financial instrument at all had the issuer adequately fulfilled his ad hoc disclosure obligations. See
Verse (n 107) 363, 387; Röh and de Raet (n 108) 122, 137; Seggewiße (n 121) paras 24–26.
124 See, e.g., Röh and de Raet (n 108) 122, 137.
125 Kumpan (n 120) para 6. See further: Verse (n 107) 363, 391; Richard Wichmann, Haftung am Sekundärmarkt für feh-
linformationsbedingte Anlegerschäden (Mohr Siebeck 2017); Jan-Winter, Der nach den §§ 97 und 98 WpHG zu ersetzende
Schaden (Duncker & Humblot 2019).
126 BGH, 13.12.2011, XI ZR 51/10; BGH WM 2012, 303, 309. See also Kumpan (n 120) para 6; Dörte Poelzig, ‘§ 98
WpHG: Schadenersatz wegen Veröffentlichung unwahrer Insiderinformationen’ in Thomas Ebenroth and others (eds),
Handelsgesetzbuch (4th edn, C. H. Beck 2020) paras 25ff; Hellgardt, ‘§ 97 WpHG’ (n 119) paras 120ff; Wichmann
(n 125) 1, 16.
127 Ibid.
128 BGH, 13.12.2011, XI ZR 51/10; BGH WM 2012, 303, 309. See also the literature cited above n 126.
129 BGH, 09.05.2005, II ZR 287/02.
130 Röh and de Raet (n 108) 122; Wichmann (n 125) 56ff.
131 José Pedro Fazenda Martins, Orlando Vogler Guiné and Soraia Ussene, ‘Portugal’ in Golden (n 63) 201, 202ff. See also
Thomale, Der gespaltene Emittent (n 10) 106; Thomale and Weller (n 10).
377
a uniform capital market information liability regime.132 Under Art 251 CVM, an issuer can be
held liable for disclosing false or misleading information or for failing to disclose information
as required by law.133 Art 251 CVM references Arts 149–154 CVM and Art 243 CVM. These
provisions regulate prospectus liability, but serve as legal bases for liability claims because of
wrongful ad hoc disclosures by analogy.134 Under Art 149 para 2 CVM, simple negligence
on the part of the issuer is sufficient with no further mens rea being required.135 In accordance
with Art 149 para 1 lit c CVM, the burden of proof lies with the issuer, who has to prove that
he applied the required duty of care.136 Nonetheless, Art 251 CVM, Arts 149–154 CVM and
Art 243 CVM have little practical relevance,137 as there have been few lawsuits by investors in
Portugal,138 even though their numbers have been on the rise in recent years.139
5. France, Italy and Spain: General tort law clauses provide private cause of action for
false or misleading ad hoc disclosure
(a) France
30A.037 Investors may bring claims against the issuer or its directors and officers for secondary market
misrepresentation under the general tort law clause in Art 1240 of the Code Civil (CC,
French Civil Code).140 Yet, the French capital markets regime primarily relies on public
enforcement of securities law.141 Private enforcement of capital markets law has traditionally
been met with scepticism.142 Consequently, the French legal system does not provide essential
132 Carlos Ferreira de Almeida, ‘Caducidade do Direito a Indemnização por Informação Deficiente no Âmbito dos
Mercados de Valores Mobiliários’ (2016) 54 Cadernos do Mercado de Valores Mobiliários 9, 9; Nuno Salazar Casanova
and Nair Maurício Cordas, ‘Portugal’ in Savitt (n 65) 196. See, in German Margaret Böckel and Andreas Grünewald,
‘Prospekt- und Kapitalmarktinformationshaftung in Portugal’ in Hopt and Voigt (n 99) 897, 915ff, 923ff. As laid out in
detail in Thomale, Der gespaltene Emittent (n 10) 106.
133 Paulo de Tarso Domingues, ‘Portugal: The Legal Framework of the Portuguese Capital Market’ in Conac and Gelter
(n 5) 537, 552 f.
134 De Tarso Domingues (n 133) 537, 538 f.
135 ‘elevados padrões de diligência professional’. See also Böckel and Grünewald (n 132) 897, 925.
136 The Portuguese Supremo Tribunal de Justiça clarified that Art 7 para 1 CVM, which defines the characteristics of capital
markets information in terms of the CVM, also applies to ad hoc disclosure and states that ‘A informação [...] deve ser
completa, verdadeira, actual, clara, objectiva e lícita.’ See Supremo Tribunal de Justiça, dated 5 April 2016, case no Az.
127/10.0TBPDL.L1.S1.
137 This may also be due to the lack of judicial clarification as regards the calculation of damages as well as the burden of
proof incumbent upon plaintiff investors in that regard. See Böckel and Grünewald (n 312) 897, 910, 926.
138 Apart from the highly publicised case involving Banco Comercial Português, S.A., involving market manipulation
through disguised acquisition of one’s own shares, there are few judgments assessing issuer liability under Art 251 CVM.
Neither Böckel and Grünewald (n 132) 897, nor Casanova and Cordas, ‘Portugal’ in Savitt (n 132) (ed), The Securities
Litigation Review (3rd edn, Law Business Research Ltd 2017) 204 cite any relevant decision. For further information on
the Banco Comercial case, see De Tarso Domingues (n 133) 538, 546 f.
139 Casanova and Cordas, ‘Portugal’ in Savitt (n 132) 196, 198 f.
140 Pierre-Henri Conac, ‘France: The Compensation of Investors’ Losses for Misrepresentation on Financial Markets’ in
Conac and Gelter (n 5) 331, 346 f. In German: Rüdiger Veil and Philipp Koch, Französisches Kapitalmarktrecht (Carl
Heymanns Verlag 2010) 20ff, 77. See also Thomale, Der gespaltene Emittent (n 10) 104 f.
141 On the role of the Autorité des marchés financiers (Financial Markets Authority, AMF) as central administrative authority,
see e.g., Olivier Hubert and Arnaud Pince, ‘France’ in Golden (n 63) 69, 70 f, 83.
142 Conac (n 140) 331, 332ff, 345 f, 361.
378
parts of the procedural cornerstones of investor litigation,143 nor do French courts follow the
fraud-on-the-market theory.144
(b) Italy
In Italy, civil liability claims for inadequate ad hoc disclosure can be brought under general 30A.038
tort law.145 According to prevailing legal opinion, investors may bring claims against the issuer
for misleading information under the wide-reaching general tort law clause in Art 2043 of the
Codice Civile (CC, Italian Civil Code).146 In addition, Art 2395 CC is commonly interpreted
as to provide investors with a direct right to damages for inadequate ad hoc disclosure against
the issuer’s directors for negligent or intentional acts.147
(c) Spain
Spanish law includes a securities code, the Ley del Mercado de Valores (LMV). Art 124 30A.039
LMV148 provides a special offence for liability claims brought by investors for damage due to
inadequate capital market information. Yet, Art 124 LMV does not apply to cases of ad hoc
disclosure.149 Consequently, these cases fall under general tort law. The Código Civil (CC,
Spanish Civil Code) grants investors a general cause of action against the issuer in accordance
with Art 1902 CC, the Code’s general tort law clause.150
143 Advantages such as the possibility to bring class actions against issuer, see e.g., Bertrand Cardi and Nicolas Mennesson,
‘France’ in Savitt (n 65) 108, 113.
144 See para 30A.024 supra; Conac (n 140) 331, 333.
145 Guido A Ferrarini and Marco Leonardi‚ ‘Prospekt- und Kapitalmarktinformationshaftung in Italien’ in Hopt and
Voigt (n 99) 713, 719ff; Guido Ferrarini and Paolo Giudici, ‘Italy: The Protection of Minority Investors and the
Compensation of Their Losses’ in Conac and Gelter (n 5) 446, 454ff. For a case study on private enforcement in the
context of the Parmalat financial fraud scandal, see Guido Ferrarini and Paolo Giudici, ‘Financial Scandals and the Role
of Private Enforcement: The Parmalat Case’ (2005) 40 ECGI LWP 32 f. See also Thomale, Der gespaltene Emittent
(n 10) 104 f.
146 Ferrarini and Giudici, ‘Italy: The Protection of Minority Investors and the Compensation of Their Losses’ (n 145) 446,
454 f.
147 Paolo Giudici, ‘Representative Litigation in Italian Capital Markets: Italian Derivative Suits and (if Ever) Securities
Class Actions’ (2009) 6/2–3 ECFR 246, 265 f; Ferrarini and Giudici, ‘Italy: The Protection of Minority Investors and
the Compensation of Their Losses’ (n 145) 446, 455.
148 David Carcía-Ochoa Mayor and Carlos Montoro Esteve, ‘Spain’ in Golden (n 63) 229, 229 f. As laid out in Thomale,
Der gespaltene Emittent (n 10) 104 f.
149 Mónica Fuentes Naharro, ‘Spain: Minority Investors’ Protection in Spain: Civil Liability Remedies under Securities
Law’ in Conac and Gelter (n 5) 596, 619ff.
150 See, e.g., Charles Arsouze, ‘Réflexions sur les propositions du Rapport Coulon concernant le pouvoir de sanction de
l’AMF’ (2008) 3 BJB 246, 251. On Spain, see Iribarren Blanco, Responsabilidad civil por la información divulgada por las
sociedades cotizadas (La Ley 2008) 170: ‘Es cierto que exigir responsabilidad por daños en los mercados de valores por la
divulgación de informaciones engañosas no ha sido habitual en nuestra práctica hasta este momento.’ Fuentes Naharro
(n 149) 596, 619ff.
379
6. Austria and the Netherlands: Art 17 MAR implemented as a ‘protective’ rule within
national law of torts
(a) Austria
30A.040 In Austria, general tort law provides investors with a private cause of action against issuers
for damage caused by inadequate ad hoc disclosures.151 Civil liability claims are governed by
§§ 1293ff of the Allgemeines Bürgerliches Gesetzbuch (ABGB, Austrian Civil Code). The
Austrian Supreme Court, with an overwhelming support of legal doctrine,152 interprets Art
17 MAR as a so-called ‘protective law’ (Schutzgesetz)153 in accordance with § 1311 ABGB.154
This is to say that any negligent violation of Art 17 MAR will automatically be translated into
every investor’s private cause of action to sue the issuer for damages.155 The precise elements of
these claims are yet to be clarified by case law. As regards the calculation of damages, prevailing
scholarly opinion follows German law in holding that the investor can, at his or her choice,
either claim out-of-pocket loss or rescissory damages.156 Austrian law does not follow the
fraud-on-the-market theory.157
(b) The Netherlands

30A.041 In the Netherlands, civil liability claims for violations of ad hoc disclosure obligations are gov-
erned by general tort law.158 Dutch law, just like Austrian law, considers Art 17 MAR, as well
as Art 12 and Art 15 MAR, 159 to be protective laws,160 i.e., laws designated to protect not just
the integrity of the market in general, but the individual investor.161 Consequently, under Art
151 Martin Gelter and Michael Pucher, ‘Austria: Securities Litigation and Enforcement’ in Conac and Gelter (n 5) 261, 282.
In further detail, Thomale, Der gespaltene Emittent (n 10) 102ff.
152 But see Friedrich Harrer, ‘Zivilrechtliche Irritationen im Kapitalmarktrecht’ (2011) ZFR 9, 9ff.
153 On the legal concept see Martin Karollus, Funktion und Dogmatik der Haftung aus Schutzgesetzverletzung (Springer
1992); Rudolf Welser and Brigitta Zöchling-Jud, Grundriss des bürgerlichen Rechts Band II (15th edn, Manz 2015)
paras 1392ff; Ernst Karner, ‘§ 1311 ABGB’ in Helmut Koziol, Peter Bydlinski and Raimund Bollenberger (eds),
ABGB-Kurzkommentar (6th edn, Verlag Österreich 2020) paras 3ff.
154 See e.g., Austrian Supreme Court of Justice (Oberster Gerichtshof, OGH), Resolution of 15 March 2012- – 6 Ob 28/12d,
confirmed by OGH, Resolution of 24 January 2013- – 8 Ob 104/12w; OGH, Resolution of 20 March 2015- – 9 Ob
26/14k. A recent case on consumer rights OGH, Resolution of 7 July 2017 – 6 Ob 18/17s. For a detailed analysis, see:
Alexander Schopper, ‘Ad-hoc-Meldepflicht als Schutzgesetz’ [2014] ÖBA 495; Susanne Kalss, Martin Oppitz and
Johannes Zollner, Kapitalmarktrecht (2nd edn, Linde 2015) § 20 paras 16ff.
155 Gelter and Pucher (n 151) 261, 288.
156 Gelter and Pucher (n 151) 261, 284 f. See also Alexander Schopper and Benedikt Wallner, ‘Aktuelle Fragen des
Anlegerschutzes im österreichischen Kapitalmarktrecht’ (2015) 12 RdW 2015, 763; Kalss, Oppitz, Zollner (n 154) § 20
para 13.
157 Gelter and Pucher (n 151) 261, 287.
158 For further analysis on securities litigation in the Netherlands, see Marieke Driessen and Niek Groenendijk,
‘Netherlands’ in Golden (n 63) 162, 163. For further detail, see Thomale, Der gespaltene Emittent (n 10) 102ff.
159 Previously, this was assumed for Rule 28h of the Listing and Liability Rules of Euronext Amsterdam and Art 5:59 and
then Art 5:25i Wet op het financieel toezicht, the corresponding provisions of the Dutch Securities Act. See Levinus
Timmerman and Marie-Louise Lennarts, ‘Prospekt- und Kapitalmarktinformationshaftung in den Niederlanden’ in
Hopt and Voigt (n 99) 773, 801ff.
160 Loes Lennarts and Joti Roest, ‘Netherlands: Protection of Investors and the Compensation of Their Losses’ in Conac
and Gelter (n 5) 470, 490 f.
161 See Danny Busch, ‘Private Enforcement of MAR in European Law’ [2016] SSRN Electronic Journal https://ssrn.com/
abstract=2900854 accessed on 12 October 2020, with further references in paras 3, 5 and 48 f. See also Lennarts and
Roest (n 160) 470, 490 f.
380
6:162–2 in conjunction with Art 6:163 of the Burgerlijk Wetboek (Civil Code), civil liability
claims can be brought by individual investors.162 However, many details remain unclear, includ-
ing the burden of proof for causation. Absent clarification by the Dutch courts, legal doctrine
speculates that transaction causality may be rebuttably presumed and hence recissory damages
generally due, if ad hoc disclosure is materially misleading.163
7. Ireland and Sweden: Focus on public enforcement and no civil issuer liability
(a) Ireland
In the Irish Republic, ad hoc disclosure obligations are enforced by criminal and administrative 30A.042
law.164 The Central Bank of Ireland acts as the main authority in the enforcement of Statutory
Instrument No 349, which implements European market abuse requirements with regard to ad
hoc disclosure.165 Irish company law only recognises private enforcement with regard to insider
trading and market manipulation. However, claims by investors must be directed exclusively
against the trader, not against the issuer.166
(b) Sweden
Swedish private law, similar to Irish law, does not provide investors with a private cause 30A.043
of action against issuers for damage caused by inadequate ad hoc disclosure:167 as general
principles of Swedish tort law apply, pure financial loss cannot be claimed, unless the person
sustaining the damage violated criminal law provisions.168
162 See, e.g., Timmermann and Lennarts (n 159) 773, 801ff; Lennarts and Roest (n 160) 470, 490 f.
163 Lennarts and Roest (n 160) 470, 489 f, 494 f.
164 European Union (Market Abuse) Regulations 2016, Statutory Instrument No 349 of 30 June 2016 (IRL). Similarly, the
instrument’s predecessor clarified that any enforcement would only be of a public nature. See s 34 para 2 Market Abuse
(Directive 2003/6/EC) Regulations 2005, Statutory Instrument No 342 of 5 July 2005 (IRL). See also Thomale, Der
gespaltene Emittent (n 10) 107.
165 In its Guidance on Market Abuse Regulatory Framework, the Central Bank of Ireland states:
Persons falling within the scope of the Market Abuse Rules should have regard to the fact that they will at all times be
subject to the powers granted to the Central Bank under Part 4 of the 2016 Regulations and the enforcement provisions
set out in Part 5 of the 2016 Regulations and Chapter 2 of Part 23 of the Companies Act, 2014 and that in accordance
with Section 1370(6) of the Companies Act, 2014 administrative sanctions may be applied in relation to a contraven-
tion of the Central Bank (Investment Market Conduct) Rules.
See Central Bank of Ireland, ‘Guidance on Market Abuse Regulatory Framework, 22 July 2019’ (Central Bank of Ireland
2019).
166 s 33 Investment Funds, Companies and Miscellaneous Provisions Act 2005.
167 On the Scandinavian approach to the public dimension of law of torts, see Bjarte Askeland, ‘Basic Questions of Tort Law
from a Norwegian Perspective’ in Koziol (ed), Basic Questions of Tort Law (n 16) 99, 100ff; David Ackebo and Andreas
Johard, ‘Sweden’ in Savitt (n 65) 245, 249, 253ff. For further detail see Thomale, Der gespaltene Emittent (n 10) 107.
168 Ackebo and Johard (n 167) 245, 250; Rüdiger Veil and Fabian Walla, Schwedisches Kapitalmarktrecht (Carl Heymanns
2010) 28 f, 79 f, 87.
381
C. INTERNATIONAL JURISDICTION IN SECURITIES LITIGATION FOR MARKET

ABUSE
1. Introduction
30A.044 As shown above, European capital markets law, in its private dimension, is largely dependent
on national substantive law of torts, which differs widely between Member States. Member
State laws of civil procedure are equally heterogeneous, in particular with regard to the
availability of class actions, which is vital in capital markets litigation.169 As a result, both the
conflicts of tort laws and international jurisdiction require clarification: in the EU, interna-
tional adjudicatory jurisdiction in civil and commercial matters is determined by the Brussels
Ia-Regulation. Absent a choice of court agreement170 (see E), investors may, in accordance
with Art 4 para 1, Art 63 para 1 Brussels Ia-Regulation, choose to take their case to the courts
of that Member State in which the issuer has its place of establishment (2). Alternatively, if the
underlying legal relationship qualifies as a consumer contract, investors may bring suit at their
own place of domicile in accordance with Art 18 para 1 alt 2 Brussels Ia-Regulation (3). Under
Art 7 (2) Brussels Ia-Regulation, investors may also bring proceedings before the court compe-
tent in matters relating to tort, (4) which, at the investor’s choice, is determined either by the
place of the event giving rise to the damage (locus delicti commissi) (b) or by the place of damage
(locus damni) (c) as a respective connecting factor. Otherwise, a court seized can only after the
fact become internationally competent to hear the case by defendants voluntarily entering an
appearance according to Art 26 para 1 Brussels Ia-Regulation.
2. Art 4 para 1, Art 63 para 1 Brussels Ia-Regulation: Domicile
30A.045 Pursuant to the general principle of actor sequitur forum rei, Art 4 para 1 Brussels Ia-Regulation
prescribes that persons domiciled in a given Member State shall, irrespective of their nation-
ality, be sued in the courts of that Member State.171 Other persons do not profit from this
principle and are hence, according to Arts 5 and 6, subject to national venues of exorbitant
international jurisdiction as notified under Art 76 additionally to all venues recognised by the
Brussels Ia-Regulation itself.172
169 cf Thomale, Der gespaltene Emittent (n 10) 84 f.

170 For further analysis, see Chris Thomale, ‘Gerichtsstand und Rechtswahl im Kapitalmarktrecht’ (2020) 84 RabelsZ 841.
171 Paul Vlas, ‘Article 4’ in Ulrich Magnus and Peter Mankowski (eds), Brussels Ibis Regulation – Commentary (Otto Schmidt
2016) paras 3–4; Paul Torremans and others (eds), Cheshire, North & Fawcett: Private International Law (Oxford
University Press 2017) 212–215, 243–244. See also Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3)
336.
172 Such member state rules include e.g., jurisdiction based on the plaintiff’s nationality as provided by Arts 14, 15 French
Civil Code (Code Civil), on the presence of assets belonging to the defendant under s 23 German Civil Procedure Code
(Zivilprozessordnung) and s 99 Austrian Jurisdiction Code (Jurisdiktionsnorm) and the presence of formally instituted
legal representation as per Arts 3, 4 of the Italian law No 218 of 31 May 1995. For further information see https://e
-justice.europa.eu/content_brussels_i_regulation_recast-350-en.do accessed on 19 January 2021.
382
C. International jurisdiction in securities litigation for market abuse
Issuers of securities are legal persons.173 As a result, their domicile receives a special, autono- 30A.046
mous EU definition in Art 63 para 1 Brussels Ia-Regulation:174 At the plaintiff’s choice, the
domicile is to be understood, alternatively, as the place where the issuer has its statutory seat,
its central administration or its principal place of business.175
3. Art 17 para 1, Art 18 para 1 Brussels Ia-Regulation: Place of domicile of the consumer
investor
Arts 17–19 Brussels Ia-Regulation specify jurisdiction over consumer contracts and, as 30A.047
a comprehensive regime, have priority over general (see 2) and special jurisdiction (see 4).176
In accordance with Art 18 para 1 Brussels Ia-Regulation, a consumer may bring proceedings
against the other party to a contract either in the courts of the Member State in which that
party is domiciled or, at his choice and, regardless of the domicile of the other party, in the
courts of the place where the consumer is domiciled.177 This is designed to protect the eco-
nomically weaker and less experienced party,178 the consumer, from what is presumed to be an
inherently unequal contractual relationship.179
Art 17 para 1 defines consumer contracts as contracts concluded by the consumer for a purpose 30A.048
which can be regarded as being outside the consumer’s present or future trade or profession.180
173 Art 3 para 1 (21) Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on
market abuse (Market Abuse Regulation- – MAR) and repealing Directive 2003/6/EC of the European Parliament and
of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC [2014] OJ L 173/1.
174 Vlas (n 171) para 11; Trevor C Hartley, International Commercial Litigation (3rd edn, Cambridge University Press 2020)
27 f.
175 Case 21/76 Mines de Potasse d’Alsace [1976] ECR 1735, para 19; Torremans and others (n 171) 200–202; see also
Matthias Lehmann, ‘Where Does Economic Loss Occur?’ (2011) 7/3 JPIL 527, 527–528.
176 Peter Mankowski and Peter Arnt Nielsen, ‘Introduction to Articles 17–19’ Magnus and Mankowski (n 171) para 2. See
also Christopher Bisping, ‘Mandatorily Protected: The Consumer in the European Conflict of Laws’ (2014) 22/4 ERPL
513, 519ff. As laid out in Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 336 f.
177 This has long been the ratio legis for special consumer jurisdiction under the Brussels Ia and Brussels I-Regime. See, e.g.,
Recital 14 Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on
jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels Ia-Regulation)
[2012] OJ L 351/1: ‘to ensure the protection of consumers and employees (…) certain rules of jurisdiction in this
Regulation should apply regardless of the defendant’s domicile’. Similarly Recitals 18, 19 Brussels Ia-Regulation. As
referenced in: Torremans and others (n 171) 200. See also Recital 13 Council Regulation (EC) No 44/2001 of 22
December 2000 on jurisdiction and the recognition and enforcement of judgements in civil and commercial matters
(Brussels I-Regulation) [2001] OJ L 12/1: ‘In relation to insurance, consumer contracts and employment, the weaker
party should be protected by rules of jurisdiction more favourable to his interests than the general rules provide for.’ As
referenced in Mankowski and Nielsen, ‘Introduction to Articles 17–19’ (n 176) para 3. See also Peter Mankowski and
Peter Arnt Nielsen, ‘Article 18’ in Magnus and Mankowski (n 171) paras 4–10.
178 Mankowski and Nielsen, ‘Introduction to Articles 17–19’ (n 176) para 3; Geert van Calster, European Private
International Law (2nd edn, Hart Publishing 2016) 89.
179 See Case C‑218/12 Emrek [2013] ECLI:EU:C:2013:494, Opinion of GA Cruz Villalón, para 21 on the aim of special
jurisdiction over consumer contracts: ‘to rebalance, at the level of international jurisdiction, a contractual relationship
that is unequal in principle’. See also Case C-269/95 Benincasa [1997] ECR I-3767, para 17; Mankowski and Nielsen,
‘Introduction to Articles 17–19’ (n 176) para 3.
180 Benincasa (n 179) para 16; on the burden of proof regarding the purpose of a contract, see Case C-464/01 Gruber [2005]
ECR I-439, paras 46–47. See also van Calster (n 178) 92–94; Torremans and others (n 171) 292.
383
The contract must have been concluded between a consumer and a professional,181 as Art 17
para 1 does not extend to purely unilateral commitments.182 Furthermore, only consumer
contracts listed expressly in Art 17 para 1 Brussels Ia-Regulation are subject to the provision.183
As regards securities litigation, Art 17 para 1 lit c Brussels Ia-Regulation is most relevant.
Accordingly, the contract in question must have been concluded with a person who pursues
commercial or professional activities in the Member State of the consumer’s domicile or, by
any means, directs such activities to that Member State or to several States including that
Member State.184 This is of particular relevance as regards financial transactions concluded at
a distance, typically online.185
30A.049 In accordance with Arts 17–19 Brussels Ia-Regulation, the investor may bring civil proceed-
ings for damage resulting from market abuse at the court of the place where the investor is
domiciled.186 Yet, very few, if any, cases of securities litigation rest upon a straightforward
contractual relationship between the investor (plaintiff) and the issuer (defendant).187 Instead,
investors usually enter into a contract with a financial intermediary.188 At the same time,
however, financial intermediaries who do not acquire financial instruments for private final
usage do not qualify as consumers.189 Hence, the contract between financial intermediary and
issuer does not fall within the scope of application of Art 17 para 1 Brussels Ia-Regulation. To
the detriment of plaintiff investors, the CJEU has ruled that an applicant who is not himself
a party to the consumer contract in question cannot enjoy the benefit of the jurisdiction
relating to consumer contracts.190 Consequently, if, as usual, the investor has not acquired his
financial instruments directly from the issuer, Arts 17–19 Brussels Ia-Regulation do not apply.
181 Benincasa (n 179) para 17; Case C-27/02 Engler [2005] ECR I-481, para 36. See also Torremans and others (n 171) 292;
Peter Mankowski and Peter Arnt Nielsen, ‘Article 17’ in Magnus and Mankowski (n 171) para 43.
182 Case C-180/06 Ilsinger [2009] ECR I-3961, paras 53–59; see also van Calster (n 178) 92; Torremans and others (n 171)
292.
183 Torremans and others (n 171) 293; Mankowski and Nielsen, ‘Article 17’ (n 181) para 51.
184 Torremans and others (n 171) 294–296; Mankowski and Nielsen, ‘Article 17’ (n 181) paras 60–64; van Calster (n 178)
94–96.
185 See e.g., Joined Cases C-585/08 Pammer and 144/09 Hotel Alpenhof [2010] ECR I-12527, in particular paras 81–84 for
relevant factors to determine whether the professional ‘directed’ his activities to a Member State. See also van Calster
(n 178) 94–99; Torremans and others (n 171) 294.
186 As laid out in Chris Thomale, ‘Herstellerhaftung: Deliktsgerichtsstand und anwendbares Recht’ in Petra Leupold
(ed), Forum Verbraucherrecht 2020 (facultas 2020) 71, 79; Chris Thomale, ‘Herstellerhaftungsklagen – Internationaler
Deliktsgerichtsstand und anwendbares Recht bei reinen Vermögensschäden wegen versteckter Produktmängel’ (2020)
119 ZVglRWiss 59, 67ff.
187 Mankowski and Nielsen, ‘Introduction to Articles 17–19’ (n 176) para 29. See also Veil, ‘§ 9 Market Participants’ in Veil
(n 3) 121, 123ff; Dorothee Einsele, ‘Capital Market Law and Private International Law’ (2017) 81 RabelsZ 781, 783.
188 Mankowski and Nielsen, ‘Introduction to Articles 17–19’ (n 176) para 29; Einsele ‘Capital Market Law and Private
International Law’ (n 187) 783.
189 Case C-96/00 Gabriel [2002] ECR I-6367, para 47; Engler (n 180) para 34. See also van Calster (n 178) 92.
190 Case C‑498/16 Schrems II [2018] ECLI:EU:C:2018:37, paras 44ff; Case C-375/13 Kolassa [2015] ECLI:EU:C:2015:
37, paras 32ff; Torremans and others (n 171) 292.
384
4. Art 7 (2) Brussels Ia-Regulation: Special jurisdiction for torts
(a) General aspects

(aa) International and local jurisdiction for alleged torts
Under Art 7 (2) Brussels Ia-Regulation, an alleged tortfeasor domiciled in a Member State may 30A.050
be sued in the courts ‘at the place where the harmful event occurred or may occur in matters
relating to tort, delict or quasi-delict’.191 From the uncontested wording of this special venue,
two salient aspects are noteworthy: first, the courts ‘at the place’ are designated, comprising
both international and local jurisdiction. This truism deserves underscoring for, in some deci-
sions, the CJEU seems to neglect or overlook this fact.192 Second, this venue will only be good
for claims in ‘tort, delict or quasi-delict’, i.e., plaintiffs cannot abuse tort claims as an anchor
and rely simultaneously on contractual or other causes of action.193 At the same time, a prima
facie statement of a claim in tort, delict or quasi-delict suffices to establish jurisdiction under
Art 7 (2) Brussels Ia-Regulation.194
(bb) Principle of ubiquity

Since 1976, the CJEU has been applying a broad reading to ‘the place where the harmful 30A.051
event occurred’, giving plaintiffs a choice to sue, alternatively, at the place where the damage
occurred (locus damni) or at the place of the event giving rise to the damage (locus delicti
commissi).195 This broad reading is oftentimes called principle of ubiquity, i.e., the tort to be
deemed committed ‘everywhere’ (lat ubique = everywhere), meaning at both locus damni and
locus delicti commissi simultaneously. In effect, this bestows a privilege upon the plaintiff, the
alleged victim, granting him further choices as to where he wants to institute proceedings
against the alleged tortfeasor.196
(cc) Principle of concentration

Contrary to what a superficial appreciation of the principle of ubiquity might suggest, it is 30A.052
established that both locus damni and locus delicti commissi have to be interpreted as designating
one single place, ‘the place’ of international and local jurisdiction. This requires a normative
operation, which can be called concentration: A series of events or facts scattered de facto about
manifold places, de iure, have to be deemed concentrated at one specific place. For that reason,
the CJEU stresses that locus damni refers to the place where the damage ‘initially […] actually
191 Peter Mankowski, ‘Article 7’ in Magnus and Mankowski (n 171) paras 226ff; van Calster (n 178) 144ff. See also
Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 336ff.
192 Case C-68/93 Shevill [1995] ECR I-415, para 30; Joined Cases C-509/09 eDate Advertising and C-161/10 Martinez
[2011] ECR I-10269, para 51.
193 Case 189/87 Kalfelis [1988] ECR 5565 para 19; Case C-548/12 Brogsitter [2014] ECLI:EU:C:2014:148, paras 24 f, 29.
194 Determining jurisdiction at a stage where a proper taking of evidence is still outstanding logically implies an attenuated
standard for the elements of the norm conferring jurisdiction. Implicit recognition by Case C-194/16 Svensk Handel
[2017] ECLI:EU:C:2017:766, recital 43. See also Thomale, ‘Herstellerhaftungsklagen’ (n 186) 95 f.
195 Mines de Potasse d’Alsace (n 174) para 15.
196 ibid para 19; see also Case C-133/11 Folien Fischer [2012] ECLI:EU:C:2012:664, para 37; see also van Calster (n 178)
147–148; Mankowski, ‘Article 7’ in Magnus and Mankowski (n 171) paras 251 f. For an extensive discussion see
Thomale, ‘Herstellerhaftungsklagen’ (n 186) 88ff.
385
manifests’ itself,197 ruling out, inter alia, mere reflex damage198 or consecutive damage events.199
Likewise, the locus delicti commissi is understood by definition to denote only one single place
where the ‘harmful event originated’,200 such as, for example, where a cartel was originally
concluded.201
(dd) Favor actoris

30A.053 Due to the scarcity of CJEU case law, litigators in many cases will be forced to fall back on
genuine statutory construction in order to determine what the ‘place where the harmful event
occurred or may occur’ means in a given case. This raises the question of what exactly the
overarching purpose of Art 7 (2) Brussels Ia-Regulation is. Many have suggested procedural
efficiency.202 According to that reading, the main goal of Art 7 (2) is the ‘sound adminis-
tration of justice and the efficacious conduct of proceedings’.203 By implication, the norm is
often assumed to be not about protecting the tort victim as a weaker party.204 This view is not
convincing:205 first, by its very structure as a venue of special, i.e., optional, jurisdiction, Art 7
197 Case C-364/93 Marinari [1995] ECR I-2719, para 21; Case C-189/08 Zuid-Chemie [2009] ECR I-6917, para 27; Case
C-352/13 CDC Hydrogen Peroxide [2015] ECLI:EU:C:2015:335, paras 51 f; Case C-343/19 VW [2020] ECLI:EU:C:
2020:534, paras 26 f.
198 Case C-220/88 Dumez France [1990] ECR I-49, para 20.
199 Marinari (n 197) paras 14 f.
200 Shevill (n 191) para 24. See also Case C-147/12 ÖFAB [2013] ECLI:EU:C:2013:490; David Paulus, ‘Vor I 7 (VO (EU)
1215/2012), Artikel 7’ in Reinhold Geimer and Rolf Schütze (eds), Internationaler Rechtsverkehr Volume I (61st edn, C.
H. Beck 2021) para 191; Astrid Stadler, ‘EuGVVO neue Fassung Art. 7: Besondere Gerichtsstände’ in Hans-Joachim
Musielak and Wolfgang Voit (eds), Zivilprozessordnung (16th edn, Verlag Franz Vahlen 2019) para 19 with further
references.
201 CDC Hydrogen Peroxide (n 196) para 44.
202 Susanne Würthwein, ‘Zur Problematik der örtlichen und internationalen Zuständigkeit aufgrund unerlaubter Handlung’
(1993) 106 ZZP 51, 67; Tanja Domej, ‘Negative Feststellungsklagen im Deliktsgerichtsstand’ (2008) 6 IPRax 550, 553;
Gerhard Wagner, ‘EuGVVO, Art. 5’ in Martin Stein and Friedrich Jonas (eds), Kommentar zur Zivilprozessordnung
(22nd edn, Mohr Siebeck 2011) para 119; Christoph Thole, ‘EuGVVO, Art. 7 Nr. 2’ in Bernhard Wieczorek and
Rolf Schütze (eds), Zivilprozessordnung und Nebengesetze (4th edn, De Gruyter 2018) para 54; Stefan Leible, ‘Brüssel
Ia-VO, Art. 7’ in Thomas Rauscher (ed), Europäisches Zivilprozess- und Kollisionsrecht EuZPR/EuIPR, Band I (5th edn,
Otto Schmidt 2021) para 103; Paulus (n 200) para 139; Paul Oberhammer, ‘Deliktsgerichtsstand am Erfolgsort reiner
Vermögensschäden’ (2018) 12 JBl 750, 751; Angelo Lupoi, ‘Appendice I (Regolamento (UE) n. 1215/2012), Art. 7’ in
Federico Carpi and Michele Taruffo (eds), Commentario breve al Codice di Procedura Civile (8th edn, Wolters Kluwer
2015) 3133; Hélène Gaudemet-Tallon, Compétence et exécution des jugements en Europe (4th edn, LGDJ 2010) 223;
Dominique Bureau and Horatia Muir Watt, Droit international privé, Tome II (4th edn, Presses Universitaires de France
2017) para 967, but see para 1018.
203 Zuid-Chemie (n 197) para 24 with further references.
204 Folien Fischer (n 196) para 46; Case C-45/13 Kainz [2014] ECLI:EU:C:2014:7, para 31; Svensk Handel (n 194) para 39.
205 Fausto Pocar, ‘Le lieu du fait illicite dans les conflits de lois et de jurisdictions’ (1988) 7 DIP: travaux du CFDIP 71, 78;
Kurt Kiethe, ‘Internationale Tatortzuständigkeit bei unerlaubter Handlung – die Problematik des Vermögensschadens’
[1994] NJW 222, 224; Dietmar Czernich, ‘Brüssel Ia-VO, Art. 7’ in Dietmar Czernich, Georg E Kodek and Peter G
Mayr (eds), Europäisches Gerichtsstands- und Vollstreckungsrecht (4th edn, LexisNexis 2015) para 106; Daphne Ariane
Simotta, ‘EuGVVO, Art. 5’ in Hans W Fasching and Andreas Konecny (eds), Zivilprozessgesetze (2nd edn, Manz
2008) para 260; Stefan Auer, ‘Vor I 10 (VO (EG) Nr. 44/2001), Artikel 5’ in Reinhold Geimer and Rolf Schütze (eds),
Internationaler Rechtsverkehr Volume II (61st edn, C. H. Beck 2021) para 114; Reinhold Geimer, ‘§ 84 Der Gerichtsstand
am Ort der unerlaubten Handlung – forum delicti commissi, Art. 5 Nr. 3 I. Ratio conventionis’ in Reinhold Geimer and
Rolf Schütze (eds), Internationale Urteilsanerkennung Volume I/1 (C. H. Beck 1983) 604 f; Reinhold Geimer, ‘EuGVVO,
Art. 7’ in Reinhold Geimer and Rolf Schütze (eds), Europäisches Zivilverfahrensrecht (4th edn, C. H. Beck 2020) paras
201ff; Reinhold Geimer, Internationales Zivilprozessrecht (8th edn, Otto Schmidt 2020) para 1497; Reinhold Geimer,
386
(2) does not and cannot promote procedural efficiency for it is up to the plaintiff to choose
whether she wants to rely on it or not. In making this choice, plaintiffs will be much more
likely to pursue their private litigious goals than European procedural efficiency. The principle
of ubiquity, exacerbating this potential for ‘venue arbitrage’, in its origin has therefore rightly
been construed as a favour to the plaintiff.206 Had such efficiency been the objective, Art 7
(2) would have had to be dressed as exclusive jurisdiction or to provide a forum non conveniens
exception if plaintiffs, for whatever litigious strategy, choose a less closely connected venue over
another. Second, a comparative and historical interpretation reveals that the manifold virtually
identical predecessors of Art 7 (2), going all the way back at least to the 6th century,207 have
always been interpreted in accordance with their obvious effect, namely as granting a privilege
to tort victims. To be sure, that paraphrase would be over-simplifying, as the venue becomes
available not only to actual tort victims, but, by the preliminary nature of jurisdictional venues,
to alleged tort victims. This is the context in which some CJEU decisions, seemingly debunking
any individually protective thrust of Art 7 (2), have to be seen: by ruling that the special venue
created by Art 7 (2) should be open to negative declaratory judgments pursued by the alleged
tortfeasor as well208 and that the plaintiff’s bare interest cannot justify ‘making up’ a tort venue
beyond the wording of Art 7 (2),209 the CJEU is really not denying, but rather defining and
limiting, that privilege. This fact is underscored by a line of cases on privacy and personality
rights, in which the CJEU, for the overtly stated reason of protecting alleged victims, offers
a very generous interpretation of Art 7 (2).210 As a result, the dominating idea of Art 7 (2)
Brussels Ia-Regulation is to grant a privilege to alleged tort victims, a favor actoris or favor laesi.
It is only the extent of that privilege which has to be limited and reconciled with procedural
efficiency and fairness.
(b) Place where the damage occurred (locus damni)

The locus damni is easy to determine in straightforward cases like damage inflicted upon an 30A.054
object or a human body: the actual manifestation of the damage will then coincide with the
‘Art. 7 (Art. 5 LugÜ) EuGVVO’ in Richard Zöller (ed), Zivilprozessordnung (33rd edn, Otto Schmidt 2020) para 53;
Haimo Schack, ‘Die grenzüberschreitende Verletzung allgemeiner Urheberpersönlichkeitsrechte’ (1988) 108 UFITA
51, 70; Hartmut Linke and Wolfgang Hau, Internationales Zivilverfahrensrecht (8th edn, Otto Schmidt 2021) para 5.34;
Benedikt Buchner, Kläger- und Beklagtenschutz im Recht der internationalen Zuständigkeit (Mohr Siebeck 1998) 127;
Oliver Schlüter, ‘Zum fliegenden Gerichtsstand bei Persönlichkeitsrechtsverletzungen durch Medienveröffentlichungen’
[2010] AfP 340, 341; Case C-523/10 Wintersteiger [2012] ECLI:EU:C:2012:90, Opinion of GA Villalón, para 17;
Case C-133/11 Folien Fischer [2012] ECLI:EU:C:2012:226, Opinion of GA Jääskinen, para 48; Ralph Wyss, Der
Gerichtsstand der unerlaubten Handlung im schweizerischen und internationalen Zivilprozessrecht (Dike Verlag Zürich
1997) 107; Heinrich Hempel, ‘Art. 36’ in Karl Spühler, Luca Tenchio and Dominik Infanger (eds), Basler Kommentar
zur Schweizerischen Zivilprozessordnung (3rd edn, Helbing & Lichtenhahn 2017) para 4; Jan von Hein, ‘Der Schutz
des Geschädigten bei grenzüberschreitenden Delikten im europäischen Zivilprozessrecht’ in Jens Kleinschmidt and
others (eds), Strukturelle Ungleichgewichtslagen in der internationalen Streitbeilegung (Peter Lang 2016) 45, 47. In general,
Konrad Ost, Doppelrelevante Tatsachen im Internationalen Zivilverfahrensrecht (Peter Lang 2002) 13, 161ff. See also
Herbert Roth, ‘§ 32’ in Friedrich Stein and Martin Jonas (eds), Kommentar zur Zivilprozessordnung (23rd edn, Mohr
Siebeck 2014) para 1.
206 cf Case 21/76 Mines de Potasse d‘Alsace [1976] ECR 1735, Opinion of GA Capotorti, paras 8 f.
207 For a detailed analysis see Thomale, ‘Herstellerhaftungsklagen’ (n 186) 67ff.
208 Folien Fischer (n 196) para 47.
209 Kainz (n 204).
210 Shevill (n 192); eDate Advertising and Martinez (n 192); Svensk Handel (n 194). For a detailed analysis see Thomale,
‘Herstellerhaftungsklagen’ (n 186) 59, 67ff.
387
place of the chose or body respectively. Capital market torts, however, are more complicated for
the damages plaintiff investors seek to recover here are harder to locate as only the investor’s
general patrimony is affected while no tangible assets have been lost or devalued.
(aa) Pure economic loss

30A.055 Not only, but especially in the German-speaking world, scholars have tried to identify the
location problem just outlined as a difficulty rooted in the concept of pure economic loss (reiner
Vermögensschaden). They allege that a person’s patrimony in and of itself, being intangible, has
no location whatsoever, which is why, the suggestion goes, Art 7 (2) Brussels Ia-Regulation in
terms of locus damni should be wholly unavailable.211 This view, however, is mistaken. First of
all, it fails to appreciate the notion of pure economic loss and its function in civil law: pure eco-
nomic loss is a term entirely interdependent with specific substantive tort systems. Candidly
speaking, the very notion of ‘pure economic loss’ lacks any sense outside a tort system that – be
it by limiting protected interests like German law does or by limiting the duty of care accord-
ingly, as English law does – systematically tries to discriminate against generic (i.e., ‘pure eco-
nomic’) losses as opposed to those caused by a specific type of infringement.212 This is why tort
systems that are based on a general tort clause like Arts 1240 f French Civil Code (Code Civil),
simply restating the Ulpianian alterum non laedere213 and leaving the rest to the courts, have no
use for the very concept of pure economic loss.214 As a result, being ‘purely economic’ does not
reference the morphology of a certain type of damage and is not synonymous with immaterial
or intangible damage, but rather points at the chain of causal events leading to such damage.
This becomes clear when pure economic loss is compared with consequential economic loss: if
a plaintiff has a tort committed against herself and, as a result, is deprived of a business oppor-
tunity, she has suffered a loss and can sue for damages. This very same damage will be deemed
purely economic if the tort – as would be the case, for example, under German and Austrian
law – does not affect a specifically protected interest such as, for example, misleading invest-
ment advice. If, however, the preceding tort does affect such an interest – for example, if the
plaintiff’s property is damaged, say, in a car accident, and this is why, consequently, the business
opportunity is lost – the identical damage will be considered consequential economic loss.
As it turns out, consequential economic loss is not any more ‘material’ or ‘tangible’ than pure
211 See Matthias Schwarz, Der Gerichtsstand der unerlaubten Handlung nach deutschem und europäischem Zivilprozeßrecht
(Peter Lang 1990) 46ff, 160 f; Haimo Schack, Internationales Zivilverfahrensrecht (8th edn, C. H. Beck 2021) para 345;
Paul Oberhammer, ‘Artikel 5’ in Felix Dasser and Paul Oberhammer (eds), Lugano-Übereinkommen (3rd edn, Stämpfli
Verlag 2021) para 119; Oberhammer, ‘Deliktsgerichtsstand am Erfolgsort reiner Vermögensschäden’ (n 202) 752 f;
; Astrid Stadler, ‘Der deliktische Erfolgsort als internationaler Gerichtsstand bei reinen Vermögensdelikten’ in Rolf
Schütze and others (eds), Fairness, Justice, Equity: Festschrift für Reinhold Geimer zum 80. Geburtstag (C. H. Beck 2017)
715, 725 f; Astrid Stadler and Matthias Klöpfer, ‘EuGH-Rechtsprechung zur EuGVVO aus den Jahren 2015 und
2016’ (2017) 4 ZEuP 890, 906; Christoph Wendelstein, ‘Der Gerichtsstand nach Art. 7 Art 7 Nr 2 Brussel Ia-VO bei
“reinen” Vermögensschäden’ (2018) 6 GPR 272. See also Case C-12/15, Universal Music [2016] ECLI:EU:C:2016:161,
Opinion of GA Szpunar, para 36; P J Rogerson, ‘The Situs of Debts in the Conflict of Laws –Iillogical, Unnecessary and
Misleading’ (1990) 49/3 CLJ 441, in particular 453; Hartley, International Commercial Litigation (n 174) 132.
212 cf Gerhard Wagner, ‘Comparative Tort Law’ in Mathias Reimann and Reinhard Zimmermann (eds), Oxford Handbook
of Comparative Law (2nd edn, Oxford University Press 2019) 1004ff.
213 Ulpian (lib. sec. reg.), D. 1, 1, 10, 1. See also Inst. 1.3.
214 See Christian Lapoyade Deschamps, ‘La reparation du prejudice économique pur en droit français’ (1998) 50 RIDC 367;
Christian von Bar, Gemeineuropäisches Deliktsrecht, Band II (C. H. Beck 1999) para 25.
388
economic loss.215 Further, neither is the location of consequential economic loss in terms of
locus damni any more self-evident than the location of pure economic loss for the real problem
is the economic nature of both kinds of losses per se. Economic losses, however, cannot be
disregarded altogether for the purposes of Art 7 (2) Brussels Ia-Regulation and its element of
locus damni: there is simply no authority in the wording or history of Art 7 (2) for such a drastic
restriction. Thus, the fact that the kind of damages recovered in capital market tort law suits
are purely economic damages, as far as Art 7 (2) Brussels Ia-Regulation is concerned, can be
squarely disregarded.216
(bb) CJEU: place and time of the transaction effecting initial damage determines locus damni
As of yet, there has been no CJEU case law available on the application of Art 7 (2) Brussels 30A.056
Ia-Regulation with regard to capital market torts. In a series of investor litigations, however, the
CJEU has taken the location of the bank account, from which the plaintiff investor perfected
her investment, to be the relevant locus damni:217 this reference to the ‘place where the bank is
established in which the applicant possessed the bank account in which the damage occurred’218
is backed up by statutory authority: not only do Art 2 (9) lit iii Reg (EU) 2015/848219 and Art 4
(4) lit a Reg (EU) 655/2014220 locate cash in a similar manner, but as cash is commonly under-
stood to be a claim against the bank bestowing the cash account, Art 4 para 1 lit b Rome I des-
ignates the law of the place of the bank’s branch to govern that claim.221 This solution has been
finding significant support in legal doctrine,222 while also facing fundamental criticism.223 More
importantly, the issue is still being litigated,224 although a considerable number of decisions
have been cast and quite some ink has been spilt on the topic. For a larger part, this persistent
legal uncertainty is a result of the CJEU’s reticence to openly state the exact legal standard it
applies. For, while ultimately the line of cases just cited come down to the location of the inves-
tor’s bank account, the reasoning is surprisingly vague. The court does not unambiguously use
215 Thomale, ‘Herstellerhaftungsklagen’ (n 186) 63ff; Thomale, ‘Herstellerhaftung: Deliktsgerichtsstand und anwendbares
Recht’ (n 186) 72ff; for a comparative perspective, see Mauro Bussani and Vernon Valentine Palmer, ‘The Liability
Regimes of Europe – their Façades and Interiors’ in Mauro Bussani and Vernon Valentine Palmer (eds), Pure Economic
Loss in Europe (Cambridge University Press 2003) 120ff.
216 But see ambiguous obiter remarks by Case C-12/15, Universal Music [2016] ECLI:EU:C:2016:449, para 38; VW (n 197)
paras 32–34.
217 See Case C-168/02 Kronhofer [2004] ECR I-6009; Kolassa (n 190); Case C-304/17 Löber [2018] ECLI:EU:C:2018:
701.
218 Löber (n 217) para 35 citing Kolassa (n 190) para 56.
219 Regulation (EU) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings
[2015] OJ L 141/19.
220 Regulation (EU) No 655/2014 of the European Parliament and of the Council of 15 May 2014 establishing a European
Account Preservation Order procedure to facilitate cross-border debt recovery in civil and commercial matters [2014] OJ
L 189/59.
221 cf s 5–116 lit b Uniform Commercial Code; Joseph H Sommer, ‘Where is a Bank Account?’ (1998) 57/1 Md L Rev 1,
66ff.
222 Lehmann, ‘Where Does Economic Loss Occur?’ (n 175) 527, 534 f, 544 with further references. See also Christian
von Bar, Internationales Privatrecht, Band II (C. H. Beck 1991) para 665; Andreas Spickhoff, ‘Die Restkodifikation des
Internationalen Privatrechts: Außervertragliches Schuld- und Sachenrecht’ [1999] NJW 2209, 2213; Brigitta Lurger and
Martina Melcher, Handbuch Internationales Privatrecht (Verlag Österreich 2021) paras 5/37ff.
223 OGH, Resolution of 14.6.2012, 3 Ob 14/12y, para 3.8.3. Similar also Wendelstein (n 211) 277 f.
224 cf Hoge Raad (Den Haag), Resolution of 14.6.2019, see Case C-709/19 Vereniging van Effectenbezitters [2021] ECLI:
EU:C:2021:377.
389
the bank account as the single and decisive connecting element. Instead, it prefers to stress that
while the plaintiff’s domicile as such being not identical with the locus damni, if the bank account
is also there, this additional connecting factor may tip the scale towards allowing her to bring
suit at that place.225 This shaky, and in part simply inaccurate legal reasoning,226 regrettable as
it is, can be disregarded from a legal realist standpoint in the light of a ratio decidendi, which is
deeply rooted in EU secondary law and legal doctrine.
30A.057 However, another line of cases constitutes a more fundamental challenge to the ‘bank account
approach’ just laid out. This alternative line, focusing on the investment contract instead, is
led by the Universal Music decision.227 Here, a Dutch plaintiff had mandated a Czech law firm
to conduct negotiations and represent the plaintiff in the Czech Republic. The firm concluded
a Share Purchase Agreement (SPA) in the name of the plaintiff with the Czech counterpart,
in which, due to alleged negligence by the law firm, a five-fold inflated purchase price was
stipulated. As the sum had been paid from a Dutch bank account, the plaintiff, seeking redress
from the law firm, wanted to rely on Art 7 (2) Brussels Ia-Regulation and bring suit in the
Netherlands. Under the strict ‘bank account approach’, this would have been correct. Instead,
the CJEU distinguished that line of cases, restricting it to situations where the ‘damage mate-
rialises directly in the applicant’s bank account’.228 A similar approach was visible from another
decision on cartel damages, where the locus damni had been found at the place where a cartel
victim concluded a contract at an artificially cartel-inflated price, i.e., ‘the place in which one
agreement in particular was concluded which is identifiable as the sole causal event giving rise
to the loss allegedly suffered’.229
30A.058 Juxtaposed as they may seem at first sight, the ‘bank account approach’ and the ‘transac-
tion approach’ fit together rather neatly: the decisive question is when exactly the damages
a plaintiff seeks to recover at the venue designated by Art 7 (2) Brussels Ia-Regulation were
completed. If the plaintiff was facing no enforceable obligation to pay right up to the moment
where she paid cash from her bank account, it is by that very transaction only that actual,
effective damages materialise. This was the case in Kolassa and Löber: both Mr Kolassa and
Mrs Löber could, had they know at the time about the alleged misinformation they had been
given, have refused to transfer the money to their broker bank. Thus, precisely by transferring
the money, their damage ‘directly materialised’ in their various bank accounts. Conversely, in
the Universal Music case, the damage was already complete and perfected when the SPA itself
was concluded for the plaintiffs, due to the privity of contract, could not have relied on their
law firm’s wrongdoing in relation to their SPA counterpart. Therefore, the transaction being
said and done, the consecutive payment really did not add anything to the initial damage, being
a balance sheet neutral exchange of cash for the extinction of debt owed under the SPA. This is
also consistent with the latest decision on Art 7 (2) Brussels Ia-Regulation, in which the CJEU
held that purchasers of manipulated cars could bring suit against a foreign producer in their
225 Kolassa (n 190) paras 48ff; Löber (n 217) paras 22ff.

226 See e.g., Löber (n 217) para 31, declaring ‘Austrian courts’ to be competent under Art 7 (2) Brussels Ia-Regulation
(n 177), while overtly ignoring the fact that this title, regulating both international and local jurisdiction, requires
a precise designation of the very place and venue where suit can be brought.
227 Universal Music (n 216).
228 Ibid., para 36.
229 CDC Hydrogen Peroxide (n 197) paras 52, 56.
390
home country: this was based on the factual assumption that the transaction leading to the pur-
chasers’ damage took place in their home country and immediately perfected their damage.230
(cc) Capital market transaction determines locus damni

As financial instruments are traded, certainly on the secondary market but also for the largest 30A.059
part on the primary market, it is this very transaction constituting the kind of damage plaintiffs
seek redress for in cases of market abuse. This resonates with the ‘Birnbaum-rule’ recognised
in many Member State capital markets tort laws.231 According to this rule, only plaintiffs who
actually bought or sold a given financial instrument can recover damages due to wrongful
capital market information. In other words: The decision not to transact in a given financial
instrument, based on wrongful information as it may very well be, does not sound in damages.
This prominent and widely shared element of substantive capital markets tort liability, at
a private international level, is adequately mirrored by using the transaction to determine the
locus damni.232
(dd) Trading venue determines the lieu of a transaction in financial instruments

Modern private international law shows little excitement for the place of conclusion of a con- 30A.060
tract as a connecting factor, because it is deemed coincidental and arbitrary.233 At the same
time, however, this factor is still being used, notably in Art 11 paras 1 Alt 2 and 13 Rome
I-Regulation. Capital market transactions anyway are commonly perceived as being conducted
where a financial instrument is listed and traded. Hence the usual parlance of an instrument
being traded ‘at the NYSE’ or ‘at the Frankfurt Stock Exchange’: transaction contracts, just
like the instruments themselves, are implicitly attributed to the trading venue.234 If there is
a double listing, a transaction will be located at the trading venue it refers to, leaving it to an
investor or a broker’s best practice assessment under Art 27 MiFID II to choose the proper
trading venue under this ‘relevant aspect’.235 Thus, it makes perfect sense to treat the location of
the trading venue as the locus damni of capital markets tort liability. This connection, further,
is in line with the common ideas of out-of-pocket loss and fraud on the market: if the damage
230 Case C-343/19 VW [2020] ECLI:EU:C:2020:253, Opinion of AG Sánchez-Bordona, para 74; VW (n 197) paras 30 f.
Had the issue of perfection been brought up more explicitly, the court might have gone further to investigate if it were
truly the purchase itself or only the payment of the purchase price which completed the damage. However, it seems
natural to assume consumer purchasers used cash accounts from home country banks anyway, so it is hard to imagine the
outcome would have been any different.
231 cf the leading US case Birnbaum v Newport Steel Corp, 193 F.2d 461 (CA2 1952). For a comparative note, see Hopt
and Voigt, ‘Grundsatz- und Reformprobleme der Prospekt- und Kapitalmarktinformationshaftung’ in Hopt and Voigt
(n 99) 9, 111ff and above ss 97 and 98 WpHG.
232 Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 332, 340.
233 Gerhard Kegel and Klaus Schurig, Internationales Privatrecht (9th edn, C. H. Beck 2004) 647. See also Robert Freitag,
Internationale Prospekthaftung revisited – Zur Auslegung des europäischen Kollisionsrechts vor dem Hintergrund der
“Kolassa”-Entscheidung des EuGH’ (2015) 25 WM 1165, 1168: ‘Verträge aber sind ihrerseits der Prototyp der ‚vater-
landslosen Gesellen‘ ohne unmittelbar greifbares reales Substrat.’
234 On the concept of trading venue see Art 4 para 1 (24) Directive 2014/65/EU of the European Parliament and of the
Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive
2011/61/EU (MiFID II) [2014] OJ L 173/349.
235 cf Francisco Garcimartín, ‘The Law Applicable to Prospectus Liability in the European Union’ (2011) 5/6 L & Fin Mkts
Rev 449, 455.
391
suffered by an investor is understood to lie in the detrimental influence on an financial instru-

ment’s market price, it appears only logical that this damage be located at the marketplace.
Moreover, this solution finds support in Art 4 para 1 lit h, 6 para 4 lit d and e in connection
with Recitals 28ff Rome I-Regulation, which locate a transaction in financial instruments at
the trading venue even if consumers are involved. At last, the CJEU argued in Vereniging van
Effectenbezitters that a listed company can only reasonably foresee an investment market and
incur liability in Member States, where it has complied with statutory reporting obligations in
connection with its stock exchange listing.236
30A.061 As a result, for the sake of determining the locus damni for capital market torts, the transaction
in a financial instrument has to be located at the trading venue. For virtual stock exchanges
without a trading venue strictly speaking, the seat of the operator can serve as the connecting
factor.237 This solution, by analogy, has to be extended to OTC transactions such as ATS-,
face-to-face or dark pool transactions.238 For, although these transactions do not literally take
place at a trading venue, they are still heavily influenced by the pricing reference provided by it.
In fact, it is by this very market pricing that a listing diminishes an issuer’s capitals costs.239 As
a result, the trading venue provides an institutional market of reference. This ripple effect of
a trading venue at law can be translated into a vis attractiva mercatus,240 i.e., a figurative centre
of gravity for all transactions. Consequently and much in the spirit of the principle of concen-
tration, all transactions, whether formally conducted at the trading venue or not, can be deemed
located at the trading venue. If no explicit or implicit reference to a certain trading venue can be
found, notably, if an OTC transaction concerns a financial instrument listed at several trading
venues simultaneously, the primary institutional market of reference has to be determined by
figuring out whose pricing influence is stronger.241
(ee) Basic rule

30A.062 In capital market torts, the locus damni is determined by the primary trading venue, where
a given financial instrument, upon which plaintiffs base their claims in tort, is listed.
236 Vereniging van Effectenbezitters (n 224) para 34 f; cf Franziska Gehann, ‘Internationale Zuständigkeit am deliktischen
Erfolgsort bei reinen Vermögensschäden – ein erster Schritt zum Marktortprinzip? Zugleich Bespr. von EuGH, Urt. v.
12.5.2021 – Vereniging van Effectenbezitters (C-709/19)’ (2021) 24 NZG 823, 826 f.
237 See Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 342 f.
238 Larger packages of financial instruments, especially bonds, are often traded OTC. For details see Erik Banks, Dark Pools
(2nd edn, Palgrave Macmillan UK 2014); Martin Konstantin Thelen, Dark Pools (Duncker & Humblot 2019); Kern
and Maly (n 3) 243, 245 f; Glenn Morgan, ‘Reforming OTC Markets: The Politics and Economics of Technical Fixes’
(2012) 13/3 EBOR 391, 394ff.
239 cf Richard Lambert, Christian Leuz and Robert E Verecchia, ‘Accounting Information, Disclosure, and the Cost of
Capital’ (2007) 45/2 JAR 385; de Fontenay (n 67) 490ff.
240 On the similar mechanism of vis attractiva concursus see Art 6 para 1 Reg (EU) 2015/848 (n 219) and Peter Mankowski,
‘Art. 6’ in Peter Mankowski, Michael F Müller and Jessica Schmidt (eds), Europäische Insolvenzverordnung 2015 (C. H.
Beck 2016) para 7 with further references.
241 cf the concerns voiced by Wolf-George Ringe and Alexander Hellgardt, ‘The International Dimension of Issuer
Liability—Liability and Choice of Law from a Transatlantic Perspective’ (2011) 31/1 OJLS 23, 53 f.
392
(c) Place of the event giving rise to the damage (locus delicti commissi)
It has already been noted above that there is no CJEU case law available on the application of 30A.063
Art 7 (2) Brussels Ia-Regulation with regard to capital market torts. However, worse than with
respect to the locus damni, where at least general case law is abundantly available, the alternative
locus delicti commissi is quite underdetermined even beyond capital markets law. The only
truly clarified point consists in the fact that, in line with the principle of concentration, for the
sake of Art 7 (2) Brussels Ia-Regulation, a tort is deemed to be committed at the fictitiously
contracted single place, where the ‘harmful event originated’.242 In reality, to be sure, a person’s
conduct constituting market abuse may not consist of one singular action, but may spread over
a period of time and different places, manifesting itself in a multitude of acts (e.g., meetings,
calls, e-mails).243 But, at law, such a line of events has to be consolidated to their place of origin.
It seems reasonable to locate the place where market abuse originated at the place of the initial 30A.064
decision to wrongfully inform, defraud or manipulate the market. For companies, it is widely
presumed that such decision to deceive by act or omission244 is initiated at the corporation’s
administrative seat.245 In the language of the Brussels Ia-Regulation, the locus delicti commissi
for market abuse committed by an issuer of financial instruments can thus be found at the place
of the issuer’s central administration.246
5. Summary: Default venues of jurisdiction for capital market torts by issuers
By default – i.e., notably absent any choice of court agreement, consumer contract, entering an 30A.065
appearance according to Art 26 para 1 Brussels Ia-Regulation or joinder jurisdiction under Art
8 Brussels Ia-Regulation – the following venues are typically available for lawsuits concerning
an issuer’s capital market tort liability for market abuse based on Art 4 para 1, Art 63 para 1 and
Art 7 (2) Brussels Ia-Regulation:
– The courts of the Member State (i.e., only international jurisdiction), where the issuer has its:
● statutory seat,
● central administration, or
● principal place of business
– The courts at the place (i.e., international and local jurisdiction)
● of the chosen or, absent such choice, primary trading venue (locus damni)
● where the issuer has its central administration (locus delicti commissi).
242 Shevill (n 192) para 24. ÖFAB (n 200); CDC Hydrogen Peroxide (n 197) para 44. See also Mankowski, ‘Article 7’ in
Magnus and Mankowski (n 171) para 264. See also Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3)
337.
243 As regards infringement of competition law, see van Calster (n 178) 146–147.
244 Paulus (n 200) para 189.
245 Marinari (n 197) para 12. Also Felix Mormann, Zuständigkeitsrechtlicher Schutz vor Anlegerklagen in den USA (Jenaer
Wissenschaftliche Verlagsgesellschaft 2010) 376ff. See also Peter Gottwald, ‘Brüssel Ia-VO Art. 7’ in Wolfgang Krüger
and Thomas Rauscher (eds), Münchener Kommentar zur Zivilprozessordnung (5th edn, C. H. Beck 2017) para 56.
246 As laid out in Thomale, ‘Herstellerhaftung: Deliktsgerichtsstand und anwendbares Recht’ (n 186) 79 f; Thomale,
‘Internationale Kapitalmarktinformationshaftung’ (n 3) 337 f.
393
D. APPLICABLE LAW IN SECURITIES LITIGATION FOR MARKET ABUSE
1. Introduction
30A.066 National civil liability regimes for damage due to market abuse have not been harmonised
in the EU (see B). Hence, the outcome of securities litigation for market abuse may vary
significantly, depending on the applicable substantive law. As a result, if a court inside the
EU is found competent to hear a case under the Brussels Ia-Regulation (see C), the Rome
II-Regulation determines the applicable law both by default in Art 4 Rome II-Regulation and
by choice of law agreements according to Art 14 Rome II-Regulation. This section deals with
the applicability of the Rome II-Regulation and its default conflict of laws rules. After that,
choice of court and choice of law clauses will be discussed, as they can be promoted using an
issuer’s charter or prospectus (see E).
2. Applicability of the Rome II-Regulation
(a) Non-contractual obligations in civil and commercial matters

30A.067 According to Art 1 para 1 Rome II-Regulation, only ‘non-contractual obligations in civil and
commercial matters’ fall within the scope of the Regulation. As shown above (C.3), in securities
litigation for market abuse anyway, there is no contractual relationship between the parties.247
Neither is there any reason to question the civil and commercial nature of the underlying
obligation.
(b) ‘Negotiable instrument’ under Art 1 para 2 lit c Rome II-Regulation

30A.068 On the face of it, Art 1 para 2 lit c Rome II-Regulation, excluding ‘negotiable instruments’ from
the scope of the Regulation, also seems to capture financial instruments. However, this would
fail to appreciate that this carve-out was intended to be confined only to obligations arising
specifically out of the securitisation of an instrument.248 A paradigmatic example would be
the recourse for non-acceptance or non-payment of a bill of exchange or a promissory note.249
Consequently, securities litigation for market abuse is not covered by Art 1 para 2 lit c.250
(c) ‘Law of companies’ under Art 1 para 2 lit d Rome II-Regulation

30A.069 Under Art 1 para 2 lit d Rome II-Regulation, ‘non-contractual obligations arising out of the
law of companies and other bodies corporate or unincorporated’ are excluded from the scope
of the Regulation. Just like the identical Art 1 para 1 lit f Rome I-Regulation, this exception
has to be narrowly construed such as to encompass only particularly complex questions of
organisational law, of which some are included in the non-exhaustive list of Art 1 para 2 lit d
247 On the somewhat more controversial topic of the quasi-contractual nature of prospectus liability, see Thomale,
‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 331.
248 Mario Giuliano and Paul Lagarde, Report on the Convention on the law applicable to contractual obligations (80/934/EEC
[1980] OJ L 266/1) 10: ‘arise out of their negotiable character’, as explicitly referenced by Commission, ‘Proposal for
a Regulation of the European Parliament and the Council on the law applicable to non-contractual obligations (ROME
II)’ COM (2003) 427 final, 9 f.
249 cf Art 43 Convention providing a Uniform Law For Bills of Exchange and Promissory Notes (Geneva, 1930).
250 Thomale, ‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 331 f.
394
D. Applicable law in securities litigation for market abuse
Rome II-Regulation.251 More precisely speaking, the carve-out intends to prevent any dépeçage
within the lex societatis so that incompatibilities between different substantive company laws
are avoided.252 Obligations arising out of financial instruments, although, especially in the case
of shares, being indirectly connected to organisational law in a broad sense, do not cause this
specific dépeçage problem. This is further underscored by genealogical evidence: during the
legislative process, the UK launched an initiative to give Art 1 para 2 lit d Rome II-Regulation
a different wording such as to extend to ‘non-contractual obligations arising out of transac-
tions [...] relating to financial instruments [...]’.253 It was not able to convince the legislator.
Therefore, securities litigation for market abuse is not covered by Art 1 para 2 lit d Rome
II-Regulation.254
(d) Evictive supremacy over national conflict of laws rules

According to Art 288 para 2 TFEU, the Rome II-Regulation is generally and directly appli- 30A.070
cable throughout the EU. What is more, under the supremacy principle as developed by the
CJEU,255 the Rome II-Regulation requires every national court to set aside whatever conflict
of laws rules may exist in its national legal system. Such conflict of laws rules can be openly
expressed as such, if for example, they appear in private international law codes. However,
especially unilateral conflict of laws rules can also be disguised as what at first glance looks like
a substantive rule:256 ss 97 and 98 WpHG,257 for example, require a ‘trading venue in Germany’.
This element formulates an implicit negative unilateral conflict of laws rule with the content: ‘If
the trading venue is not in Germany, the substantive liability rules of ss 97 and 98 do not apply.’
Assuming that, at the same time, the Rome II-Regulation were still designating German sub-
stantive rules on the liability for wrongful continuous disclosure to be applicable, that German
conflict of laws rule would have to be set aside.258
3. General rule: Art 4 para 1 Rome II-Regulation (lex loci damni)
Under Art 4 para 1 Rome II-Regulation, the law applicable to a non-contractual obligation259 30A.071
arising out of a tort or delict is the law of the country in which the damage occurs (lex loci
251 Giuliano and Lagarde (n 247) 12. See also Case C-25/18 Kerr [2019] ECLI:EU:C:2019:376, para 33; Case C-272/18
TVP [2019] ECLI:EU:C:2019:827, para 35.
252 Chris Thomale, ‘Anlegerschutz bei treuhänderischen Auslandsinvestitionen’ (2019) 6 VbR 204, 206. See Ulrich Magnus,
‘Rom I-VO, Art. 1’ in Ulrich Magnus and others (eds), von Staudingers Kommentar zum BGB (15th edn, De Gruyter
Sellier 2016) para 82; Peter Kindler, ‘Rom I-VO, Art. 1’ in Beate Gsell and others (eds), beck-online Großkommentar (C.
H. Beck 2019) para 56.
253 Amendment proposal UK of 30 March 2006 – Council Document No 7928/06.
254 See also LG Stuttgart, 28.02.2017, 22 AR 1/17; LG Stuttgart WM 2017, 1451; LG Stuttgart BeckRS 2017, 118702
para 140; LG Stuttgart, 24.10.2018, 22 O 101/16; LG Stuttgart WM 2019, 463 para 170.
255 Leading case Case 6/64 Costa v ENEL [1964] ECR 585; see also Paul Craig and Gráinne De Búrca, EU Law (7th edn,
Oxford University Press 2020) ch 10.
256 On the general phenomenon of implicit choice of law rules, see Kegel and Schurig (n 233) 52; Christian von Bar and
Peter Mankowski, Internationales Privatrecht Band I: Allgemeine Lehren (2nd edn, C. H. Beck 2003) § 4 paras 7ff, 220ff;
Kurt Siehr, ‘Normen mit eigener Bestimmung ihres räumlich-persönlichen Anwendungsbereichs im Kollisionsrecht der
Bundesrepublik Deutschland’ (1982) 46 RabelsZ 357.
257 Wertpapierhandelsgesetz (WpHG).
258 Thomale, ‘Rechtsquellen des Kapitalmarktrechts’ (n 2) 332ff.
259 Axel Halfmeier, ‘Rome II Art 1’ in Gralf-Peter Calliess and Moritz Renner (eds), Rome Regulations: Commentary (Wolters
Kluwer 2020) 28ff; Ivo Bach, ‘Art 1 Rome II’ in Peter Huber (ed), Rome II Regulation – Pocket Commentary (Sellier 2011)
395
damni).260 Art 2 para 1 Rome II-Regulation defines damage autonomously as any consequence
arising out of tort or delict, unjust enrichment, negotiorum gestio or culpa in contrahendo.261
Damage pursuant to Art 4 para 1 Rome II-Regulation is to be interpreted as the initial damage
to legal interests or property.262 Consequently, neither the law of the country in which the
event giving rise to the damage occurred (lex loci delicti commissi) nor the law of the country or
countries in which indirect consequences of the event occur are applicable under Art 4 para 1
Rome II-Regulation.263
30A.072 On pure economic loss resulting from market abuse, just as on Art 4 para 1 Rome II-Regulation
in general, the CJEU has yet to produce case law as to how exactly it wants to interpret the
locus damni in a conflict of laws context.264 In the meantime, scholarly literature commonly uses,
by analogy, the CJEU’s extensive body of case law on the locus damni in terms of a venue for
special jurisdiction under Art 7 (2) Brussels Ia-Regulation as a point of reference.265 Several
reasons argue in favour of this approach.
30A.073 First, the EU legislator in both Art 4 para 1 Rome II-Regulation and Art 7 no 2 Brussels
Ia-Regulation uses very similar wording, which clearly invites drawing analogies.266 Second,
both Recital 7 Rome II-Regulation and Recital 16 Brussels Ia-Regulation suggest that the
Rome II-Regulation should ideally be applied in harmony with the Brussels Ia-Regulation.267
Third, a parallel application of forum and ius, i.e., competent courts being able to apply their
home jurisdiction’s substantive law to the case before them, has obvious advantages to it in
terms of legal certainty and procedural efficiency, which is why it is widely deemed a desirable
15ff; Andrew Dickinson, The Rome II Regulation: The Law Applicable to Non-Contractual Obligations (Oxford University
Press 2008) paras 4.46ff. See also, Gregor Bachmann, ‘Die internationale Zuständigkeit für Klagen wegen fehlerhafter
Kapitalmarktinformation’ (2007) 3 IPRax 77, 78. See also Thomale, ‘Internationale Kapitalmarktinformationshaftung’
(n 3) 345 f.
260 Hartley, International Commercial Litigation (n 174) 608 f; van Calster (n 178) 251ff; see also Matthias Lehmann,
‘Vorschlag für eine Reform der Rom II-Verordnung im Bereich der Finanzmarktdelikte‘ (2012) 5 IPRax 399, 400 f;
Matthias Lehmann, ‘Proposition d’une règle spéciale dans le Règlement Rome II pour les délits financiers’ (2012) 101/3
Rev crit DIP 485, 490 f.
261 van Calster (n 178) 253; Ivo Bach, ‘Art 4 Rome II’ in Huber (n 278) 16.
262 Jan von Hein, ‘Rome II Article 4’ in Calliess (n 258) 2; Bach, ‘Art 4 Rome II’ (n 261) 17 f; Dickinson (n 258) paras
4.47ff, 4.66ff.
263 van Calster (n 178) 252 f; von Hein, ‘Rome II Article 4’ (n 261) 17ff.
264 Thomale, ‘Herstellerhaftung: Deliktsgerichtsstand und anwendbares Recht’ (n 186) 86 f.
265 Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 345 f. See, e.g., Dickinson (n 258) paras 4.26ff; von
Hein, ‘Rome II Article 4’ (n 261) 20 ff; Bach, ‘Art 4 Rome II’ (n 260) 26ff; Matthias Lehmann, ‘Prospectus Liability
and Private International Law – Assessing the Landscape after the CJEU’s Kolassa Ruling (Case C-375/13)’ (2016)
12/2 JPIL 318, 336. Agreeing: Andreas Engert and Gunnar Groh, ‘Internationaler Kapitalanlegerschutz vor dem
Bundesgerichtshof’ (2011) 4 IPRax 458, 468; Christian von Bar and Peter Mankowski, Internationales Privatrecht Band
2: Besonderer Teil (2nd edn, C. H. Beck 2019) paras 316ff, in particular paras 150 f, 158; Hannes Unberath, Johannes
Cziupka and Steffen Pabst, ‘Rom II-VO, Artikel 4’ in Thomas Rauscher (ed), Europäisches Zivilprozessrecht und
Kollisionsrecht EuZPR/EuIPR, Band III (4th edn, Otto Schmidt 2016) paras 40ff. For a critical analysis of this approach,
see Thomale, ‘Herstellerhaftungsklagen’ (n 186) 71ff.
266 Thomale, ‘Herstellerhaftungsklagen’ (n 186) 71.
267 See Recital 7 Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law
applicable to non-contractual obligations (Rome II) [2007] OJ L199/40 and Recital 16 Brussels Ia-Regulation (n 176).
With further analysis von Hein, ‘Der Schutz des Geschädigten bei grenzüberschreitenden Delikten im europäischen
Zivilprozessrecht’ (n 205) 57. In detail Thomale, ‘Herstellerhaftungsklagen’ (n 186) 71 f.
396
result.268 However, it should be noted that, contrary to the apparent identity of the concept
of locus damni, its function and modus operandi in both norms is entirely different:269 most
importantly, the locus damni, in the context of Art 7 (2) Brussels Ia-Regulation, only defines
one ‘special’ out of several venues available to the parties, while being specific down to the
very local venue itself. Conversely, in Art 4 para 1 Rome II-Regulation, locus damni is the one
necessary and sufficient connecting factor in the conflict of laws rule, designating the applicable
substantive law of torts. Hence, in between the jurisdictional and the conflict of laws contexts,
the reference to the place where the damage occurs shifts from pluralistic to monistic and from
place-focused to State-focused. As a result, it would be unwarranted to draw simple analogies
between the locus damni used in Art 7 (2) Brussels Ia-Regulation and the one used in Art 4
para 1 Rome II-Regulation. However, the general desirability of achieving maximum coher-
ence between the two remains. This justifies at least a rebuttable presumption of uniformity,
meaning that the conceptual evolution of locus damni in one field, notably with regard to the
case law produced by the CJEU on Art 7 (2) Brussels Ia-Regulation, should indeed extend to
the other, i.e., Art 4 para 1 Rome II-Regulation.270
Based on the default identity of locus damni in both Art 7 (2) Brussels Ia-Regulation and in 30A.074
Art 4 para 1 Rome II-Regulation, above said comments on the former apply (see C.4.b)) by
analogy to the latter. As a result, the law of torts applicable by default to capital market abuse is
the law of the country where the primary trading venue of the financial instrument in question
is located.271
4. Alternative connecting factors: Art 4 paras 2 and 3 Rome II-Regulation
As laid out above, Art 4 para 1 Rome II-Regulation yields the country where the primary 30A.075
trading venue is located as the connecting factor for designating the law of torts applica-
ble to market abuse. However, this formulates a mere default: Art 4 paras 2 and 3 Rome
II-Regulation provide legal bases to deviate from this connecting factor in order to achieve
a closer connection with a different legal order.272 In the following, such alternative connecting
factors shall be investigated.
268 See, e.g., Marc-Philippe Weller, ‘Die lex personalis im 21. Jahrhundert: Paradigmenwechsel von der lex patriae zur lex
fori’ in Katharina Hilbig-Lugani and others (eds), Festschrift Coester-Waltjen (Gieseking Verlag 2015), 897ff.
269 As argued in detail in Thomale, ‘Herstellerhaftungsklagen’ (n 186) 72ff.
270 von Hein, ‘Rome II Article 4’ (n 261) paras 20ff; Gisela Rühl, ‘Rom II-VO, Art 4’ in Beate Gsell and others (eds),
beck-online Großkommentar (C. H. Beck 2017) paras 68–68.2. See also Bach, ‘Art 4 Rome II’ (n 261) 18.
271 cf ‘Resolution of the Special Commission ‘Financial Market Law’’ of the German Council for Private International
Law’ (2012) 5 IPRax 470, 470f. In detail Garcimartín (n 235) 455; Lehmann, ‘Proposition d’une règle spéciale dans le
Règlement Rome II pour les délits financiers’ (n 259) 507 f; Lehmann, ‘Prospectus Liability and Private International
Law’ (n 264) 339ff. See also, using Art 6 by analogy Dorothee Einsele ‘Internationales Prospekthaftungsrecht –
Kollisions- rechtlicher Anlegerschutz nach der Rom II-Verordnung’ (2012) 1 ZEuP 23, 39ff; Einsele, ‘Capital
Market Law and Private International Law’ (n 187) 788ff; Dörte Poelzig and Matthias Windorfer, ‘Rom II-VO Art 6
Unlauterer Wettbewerb und den freien Wettbewerb einschränkendes Verhalten’ in Gsell and others (n 269) paras 264ff;
Herbert Kronke, ‘UNIDROIT’ in Jürgen Basedow and others (eds), Encyclopedia of Private International Law, Band II
(Edward Elgar Publishing 2017) 1129, 1137.
272 van Calster (n 178) 255 f; von Hein, ‘Rome II Article 4’ (n 261) 43 f; Bach, ‘Art 4 Rome II’ (n 261) 79ff; Dickinson
(n 258) paras 4.84ff. See, e.g., Lehmann, ‘Vorschlag für eine Reform der Rom II-Verordnung im Bereich der
Finanzmarktdelikte‘ (n 259) 402.
397
(a) Art 4 para 2 Rome II-Regulation: lex domicilii communis

30A.076 If both the debtor and the creditor of an alleged claim in tort share the same country of habitual
residence, so-called lex domicilii communis, at the time the damage occurs, Art 4 para 2 Rome
II-Regulation gives priority to that connecting factor over the locus damni. This rule, together
with Art 4 para 3 Rome II-Regulation, expresses the Regulation’s objective to reconcile legal
certainty on the one hand, by stipulating the locus damni as a clear-cut connecting factor, with
the principle of the closest connection, offering some leeway to deviate from this default if
a manifestly closer connection transpires in a given case.273 Consequently, the special rule of Art
4 para 2 Rome II-Regulation must only be followed if the lex domicilii communis indeed offers
such closer connection. In the field of market abuse, this is not the case,274: through the pricing
system it offers, the trading venue is so intimately intertwined with the financial instrument
itself and the damage resulting from having transacted in it that a mere connection between the
creditor and debtor of such claim appears coincidental to that much closer connection. Thus, in
cases of market abuse, Art 4 para 2 Rome II-Regulation does not apply.275
(b) Art 4 para 3 Rome II-Regulation: lex societatis or lex auctoritatis competentis
(aa) Presumptive aptness of the lex loci damni
30A.077 As Art 4 para 3 Rome II-Regulation invokes the principle of the closest connection, in the field
of market abuse it has invited a wide array of alternative connecting factors proposed by legal
doctrine. From the outset, it should be noted, however, that Art 4 para 3 Rome II-Regulation
is supposed to complement rather than undermine the standard choice Art 4 para 1 makes in
favour of the locus damni. Therefore, in order to oust Art 4 para 1, an alternative connecting
factor must formulate not just any, but a ‘manifestly’ closer connection and be fact-specific,
similar to the example of a pre-existing contractual relationship between the parties mentioned
in the second sentence of Art 4 para 3.
(bb) Lex societatis

30A.078 It has been suggested to use the lex societatis, i.e., the law of the country which governs the
issuer’s company law. One main argument presupposes that capital market tort liability is
mainly focused on complementing the issuer’s corporate governance framework, which is why
it would make sense to subject both to the same legal regime.276 Another argument focuses on
the EU internal market and refers to Art 27 Rome II-Regulation in order to make the case that
the country of origin principle were mandated to determine both the issuer’s company law and
capital market tort law in accordance with the issuer’s country of incorporation and statutory
seat.277 It is submitted that none of these arguments succeed in showing a manifestly closer
connection to the lex societatis: the idea to look at capital market tort liability as an outpost
of corporate governance simply fails to appreciate that, throughout EU capital markets law,
the market rather than the law of the issuer as just one of many participants in that market is
273 cf Recital 14.

274 See also Einsele, ‘Internationales Prospekthaftungsrecht (n 270) 30; Engel (n 41) 182 f with further references.
275 See also Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 353.
276 Ringe and Hellgardt (n 240) 46ff, relying on Fox, ‘Civil Liability and Mandatory Disclosure’ (n 65) 253ff.
277 cf Philipp Tschäpe, Robert Kramer and Oliver Glück, ‘Die ROM II-Verordnung – Endlich ein einheitliches
Kollisionsrecht für die gesetzliche Prospekthaftung?’ [2008] RIW 657, 663ff; Anton K Schnyder, ‘Internationales
Kapitalmarktrecht’ in Jan von Hein (ed), Münchener Kommentar zum BGB (5th edn, C. H. Beck 2010) para 119.
398
being used as a primary connecting factor.278 There is no reason to suggest otherwise for capital
market torts where this would principally run against the presumed default of Art 4 para 1
Rome II-Regulation. Likewise the country of origin principle is not designed to gloss over
conceptual distinctions like the one between company law and capital markets law and certainly
cannot warrant disregarding mentioned focus on the market.279
(cc) Lex auctoritatis competentis

Another point of reference for an alternative connecting factor is the law governing the obli- 30A.079
gation to inform the capital market itself, upon whose breach the liability in tort can be based.
Prospectus law offers some margin for national regulatory differences in this regard, hence
creating situations in which the law of the trading venue and the law of the prospectus can
deviate from each other.280 In such situations, proposals have been brought forward to allow
the law of the prospectus to govern both the obligation itself and the ensuing tort liability if it
is breached.281 Conversely, the MAR has harmonised the law of market abuse throughout the
EU, leaving no such margin. Still, the administrative competence to exercise market oversight
and to control and enforce compliance with the MAR does not primarily rest with ESMA,
but is delegated to Member State bodies such as, for example, Art 6 Delegated Regulation
2016/522282 does with regard to delayed continuous disclosure of inside information. It has
been suggested to tie the choice of capital market tort law to that administrative competence,
i.e., to apply the tort law of the country of the competent administrative authority (lex auctor-
itatis competentis).283 However, this would, simultaneously, confuse public and private as well
as competence and conflict of laws. Lacking any sound theoretical or positive foundation, this
proposal certainly cannot overcome the threshold of a manifestly closer connection as required
by Art 4 para 3 Rome II-Regulation.284
278 See e.g., Art 1 para 1, Art 16 Transparency Directive (n 101), Art 1 para 1 in conjunction with Recital 70 of the
Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be
2003/71/EC (Prospectus Regulation) [2017] OJ L 168/12 and Art 2 para 1 MAR. See also, Lehmann, ‘Vorschlag
für eine Reform der Rom II-Verordnung im Bereich der Finanzmarktdelikte’ (n 259) 403 f; Thomale, ‘Internationale
Kapitalmarktinformationshaftung’ (n 3) 349 f.
279 cf Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 347 f.
280 See, notably, Arts 25 f Prospectus Regulation (n 277).
281 See, notably, a series of German monographs with that general thrust: Philip Denninger, Grenzüberschreitende
Prospekthaftung und Internationales Privatrecht (Nomos 2015) 274ff; Björn Steinrötter, Beschränkte Rechtswahl im
Internationalen Kapitalmarktprivatrecht und akzessorische Anknüpfung an das Kapitalmarktordnungsstatut (Jenaer
Wissenschaftliche Verlagsgesellschaft 2014) 216ff; Damian Schmidt, Prospekthaftung im Spannungsfeld von Gesetz und
richterrechtlicher Gestaltung (Nomos 2018) 433ff; Engel (n 41) 302ff.
282 Commission Delegated Regulation (EU) 2016/522 of 17 December 2015 supplementing Regulation (EU) No 596/2014
of the European Parliament and of the Council as regards an exemption for certain third countries public bodies and
central banks, the indicators of market manipulation, the disclosure thresholds, the competent authority for notifications
of delays, the permission for trading during closed periods and types of notifiable managers' transactions [2015] OJ L
88/1.
283 Hellgardt, ‘§ 97 WpHG’ (n 119) para 177.
284 cf Thomale, ‘Internationale Kapitalmarktinformationshaftung’ (n 3) 351 f.
399
5. Summary
30A.080 In securities litigation before Member State courts, the law of torts applicable to market abuse
according to Art 4 Rome II-Regulation is the law of the country where the primary trading
venue of the financial instrument in question is located. In the rare case of the primary trading
venue being located in a third country, according to Arts 3, 24 Rome II-Regulation, this leads
to the application of that third country’s law of torts. The applicable law of torts thus being
determined, Art 15 Rome II Regulation circumscribes the exact scope of questions covered
by that applicable law of torts. It should be noted, however, that in many ways this marks but
the start of the ‘private international journey’, with notably mandatory provisions (Art 16),
public policy exceptions (Art 26) and local data (Art 17) still asking for a careful assessment
on a case-by-case basis. By and large, however, the issuer’s listing decision also determines by
which law of torts she is held accountable for breaches of the market abuse regime.
E. CHOICE OF COURT AND CHOICE OF LAW AGREEMENTS IN SECURITIES

LITIGATION FOR MARKET ABUSE
1. Introduction
30A.081 As national civil liability regimes for damage caused by market abuse vary greatly (see B),
parties who want to deviate from the default rules on jurisdiction (see C) and on the conflict
of laws (see D) may conclude choice of court or choice of law agreements setting aside those
default rules.285 In the EU, choice of court agreements for securities litigation are governed by
Art 25 para 1 Brussels Ia-Regulation, while the choice of tort law is regulated by Art 14 para 1
Rome II-Regulation. In practice, the two most common forms of choice of court and choice of
law agreements regarding securities litigation are concluded using clauses in the issuer’s charter
or in the prospectus accompanying the emission of the issuer’s financial instrument.
2. Choice of court clauses under Art 25 para 1 Brussels Ia-Regulation
(a) General scope of application

30A.082 In accordance with Art 25 para 1 Brussels Ia-Regulation, parties may agree on a specific court
or the courts of a Member State to have jurisdiction over ongoing or future disputes arising in
connection with a particular legal relationship.286 In practice, ex-ante choice of court clauses
285 Trevor C Hartley, Choice-of-Court Agreements under the European and International Instruments (Oxford University
Press 2013) para 1.01; see also Tena Ratkovic and Dora Zgrabljvic Rotar, ‘Choice-of-Court Agreements under the
Brussels I Regulation (Recast)’ (2013) 9/2 JPIL 245, 245 f; Hartley, International Commercial Litigation (n 174) 198;
van Calster (n 178) 114ff; Ulrich Magnus, ‘Article 25’ in Magnus and Mankowski (n 171) paras 1 f, 28; Jan von
Hein, ‘Rome II Article 14’ in Calliess (n 258) 2ff; Richard Fentiman, International Commercial Litigation (2nd edn,
Oxford University Press 2015) paras 1.01ff, 1.22ff; Lehmann, ‘Vorschlag für eine Reform der Rom II-Verordnung im
Bereich der Finanzmarktdelikte’ (n 258) 400 f. For a detailed analysis, see Thomale, ‘Gerichtsstand und Rechtswahl im
Kapitalmarktrecht’ (n 170).
286 Hartley, International Commercial Litigation (n 174) 200ff; van Calster (n 178) 113 f; Magnus, ‘Article 25’ (n 284) paras
66ff.
400
E. CHOICE OF COURT AND CHOICE OF LAW AGREEMENTS IN SECURITIES LITIGATION
are most common, often in conjunction with ex-ante choice of law clauses.287 Unless the parties
explicitly agree otherwise, choice of law clauses are presumed to be exclusive288 and to apply
regardless of the parties’ domicile. Their substantive validity has to be assessed by the law of
the state whose courts have been chosen.289 The clause must be made or evidenced in writing
or in a form that accords with established practices between the parties290 or, in international
trade or commerce, a form that accords with customs that the parties were or should have been
aware of.291
(b) Charter clause

Issuers may decide to include a choice of court clause into their charter, subjecting secu- 30A.083
rities litigation against the issuer to the chosen courts’ jurisdiction.292 Yet, Art 25 para 1
Brussels Ia-Regulation requires contractual choice of court agreements between two parties.293
A charter is an atypical contractual agreement, first, as there are multiple parties, and, second,
as it extends to future shareholders, including those who were not involved in the initial conclu-
sion of the charter. Such investors who were not shareholders at the time of the charter clause’s
conclusion, do not explicitly consent.294 Nonetheless, the CJEU has ruled that Art 25 para
1 Brussels Ia-Regulation also applies to a choice of court clause in a corporation’s charter,295
as the links between shareholders are comparable to those between parties to a contract.296
Shareholders who were not parties when the choice of court clause was initially concluded are
assumed to have implicitly consented:297 By choosing to become and remain a shareholder, the
investor agrees to be subject to all the provisions appearing in the statutes and to the decisions
adopted by the organs of the corporation.298 Hence, all clauses are applicable, even if the share-
holder disapproves of some,299 as long as the statutes are accessible to the shareholder (e.g., at
the corporation’s seat or in a public register).300
287 Hartley, International Commercial Litigation (n 174) 200.

288 Ibid., 199; Alex Mills, Party Autonomy in Private International Law (Cambridge University Press 2018) 96ff.
289 For further analysis see, Hartley, Choice-of-Court Agreements (n 284) para 7.06; Ilaria Queirolo, ‘Choice of Court
Agreements in the New Brussels I-bis Regulation: A Critical Appraisal’ (2014) 15 YPIL 113, 117 f, 124; Magnus,
‘Article 25’ (n 284) para 3; Fentiman (n 284) paras 2.48 f. In detail, Mills (n 287) 212ff.
290 Hartley, Choice-of-Court Agreements (n 284) para 7.49; van Calster (n 178) 120, 122 f; Magnus, ‘Article 25’ (n 284) paras
88ff, 95ff, 109ff; Fentiman (n 284) paras 2.82 f; Torremans and others (n 171) 237 f.
291 Hartley, International Commercial Litigation (n 174) 202; van Calster (n 178) 123; Magnus, ‘Article 25’ (n 284) paras
114ff; Mills (n 287) 107ff; Torremans and others (n 171) 240 f.
292 See Thomale, ‘Gerichtsstand und Rechtswahl im Kapitalmarktrecht’ (n 170).
293 Hartley, International Commercial Litigation (n 174) 199, 201; van Calster (n 178) 126 f; Magnus, ‘Article 25’ (n 284)
paras 77ff; Fentiman (n 284) paras 2.86ff.
294 See, e.g., Hartley, International Commercial Litigation (n 174) 199, 201, 212; Magnus, ‘Article 25’ (n 284) paras 135 f.
295 Hartley, International Commercial Litigation (n 174) 203, 208 f; see also van Calster (n 178) 114; Mills (n 287) 185 f.
296 Case C-214/89 Powell Duffryn [1992] ECR I-1745, para 16.
297 Ibid., paras 19, 27 f. Implicitly acknowledging the previous ruling Case C-543/10 Refcomp [2013] ECLI:EU:C:2013:62,
paras 31 f. See also Hartley, International Commercial Litigation (n 174) 208 f; Magnus, ‘Article 25’ (n 284) paras 135 f;
Mills (n 287) 185 f.
298 Powell Duffryn (n 295) para 19.
299 Ibid., para 19.
300 Ibid., para 28.
401
(c) Prospectus clause

30A.084 Many financial instruments such as, for example, bonds, do not confer membership rights.
In those as in many other cases, the charter is not a viable option for implementing a choice
of court clause. Instead, however, choice of court clauses may be inserted into the financial
instrument’s prospectus.301 Again, a contractual agreement is required under Art 25 para 1
Brussels Ia-Regulation.302 A prospectus by itself is produced unilaterally by the issuer. Hence,
the CJEU has ruled that for a prospectus clause to be valid, it must have been the subject of
clearly and precisely demonstrated consensus between the parties.303
30A.085 On the primary market, parties can achieve such consensus by explicitly referencing the pro-
spectus in their transaction contract. Yet, on the secondary market, issuer and investor do not
enter into any contract. Still, the CJEU has held that a choice of court clause in a prospectus
that is produced may be relied upon against a third party that acquired the respective financial
instrument from a financial intermediary.304 For the clause to be valid, three conditions must
be fulfilled: first, the clause must be valid in the initial relationship between the issuer and the
financial intermediary.305 Second, the third party (the plaintiff investor) must have succeeded
to the financial intermediary’s rights and obligations attached to those financial instruments
under the applicable national law through their acquisition on the secondary market.306 Third,
the third party must have had the opportunity to acquaint herself with the prospectus contain-
ing the choice of court clause (e.g., by making the prospectus available online).307
30A.086 Under Art 25 para 1 sent 3 lit c Brussels Ia-Regulation, in international trade or commerce, the
choice of court agreement may also be concluded in a form recognised by international trade
or commerce custom. Regarding the insertion of a choice of court clause into a prospectus,
the CJEU found such a custom, allowing for a presumption of consent.308 There are only two
conditions: first, this custom must generally and regularly be followed by the operators in the
sector concerned when contracts of that type are concluded.309 Second, either the parties must
have already entered into commercial or trade relations or with other parties operating in the
respective sector, or the conduct in question must be sufficiently well known and be considered
established practice.310
301 As laid out in Thomale, ‘Gerichtsstand und Rechtswahl im Kapitalmarktrecht’ (n 170).

302 Hartley, International Commercial Litigation (n 174) 199, 201; Magnus, ‘Article 25’ (n 284) paras 77ff.
303 Hartley, International Commercial Litigation (n 174) 201. In detail, see also Simon Schwarz, Globaler Effektenhandel
(Mohr Siebeck 2016) 703ff.
304 Case C-366/13 Profit Investment SIM [2016] ECLI:EU:C:2016:282, para 37.
305 Ibid., para 37.
306 Ibid., para 37.
307 Ibid., para 37.
308 Ibid., paras 49 f.
309 Ibid., para 50.
310 Ibid., para 50.
402
3. Choice of law clauses under Art 14 para 1 lit b Rome II-Regulation
(a) General scope of application

Civil liability claims for damages brought by investors against the issuer for market abuse are 30A.087
based on non-contractual obligations.311 Thus, corresponding choice of law agreements fall
within the scope of application of Art 14 para 1 Rome II-Regulation,312 pursuant to which,
parties may agree to subject non-contractual obligations to the law of their choice.313 A choice
of law agreement has to be entered into after the event giving rise to the damage occurred or,
if all parties pursue a commercial activity,314 be freely negotiated before said event (ex-ante
clause).315 In capital markets law, the most common form of choice of law clauses are ex-ante
clauses in accordance with Art 14 para 1 lit b Rome II-Regulation, which may either be
included in the issuer’s charter or in the prospectus accompanying the emission of a financial
instrument.
(b) Choice of law agreements in the issuer’s charter or the prospectus

In accordance with Art 14 para 1 lit b Rome II-Regulation, there must be an agreement 30A.088
between the parties to submit non-contractual obligations to the substantive law of their
choice.316 The legal relationship between secondary market participants and the issuer raises
similar questions to those brought up in the context of choice of court agreements under Art
25 para 1 Brussels Ia-Regulation (see 2c).317 Art 14 para 1 lit b Rome II-Regulation allows the
inclusion of unilateral choice of law clauses, for example in a prospectus.318 In analogy to Art 3
para 5 and Art 10 Rome I-Regulation, the chosen substantive law also determines the validity
of the choice of law itself.319
In order for an ex-ante clause to be valid under Art 14 para 1 lit b Rome II-Regulation, all 30A.089
parties must pursue a commercial activity.320 However, the Rome II-Regulation does not
offer a consistent definition of that concept.321 Recital 31 of the Rome II-Regulation merely
states that, despite party autonomy, protection should be given to weaker parties as regards
choice of law agreements.322 However, the Recital does not clarify whether Art 14 para 1
311 For a detailed analysis, see Thomale, ‘Gerichtsstand und Rechtswahl im Kapitalmarktrecht’ (n 170).
312 See e.g., Hartley, International Commercial Litigation (n 174) 637 f; van Calster (n 178) 268 f; on the dynamics of choice
of law in multistate litigation, see Fentiman (n 284) paras 4.01ff; von Hein, ‘Rome II Article 14’ (n 284) 3ff; Mills
(n 287) 404ff. See Dickinson (n 258) paras 13.06ff.
313 Hartley, International Commercial Litigation (n 174) 637 f; Dickinson (n 258) paras 13.37ff.
314 von Hein, ‘Rome II Article 14’ (n 284) 19; Ivo Bach, ‘Art 14 Rome II’ in Huber (n 258) 7.
315 Hartley, International Commercial Litigation (n 174) 638; von Hein, ‘Rome II Article 14’ (n 284) 18ff; Bach, ‘Art 14
Rome II’ (n 313) 6, 27ff; Dickinson (n 258) paras 13.11ff.
317 See also Recital 7 Rome II-Regulation (n 265): The substantive scope and the provisions of this Regulation should be
consistent with Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and
enforcement of judgments in civil and commercial matters (Brussels I) and the instruments dealing with the law appli-
cable to contractual obligations.
318 See, e.g., Giesela Rühl, ‘Art 14 Rom II-VO’ in Gsell and others (n 269) para 105. Andreas Vogeler, Die freie Rechtswahl
im Kollisionsrecht der außervertraglichen Schuldverhältnisse (Mohr Siebeck 2013) 152ff.
319 Rühl, ‘Art 14 Rom II-VO’ (n 317) paras 109ff with further references.
320 Indecisive Rühl, ‘Art 14 Rom II-VO’ (n 317) para 64; Dickinson (n 258) paras 13.37ff.
321 von Hein, ‘Rome II Article 4’ (n 261) 19; Bach, ‘Art 14 Rome II’ (n 313) 7.
322 Ibid.
403
lit b Rome II-Regulation allows ex-ante clauses to be concluded with consumers. Given the
similar wording, one might consider drawing an analogy to Art 6 para 1 Rome I-Regulation323
and defining commercial activity as acting in the exercise of one’s trade or profession.324
Yet, this narrow interpretation would exclude private investors from Art 14 para 1 lit b
Rome II-Regulation’s scope of application.325 Private investors do not act in the exercise of
their trade or profession, despite intending to make a profit.326 However, private investors
cannot be regarded, per se, as being the weaker party in their transaction, as Recital 31 would
suggest. Thus, interpreting the term ‘commercial activity’ in the sense of Art 6 para 1 Rome
I-Regulation is to be rejected.327 Instead, the EU legislator’s choice of words should be noted:
Art 14 para 1 sent 1 lit b Rome II-Regulation uses a different expression than Art 6 para 1
Rome I-Regulation’s well-established definition of professional activity. Thus, Art 14 para 1
lit b Rome II-Regulation’s term ‘commercial activity’ should be interpreted to have a broader
meaning,328 which includes any for-profit activity, for example a (semi-professional) private
investor’s security transactions:329 If their activity is profit-oriented, consumers may also pursue
commercial activities. Hence, choice of law clauses concluded in accordance with Art 14 para 1
lit b Rome II-Regulation are applicable to them.330
30A.090 Art 14 para 1 lit b Rome II-Regulation requires ex-ante choice of law clauses to be ‘freely nego-
tiated’. However, just like ‘commercial activity’, neither is this concept properly defined.331 At
first sight, one might consider drawing analogies to the definition of an ‘individual agreement’
laid out in the Unfair Terms Directive332 and use that to interpret Art 14 para 1 lit b Rome
II-Regulation.333 In accordance with Art 3 para 2 of that Directive, a term is individually nego-
tiated if it has not been drafted in advance and the consumer has therefore been able to influ-
ence the substance of the term. Under such a reading, charter clauses and prospectus clauses, as
far as choice of law is concerned, would be flat-out null and void. However, again, the different
wording of Art 14 para 1 lit b Rome II-Regulation has to be taken seriously: had the legislator
wanted to import the concept of individual negotiation, it could have done so. But it chose
otherwise. What is more, the legislative history of this concept is rather confusing, transmitting
no discernible plan or intention.334 The protection of weaker parties per se does not require
individual negotiation, as protection can be achieved otherwise, for example, through Art 14
323 Ibid., 21ff.

324 On the discrepancies in the regulation of consumer contracts between the Rome II-Regulation (n 266) and the Brussels
Ia-Regulation (n 177), see e.g., Bisping (n 176) 522ff.
325 As laid out by the German Federal Supreme Court: BGH, 9.2.2017, IX ZR 67/16 para 18.
326 See Abbo Junker, ‘Art 14 Rom II-VO’ in Rixecker R and Säcker F J (eds), Münchener Kommentar zum BGB (8th edn,
C. H. Beck 2021) para 23; Peter Picht, ‘Artikel 14 Rom II-VO’ in Krüger and Rauscher (n 244) paras 20 f. Similarly,
Melanie Schmitz, Die Rechtswahlfreiheit im europäischen Kollisionsrecht (Duncker & Humblot 2017) 179.
328 Taking the above-mentioned into account Vogeler (n 317) 255.
329 See, e.g., Picht (n 325) para 20, with similar argumentation to Vogeler (n 317) 252ff.
331 Bach, ‘Art 14 Rome II’ (n 313) 28.
332 Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts [1993] OJ L 95/29.
333 Instead of many Rühl, ‘Art 14 Rom II-VO’ (n 317) para 68ff, 74 with further references; Heinrich Dörner, ‘Art 14
Rom II-VO’ in Reiner Schulze and others (eds), Handkommentar BGB (10th edn, C. H. Beck 2019) para 3; Jan von
Hein, ‘Europäisches Internationales Deliktsrecht nach der Rom II-Verordnung (2009) 1 ZEuP 6, 20; Konrad Uhink,
Internationale Prospekthaftung nach der Rom II-VO (Verlag Dr Kovac 2016) 101ff.
334 Schmitz (n 325) 181ff.
404
paras 2 and 3.335 Given that the suggested equating of freely negotiated with individually nego-
tiated leads to a well-documented series of puzzles and inconsistencies between ex-ante and
ex-post choice of law clauses, it seems most prudent to simply ignore the criterion as an element
of the rule.336 It should rather be seen as a ‘narrative element’, celebrating the availability and
promotion of party autonomy in the law of torts, which, leading up to the Rome II-Regulation,
had been a contentious issue.337
4. Summary
Art 25 para 1 Brussels Ia-Regulation and Art 14 para 1 lit b Rome II-Regulation allow parties 30A.091
of securities litigation to choose ex ante both the competent courts and the applicable law of
torts with respect to their dispute. In practice, such choice of court and choice of law agree-
ments can be achieved by inserting the respective clause into either the issuer’s charter or into
the prospectus accompanying the financial instrument.
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413
ARTICLE 31
EXERCISE OF SUPERVISORY POWERS AND
IMPOSITION OF SANCTIONS
1. Member States shall ensure that when determining the type and level of administrative
sanctions, competent authorities take into account all relevant circumstances, including,
where appropriate:
(a) the gravity and duration of the infringement;
(b) the degree of responsibility of the person responsible for the infringement;
(c) the financial strength of the person responsible for the infringement, as indicated,
for example, by the total turnover of a legal person or the annual income of a natural
person;
(d) the importance of the profits gained or losses avoided by the person responsible for
the infringement, insofar as they can be determined;
(e) the level of cooperation of the person responsible for the infringement with the
competent authority, without prejudice to the need to ensure disgorgement of profits
gained or losses avoided by that person;
(f) previous infringements by the person responsible for the infringement; and
(g) measures taken by the person responsible for the infringement to prevent its repetition.
2. In the exercise of their powers to impose administrative sanctions and other administrative
measures under Article 30, competent authorities shall cooperate closely to ensure that
the exercise of their supervisory and investigative powers, and the administrative sanctions
that they impose, and the other administrative measures that they take, are effective and
appropriate under this Regulation. They shall coordinate their actions in accordance
with Article 25 in order to avoid duplication and overlaps when exercising their supervi-
sory and investigative powers and when imposing administrative sanctions in respect of
cross-border cases.
OVERVIEW
A. SUBJECT OF REGULATION 31.001 C. COOPERATION OF MEMBER STATES (PARA 2) 31.012

B. PENALTY ASSESSMENT CRITERIA (PARA 1) 31.004
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Michael Rohregger and Charlotte Pechhacker - 9781800882249
B. Penalty assessment criteria (para 1)
A. SUBJECT OF REGULATION
In order to ensure full compliance with Union law, sanctions must be effective, proportionate 31.001
and deterring.1 Sanctions shall be effective where they ensure compliance with Union law,
proportionate where they are in proportion to the gravity of the infringement and do not
exceed what is necessary to achieve the objective, and deterring when they deter persons from
committing the offence.2 Whether sanctions meet these three criteria depends, inter alia,
on the factors taken into account by the competent authorities when imposing them.3 Art
31 lists some of these factors. This is also in line with the objective of the MAR to ensure
a common approach in Member States (Recital 71) by establishing administrative sanctions
and other administrative measures. For, as the Commission points out in its Communication
of 8 December 2010 on strengthening the sanctions regime in the financial services sector,4
the fact that the competent authorities do not apply the same criteria when imposing sanctions
constitutes a weakness of the sanctions regime.5 For this reason, Art 31 para 1 MAR provides
for a number of circumstances that can be taken into account in determining the type and level
of the administrative sanction; Art 31 para 1 is thus a provision on the assessment of penalties.
Para 2 obliges Member States to cooperate and coordinate measures. 31.002
The provisions of Art 31 para 1 are not directly applicable in the Member States, but rather 31.003
require transposition into national law (Art 39 para 3). The French legislator fulfilled this obli-
gation by modifying Art L621-15 para III ter code monétaire et financier. In Germany, there is
no explicit list of criteria. However, basic requirements are regulated in §§ 17, 47 OWiG6 and
§ 120 paras 14 and 15 WpHG.7 In the UK this provision was implemented in s 124 FSMA8
and DEPP 6.2.1 FCA Handbook. The Austrian legislator fulfilled this obligation by creating
§ 158 BörseG 2018.9
B. PENALTY ASSESSMENT CRITERIA (PARA 1)
Member States must ensure that the competent authority takes into account all relevant 31.004
circumstances when determining the type and level of administrative sanctions (Art 31 para
1). Some of these circumstances are explicitly mentioned in Art 31. By using the term ‘where
appropriate’, the Union legislator makes it clear that the list is only demonstrative.
1 Recitals 70ff.
2 Commission, ‘Reinforcing sanctioning regimes in the financial services sector’ (Communication) COM (2010) 716 final,
5.
3 Commission (n 2) 15.
4 Reference to De Larosière, ‘The High-Level Group on Financial Supervision in the EU’ (Report), 25 February 2009, in
particular para 201.
5 Commission (n 2) 6, 8.
6 Gesetz über Ordnungswidrigkeiten 1987, BGBl I 602.
415
Article 31 EXERCISE OF SUPERVISORY POWERS AND IMPOSITION OF SANCTIONS
31.005 The gravity and duration of the infringement (lit a) play a central role in determining the sanc-
tion. In addition to the gravity of the infringement of the protected legal interest, the duration
of the infringement must also be taken into account.10
31.006 The sanction must also be based on the degree of responsibility of the person responsible for
the infringement (lit b).
31.007 Furthermore, it must be in reasonable proportion to the financial strength of the responsible
natural or legal person (lit c). The financial strength can be derived from the total turnover of
a legal person or the annual income of a natural person. This ensures that sanctions affect all
financial service providers equally. This is because a mild penalty would have a deterrent effect
on certain smaller but not larger financial institutions.11 At the same time, the provision is thus
able to observe the principle of proportionality.12
31.008 Profits gained by committing the infringement and losses avoided, insofar as these can be
determined, can also be taken into account when calculating the sanction (lit d). This provision,
on the one hand, serves as a deterrent and, on the other, takes into account the effects of the
infringement.13
31.009 If a natural person or legal person declares its willingness to cooperate with the competent
authority, this may – depending on the circumstances (Recital 71) – constitute a mitigating
factor (lit e). This is because the cooperation of the offending person can increase both the
investigative capacity of the authorities and the effectiveness of the sanctions.14 However, the
profits gained or losses avoided as a result of the offence must be disgorged in any case.
31.010 In determining the sanction, the competent authority may also take into account any previous
infringements (lit f) by the person responsible for the infringement.15
31.011 Account shall also be taken of measures taken after the infringement by the person responsible
for the infringement to prevent a repetition of that infringement (lit g). Such measures include,
for example, the introduction of an effective control system in a company after an infringement
has become known.
C. COOPERATION OF MEMBER STATES (PARA 2)
31.012 The competent authorities shall cooperate closely in the exercise of their powers to impose
administrative sanctions and other administrative measures in accordance with Art 30 to
ensure that the exercise of their supervisory and investigative powers and the administrative
10 On the meaning of ‘duration’ in the context of insider trading see Sophie Cools, ‘Article 31: Exercise of Supervisory
Powers and Imposition of Sanctions in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse Regulation (Oxford
University Press 2017) 495.
11 Commission (n 2) 8, 13 f.
14 Commission (n 2) 9, 14.
15 Whether both infringements have to be of the same type, see Cools (n 10) 497.
416
C. Cooperation of Member States (para 2)
sanctions that they impose and the other administrative measures that they take are effective
and appropriate. In line with the objective of Art 31 (see para 31.001), the duty to cooperate is
probably to be understood as meaning that the competent authority should take into account
the practice in other Member States when imposing sanctions and carrying out supervisory
and investigative powers in order to ensure a uniform application of Union law. Cooperation
is facilitated by the new European Financial Supervisory Authorities (see paras 33.002ff on
cooperation with ESMA; see also paras 25.001ff).16
Art 31 para 2 obliges Member States to coordinate their action in cross-border cases in 31.013
accordance with Art 25 (cf Recital 67). This is intended to avoid duplication and overlap both
in the exercise of supervisory and investigative powers and in the imposition of administrative
sanctions (ne bis in idem) (for details see para 25.003ff).17
Literature
Cools S, ‘Article 31: Exercise of Supervisory Powers and Imposition of Sanctions’ in Ventoruzzo M and
Mock S (eds), Market Abuse Regulation (Oxford University Press 2017)
ESMA, ‘Final Report, Draft Implementing Technical Standards on forms and procedures for coop-
eration between competent authorities under Regulation (EU) No 596/2014 on market abuse’,
ESMA70-145-100, 30.5.2017
ESMA, ‘Final Report, Draft Implementing Technical Standards on forms and procedures for coopera-
tion under Article 24 and 25 of Regulation (EU) No 596/2014 on market abuse’, ESMA70-145-398,
6.2.2018
17 On the cooperation between the Member States, see, in particular, ESMA, ‘Final Report, Draft Implementing
Technical Standards on forms and procedures for cooperation under Article 24 and 25 of Regulation (EU) No 596/2014
on market abuse’, ESMA70–145–398, 6.2.2018; ESMA, ‘Final Report, Draft Implementing Technical Standards on
forms and procedures for cooperation between competent authorities under Regulation (EU) No 596/2014 on market
abuse’, ESMA70–145–100, 30.5.2017.
417
ARTICLE 32
REPORTING OF INFRINGEMENTS
1. Member States shall ensure that competent authorities establish effective mechanisms
to enable reporting of actual or potential infringements of this Regulation to competent
authorities.
2. The mechanisms referred to in paragraph 1 shall include at least:
(a) specific procedures for the receipt of reports of infringements and their follow-up,
including the establishment of secure communication channels for such reports;
(b) within their employment, appropriate protection for persons working under a con-
tract of employment, who report infringements or are accused of infringements,
against retaliation, discrimination or other types of unfair treatment at a minimum;
and
(c) protection of personal data both of the person who reports the infringement and the
natural person who allegedly committed the infringement, including protection in
relation to preserving the confidentiality of their identity, at all stages of the proce-
dure without prejudice to disclosure of information being required by national law in
the context of investigations or subsequent judicial proceedings.
3. Member States shall require employers who carry out activities that are regulated by finan-
cial services regulation to have in place appropriate internal procedures for their employees
to report infringements of this Regulation.
4. Member States may provide for financial incentives to persons who offer relevant infor-
mation about potential infringements of this Regulation to be granted in accordance with
national law where such persons do not have other pre-existing legal or contractual duties
to report such information, and provided that the information is new, and that it results in
the imposition of an administrative or criminal sanction, or the taking of another adminis-
trative measure, for an infringement of this Regulation.
5. The Commission shall adopt implementing acts to specify the procedures referred to
in paragraph 1, including the arrangements for reporting and for following-up reports,
and measures for the protection of persons working under a contract of employment and
measures for the protection of personal data. Those implementing acts shall be adopted in
accordance with the examination procedure referred to in Article 36(2).

418
A. Subject matter
OVERVIEW
A. SUBJECT MATTER 32.001 SYSTEM BY THE EMPLOYER 32.009

B. ESTABLISHMENT OF A WHISTLEBLOWING D. FINANCIAL INCENTIVES 32.010
SYSTEM BY THE AUTHORITIES 32.004 E. IMPLEMENTING ACTS (PARA 5) 32.012
C. ESTABLISHMENT OF A WHISTLEBLOWING
A. SUBJECT MATTER
The MAR aims at preventing and sanctioning market abusive behaviour. In order to enable 32.001
the supervisory authorities to detect such conduct and to impose sanctions, it is necessary to set
up a system in which whistleblowers can report suspicions of such conduct to the authorities.
In doing so, the protection of both the whistleblowers and the persons against whom the accu-
sation is made must be ensured. The former must be protected against retaliation, while the
latter must be protected by the right to protection of their personal data, the right to a defence
and the right to be heard before decisions concerning them are taken.1 While paras 1 and 2
contain provisions on external whistleblowing, para 3 refers to internal communications of
infringements.2
Any person who is aware of a possible infringement of the provisions of the MAR may report 32.002
on such. These will, as a rule, be persons who, due to their function or profession, have insight
into internal processes.
Pursuant to Art 39 para 3 MAR, Art 32 had to be implemented into national law by 3 July 32.003
2016. The French legislator implemented Art 32 by creating Arts L634–1 to L634–4 code
monétaire et financier and Arts 145–1 to 145–4 règlement général de l’autorité des marchés
financiers. In Germany, para 1 and 2 of this Article were implemented in § 4d FinDAG.3,4 Para
3 was implemented in § 80 para 1 WpHG5 and in § 25a para 1 KWG6 for investment services
companies, in § 5 para 7 BörsG7 for companies operating the stock exchange and in § 23 para
6 VAG8 for insurance services companies. In the UK Art 32 paras 1 and 2 were implemented
in the Financial Services and Markets Act 2000 (Market Abuse) Regulations 2016 Schedule
(reporting of actual or potential contraventions of the market abuse regulation to the FCA).9
1 Recital 74 MAR.
2 Thomas Rotsch and Markus Wagner ‘'§ 34: Die verfahrensrechtliche Relevanz der Einrichtung einzelner
Compliance-Maßnahmen’ in Thomas Rotsch (ed), Criminal Compliance Handbuch (Nomos 2015) para 10.
3 Finanzdienstleistungsaufsichtsgesetz (FinDAG) 2002, BGBl I 1310.
4 On the lack of protection in relation to preserving the confidentiality of the identity in criminal proceedings see
Christoph Kumpan and Robin Misterek, ‘Artikel 32 Meldungen von Verstößen’ in Eberhard Schwark and Daniel
Zimmer (eds), Kapitalmarktrechts-Kommentar (5th edn, C. H. Beck 2020) para 14.
7 Börsengesetz 2007, BGBl I 1330.
8 Versicherungsaufsichtsgesetz 2015, BGBl I 434.
9 SI 2016, 680.
419
Article 32 REPORTING OF INFRINGEMENTS
Para 3 was implemented by means of s 131AA FSMA10 and SYSC 18.3.1 FCA Handbook.
The Austrian legislator implemented Art 32 by means of §§ 48h, 48i Börsegesetz as amended
by BGBl I 2016/76 (now § 160 BörseG 2018;11 Art 32 para 3 in § 159 BörseG 2018).12
B. ESTABLISHMENT OF A WHISTLEBLOWING SYSTEM BY THE AUTHORITIES
32.004 Para 1 imposes an obligation on the competent authorities to establish effective mechanisms
to enable the reporting of actual or potential infringements of the MAR. To this end, special
mechanisms shall be established for the receipt and follow-up of reports of infringements,
including the establishment of secure communication channels. In addition, arrangements shall
be made for adequate protection of persons who report or who are accused of infringements as
well as their personal data, including the confidentiality of their identity. The content of these
mechanisms is governed by Implementing Directive 2392/2015 (see para 32.012).
32.005 Competent authorities shall indicate on their website how a notification to the authority can
be made.13 The communication channels provided for this purpose must be ‘secure’ and ensure
the confidentiality of the notification (para 2 lit a). These two conditions are met if the dedi-
cated communication channels are separated from the general communication channels of the
competent authority, if they ensure the completeness, integrity and confidentiality of the infor-
mation, if they prevent access by non-authorised staff of the competent authority and if they
enable the storage of durable information (Art 6 para 2 Implementing Directive 2015/2392).
It must be possible to submit the notification at least in electronic or paper form, through tele-
phone lines and by means of personal meetings; the introduction of additional further forms of
notification is permitted (Art 6 para 3 Implementing Directive 2015/2392). On their website,
the competent authorities shall indicate whether telephone conversations are recorded (Art 4
para 2 lit a Implementing Directive 2015/2392).14
32.006 The protection of persons working under an employment contract (para 2 lit b) shall at least
be provided by providing comprehensive information and advice to notifying persons on the
legal remedies and procedures available under national law to protect them against unfair
treatment, including on the procedures for claiming pecuniary compensation. Furthermore,
the reporting person shall receive effective assistance from other relevant authorities involved in
their protection against unfair treatment, including by certifying the condition of whistleblower
of the reporting person in employment disputes (Art 8 Implementing Directive 2015/2392).
The protection afforded by the authority in this way is intended, in particular, to prevent retal-
iation, discrimination or other types of unfair treatment due to whistleblowing. This includes

12 ErlRV 1661 BlgNR 25. GP 20; ErlRV 1186 BlgNR 25. GP 3.
13 For Austria, see FMA’s website.
14 This provision is based on a proposal by ESMA on the basis of the consultations carried out by it (ESMA, ‘ESMA’s
technical advice on possible delegated acts concerning the Market Abuse Regulation’ (Final Report), ESMA/2015/224,
3. February 2015, 61).
420
D. Financial incentives
dismissals, punitive transfers, harassment, the reduction or withdrawal of tasks, position, salary,
benefits or promotions, as well as threats thereof.15
A (broad, also including temporary staff, apprentices and trainees) definition of persons working 32.007
under ‘employment contracts’ or as ‘employees’ within the meaning of Art 32 is found, neither
in the Implementing Directive itself nor in the MAR, despite efforts made during the drafting
of the Implementing Directive. This is due to the fact that the decisive criterion for assessing
the addressees of internal whistleblowing systems is the legal existence of a contract, but not its
specific concept.16 Thus, when assessing whether persons are working under an employment
contract, neither the nature of the employment relationship (part-time, fixed-term, etc.) nor
whether they are working for remuneration or without remuneration is relevant.17
In order to ensure the protection of personal data (para 2 lit c) – in particular against the 32.008
background of Art 8 as well as Arts 7 and 48 CFR18 – of both the reporting and the reported
person, records relating to a notification must be stored in a confidential and secure system.19
Only specifically authorised staff members of the competent authority should have access to
this system, and this exclusively for the purpose of performing their professional duties (Arts 9
and 11 Implementing Directive 2015/2392). If the identity of the reported person is not known
to the public, the Member State concerned shall ensure that their identity is protected at least
in the same manner as for persons that are under investigation by the competent authority (Art
11 Implementing Directive 2015/2392).
C. ESTABLISHMENT OF A WHISTLEBLOWING SYSTEM BY THE EMPLOYER
Employers who carry out activities that are regulated by financial services regulation should be 32.009
obliged by the Member States to put in place adequate internal procedures for their employees
to report infringements of the MAR (para 3).
D. FINANCIAL INCENTIVES
For persons who are not already obliged to report infringements ex lege (e.g., because of their 32.010
sovereign duties, loyalty obligations), Member States may provide financial incentives to
15 ESMA, Final Report (n 14) 62; see also ESMA, ‘ESMA’s draft technical advice on possible delegated acts concerning
the Market Abuse Regulation’ (Consultation Paper), 11. July 2014 ESMA/2014/808, 50 f.
16 ESMA, Final Report (n 14) 62.
17 Recital 6 Commission Implementing Directive (EU) 2015/2392 of 17 December 2015 on Regulation (EU) No
596/2014 of the European Parliament and of the Council as regards reporting to competent authorities of actual or
potential infringements of that Regulation [2015] OJ L 332/126.
18 Commission, ‘Commission Staff Working Paper, Impact Assessment, Accompanying the document Proposal for
a Regulation of the European Parliament and of the Council on insider dealing market manipulation (market abuse) and
the Proposal for a Directive of the European Parliament and of the Council on criminal sanctions for insider dealing and
market manipulation’ COM (2011) 651 final/SEC (2011) 1218 final, 121, 156.
19 However, absolute confidentiality cannot be guaranteed because disclosure might exceptionally be necessary pursuant to
Arts 27, 28 and 29 MAR; on this, see Sophie Cools, ‘Article 32: Reporting of Infringements’ in Marco Ventoruzzo and
Sebastian Mock (eds), Market Abuse Regulation (Oxford University Press 2017) 505 f.
421
Article 32 REPORTING OF INFRINGEMENTS
report infringements. However, such incentives are only available if the information is new20
and if a sanction or administrative measure is actually imposed (para 4, also Recital 74).
The Commission considered the possibility of financial payment of reports to be necessary,
especially in light of the fact that the authorities often only learn of infringements and obtain
valuable evidence as a result.21 In its Working Paper from 20 October 2011, the Commission
proposed that the amount of the payment should be calculated as a percentage of the fine
imposed.22
32.011 However, there are fundamental concerns – not only with regard to Art 32 – about the granting
of financial incentives. In particular, there is a risk that the temptation to obtain financial remu-
neration will increase the number of useless reports and thus the workload of the authority.
However, by linking the financial incentive to the imposition of a sanction, this risk should be
limited.23
E. IMPLEMENTING ACTS (PARA 5)
32.012 In order to establish the procedures referred to in Art 32, the Commission adopted the
Implementing Directive 2015/2392.24
32.013 This was issued in accordance with the committee procedure under Regulation 182/201125 (to
which Art 36 para 2 refers). This provides for the involvement of a committee composed of
representatives of the Member States in the adoption of the Directive.
32.014 In France, the Implementing Directive was implemented by means of Instruction AMF
DOC-2018–13. In Germany, it was implemented by means of BaFinVersMeldV.26 In the
UK, the Financial Services and Markets Act 2000 (Market Abuse) Regulation 2016 Schedule
was created in order to implement this Directive. In Austria, the mentioned Implementing
Directive was implemented in § 160 BörseG27 (§ 48i BörseG 198928).
20 On the newness of information, see Cools (n 19) 505 f.

23 Rotsch and Wagner (n 2) § 34 paras 90 f.
24 Commission Implementing Directive (EU) of 17 December 2015 (n 17).
25 Regulation (EU) 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules
and general principles concerning mechanisms for control by Member States of the Commission’s exercise of imple-
menting powers [2011] OJ L 55/2013.
26 Bundesanstalt für Finanzdienstleistungsaufsicht Verstoßmeldeverordnung 2016, BGBl I 1572.
28 Börsegesetz 1989, BGBl 558/1990.
422
E. Implementing acts (para 5)
Literature
Cools S, ‘Article 32: Reporting of Infringements’ in Ventoruzzo M and Mock S (eds), Market
Kumpan C and Misterek R, ‘Artikel 32 Meldungen von Verstößen’ in Schwark E and Zimmer D (eds),
Rotsch T and Wagner M, ‘§ 34: Die verfahrensrechtliche Relevanz der Einrichtung einzelner
Compliance-Maßnahmen’ in Rotsch T (ed), Criminal Compliance Handbuch (Nomos 2015)
423
ARTICLE 33
EXCHANGE OF INFORMATION WITH ESMA
1. Competent authorities shall provide ESMA annually with aggregated information regard-
ing all administrative sanctions and other administrative measures imposed by the com-
petent authority in accordance with Articles 30, 31 and 32. ESMA shall publish that
information in an annual report. Competent authorities shall also provide ESMA annually
with anonymised and aggregated data regarding all administrative investigations under-
taken in accordance with those Articles.
2. Where Member States have, in accordance with the second subparagraph of Article 30(1),
laid down criminal sanctions for the infringements referred to in that Article, their com-
petent authorities shall provide ESMA annually with anonymised and aggregated data
regarding all criminal investigations undertaken and criminal penalties imposed by the
judicial authorities in accordance with Articles 30, 31 and 32. ESMA shall publish data on
criminal sanctions imposed in an annual report.
3. Where the competent authority has disclosed administrative or criminal sanctions or other
administrative measures to the public, it shall simultaneously notify ESMA thereof.
4. Where a published administrative or criminal sanction or other administrative measure
relates to an investment firm authorised in accordance with Directive 2014/65/EU,
ESMA shall add a reference to that published sanction or measure in the register of invest-
ment firms established under Article 5(3) of that Directive.
exchange of information as referred to in this Article.
by 3 July 2016.
Power is conferred on the Commission to adopt the implementing technical standards referred
to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1095/2010.
OVERVIEW
A. INTRODUCTION 33.001 C. IMPLEMENTING TECHNICAL STANDARDS (PARA

B. COOPERATION WITH ESMA 33.003 5)33.007
424
B. Cooperation with ESMA
A. INTRODUCTION
The MAR is a further development of the MAD 2003 and is based, inter alia, on the idea of 33.001
creating uniform rules for the Member States.1 The so-called ‘De Larosière Report’, to which
the MAR refers in the Recitals, states that there is an urgent need to harmonise the sanctions
provided for in the Member States.2
The establishment of ESMA in February 2012 as the European Supervisory Authority should 33.002
accordingly contribute to the consistent application of Union law (Art 8 para 1 lit b ESMA
Regulation) and coordinate the activities of the national authorities.3 The obligation of the
Member States to report on sanctions and other measures imposed, as set out in Art 33, con-
tributes to harmonisation in that it gives ESMA a uniform picture of the punitive practice of
the individual Member State.4
B. COOPERATION WITH ESMA
Para 1 requires the competent authorities to provide ESMA annually5 with information. All 33.003
administrative sanctions and other administrative measures imposed in accordance with Arts
30, 31 and 32 and all administrative proceedings conducted in the context of the provisions
shall be reported. The information on investigations shall be provided in such a way as to
reflect the actual investigative activities carried out in a given year under the provisions of the
MAR.6 These data should include the number of investigations initiated, the total number of
cases pending and the number of cases closed in the period concerned.7 Data on investigations
carried out must also be provided by the Member States with regard to criminal proceedings if
they have decided, in accordance with Art 30 para 1 subpara 2, to impose criminal sanctions for
the infringements mentioned therein (para 2).8
1 Recital 3 MAR.
2 De Larosière, ‘The High-Level Group on Financial Supervision in the EU’ (Report), 25.2.2009, para 84.
3 Fabian Walla, ‘Capital Markets Supervision in Europe’ in Rüdiger Veil (ed), European Capital Markets Law (2nd edn,
Oxford and Portland 2017) para 64; see also Sophie Cools, ‘Article 33: Exchange of Information with ESMA’ in Marco
Ventoruzzo and Sebastian Mock (eds), Market Abuse Regulation (Oxford University Press 2017) 515 f.
4 Pursuant to Art 30 regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November
2010 establishing a European Supervisory Authority (European Securities and Markets Authority) (ESMA Regulation)
[2010] OJ L 331/84, ESMA is required to assess, in the context of a comparative analysis, the effectiveness and degree of
convergence in the enforcement of the provisions adopted in the context of the implementation of Union law (including
administrative measures and sanctions against persons responsible for non-compliance with those provisions). When
carrying out the comparative analysis, ESMA may take into account information already available (Art 33). On the basis
of that analysis, ESMA may issue guidelines and recommendations (Art 16).
5 The transmission shall be made annually by 31 March at the latest (Art 3 para 2 Commission Implementing Regulation
(EU) 2017/1158 of 29 June 2017 laying down implementing technical standards with regards to the procedures and
forms for competent authorities exchanging information with the European Securities Market Authority as referred to
in Article 33 of Regulation (EU) No 596/2014 of the European Parliament and of the Council [2017] OJ L 167/22).
6 Recital 4 Commission Implementing Regulation (EU) 1158/2017 (n 5).
7 Recital 78 MAR.
8 In Austria, the offences referred to in Art 30 para 1 of the MAR are administrative offences (cf § 155 Börsegesetz 2018,
BGBl I 107/2017).
425
Article 33 EXCHANGE OF INFORMATION WITH ESMA
33.004 Implementing Regulation 1158/2017 regulates the manner in which the information is to
be transmitted (see para 33.008). In order to facilitate communication between ESMA and
the competent authorities, the latter must establish contact points.9 The transmission of
information must be carried out using special forms and must be detailed and harmonised.10
The competent authority must indicate, for example, how many sanctions have been imposed,
whether they are pecuniary or non-pecuniary sanctions and how many persons are affected by
the measures or sanctions (for details see Annex I Implementing Regulation 1158/2017).
33.005 ESMA shall publish the information submitted to it by the Member States in an annual
report.11
33.006 Where the competent authority has disclosed an administrative or criminal sanction or other
administrative measures to the public,12 it shall simultaneously notify ESMA thereof (para 3).
Whether and under what conditions an administrative or criminal sanction or other measure is
to be disclosed to the public is determined in accordance with Art 34. If the sanctioned person
is an investment firm authorised under MiFID II (Arts 5ff MiFID II), ESMA must disclose
the sanction or other measure in the register of investment firms (Art 5 para 3 MiFID II; a list
drawn up by ESMA of all EU investment firms).
C. IMPLEMENTING TECHNICAL STANDARDS (PARA 5)
33.007 ESMA shall draft implementing technical standards in accordance with para 5 to determine
the procedure and forms for the exchange of information between Member States and ESMA
(but not including strategic decisions or policy choices13). This is to ensure uniform conditions
of application of Art 33.
33.008 At the end of July 2016,14 ESMA submitted a draft on technical implementing standards for
Art 33 to the Commission.15 This contains technical standards on how the competent authori-
ties are to communicate their annual report on the sanctions imposed by them and the investi-
gations carried out (paras 1 and 2) to ESMA. On the basis of this draft and on the basis of Art
15 of the ESMA Regulation, the Commission adopted Implementing Regulation 1158/2017
laying down technical implementing standards with regards to the procedures and forms for
competent authorities exchanging information with the European Securities Market Authority
as referred to in Article 33 of Regulation (EU) No 596/2014 of the European Parliament and
of the Council (on content, see para 33.003).
9 Recital 2, Art 2 Commission Implementing Regulation (EU) 1158/2017 (n 5).

10 Recital 3 Commission Implementing Regulation (EU) 1158/2017 (n 5).
11 Commission Implementing Regulation (EU) 1158/2017 (n 5) did not enter into force until July 2017, thus no annual
report on penalties, measures and procedures has been published to date.
12 On this for Austria, see § 161 Börsegesetz 2018.
13 Art 15 ESMA Regulation (n 4).
14 Pursuant to para 5, it had time for this until 3 July 2016.
15 ESMA, Draft Implementing Technical Standards on sanctions and measures under Regulation (EU) No 596/2014 on
market abuse (Final Report), ESMA/2016/1171, 26. June 2016.
426
C. Implementing technical standards (para 5)
Literature
Cools S, ‘Article 33: Exchange of Information with ESMA’ in Ventoruzzo M and Mock S (eds), Market
Walla F, ‘Capital Markets Supervision in Europe’ in Veil R (ed), European Capital Markets Law (2nd edn,
Oxford and Portland 2017)
427
ARTICLE 34
PUBLICATION OF DECISIONS
1. Subject to the third subparagraph, competent authorities shall publish any decision
imposing an administrative sanction or other administrative measure in relation to an
infringement of this Regulation on their website immediately after the person subject to
that decision has been informed of that decision. Such publication shall include at least
information on the type and nature of the infringement and the identity of the person
subject to the decision.
The first subparagraph does not apply to decisions imposing measures that are of an
investigatory nature.
Where a competent authority considers that the publication of the identity of the
legal person subject to the decision, or of the personal data of a natural person, would be
disproportionate following a case-by- case assessment conducted on the proportionality
of the publication of such data, or where such publication would jeopardise an ongoing
investigation or the stability of the financial markets, it shall do any of the following:
(a) defer publication of the decision until the reasons for that deferral cease to exist;
(b) publish the decision on an anonymous basis in accordance with national law where
such publication ensures the effective protection of the personal data concerned;
(c) not publish the decision in the event that the competent authority is of the opinion
that publication in accordance with point (a) or (b) will be insufficient to ensure:
(i) that the stability of financial markets is not jeopardised; or
(ii) the proportionality of the publication of such decisions with regard to measures
which are deemed to be of a minor nature.
Where a competent authority takes a decision to publish a decision on an anonymous basis
as referred to in point (b) of the third subparagraph, it may postpone the publication of
the relevant data for a reasonable period of time where it is foreseeable that the reasons for
anonymous publication will cease to exist during that period.
2. Where the decision is subject to an appeal before a national judicial, administrative or
other authority, competent authorities shall also publish immediately on their website such
information and any subsequent information on the outcome of such an appeal. Moreover,
any decision annulling a decision subject to appeal shall also be published.
3. Competent authorities shall ensure that any decision that is published in accordance with this
Article shall remain accessible on their website for a period of at least five years after its publica-
tion. Personal data contained in such publications shall be kept on the website of the competent
authority for the period which is necessary in accordance with the applicable data protection rules.
428
B. Objective of the provision
OVERVIEW
A. OBJECT AND STRUCTURE OF THE PROVISION OBLIGATION 34.006

34.001 D. NEED FOR IMPLEMENTATION AND
B. OBJECTIVE OF THE PROVISION 34.004 IMPLEMENTATION 34.011
C. CONTENT AND SCOPE OF THE PUBLICATION
A. OBJECT AND STRUCTURE OF THE PROVISION
Art 34 regulates the obligation of Member States to publish infringements of capital market 34.001
law (so-called naming and shaming).1
The systematic nature of Art 34 establishes a general obligation to publish administrative 34.002
sanctions as a rule, with exemptions in individual cases where conflicting interests prevail. The
balancing of interests provided for in Art 34 is necessary in view of the fundamental rights
affected by publication – above all the protection of data and personality (Art 8 ECHR, Arts
7 and 8 CFR).
It is noteworthy that the authority is provided with specific instructions for action in the 34.003
event of the existence of overriding reasons against publication in Art 34 para 1 subpara 3.
Accordingly, the publication must be deferred, made anonymous or not published at all.
These restrictions to the duty of publication do not rank next to each other in equal measure,
but their order appears to be mandatory. This follows first of all from the wording of Art 34,
where it says here that ‘[the competent authority] shall do any of the following [...]’ and the list
does not contain an ‘or’.2 Above all, however, the gradation of the alternative courses of action
with regard to their different intensity of intervention in the interests of the person affected by
the publication speaks in favour of an order of priority to be observed. Publication is only to be
dispensed with completely if neither subsequent disclosure (including the identity of the person
responsible) nor anonymous disclosure of the decision sufficiently ensures the protection of the
interests of the person concerned.3
B. OBJECTIVE OF THE PROVISION
Art 34 aims at ensuring that the publication of decisions of the competent authority has a deter- 34.004
rent effect on the general public.4 Thus, primarily general preventive purposes are pursued.
1 Klaus von der Linden, ‘Das neue Marktmissbrauchsrecht im Überblick’ (2016) 18 DStR 1036, 1041; Rüdiger Veil, ‘§ 12:
Sanktionen’ in Rüdiger Veil (ed), Europäisches Kapitalmarktrecht (2nd edn, Mohr Siebeck 2014) para 1; Sophie Cools,
‘Article 34: Publication of Decisions’ in Marco Ventoruzzo and Sebastian Mock (eds), Market Abuse Regulation (Oxford
University Press 2017) 519.
2 Differently, Recital 73.
3 cf Cools (n 1) 520.
4 Recital 73.
429
Article 34 PUBLICATION OF DECISIONS
34.005 Moreover, the publication of decisions is an important tool for the competent authorities to
inform market participants of what conduct is considered an infringement of market abuse
law.5 This objective is questionable with regard to the prescribed naming of the person
responsible and the resulting interference with fundamental rights. Market participants could
be informed about the contents of the MAR in the same way by less stringent means, such as
anonymous publication. However, the general public’s access to the rulings of the competent
supervisory authorities contributes to legal certainty in any case.
C. CONTENT AND SCOPE OF THE PUBLICATION OBLIGATION
34.006 The national supervisory authorities are required to publish on their website all decisions on
the imposition of sanctions or other measures due to an infringement of the MAR. In the
same way, any legal appeals or remedies against the decision of the national authority shall be
published. Information on the outcome of the legal proceedings must also be published on the
website (para 34.002).
34.007 Concerning the scope of the publication, Art 34 specifies a minimum content: In addition to
the ‘type and nature’ of the infringement, the identity of the person subject to the decision
must also be published. The explicit mention of the name of the infringer reflects the purpose
of the provision to publicly denounce market abuse misconduct.
34.008 In order to protect the personal rights and data protection interests of natural persons and legal
persons that are individually affected by such a publication, Art 34 para 1 subpara 3 provides for
the limit of proportionality. The differentiation in Art 34 para 1 subpara 3 between the protec-
tion of the ‘identity of the legal person subject to the decision’, on the one hand, and the protection
of the ‘personal data of a natural person’, on the other, is due to the fact that the GDPR only
covers natural persons, but not legal persons.6 The authority has to examine in each individual
case whether the interests which specifically oppose publication nevertheless justify a disclosure
of the persons responsible (i.e., the naming of the legal persons or personal data of a natural
person). When weighing up interests, any jeopardising of ongoing investigations and the sta-
bility of the financial markets must also be explicitly taken into account.
34.009 If the authority comes to the conclusion, after weighing up the interests involved, that it is
disproportionate to mention the name, Art 34 para 1 subpara 3 provides a priority order for
action: It must defer publication of the decision (including identity) until the reasons for that
deferral cease to exist. In this context, above all external circumstances, such as the termination
of an ongoing investigation, are to be taken into consideration. If the reasons for the deferral
no longer apply, the authority must publish the decision in anonymous form. This, however,
only to the extent that it is ensured that no conclusions can be drawn from the context of the
decision or other contents about the specific person behind it. If effective anonymisation cannot
5 Recital 73 sent 2.
6 Art 1 para 1 GDPR; cf Michael Potacs and Bernhard Raschauer, ‘Zur Problematik hoher Geldbußen im Unionsrecht –
am Beispiel der Datenschutzgrundverordnung’ (2017) 2 ÖZW 54, 55.
430
D. Need for implementation and implementation
be ensured in order to protect the right of personality or the stability of the financial markets,
the decision must not be published even in an anonymised form.7
In terms of time, Art 34 para 3 stipulates a minimum period of accessibility of the publication 34.010
of five years. At this point, reference is again made to the proportionality test to protect the
interests concerned. Thus, it may be that the publication at the time of the decision on the
infringement – i.e., at the time of the publication obligation – is proportionate in the light of all
interests, but this may change over the course of the five years. Art 34 para 3 is to be understood
in such a way that the authority has to take up a possibly disproportionate measure to protect
personal data. A publication is to be deleted if it is no longer ‘necessary’ – i.e., disproportionate
– in the light of conflicting interests.
D. NEED FOR IMPLEMENTATION AND IMPLEMENTATION
Art 34 was to be implemented in national law by 3 July 2016.8 The French legislator complied 34.011
with this Art by modifying Art L621–15 para V code monétaire et financier. The German
legislator implemented this Art by means of § 125 WpHG9. In the UK, the legislator created
s 391 para 8B FSMA10 in order to comply with Art 34. In Austria, this was complied with by
§§ 110, 145, 161 BörseG 201811 and by the identical predecessor provision § 48j Börsegesetz
1989 as amended by BGBl I 2016/76.12
Literature
Cools S, ‘Article 34: Publication of Decisions’ in Ventoruzzo M and Mock S (eds), Market Abuse
Kalss S and Oelkers J, ‘Öffentliche Bekanntgabe – ein wirksames Aufsichtsinstrument im
Kapitalmarktrecht?’ [2009] ÖBA 123
Potacs M and Raschauer B, ‘Zur Problematik hoher Geldbußen im Unionsrecht – am Beispiel der
Datenschutzgrundverordnung’ (2017) 2 ÖZW 54
Rüdiger Veil, ‘§ 12: Sanktionen’ in Rüdiger Veil (ed), Europäisches Kapitalmarktrecht (2nd edn, Mohr
Siebeck 2014)
von der Linden K, ‘Das neue Marktmissbrauchsrecht im Überblick’ (2016) 18 DStR 1036
7 cf Cools (n 1) 520.
8 Art 39 para 3.
431
ARTICLE 35
EXERCISE OF THE DELEGATION
Elisabeth Drach
1. The power to adopt delegated acts is conferred on the Commission subject to the condi-
tions laid down in this Article.
2. The power to adopt delegated acts referred to in Article 6(5) and (6), Article 12(5), the
third subparagraph of Article 17(2), Article 17(3), Article 19(13) and (14), and Article 38
shall be conferred on the Commission for a period of five years from 31 December 2019.
The Commission shall draw up a report in respect of the delegation of power not later
than nine months before the end of the five-year period. The delegation of power shall be
tacitly extended for periods of an identical duration, unless the European Parliament or the
Council opposes such extension not later than three months before the end of each period.
3. The delegation of power referred to in Article 6(5) and (6), Article 12(5), the third sub-
paragraph of Article 17(2), Article 17(3), Article 19(13) and (14) and Article 38, may be
revoked at any time by the European Parliament or by the Council. A decision of revo-
cation shall put an end to the delegation of the power specified in that decision. It shall
take effect the day following the publication of the decision in the Official Journal of the
European Union or at a later date specified therein. It shall not affect the validity of any
delegated acts already in force.
4. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the
European Parliament and to the Council.
5. A delegated act adopted pursuant to Article 6(5) or (6), Article 12(5), the third subpar-
agraph of Article 17(2), Article 17(3), Article 19(13) or (14) or Article 38, shall enter
into force only if no objection has been expressed either by the European Parliament or
the Council within a period of three months of notification of that act to the European
Parliament and the Council or if, before the expiry of that period, the European Parliament
and the Council have both informed the Commission that they will not object. That period
shall be extended by three months at the initiative of the European Parliament or the
Council.
35.001 So far, the Commission has adopted the following delegated act under Art 35 MAR:
Commission Delegated Regulation (EU) 2019/461 of 30 January 2019 amending Delegated

Regulation (EU) 2016/522 as regards the exemption of the Bank of England and the United
432
Elisabeth Drach - 9781800882249
Article 35 EXERCISE OF THE DELEGATION
Kingdom Debt Management Office from the scope of Regulation (EU) No 596/2014 of the
European Parliament and of the Council [2019] OJ L 80/10.1
The Commission has the power to adopt implementing and delegated acts based on other 35.002
Articles of the MAR as well. For completeness, all acts which have been adopted so far are
mentioned hereafter:2
● Commission Implementing Directive (EU) 2015/2392 of 17 December 2015 on Regulation

(EU) No 596/2014 of the European Parliament and of the Council as regards reporting to
competent authorities of actual or potential infringements of that Regulation [2015] OJ L
332/126;
● Commission Implementing Regulation (EU) 2016/347 of 10 March 2016 laying down
implementing technical standards with regard to the precise format of insider lists and for
updating insider lists in accordance with Regulation (EU) No 596/2014 of the European
Parliament and of the Council [2016] OJ L 65/49;
implementing technical standards with regard to the timing, format and template of the
submission of notifications to competent authorities according to Regulation (EU) No
596/2014 of the European Parliament and of the Council [2016] OJ L 72/1;
● Commission Delegated Regulation (EU) 2016/522 of 17 December 2015 supplementing
Regulation (EU) No 596/2014 of the European Parliament and of the Council as regards
an exemption for certain third countries public bodies and central banks, the indicators of
market manipulation, the disclosure thresholds, the competent authority for notifications
of delays, the permission for trading during closed periods and types of notifiable managers’
transactions [2016] OJ L 88/1;
implementing technical standards with regard to the format and template for notification
and public disclosure of managers’ transactions in accordance with Regulation (EU) No
596/2014 of the European Parliament and of the Council [2016] OJ L 88/19;
● Commission Delegated Regulation (EU) 2016/908 of 26 February 2016 supplementing
Regulation (EU) No 596/2014 of the European Parliament and of the Council laying down
regulatory technical standards on the criteria, the procedure and the requirements for estab-
lishing an accepted market practice and the requirements for maintaining it, terminating it
or modifying the conditions for its acceptance [2016] OJ L 153/3;
● Commission Delegated Regulation (EU) 2016/909 of 1 March 2016 supplementing
Regulation (EU) No 596/2014 of the European Parliament and of the Council with
regard to regulatory technical standards for the content of notifications to be submitted
to competent authorities and the compilation, publication and maintenance of the list of
notifications [2016] OJ L 153/13;
Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard
1 See also para 6.010.

2 cf European Commission, ‘Implementing and Delegated Acts on Regulation (EU) No 596/2014 of the European
Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive
2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/
EC and 2004/72/EC’ https://ec.europa.eu/info/sites/info/files/business_economy_euro/banking_and_finance/
documents/mar-level-2-measures-full_en.pdf accessed 20 April 2021.
433
Article 35 EXERCISE OF THE DELEGATION
to regulatory technical standards for the appropriate arrangements, systems and procedures
as well as notification templates to be used for preventing, detecting and reporting abusive
practices or suspicious orders or transactions [2016] OJ L 160/1;
to regulatory technical standards for the technical arrangements for objective presentation
of investment recommendations or other information recommending or suggesting an
investment strategy and for disclosure of particular interests or indications of conflicts of
interest [2016] OJ L 160/15;
● Commission Implementing Regulation (EU) 2016/959 of 17 May 2016 laying down
implementing technical standards for market soundings with regard to the systems and
notification templates to be used by disclosing market participants and the format of the
records in accordance with Regulation (EU) No 596/2014 of the European Parliament and
of the Council [2016] OJ L 160/23;
● Commission Delegated Regulation (EU) 2016/960 of 17 May 2016 supplementing
to regulatory technical standards for the appropriate arrangements, systems and procedures
for disclosing market participants conducting market soundings [2016] OJ L 160/29;
to regulatory technical standards for the conditions applicable to buy-back programmes and
stabilisation measures [2016] OJ L 173/34;
● Commission Implementing Regulation (EU) 2016/1055 of 29 June 2016 laying down
implementing technical standards with regard to the technical means for appropriate public
disclosure of inside information and for delaying the public disclosure of inside information
in accordance with Regulation (EU) No 596/2014 of the European Parliament and of the
Council [2016] OJ L 173/47;
● Commission Implementing Regulation (EU) 2017/1158 of 29 June 2017 laying down
implementing technical standards with regards to the procedures and forms for competent
authorities exchanging information with the European Securities Market Authority as
referred to in Article 33 of Regulation (EU) No 596/2014 of the European Parliament and
of the Council [2017] OJ L 167/22;
● Commission Implementing Regulation (EU) 2018/292 of 26 February 2018 laying down
implementing technical standards with regard to procedures and forms for exchange of
information and assistance between competent authorities according to Regulation (EU)
No 596/2014 of the European Parliament and of the Council on market abuse [2018] OJ
L 55/34;
● Commission Implementing Regulation (EU) 2020/1406 of 2 October 2020 laying down
implementing technical standards with regard to procedures and forms for exchange of
information and cooperation between competent authorities, ESMA, the Commission
and other entities under Articles 24(2) and 25 of Regulation (EU) No 596/2014 of the
European Parliament and of the Council on market abuse [2020] OJ L 325/7.
434
ARTICLE 36
COMMITTEE PROCEDURE
Elisabeth Drach
1. The Commission shall be assisted by the European Securities Committee established by

Commission Decision 2001/528/EC.1 That committee shall be a committee within the
meaning of Regulation (EU) No 182/2011.
2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No182/2011 shall
apply.
The European Securities Committee,2 which was set up by Commission Decision 2001/528/ 36.001
EC,3 assists the Commission. This Committee is a committee within the meaning of the
Comitology Regulation4 and consists of high level representatives of Member States.5
The Comitology Regulation sets out the mechanisms which apply where a legally binding 36.002
Union act requires the adoption of Commission implementing acts which are subject to the
control of Member States.6 This Regulation contains two procedures: The advisory procedure
(Art 4) and the examination procedure (Art 5).7
Art 36 para 2 MAR mandates the examination procedure if reference is made to this para- 36.003
graph. Only in Art 32 para 5 MAR such a reference is made; the Commission Implementing
Directive (EU) 2015/23928 is based thereon. Whether the Commission may adopt an act
1 Commission Decision 2001/528/EC of 6 June 2001 establishing the European Securities Committee (OJ L 191,
13.7.2001, p. 45).
2 For further information on the European Securities Committee see https://ec.europa.eu/info/business-economy-euro/
banking-and-finance/regulatory-process-financial-services/expert-groups-comitology-and-other-committees/european
-securities-committee_en accessed on 20 April 2021.
3 Commission Decision 2001/528/EC (n 1)
4 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the
rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of
implementing powers [2011] OJ L 55/13.
5 Art 3 Commission Decision 2001/528/EC.
6 Art 1 Regulation (EU) No 182/2011.
7 cf Paul Craig and Gráinne de Búrca (eds), EU Law (6th edn, Oxford University Press 2015) 142; Gregor Schusterschitz,
‘Art 291 AEUV’ in Heinz Mayer and Karl Stöger (eds), EUV/AEUV (Manz 2014) para 14.
8 Commission Implementing Directive (EU) 2015/2392 of 17 December 2015 on Regulation (EU) No 596/2014 of the
European Parliament and of the Council as regards reporting to competent authorities of actual or potential infringe-
ments of that Regulation [2015] OJ L 332/126.
435
Article 36 COMMITTEE PROCEDURE
under the examination procedure depends on the opinion given by the committee. The com-
mittee decides by qualified majority.9 The Commission adopts the draft implementing act if
the opinion is positive. If the opinion is negative, the act cannot be adopted. However, the
Commission may submit the act to the appeal committee,10 or submit an amended version of
the draft to the committee. If the committee delivers no opinion, the Commission can adopt
the draft implementing act. The adoption is prima facie not possible if a simple majority is
against the draft, the act concerns certain issues (e.g., taxation or the protection of the health or
safety of humans) or the basic act says otherwise.11
Literature
Craig P and de Búrca G (eds), EU Law (6th edn, Oxford University Press 2015)
Schusterschitz G, ‘Art 291 AEUV’ in Mayer H and Stöger K (eds), EUV/AEUV (Manz 2014)
9 The provisions of Art 16 paras 4 and 5 TEU apply to this majority (Art 5 para 1 Regulation (EU) No 182/2011).
10 See Art 6 Regulation (EU) No 182/2011 on the referral to the appeal committee.
11 Art 5 para 4 Regulation (EU) No 182/2011; see also Craig and de Búrca (n 7) 143.
436
ARTICLE 37
REPEAL OF DIRECTIVE 2003/6/EC AND ITS
IMPLEMENTING MEASURES
Elisabeth Drach
Directive 2003/6/EC and Commission Directives 2004/72/EC, 2003/125/EC1 and 2003/124/

EC2 and Commission Regulation (EC) No 2273/20033 shall be repealed with effect from
3 July 2016. References to Directive 2003/6/EC shall be construed as references to this
Regulation and shall be read in accordance with the correlation table set out in Annex II to
this Regulation.
The Market Abuse Directive4 is repealed with this provision. This repeal applies accordingly 37.001
to the three Commission Implementing Directives5 and the Buy-back Programmes and
Stabilisation Regulation 2273/2003.6 Whenever reference is made to the MAD, this reference
shall be understood as reference to the MAR. For this reason, Annex II to the Regulation
contains a correlation table.7
1 Commission Directive 2003/125/EC of 22 December 2003 implementing Directive 2003/6/EC of the European
Parliament and of the Council as regards the fair presentation of investment recommendations and the disclosure of
conflicts of interest (OJ L 339, 24.12.2003, p. 73).
2 Commission Directive 2003/124/EC of 22 December 2003 implementing Directive 2003/6/EC of the European
Parliament and of the Council as regards the definition and public disclosure of inside information and the definition of
market manipulation (OJ L 339, 24.12.2003, p. 70).
3 Commission Regulation (EC) No 2273/2003 of 22 December 2003 implementing Directive 2003/6/EC of the
European Parliament and of the Council as regards exemptions for buy-back programmes and stabilisation of financial
instruments (OJ L 336, 23.12.2003, p. 33).
manipulation [2003] OJ L 96/16.
5 Commission Directive 2003/124/EC (n 2); Commission Directive 2003/125/EC (n 1); Commission Directive 2004/72/
EC of 29 April 2004 implementing Directive 2003/6/EC of the European Parliament and of the Council as regards
accepted market practices, the definition of inside information in relation to derivatives on commodities, the drawing up
of lists of insiders, the notification of managers' transactions and the notification of suspicious transactions [2004] OJ L
162/70.
6 Commission Regulation (EC) No 2273/2003 (n 3).
7 cf Sebastian Mock, ‘Article 37: Repeal of Directive 2003/6/EC and its implementing measures’ in Marco Ventoruzzo
and Sebastian Mock (eds), MAR (Oxford University Press 2017) B.37.01; Heinz-Dieter Assmann, ‘Artikel 37 MAR:
Aufhebung der Richtlinie 2003/6/EG und ihrer Durchführungsmaßnahmen’ in Heinz-Dieter Assmann, Uwe Schneider
and Peter Mülbert (eds), Wertpapierhandelsrecht (7th edn, Otto Schmidt 2019) paras 2 f.
437
Article 37 REPEAL OF DIRECTIVE 2003/6/EC AND ITS IMPLEMENTING MEASURES
Literature
Assmann H-D, ‘Artikel 37 MAR: Aufhebung der Richtlinie 2003/6/EG und ihrer
Durchführungsmaßnahmen’ in Assmann H-D, Schneider U and Mülbert P (eds), Wertpapierhandelsrecht
Mock S, ‘Article 37: Repeal of Directive 2003/6/EC and its implementing measures’ in Ventoruzzo M
and Mock S (eds), MAR (Oxford University Press 2017)
438
ARTICLE 38
REPORT
Elisabeth Drach
By 3 July 2019, the Commission shall submit a report to the European Parliament and to the
Council on the application of this Regulation, together with a legislative proposal to amend it
if appropriate. That report shall assess, inter alia:
(a) the appropriateness of introducing common rules on the need for all Member States to
provide for administrative sanctions for insider dealing and market manipulation;
(b) whether the definition of inside information is sufficient to cover all information rele-
vant for competent authorities to effectively combat market abuse;
(c) the appropriateness of the conditions under which the prohibition on trading is man-
dated in accordance with Article 19(11) with a view to identifying whether there are any
further circumstances under which the prohibition should apply;
(d) the possibility of establishing a Union framework for cross-market order book surveil-
lance in relation to market abuse, including recommendations for such a framework; and
(e) the scope of the application of the benchmark provisions.
For the purposes of point (a) of the first subparagraph, ESMA shall undertake a mapping
exercise of the application of administrative sanctions and, where Member States have
decided, pursuant to the second subparagraph of Article 30(1), to lay down criminal sanctions
as referred to therein for infringements of this Regulation, of the application of such criminal
sanctions within Member States. That exercise shall also include any data made available
under Article 33(1) and (2).
By 3 July 2019, the Commission shall, after consulting ESMA, submit a report to the
European Parliament and to the Council on the level of the thresholds set out in Article 19(1a)
(a) and (b) in relation to managers’ transactions where the issuer’s shares or debt instruments
form part of a collective investment undertaking or provide exposure to a portfolio of assets,
with a view to assessing whether that level is appropriate or should be adjusted.
The Commission shall be empowered to adopt delegated acts in accordance with Article 35
adjusting the thresholds in Article 19(1a)(a) and (b), if it determines in that report that those
thresholds should be adjusted.
The Commission consulted ESMA on 20 March 2019 for technical advice on the report which 38.001
the Commission was supposed to submit to the European Parliament and to the Council by 3
439
Article 38 REPORT
July 2019.1 To comply with this task, ESMA created a consultation paper2 first, and summa-
rised the responses in a review of the MAR3 in September 2020. This review will contribute to
the report of the Commission.4
Literature
ESMA, ‘Consultation paper: MAR Review report’, ESMA 70–156–1459, 3 October 2019
ESMA, ‘MAR Review report‘, ESMA 70–156–2391, 23 September 2020
European Commission, ‘Re: Formal request to ESMA for technical advice on the report to be submitted
by the Commission under Article 38 of Regulation (EU) No 596/2014 on Market Abuse’, letter of 20
March 2019 https://www.esma.europa.eu/sites/default/files/library/esma_art_38_mar_mandate.pdf
accessed on 21 April 2021
1 European Commission, ‘Re: Formal request to ESMA for technical advice on the report to be submitted by the
Commission under Article 38 of Regulation (EU) No 596/2014 on Market Abuse’, letter of 20 March 2019 https://www
.esma.europa.eu/sites/default/files/library/esma_art_38_mar_mandate.pdf accessed on 21 April 2021.
2 ESMA, ‘Consultation paper: MAR Review report’, ESMA 70-156-1459, 3 October 2019.
3 ESMA, ‘MAR Review report’, ESMA 70-156-2391, 23 September 2020.
4 cf ESMA, ‘MAR Review report’ (n 3) 12.
440
ARTICLE 39
ENTRY INTO FORCE AND APPLICATION
Elisabeth Drach
1. This Regulation shall enter into force on the twentieth day following that of its publication
in the Official Journal of the European Union.
2. It shall apply from 3 July 2016 except for:
(a) Article 4(2) and (3), which shall apply from 3 January 2018; and
(b) Article 4(4) and (5), Article 5(6), Article 6(5) and (6), Article 7(5), Article 11(9), (10)
and (11), Article 12(5), Article 13(7) and (11), Article 16(5), the third subparagraph
of Article 17(2), Article 17(3), (10) and (11), Article 18(9), Article 19(13), (14) and
(15), Article 20(3), Article 24(3), Article 25(9), the second, third and fourth subpara-
graphs of Article 26(2), Article 32(5) and Article 33(5), which shall apply from 2 July
2014.
3. Member States shall take the necessary measures to comply with Articles 22, 23 and 30,
Article 31(1) and Articles 32 and 34 by 3 July 2016.
4. References in this Regulation to Directive 2014/65/EU and Regulation (EU) No 600/2014
shall, before 3 January 2018, be read as references to Directive 2004/39/EC in accordance
with the correlation table set out in Annex IV to Directive 2014/65/EU in so far as that
correlation table contains provisions referring to Directive 2004/39/EC.
Where reference in the provisions of this Regulation is made to OTFs, SME growth markets,
emission allowances or auctioned products based thereon, those provisions shall not apply to
OTFs, SME growth markets, emission allowances or auctioned products based thereon until
3 January 2018.
This Regulation shall be binding in its entirety and directly applicable in all Member States.
This regulation was published in the Official Journal of the European Union on 12 June 2014.1 39.001
The articles mentioned in para 2 lit b entered into force on the 20th day thereafter, on 2 July
2014.2 The other articles, except for Art 4 paras 2 and 3, applied only by 3 July 2016 (see also
1 OJ L 137/1.
2 Heinz-Dieter Assmann, ‘Artikel 39 MAR: Inkrafttreten und Geltung’ in Heinz-Dieter Assmann, Uwe Schneider and
Peter Mülbert (eds), Wertpapierhandelsrecht (7th edn, Otto Schmidt 2019) paras 2 f.
441
Article 39 ENTRY INTO FORCE AND APPLICATION
para 3 for the articles, which were to be implemented in national law by the Member States3).4
Art 4 paras 2 and 3 applied by 3 January 2018.5
39.002 As MiFID II and MIFIR applied by 3 January 2018, references made to these acts were
construed as references to MiFID I until this date (see also the correlation table in Annex IV
to Directive 2014/65/EU).6 Provisions which refer to OTFs, SME growth markets, emission
allowances or auctioned products based thereon applied only by 3 January 2018 as well.7
Literature
Assmann H-D, ‘Artikel 39 MAR: Inkrafttreten und Geltung’ in Assmann H-D, Schneider U and
Mülbert P (eds), Wertpapierhandelsrecht (7th edn, Otto Schmidt 2019)
Mock S, ‘Article 39: Entry into force and application’ in Ventoruzzo M and Mock S (eds), MAR (Oxford
3 See also paras 22.004ff, 23.006 f, 23.011 f, 30.010ff, 31.003, 32.014, 34.011.
4 cf Sebastian Mock, ‘Article 39: Entry into Force and Application’ in Marco Ventoruzzo and Sebastian Mock (eds), MAR
(Oxford University Press 2017) B.39.02 f; Assmann (n 2) paras 3 f.
5 cf Mock (n 4) B.39.04; Assmann (n 2) para 3.
6 Art 39 para 4 subpara 1 MAR; see also Mock (n 4) B.39.04; Assmann (n 2) para 5.
7 Art 39 para 4 subpara 2 MAR; see also Mock (n 4) B.39.04; Assmann (n 2) para 6.
442
ANNEX I
A. INDICATORS OF MANIPULATIVE BEHAVIOUR RELATING TO FALSE OR

MISLEADING SIGNALS AND TO PRICE SECURING
For the purposes of applying point (a) of Article 12(1) of this Regulation, and without prejudice
to the forms of behaviour set out in paragraph 2 of that Article, the following non-exhaustive
indicators, which shall not necessarily be deemed, in themselves, to constitute market manipu-
lation, shall be taken into account when transactions or orders to trade are examined by market
participants and competent authorities:
(a) the extent to which orders to trade given or transactions undertaken represent a signifi-
cant proportion of the daily volume of transactions in the relevant financial instrument,
related spot commodity contract, or auctioned product based on emission allowances, in
particular when those activities lead to a significant change in their prices;
(b) the extent to which orders to trade given or transactions undertaken by persons with
a significant buying or selling position in a financial instrument, a related spot commod-
ity contract, or an auctioned product based on emission allowances, lead to significant
changes in the price of that financial instrument, related spot commodity contract, or
auctioned product based on emission allowances;
(c) whether transactions undertaken lead to no change in beneficial ownership of a financial
instrument, a related spot commodity contract, or an auctioned product based on emis-
sion allowances;
(d) the extent to which orders to trade given or transactions undertaken or orders cancelled
include position reversals in a short period and represent a significant proportion of the
daily volume of transactions in the relevant financial instrument, a related spot com-
modity contract, or an auctioned product based on emission allowances, and might be
associated with significant changes in the price of a financial instrument, a related spot
commodity contract, or an auctioned product based on emission allowances;
(e) the extent to which orders to trade given or transactions undertaken are concentrated
within a short time span in the trading session and lead to a price change which is subse-
quently reversed;
(f) the extent to which orders to trade given change the representation of the best bid or
offer prices in a financial instrument, a related spot commodity contract, or an auctioned
product based on emission allowances, or more generally the representation of the order
book available to market participants, and are removed before they are executed; and
443
ANNEX I
(g) the extent to which orders to trade are given or transactions are undertaken at or around
a specific time when reference prices, settlement prices and valuations are calculated and
lead to price changes which have an effect on such prices and valuations.
B. INDICATORS OF MANIPULATIVE BEHAVIOUR RELATING TO THE EMPLOYMENT

OF A FICTITIOUS DEVICE OR ANY OTHER FORM OF DECEPTION OR
CONTRIVANCE
For the purposes of applying point (b) of Article 12(1) of this Regulation, and without prej-
udice to the forms of behaviour set out in paragraph 2 of that Article thereof, the following
non-exhaustive indicators, which shall not necessarily be deemed, in themselves, to constitute
market manipulation, shall be taken into account where transactions or orders to trade are
examined by market participants and competent authorities:
(a) whether orders to trade given or transactions undertaken by persons are preceded or
followed by dissemination of false or misleading information by the same persons or by
persons linked to them; and
(b) whether orders to trade are given or transactions are undertaken by persons before or after
the same persons or persons linked to them produce or disseminate investment recom-
mendations which are erroneous, biased, or demonstrably influenced by material interest.
444
ANNEX II
Table Annex Correlation table
This Regulation Directive 2003/6/EC

Article 1
Article 2
Article 2(1)(a) Article 9, first paragraph
Article 2(1)(b)
Article 2(1)(c)
Article 2(1)(d) Article 9, second paragraph
Article 2(3) Article 9, first paragraph
Article 2(4) Article 10(a)
Point (1) of Article 3(1) Article 1(3)
Point (2) of Article 3(1)
Points (14) to (35) of Article 3(1)
Article 4
Article 5 Article 8
Article 6(1) Article 7
Article 6(2)
Article 6(3)
Article 6(4)
Article 6(5)
Article 6(6)
Article 6(7)
Article 7(1)(a) Article 1(1), first paragraph
Article 7(1)(b) Article 1(1), second paragraph
Article 7(1)(c)
Article 7(1)(d) Article 1(1), third paragraph
Article 7(2)
Article 7(3)
Article 7(4)
445
ANNEX II

Article 7(5)
Article 8(1) Article 2(1), first subparagraph
Article 8(2)
Article 8(2)(a) Article 3(b)
Article 8(2)(b)
Article 8(3)
Article 8(4)(a) Article 2(1)(a)
Article 8(4)(b) Article 2(1)(b)
Article 8(4)(c) Article 2(1)(c)
Article 8(4)(d) Article 2(1)(d)
Article 8(4), second subparagraph Article 4
Article 8(5) Article 2(2)
Article 9(1)
Article 9(2)
Article 9(3)(a) Article 2(3)
Article 9(3)(b) Article 2(3)
Article 9(4)
Article 9(5)
Article 9(6)
Article 10(1) Article 3(a)
Article 10(2)
Article 11
Article 12(1)
Article 12(1)(d)
Article 12(2)(a) Article 1(2), first indent of second paragraph
Article 12(2)(b) Article 1(2), second indent of second paragraph
Article 12(2)(c)
Article 12(2)(d) Article 1(2), third indent of second paragraph
Article 12(2)(e)
Article 12(3)
Article 12(4)
Article 12(5) Article 1(2), third paragraph
Article 13(1) Article 1(2)(a), second paragraph
Article 13(2)
Article 13(3)
Article 13(4)
Article 13(5)
Article 13(6)
Article 13(7)
Article 13(8)
Article 13(9)
Article 13(10)
Article 13(11)
Article 14(a) Article 2(1), first paragraph
Article 14(b) Article 3(b)
Article 14(c) Article 3(a)
Article 15 Article 5
446
ANNEX II

Article 16(3)
Article 16(4)
Article 16(5) Article 6(10), seventh indent
Article 17(1), third subparagraph Article 9, third paragraph
Article 17(2)
Article 17(3)
Article 17(5)
Article 17(6)
Article 17(7)
Article 17(8) Article 6(3), first and second subparagraph
Article 17(9)
Article 17(10) Article 6(10), first and second indent
Article 17(11)
Article 18(1) Article 6(3), third subparagraph
Article 18(2)
Article 18(3)
Article 18(4)
Article 18(5)
Article 18(6)
Article 18(7) Article 9, third paragraph
Article 18(8)
Article 18(9) Article 6(10), fourth indent
Article 19(1)(a) Article 6(4)
Article 19(1)(b)
Article 19(2)
Article 19(3)
Article 19(4)(a)
Article 19(4)(b)
Article 19(5) to (13)
Article 19(14) Article 6(10), fifth indent
Article 19(15) Article 6(10), fifth indent
Article 20(3) Article 6(10), sixth indent and Article 6(11)
Article 21 Article 1(2)(c), second sentence
Article 22 Article 11, first paragraph and Article 10
Article 23(1)(d) Article 12(1)(d)
Article 23(2)(c)
Article 23(2)(d) Article 12(2)(c)
Article 23(2)(e)
Article 23(2)(f)
447
ANNEX II

Article 23(2)(g) Article 12(2)(d)
Article 23(2)(h) Article 12(2)(d)
Article 23(2)(i) Article 12(2)(g)
Article 23(2)(j) Article 12(2)(f)
Article 23(2)(k) Article 12(2)(e)
Article 23(2)(l) Article 12(2)(h)
Article 23(2)(m) Article 6(7)
Article 23(3)
Article 23(4)
Article 24(1) Article 15a(1)
Article 24(2) Article 15a(2)
Article 24(3)
Article 25(1) first subparagraph Article 16(1)
Article 25(2) Article 16(2) and Article 16(4), fourth subparagraph
Article 25(2)(a) Article 16(2), first indent of second subparagraph and Article
16(4) fourth subparagraph
Article 25(2)(b)
Article 25(2)(c) Article 16(2), second indent of second subparagraph and Article
16(4), fourth subparagraph
Article 25(2)(d) Article 16(2) third indent of second subparagraph and Article
16(4) fourth subparagraph
Article 25(3)
Article 25(4) Article 16(2), first sentence
Article 25(7) Article 16(2), fourth subparagraph fourth subparagraph and
Article 16(4)
Article 25(8)
Article 26
Article 27(1)
Article 27(2)
Article 27(3) Article 13
Article 28
Article 29
Article 30(1) first subparagraph Article 14(1)
Article 30(1)(a)
Article 30(1)(b) Article 14(3)
Article 30(2)
Article 30(3)
Article 31
Article 32
Article 33(1) Article 14(5), first subparagraph
Article 33(2)
Article 33(3) Article 14(5), second subparagraph
Article 33(4) Article 14(5), third subparagraph
Article 33(5)
Article 34(2)
Article 34(3)
Article 35
448
ANNEX II

Article 36(2)
Article 38
Annex
449
INDEX
Accepted market practice see Market practice, probability/magnitude test see Inside
accepted information, probability/magnitude
ACER see Cooperation, ACER test
Acts of deception 12.017 protracted process see Inside information,
Ad hoc disclosure 17.001ff protracted process
attribution of knowledge see Inside public domain 17.024
information, attribution of knowledge reasonable investor see Inside information,
bonds 17.003, 19.001 reasonable investors
confidentiality see Inside information, rumour see Inside information, rumours
confidentiality Administrative authority see Competent
deadline see Inside information, deadline authorities, administrative authorities
delay see Inside information, delay Artificial price level see Market manipulation,
disclosure of inside information 17.017ff, artificial price level
17.065 Attempt
duty of confidentiality see Inside information, see Market manipulation, attempt
duty of confidentiality see Prohibition of insider dealing, attempt
ESMA 17.102 Attribution of knowledge
final event 17.034 see Inside information, attribution of
financial stability 17.111 knowledge
future events 17.036 see Prohibition of insider dealing, attribution
FMA 17.090 of knowledge
group see Inside information, group Austrian Press Council 20.013
inside information 17.017 Authority, competent see Competent authorities
intermediate step see Inside information,
Benchmark 2.014 f, 3.059, 15.010, 15.012
intermediate steps
manipulation 12.030
issuer 17.009 f
Birnbaum-rule 30A.059
M&A see Inside information,
Blanket order cancellation policies 8.069
M&A transactions
Bonds
misleading see Inside information, misleading
see Ad hoc disclosure, bonds
precise information see Inside information,
see Directors’ dealings, bonds
precise information
Buy-back programme 3.042, 5.013ff
price relevance see Inside information, price
relevance Cancellation of orders see Prohibition of insider
price specificity see Inside information, price dealing, cancellation of orders
specificity Central Bank of Ireland see Regulatory authority,
private enforcement see Private enforcement national
CFR, see Powers, CFR
Chinese wall 9.015, 18.048
450
INDEX
Choice of court agreements 30A.044, 30A.065, Cooperation agreements

30A.081ff ESMA 26.001 f, 26.012ff
charter clause 30A.083 MoU 25.020 f
prospectus clause 30A.084 f third countries 25.020 f, 26.001, 26.003ff
Choice of law agreements 30A.081, 30A.087ff Cooperation obligation
charter clause 30A.088ff see Directors’ dealings, obligation to
prospectus clause 30A.088ff cooperate
Class action 30A.018, 30A.025, 30A.044 grounds for refusal 25.005
Close economic relationship see Directors’ of ESAs 24.001ff, 24.006 f, 25.001
dealings, close economic relationship Cornering 12.035
Close family ties see Directors’ dealings, close Credit institution 3.016 f
family ties
Data protection
Commodity 3.038
ESMA 27.002, 27.010
Commodity derivative see Financial instruments,
see Insider lists, destruction
commodity derivative
third countries 27.002, 27.010 f
Competence see Competent authorities
Data traffic records 3.057
local see Competent authorities, local
requesting see Powers, requesting existing
competence
data traffic records
substantive see Competent authorities,
Deadline see Inside information, deadline
substantive competence
Delay see Inside information, delay
Competent authorities 3.036
Derivative contracts 2.013
administrative authorities 22.012 f
Derivatives see Financial instruments, derivatives
direct applicability 22.004ff
Direct applicability
independence 22.014
see Competent authorities, direct applicability
judicial authorities 22.012 f
see Powers, direct applicability
local competence 22.018
Directors’ dealings 19.001ff
organisation 22.007, 22.009
asset managers 19.028
substantive competence 22.017
authorised signatory 19.045
term 22.011
bonds 19.018
Compliance organisation 9.014ff
capital increase 19.033
Confidentiality see Inside information,
close economic relationship 19.059ff
confidentiality
close family ties 19.052ff
Conflict of laws 30A.066ff
currency 19.074
negotiable instruments 30A.068
disclosure 19.085ff
non-contractual obligations 30A.067
dual mandate 19.060ff
law of companies 30A.069
duty to notify 19.078ff
lex auctoritatis competentis 30A.079
employee options 19.076
lex domicilii communis 30A.076
gifts 19.034, 19.075, 19.091
lex loci damni 30A.071ff, 30A.077
inheritance 19.034, 19.075, 19.091
lex societatis 30A.069, 30A.078
insolvency administrator 19.045
principle of supremacy 30A.070
life insurance 19.030
Cooperation
list of persons subject to the notification
ACER 25.010
obligation 19.082ff
ESAs and EU authorities 25.001ff, 25.015
MTF 19.013ff
ESMA 24.001ff, 24.006 f, 25.009
obligated parties 19.113
MAR infringements 25.015
obligation to cooperate 19.083
third countries 26.001ff
451
INDEX
occurence of conditions 19.023, 19.032 conciliation procedure, cooperation of

OTF 19.013ff authorities 25.016ff
persons closely associated 19.047ff see Cooperation, ESMA
persons discharging managerial see Cooperation agreements, ESMA
responsibilities 19.038ff see Data protection, ESMA
phantom stocks 19.019, 19.032 implementation authorisations, cooperation
pledging 19.024ff 24.008
private foundation 19.068 implementation authorisations, MoU 25.022,
relatives see Directors’ dealings, close family 26.016
ties see Insider lists, ESMA
remuneration programmes 19.031 European Supervisory Authorities 24.004 f
sanctions 19.112ff see Cooperation, ESAs and EU authorities
securities lending 19.034 see Cooperation obligation of ESAs
signal effect 19.008
False information see Market manipulation, false
stock appreciation rights 19.019, 19.032
information
subscription rights 19.033
Fault see Market manipulation, fault
template 19.092
Final event see Ad hoc disclosure, final event
threshold 19.070ff
Financial analyst 20.001
time of notification 19.085ff
Financial Conduct Authority see Regulatory
trading prohibition see Trading prohibition
authority, national
UCITS 19.029
Financial holding companies 3.018
Disclosing market participant see Market
Financial institution 3.018 f
participant, disclosing
Financial instruments 3.001ff
Disclosure
associated instruments 3.069
see Directors’ dealings, disclosure
commodity derivative 3.053
see Inside information, disclosure
derivatives 3.002
of inside information see Ad hoc disclosure
money market instruments 3.002
upon onward disclosure of inside information
Financial intermediary 30A.049, 30A.085
17.079
Financial market supervision see Regulatory
Distribution see Significant distribution
authority, national
Duty to notify see Directors’ dealings, duty to
Financial stability see Ad hoc disclosure, financial
notify
stability
Emission allowances 2.009 f, 3.044 f FMA see Regulatory authority, national
see Inside information, emission allowances see Ad hoc disclosure, FMA
market participant 3.046ff Forecasts 20.007
see Insider lists, emission allowance Fraud-on-the-market theory 30A.024 f, 30A.035,
market participants 30A.037, 30A.040
related undertaking 3.047 Freedom of the press 21.013
see Prohibition of insider dealing, emission Freezing of assets see Powers, freezing of assets
allowances Frontrunning 8.083, 9.037, 9.073
see Tipping, emission allowances Future events see Ad hoc disclosure, future events
Enforcement of obligations see Private
Group see Inside information, group
enforcement
ESFS 24.004 f Hedging 8.092
ESMA High-frequency trading 3.063
see Ad hoc disclosure, ESMA House search see Powers, house searches
452
INDEX
Independence see Competent authorities, rumours 17.104, 17.110

independence sanctions 17.116ff
Information dissemination system 17.071 spin-offs 17.097
Inside information 17.001ff, 17.017ff trading incentive 17.045ff
acquisitions 17.097 transactions subject to approval 17.098 f
see Ad hoc disclosure, inside information updating 17.078
attribution of knowledge 8.034ff, 17.012ff use 8.066ff
conditions for delay 17.090, 17.093ff Insider
confidentiality 17.024ff, 17.106ff see Primary insider
content of notification 17.070ff see Professional insider
correction 17.078 see Secondary insider
deadline 17.077 Insider dealing 8.028ff
delay 17.080ff see Prohibition of insider dealing
delay resolution 17.087 Insider lists 18.001ff
disclosure 17.065ff auction monitor 18.008
due diligence review 17.056, 17.058 auction platforms 18.008
duty of confidentiality 17.012 f auctioneers 18.008
emission allowances 17.113 ff content 18.025
group 17.010, 17.014 cumulative obligation 18.006
insolvency 17.016 data to be included 18.030ff
intermediate steps 17.033 f, 17.038, 17.049ff, declaration of acknowledgement 18.043ff
17.057ff content 18.047ff
invention 17.100 duty to inform 18.047ff
knowledge 8.029ff form 18.052
letter of intent 17.056, 17.058 refusal to sign 18.051
M&A transactions 17.022 f, 17.074ff, 17.109 repetition of duty to inform 18.053ff
market 17.015 service providers 18.049
mergers 17.097 template 18.050
misleading 17.102ff time of duty to inform 18.053ff
obligated party 17.009 destruction 18.058, 18.062
one-tier model 17.018 electronic list management 18.035
ongoing negotiations 17.095 emission allowance market participants
passing on 17.079 18.008
precautionary exemption 17.089 ESMA 18.006
precise information 17.029ff event-based section 18.027 f
presumption of use 8.083ff lifespan 18.028
price relevance 17.042ff, 17.057ff format templates 18.026
price specificity 17.039ff functions 18.002
prior notification 17.066 issuers, exemptions 18.011
probability/magnitude test 17.059ff issuers, financial instruments 18.007
prohibition of marketing 17.067 MTF 18.007
protective law 17.119 OTF 18.007
protracted process 17.033, 17.049ff, 17.054ff regulated market 18.007
reasonable investors 17.045ff issuers, persons acting on behalf of the issuer
rebuttal of presumption of use 9.001ff 18.009ff
reference to issuer 17.009, 17.020ff case groups 18.010
restructurings 17.097 issuers, service providers 18.009
453
INDEX
language 18.024 Investment firm 3.004ff

maintenance 18.058 Investment recommendation 3.065 f, 20.001
calculation of time limit 18.061 IOSCO MMoU 26.017 f
data protection, 18.058 Irrevocable undertakings 9.062
period 18.059ff Issuance calendar 20.008
need to know principle 18.058 Issuer 3.049
obligation to draw up a list 18.001, 18.045 see Ad hoc disclosure, issuer
outsourcing 18.045 see Inside information, reference to issuer
right to access 18.046 see Insider lists, issuer
obligation to inform 18.044ff
Journalists’ privilege 20.012 f
obligation to update 18.037ff
Judicial authority see Competent authorities,
case groups 18.039 f
judicial authorities
cessation 18.042
referral see Powers, referral to judicial
time limit 18.041
authorities
trigger 18.037 f
occasion 18.015ff Lead broker see Market maker
permanent insider section 18.029 Legal framework 1.001ff
persons entitled to access 18.058 Level of enforcement 30A.015
persons to be included 18.017ff distributive side effects 30A.015
authorised access 18.019 over-deterrence 30A.015
case groups 18.020ff Liability of the tippee 8.115ff
objection 18.023 knowledge 8.119ff
reference to issuer 18.017 f legal persons 8.123 f
relief 18.012ff use 8.116ff
sanctions 18.063ff Life insurance see Directors’ dealings, life
administrative violations 18.063 f insurance
violation of protective law 18.065 List see Directors’ dealings, list of persons subject
scope of application 18.003ff to the notification obligation
SME growth markets 18.034, 18.036
M&A
time 18.015 f, 18.032
see Inside information, M&A transactions
shadow lists 18.016
see Prohibition of insider dealing, M&A
transmission obligation 18.056 f
Managers’ transactions see Directors’ dealings
Intermediate step see Inside information,
Market maker 3.060
intermediate steps
see Market manipulation, market maker
International jurisdiction 30A.044
see Prohibition of insider dealing, market
actor sequitur forum rei 30A.045 f
maker
consumer contracts 30A.047ff
Market manipulation 12.001ff
torts 30A.050ff
artificial price level 12.008, 12.014, 12.022
locus damni 30A.051 f, 30A.054ff,
attempt 12.032, 15.001ff
30A.063
false information 12.012, 12.028
locus delicti commissi 30A.051 f,
false signals 12.008, 12.012 f, 12.022
30A.063ff
fault 12.031 f
principle of concentration 30A.052,
market maker 5.042
30A.061, 30A.063
misleading information 12.012 f, 12.026,
principle of ubiquity 30A.051ff
12.029
Investigatory powers see Powers, supervisory and
misleading signals 12.008, 12.012 f, 12.022
investigatory powers
454
INDEX
price manipulation 12.001ff, 12.020ff procedure 4.004ff

rumours 12.024 financial instruments 4.005, 4.007
trade-based manipulation 12.001ff parties subject to notification obligation
Market operator 3.020ff 4.004ff
Market participant thresholds see Prohibition of insider dealing,
disclosing 3.062, 11.003ff, 11.008 f, 11.012ff, notification thresholds
11.017ff time see Directors’ dealings, time of
emission allowances see Emission allowances, notification
market participant
Obligation to cooperate see Cooperation
Market practice, accepted 3.032 f, 5.005, 5.042,
obligation
13.001, 13.011ff
Obtaining information see Powers, obtaining
Market, regulated see Regulated market
information
Marketplace principle 17.003
On-site inspections see Powers, on-site inspections
Measures to ensure public is correctly informed see
OTF 3.021, 3.029ff
Powers, measures to correctly inform the
see Directors’ dealings, OTF
public
see Insider lists, issuers, financial instruments
Media 21.006
Out-of-pocket loss 30A.034 f, 30A.040, 30A.060
Media sector exemption 21.001
Own shares 5.001 f, 5.013ff, 5.024, 5.026, 5.029
Memorandum of Understanding
see Cooperation agreements, MoU Passing on see Inside information, passing on
see ESMA, implementation authorisations, Person 3.037, 3.055 f
MoU Person discharging managerial responsibilities
Mergers 9.054, 9.056 3.054, 5.046 f, 30A.028
see Inside information, mergers see Directors’ dealing, persons discharging
Minimum catalogue see Powers, minimum managerial responsibilities
catalogue Persons closely associated to persons discharging
Misleading see Inside information, misleading managerial responsibilities see Directors’
information see Market manipulation, dealings, persons closely associated
misleading information Phantom stocks see Directors’ dealings, phantom
signals see Market manipulation, misleading stocks
signals Plaintiff investor 30A.049, 30A.054, 30A.056,
Mobilisation of financial resources 6.006 30A.085
Monetary and exchange rate policy 6.002 Powers
Money market instruments see Financial CFR 23.005
instruments, money market instruments direct applicability 23.004
MTF 3.021, 3.027 f, 3.031 freezing of assets 23.012
see Directors’ dealings, MTF house searches 23.015
see Insider lists, issuers, financial instruments measures to correctly inform the public
23.021
National regulatory authority see Regulatory
minimum catalogue 23.001 f, 23.009, 23.011
authority, national
obtaining information 23.016
Notification
on-site inspection 23.014 f
content see Inside information, content of
referral to judicial authorities 23.017
notification
requesting existing data traffic records 23.019
obligation 4.001ff
requesting recordings of telephone
financial instruments 4.001, 4.003
conversations 23.018
list 4.001ff
seizures 23.015
455
INDEX
supervisory and investigatory powers 23.011 f cancellation of orders 8.057ff

temporary cessation of practices 23.020 civil law 14.014ff
Precise information see Inside information, precise conditionally concluded transactions 8.049
information counterparty 9.031
Price manipulation see Market manipulation, price criminal law 14.009ff
manipulation damages 14.016
Price relevance see Inside information, price due diligence 8.077 f
relevance emission allowances 8.062
Price specificity see Inside information, price execution of orders 9.034ff
specificity exemptions 9.007ff, 9.029ff
Primary insider 8.012ff for the account of others 8.053
administrative bodies 8.016 intermediaries 8.054ff
professional insider 8.018 f legal persons 8.008ff, 8.024ff, 8.034ff,
shareholder 8.017 8.063ff, 8.095 f, 9.007ff
Private enforcement 30A.001ff M&A 8.077 f, 9.049ff, 9.065ff
Ad hoc disclosure 30A.017ff market maker 9.029 f
Austria 30A.040 master plan 8.077 f, 9.051, 9.066 f
France 30A.037 misrepresentation 14.015
Germany 30A.030ff notification thresholds 9.071
Ireland 30A.042 nullity 14.015
Italy 30A.038 option 8.050 f
Netherlands 30A.041 presumption of use see Inside information,
Portugal 30A.036 presumption of use
Spain 30A.039 subjective offence 8.013, 8.021ff
Sweden 30A.043 takeover bids 9.049ff
United Kingdom 30A.025ff transactions without remuneration 8.047
United States 30A.018ff Protective law 30A.040 f
Effet utile 30A.010ff inside information see Inside information,
Institutional balance 30A.014 protective law
Fragmentation 30A.003 f, 30A.012ff Protracted process see Inside information,
National tort laws 30A.002ff, 30A.017ff protracted process
Regulatory competence 30A.002, 30A.005 Public debt management 6.002ff
Principle of subsidiarity 30A.006 Public domain see Ad hoc disclosure, public
Probability/magnitude test see Inside information, domain
probability/magnitude test Pure economic loss 30A.043, 30A.055, 30A.072
Professional insider 8.018 f Pure financial loss see Pure economic loss
Professional secrecy 26.001 f, 26.004, 26.006,
Reasonable investor 12.013
26.009ff, 27.001, 27.004ff
see Inside information, reasonable investors
Prohibition of insider dealing 8.028ff
Recording of telephone conversations see Powers,
acquisition and disposal 8.044ff
requesting recordings of telephone
acquisition intention 9.068ff
conversations
administrative offences 14.013
Regulated market 2.004, 3.023ff
advantage 8.079ff
see Insider lists, issuers, financial instruments
aim 8.003, 14.003
Regulatory authority, national 3.052
attempt 14.004ff
Autorité des Marchés Financiers 22.007
attribution of knowledge 8.034ff
456
INDEX
Bundesanstalt für Sponsor, designated see Market maker

Finanzdienstleistungsaufsicht 7.018, Spot commodity contract 2.012, 3.039 f
7.029, 13.020, 18.005 f, 18.016, Spot market 3.041
18.049 f, 19.015, 19.031 f, 19.061ff, Stabilisation 3.071
19.103, 22.007 Stabilisation measures 5.002ff, 5.033ff
Central Bank of Ireland 30A.042 Stake-building 3.061, 9.065ff
Financial Conduct Authority 13.020, 22.007, Statistics 20.001, 20.007, 20.010
30A.025 Stock appreciation rights see Directors’ dealings,
Finanzmarktaufsicht 5.028, 5.040, 7.008, stock appreciation rights
13.018 f, 16.011, 17.004, 17.090ff, Subject matter 1.001ff
18.005 f, 18.016, 18.050, 19.001, Supervisory powers, see Powers, supervisory and
19.063ff, 19.093, 20.008 investigatory powers
Securities Exchange Commission 30A.018 f
Takeover bids see Prohibition of insider dealing,
Relatives see Directors’ dealings, close family ties
takeover bids
Rescissory damages 30A.034 f, 30A.040 f
Temporary cessation of practices see Powers,
Requesting existing data traffic records see Powers,
temporary cessation of practices
requesting existing data traffic records
Tipping 8.097ff
Rules of professional conduct 21.013
emission allowances 8.106
Rumour
induce 8.108 f
see Inside information, rumours
legal person 8.113 f
see Market manipulation, rumours
on the basis of inside information 8.110ff
Safe harbour 5.003, 13.006 passing on a recommendation 8.099
Scalping 12.035 f, 21.017 Trading
Scienter 30A.023 algorithmic 3.043
Scope of application 2.001ff high-frequency see High-frequency trading
Secondary insider 8.021ff professional 3.058
Securities 3.068 Trading prohibition 19.098ff
Securities Exchange Commission see Regulatory competence 19.110
authority, national emergency sale 19.107
Securities lending see Directors’ dealings, securities exemptions 19.106ff
lending time period 19.099ff
Seizures see Powers, seizures voluntary 19.104
Signal 12.011 Trading system
effect see Directors’ dealings, signal effect multilateral trading facility see MTF
false see Market manipulation, false signals organised trading facility see OTF
misleading see Market manipulation, Trading venue 2.002ff, 3.034
misleading signals Transactions of persons discharging managerial
Significant distribution 3.070 responsibilities on their own account see
SME growth market 3.028, 3.035 Directors’ dealings
see Insider lists, SME growth market
Watch list 9.016
Specialist see Market maker
Wholesale energy product 3.050 f
Spector case 8.083ff
457

EU Market Abuse Regulation A Commentary On Regulation (EU) No 5962014

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EU Market Abuse Regulation A Commentary On Regulation (EU) No 5962014

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© The Editors and Contributors Severally 2021

Based on translations by Donna Stockenhuber

Edward Elgar Publishing, Inc.

A catalogue record for this book

Library of Congress Control Number: 2021947960

This book is available electronically in the

ISBN 978 1 80088 223 2 (cased)

4 Notifications and list of financial instruments 29

5 Exemption for buy-back programmes and stabilisation 33

9 Legitimate behaviour 115

10 Unlawful disclosure of inside information 138

11 Market soundings 153

12 Market manipulation 168

13 Accepted market practices 181

14 Prohibition of insider dealing and of unlawful disclosure of inside information 189

15 Prohibition of market manipulation 194

16 Prevention and detection of market abuse 198

17 Public disclosure of inside information 202

18 Insider lists 242

19 Managers’ transactions 260

20 Investment recommendations and statistics 295

21 Disclosure or dissemination of information in the media 300

22 Competent authorities 306

23 Powers of competent authorities 314

24 Cooperation with ESMA 324

25 Obligation to cooperate 329

26 Cooperation with third countries 340

27 Professional secrecy 347

28 Data protection 352

29 Disclosure of personal data to third countries 353

30 Administrative sanctions and other administrative measures 354

30A Appendix to Art 30 MAR – Private enforcement 360

31 Exercise of supervisory powers and imposition of sanctions 414

32 Reporting of infringements 418

33 Exchange of information with ESMA 424

34 Publication of decisions 428

35 Exercise of the delegation 432

36 Committee procedure 435

37 Repeal of Directive 2003/6/EC and its implementing measures 437

39 Entry into force and application 441

ARTICLE 1 SUBJECT MATTER

O. SPOT COMMODITY CONTRACT (15) 3.039

ARTICLE 4 NOTIFICATIONS AND LIST OF FINANCIAL INSTRUMENTS

ARTICLE 5 EXEMPTION FOR BUY-BACK PROGRAMMES AND STABILISATION

ARTICLE 6 EXEMPTION FOR MONETARY AND PUBLIC DEBT

ARTICLE 7 INSIDE INFORMATION

ARTICLE 8 INSIDER DEALING

ARTICLE 9 LEGITIMATE BEHAVIOUR

ARTICLE 10 UNLAWFUL DISCLOSURE OF INSIDE INFORMATION

ARTICLE 11 MARKET SOUNDINGS

ARTICLE 12 MARKET MANIPULATION

ARTICLE 13 ACCEPTED MARKET PRACTICES

ARTICLE 14 PROHIBITION OF INSIDER DEALING AND OF UNLAWFUL

ARTICLE 15 PROHIBITION OF MARKET MANIPULATION

ARTICLE 16 PREVENTION AND DETECTION OF MARKET ABUSE

ARTICLE 17 PUBLIC DISCLOSURE OF INSIDE INFORMATION

ARTICLE 18 INSIDER LISTS

3. Time limit  18.041

ARTICLE 19 MANAGERS’ TRANSACTIONS

ARTICLE 20 INVESTMENT RECOMMENDATIONS AND STATISTICS

ARTICLE 21 DISCLOSURE OR DISSEMINATION OF INFORMATION IN THE MEDIA

ARTICLE 22 COMPETENT AUTHORITIES

ARTICLE 23 POWERS OF COMPETENT AUTHORITIES

4 Notifications and list of financial instruments 29

5 Exemption for buy-back programmes and stabilisation 33

9 Legitimate behaviour 115

10 Unlawful disclosure of inside information 138

11 Market soundings 153

12 Market manipulation 168

13 Accepted market practices 181

14 Prohibition of insider dealing and of unlawful disclosure of inside information 189

15 Prohibition of market manipulation 194

16 Prevention and detection of market abuse 198

17 Public disclosure of inside information 202

18 Insider lists 242

19 Managers’ transactions 260

20 Investment recommendations and statistics 295

21 Disclosure or dissemination of information in the media 300

22 Competent authorities 306

23 Powers of competent authorities 314

24 Cooperation with ESMA 324

25 Obligation to cooperate 329

26 Cooperation with third countries 340

27 Professional secrecy 347

28 Data protection 352

29 Disclosure of personal data to third countries 353

30 Administrative sanctions and other administrative measures 354

30A Appendix to Art 30 MAR – Private enforcement 360

31 Exercise of supervisory powers and imposition of sanctions 414

32 Reporting of infringements 418

33 Exchange of information with ESMA 424

34 Publication of decisions 428

35 Exercise of the delegation 432

36 Committee procedure 435

37 Repeal of Directive 2003/6/EC and its implementing measures 437

39 Entry into force and application 441

O. SPOT COMMODITY CONTRACT (15) 3.039

3. Time limit 18.041

(a) Ireland 30A.042

ARTICLE 35 EXERCISE OF THE DELEGATION432

ARTICLE 36 COMMITTEE PROCEDURE435

ARTICLE 38 REPORT439

ARTICLE 39 ENTRY INTO FORCE AND APPLICATION441

Case C-617/10 Akerberg-Fransson [2013] ECLI:EU:C:2013:10523.005

Salabiaku vs France, App no 10519/83 (ECtHR, 7 October 1988)8.085

BVwG 14.2.2019, W210 2195872-1/6E, Wiener Privatbank 7.017; 7.029; 17.062

BVwG 21.8.2019, W148 2196914-117.062

BioPorto, Vestre Landsret 26.8.2014, UfR 2014.3464 V7.016

AMF CDS, 23 November 2006, SAN-2007-0211.003

CA Paris, 2 February 2010, no 09/026237.024

BGH 6.11.2003 1 StR 24/03, Sascha Opel 7.011; 7.035; 12.035

Corte di Cassazione, 20 January 2010, no 85887.019

Hoge Raad 5.7.2011, 08/04981 E, Veer Palthe Voûte7.032

Supremo Tribunal de Justiça 5.4.2016, case no Az. 127/10.0TBPDL.L1.S130A.036

Sentencia de la Audiencia Nacional, 20 November 2006, no 217/06 7.018; 7.034

Hövrätt för Västra Sverige, 20 Feburary 2008, B 2944-07, RH 2009-297.012

Bundesstrafgericht, 8.6.2017, SK.2017.3, Santhera7.016

Arif Mohammed v FSA UK FSMT, 29 March 20057.015

Recital 187.006 Article 2 para 1 lit c 2.008; 22.017

Article 18 para 1 18.003–18.005; 18.018; Article 23 para 1 lit a23.006

Article 14 para 330A.090 Article 12 24.005; 25.005; 26.016

Regulation (EU) No 1215/2012 of the European Article 26 para 15.028

Commission Delegated Regulation (EU) 2016/522 Recital 213.013

Commission Delegated Regulation (EU) Article 55.033

Commission Implementing Regulation (EU) Recital 610.026

Council Directive 89/592/EEC of 13 November Article 3 para 1 8.023; 11.007

Article 4 para 1 (1)3.004 Directive 2011/61/EU of the European

Section 157 17.117; 30.012 Section 1 para 113.019

Sections 4ff3.026 Market Abuse (Directive 2003/6/EC) Regulations