Fighting insider dealing at all costs?—due process aspects on the EU market abuse regime

Abstract

... In February 2021, the Court of Justice of the European Union (the Court or the ECJ) delivered a ruling on the right to remain silent in insider dealing cases.1 The Grand Chamber ruling, which could already be considered a landmark, highlights the lack of procedural safeguards in the current EU market abuse regime and the risks that such a lack entails. This article examines the Union’s market abuse regime against the backdrop of the Court’s ruling in DB v Consob and discusses the implications of pursuing a market abuse regime with a one-eyed focus on effectiveness at the expense of procedural safeguards and fundamental rights. Companies listed on a stock exchange will have to accept and abide by a number of rules and requirements; be it the obligations imposed by the listing agreement or by national laws and regulations. At European Union (EU) level, the Market Abuse Regulation (the MAR) provides a common regulatory framework on market abuse.2 Born out of the financial crisis in 2008, it places a strong emphasis on effectiveness and deterrence, imposing strict obligations on listed companies and making sure that infringements will not go unpunished. Alongside an arsenal of substantial administrative sanctions—where natural persons may have to pay as much as €5 million in fines and lose their fit and proper status—EU Member States are required to criminalize market abuse and to ensure that the offences are punishable by certain terms of imprisonment.3