Abuse Regulation Research Articles

Market Abuse Regulation and the Quality of Analyst Reports in Korea: Evidence from Analyst Characteristics

This study examines the impact of market abuse regulation on the quality of analyst reports in Korea. To compensate for the limitations of the old Capital Market Act, the Market Abuse Regulation provision was incorporated into the revised Capital Market Act and enforced in July 2015. The key feature of the new regulation is that it expands the scope of insider information; punishes not only the direct receiver, but also the n-th receiver of material information that is not released to the public; enables an easier enforcement of punishment becomes easier as the authority can impose monetary penalties without upper limitation. With the samples of analysts issuing reports both in pre- and post-regulation periods, I find that the market abuse regulation decreases the accuracy of analyst and forecast optimism, while it increases forecast dispersion at the analyst level. The effect of the regulation varies with the analysts’ characteristics, such as previous performance, changes in performance, and coverage of firms. Overall, analysts no longer benefit from the selective disclosure of information and have less incentive to maintain their optimism. The evidence indirectly indicates there is no increase in the public information that may substitute the private channels of insider information. Several additional analyses are conducted such as the impact of the regulation on Chaebol-affiliated analysts and the changes in the precision of public and private information and its effect on earnings forecast accuracy after the regulation.

Elevated fear responses to threatening cues in rats with early life stress is associated with greater excitability and loss of gamma oscillations in ventral-medial prefrontal cortex

Stress experienced early in development can have profound influences on developmental trajectories and ultimately behaviors in adulthood. Potent stressors during brain maturation can profoundly disrupt prefrontal cortical areas in particular, which can set the stage for prefrontal-dependent alterations in fear regulation and risk of drug abuse in adulthood. Despite these observations, few studies have investigated in vivo signaling in prefrontal signals in animals with a history of early life stress (ELS). Here, rats with ELS experienced during the first post-natal week were then tested on a conditioned suppression paradigm during adulthood. During conditioned suppression, electrophysiological recordings were made in the ventral medial prefrontal cortex (vmPFC) during presentations of a fear-associated cue that resolved both single-unit activity and local field potentials (LFPs). Relative to unstressed controls, ELS-experienced rats showed greater fear-related suppression of lever pressing. During presentations of the fear-associated cue (CS+), neurons in the vmPFC of ELS animals showed a significant increase in the probability of excitatory encoding relative to controls, and excitatory phasic responses in the ELS animals were reliably of higher magnitude than Controls. In contrast, vmPFC neurons in ELS subjects better discriminated between the shock-associated CS+ and the neutral (“safe”) CS− cue than Controls. LFPs recorded in the same locations revealed that high gamma band (65–95 Hz) oscillations were strongly potentiated in Controls during presentation of the fear-associated CS+ cue, but this potentiation was abolished in ELS subjects. Notably, no other LFP spectra differed between ELS and Controls for either the CS+ or CS−. Collectively, these data suggest that ELS experience alters the neurobehavioral functions of PFC in adulthood that are critical for processing fear regulation. As such, these alterations may also provide insight into increased susceptibility to other PFC-dependent processes such as risk-based choice, motivation, and regulation of drug use and relapse in ELS populations.

COVID-19 profit warnings: Delivering bad news in a time of crisis

Profit warnings (large negative earnings surprises) are important corporate reporting documents for delivering bad news and a distinctive corporate communication genre. The 2020 COVID-19 exogenous shock provides a unique worldwide crisis context for company disclosure of bad news.The research develops a genre-based typology/analytical framework for assessing COVID-19 profit warnings’ quality comprising: (1) Four profit warning/forecast quality characteristics and (2) Eight profit warning/forecast disclosures. For a sample of 160 profit-warning documents, the research manually analyses their content, culminating in a disclosure quality score/index. The research tests a model of the factors influencing disclosure quality.The research finds companies regress to silence when investors most need guidance and poor-quality disclosure, coy ambiguous language, possibly reflecting minimal regulatory guidance on this form of corporate report. Two variables are significant – Profit warnings disclosed following Financial Reporting Council guidance are of higher quality and quality varies by industry. The paper finds faux disclosure and the performativity of disclosure, which may allow boards of directors to tick-box compliance with market abuse regulations. The paper concludes with recommendations for policymakers on improvements required to enhance the quality of these highly important corporate documents.

THE LEGAL POSITION OF WORKERS AS PREFERRED CREDITORS WHO BECOME THE APPLICANT FOR BANKRUPTCY AGAINST THE COMPANY

This study aims to trace the contradictions of sentencing arrangements in child sexual abuse crimes in Aceh after the enactment of Qanun No. 6 of 2014 with Law No. 35 of 2014 on Child Protection. The regulation of child sexual abuse punishment in jinayat law in Aceh has different interpretations from other laws and regulations, including Law No. 35 of 2014 on Child Protection. So the essence of the deterrent effect for perpetrators that should be part of the goal of criminalization is not so achieved. In addition, Qanun Jinayat also has the potential for impunity for the government with Article 9 and Article 11 Qanun No. 6 of 2014 on the reasons for justification and forgiving reasons. The method used in this paper is a normative juridical method, using secondary data or library data. The study results showed that in Aceh, there had been a dualism of the legal regulation of child sexual abuse. The provisions of qanun jinayat are still many shortcomings in providing protection and rights for children as victims, so law enforcement tends to choose positive laws. It is recommended that the Aceh government to harmonize the law between jinayat law provisions and positive laws relating to sexual harassment.

Methoxphenidine (MXP) induced abnormalities: Addictive and schizophrenia‐related behaviours based on an imbalance of neurochemicals in the brain

Methoxphenidine is a dissociative-based novel psychoactive designer drug. Although fatal accidents from methoxphenidine abuse have been reported, recreational use of the drug continues. We aim to provide scientific supportfor legal regulation of recreational abuse of methoxphenidine by demonstrating its the pharmacological action. Addictive potential of methoxphenidine was examined using intravenous self-administration test with rats and conditioned place preference test with mice. Further, a series of behavioural tests (open field test, elevated plus maze test, novel object recognition test, social interaction test and tail suspension test) performed to assess whether methoxphenidine caused schizophrenia-related symptoms in mice. Additionally, neurotransmitter enzyme-linked immunosorbent assay and western blot were used to confirm methoxphenidine-induced neurochemical changes in specific brain regions related to abnormal behaviours. Methoxphenidine caused addictive behaviours via reinforcing and rewarding effects. Consistently, methoxphenidine induced over-activation of dopamine pathways in the nuclear accumbens, indicating activation of the brain reward circuit. Also, methoxphenidine caused all categories of schizophrenia-related symptoms, including positive symptoms (hyperactivity, impulsivity), negative symptoms (anxiety, social withdrawal, depression) and cognitive impairment. Consistently, methoxphenidine led to the disruption of the hippocampal-prefrontal cortex pathway that is considered to be pathological involved in schizophrenia. We demonastrate that methoxphenidine causes addictive and schizophrenia-like behaviours and induces neurochemical changes in brain regions associated with these behaviours. We propose that methoxphenidine could be used in developing useful animal disease models and that it also requires legal restrictions on its recreational use.

The Inside Information Regime of the MAR andthe Rise of the ESG Era

Abstract The rise in ESG investing has been characterized as an “investor revolution” and a manifestation of “social change”. The current coronavirus pandemic will arguably intensify the impact of such social change, with the “S” and “G” components of ESG, in particular, having been brought into sharper focus during the crisis. The issue of the extent to which ESG factors are (currently) of considerable importance – and, in particular, are likely to become even more so in the future – for the performance of share prices remains a highly controversial one in financial economics. However, where an empirically substantiated impact of ESG-related information on the prices of financial instruments can be shown, the question of whether such information is also of relevance to the inside information regime of the Market Abuse Regulation (“MAR”) arises and must be answered. This article explores the potential impact of ESG-related information and an increase in ESG-compliant investments on the prohibition on insider dealing and the obligation to publicly disclose inside information. We believe that the ESG preferences of a critical mass of real-life investors and, as a corollary, ESG-related information, are and will continue to be of great importance to the inside information regime. However, the intense debate regarding the precise depiction of the ‘reasonable investor’ within the meaning of Art. 7 MAR indicates that the relevance of ESG-related information to the inside information regime of the MAR is by no means clear. In light of these uncertainties, and given its efforts to promote sustainable finance, the EU legislature would be well advised to further specify the concept of inside information with a particular focus on ESG-related information.

СТРАТЕГІЧНІ НАПРЯМИ ПУБЛІЧНОГО УПРАВЛІННЯ ОХОРОНОЮ ЗДОРОВ’Я ТВАРИН У ФРАНЦІЇ: ДОСВІД ДЛЯ УКРАЇНИ

This paper summarizes the arguments within the scientific discussion on the issue of application of strategic management in the activities of public authorities that implement national policy in the field of animal health. The relevance of the research topic is due to the growing need of citizens to solve problems related to animal health and welfare of the territory in terms of dangerous zoonotic diseases. The main purpose of the research is to identify strategic directions of public animal health management on the example of leading European countries. The object of research is France as the country closest to Ukraine in size, administrative-territorial division, population, diversity of lands, the structure of livestock, which opens similar prospects for farmers and the food industry. The paper presents results of a study of institutional and legal bases of the system of veterinary medicine governance in France, which showed the use of strategic management. The mission of the French State Veterinary Service, which is to protect animal health, public veterinary health, the environment, have been characterized. The basic provisions of the National Animal Welfare Strategy of France for 2016–2020 have been clarified. It is noted that this Strategy is aimed at scientific support of production, strengthening veterinary controls and sanctions, innovation, modernization of the educational system, the regulation of animal abuse, empowering stakeholders at all levels. It is emphasized that the purpose of implementation of the Strategy is to mobilize the efforts of all stakeholders for the development of animal husbandry and ensure animal welfare as one of the national priorities. Public veterinary health and animal welfare have been identified as strategic directions of public animal health management in France for the last 5 years. The results of the research can be useful for drafting the mission and strategic priorities (goals) for the development of the veterinary medicine system in Ukraine, taking into account the recommendations of international organizations and the experience of developed foreign countries.

Some Reflections on the Self-insider and the Market Abuse Regulation – The Self-insider as a Monopoly-Square Insider

Abstract This article deals with the self-insider, i. e. the possible creation of the inside information by a person and its (abusive) exploitation. It describes the situation in Germany and in Italy and provides a taxonomy of the several cases of self-insider. The article then analyzes the case law of the ECJ and the MAR regulatory provisions for justifying/neglecting the existence of the self-insider (Article 9.5 and 9.6 MAR). Given the unclear regulatory answer regarding its sanctionability, the article proposes, based on the economics of MAR, a law and economics reason of why the self-insider sometime should be sanctioned, by describing it as a peculiar monopolistic behavior able to distort investors’ confidence and market integrity. Finally, the article suggests that the European legislator should explicitly deal with the problem.

The role of nociceptin in opioid regulation of brain functions

This review discusses our current knowledge on the nociceptin/orphanin (N/OFQ) system regarding its role in regulation of brain functions. Nociceptin receptor (NOPr) was identified in 1994 [Bunzow et al., 1994; Mollereau et al., 1994]. In 1995 a 17 amino acid endogenous peptide was found to be the high-affinity ligand for the NOPr [Reinscheid et al., 1995]. N/OFQ has a broad spectrum of activity and can act as on opioid-like as well as an anti-opioid peptide. Considering high level of N/OFQ and NOPr mRNA expression in the limbic brain regions, the N/OFQ/NOP system is suggested to be involved in regulation of emotions, resward, pain sensitivity, stress responsibility, sexual behavior, aggression, drug abuse and addiction. However it is still not well understood whether an increased vulnerability to drugs of abuse may be associated with dysregulation of N/OFQ/NOP system. Current review further highlights a need for further research on N/OFQ/NOP system as it could have clinical utility for substance abuse, depression, and anxiety pharmacotherapy.

Epigenetic and non-coding regulation of alcohol abuse and addiction.

Alcohol use disorder is a chronic debilitated condition adversely affecting the lives of millions of individuals throughout the modern world. Individuals suffering from an alcohol use disorder diagnosis frequently have serious cooccurring conditions, which often further exacerbates problematic drinking behavior. Comprehending the biochemical processes underlying the progression and perpetuation of disease is essential for mitigating maladaptive behavior in order to restore both physiological and psychological health. The range of cellular and biological systems contributing to, and affected by, alcohol use disorder and other comorbid disorders necessitates a fundamental grasp of intricate functional relationships that govern molecular biology. Epigenetic factors are recognized as essential mediators of cellular behavior, orchestrating a symphony of gene expression changes within multicellular environments that are ultimately responsible for directing human behavior. Understanding the epigenetic and transcriptional regulatory mechanisms involved in the pathogenesis of disease is important for improving available pharmacotherapies and reducing the incidence of alcohol abuse and cooccurring conditions.

Algorithmic Trading, High-frequency Trading: Implications for MiFID II and Market Abuse Regulation (MAR) in the EU

Modern financial markets are increasingly faster, larger, more complex and more interconnected. Regulating such a dynamic environment is one of the most challenging endeavours for regulators and policymakers. This paper offers a systematic examination of ongoing financial transformation due to algorithmic trading and its various innovative forms and presents the regulatory response to this emerging marketplace with a particular focus on MiFID II and MAR. This paper also identifies risks and perils by highlighting the shortcomings in the regulations emanating from the diverse nature of algorithms and their inherent complexity. Drawing from rich extant literature of regulatory response to innovation, artificial intelligence and algorithmic trading, this paper offers further insights for better understanding the complexity and systematic risks involved, thus advocates a dynamic and flexible response from regulators and policymakers to these new challenges.

The Inside Information Regime of the MAR and the Rise of the ESG Era

The rise in ESG investing has been characterized as an “investor revolution” and a manifestation of “social change”. The current coronavirus pandemic will arguably intensify the impact of such social change, with the “S” and “G” components of ESG, in particular, having been brought into sharper focus during the crisis. The issue of the extent to which ESG factors are (currently) of considerable importance – and, in particular, are likely to become even more so in the future – for the performance of share prices remains a highly controversial one in financial economics. However, where an empirically substantiated effect of ESG-related information on the prices of financial instruments can be shown, the question of whether such information is also of relevance to the inside information regime of the Market Abuse Regulation (“MAR”) arises and must be answered. This article explores the potential effect of ESG-related information and an increase in ESG-compliant investments on the prohibition on insider dealing and the obligation to publicly disclose inside information. We believe that the ESG preferences of a critical mass of real-life investors and, as a corollary, ESG-related information, are and will continue to be of great importance to the inside information regime. However, the intense debate regarding the precise depiction of the ‘reasonable investor’ within the meaning of Art. 7 MAR indicates that the relevance of ESG-related information to the inside information regime of the MAR is by no means clear. In light of these uncertainties, and given its efforts to promote sustainable finance, the EU legislature would be well advised to further specify the concept of inside information with a particular focus on ESG-related information.

The subtle relationship between paragraphs 1, 4, 7 and 8 of Article 17 of the Market Abuse Regulation

markdownabstract__Key points__ • Article 17 MAR sets out the legal framework with respect to the disclosure of inside information. Article 17(1) MAR contains the primary duty to disclose inside information and stipulates that the issuer must disclose inside information that directly concerns that issuer. Article 17(4) MAR grants the issuer the possibility to delay the disclosure of inside information if three cumulative conditions are met; once one or more conditions are no longer met, the primary duty revives. • In addition to the primary duty, two separate duties to disclose have been included in Article 17 MAR: i) Article 17(8) MAR stipulates that the issuer must make complete and public disclosure of inside information that is disclosed to selected parties and ii) if the issuer had opted to delay the disclosure of inside information, Article 17(7) MAR stipulates that the issuer must make complete and public disclosure of that information if it has lost its confidential nature. • One could raise doubts over the necessity and function of Paragraphs 8 and 7 of Article 17 MAR. However, in this Paper we defend the independent status of these Paragraphs. If the inside information has lost its non-public nature, the duty to disclose that information can no longer be based on Article 17(1) MAR. Paragraphs 8 and 7 of Article 17 MAR contribute to legal certainty and to achieving the goals of the MAR.

Failure to Prevent Market Abuse: A Potential New Corporate Criminal Offence?

On 7 April 2020, the Financial Conduct Authority (FCA) published its 2020/21 Business Plan, in which the regulator renewed its commitment to developing clean markets, robust in their resistance to the threat of market abuse (FCA Business Plan 2020/ 21 accessible athttps://www.fca.org.uk/publication/businessplans/ business-plan-2020-21.pdf.). In its statement, the regulator, facing growing instability in the markets brought about by the COVID-19 pandemic, warned against the risk posed by the ‘opportunity for poor behaviour’, cautioning that where the FCA finds poor practice it would ‘clamp down with all relevant force’. This posturing is not new: rooting out and punishing market abuse has consistently been a high priority for the regulator in meeting its key statutory objectives of protecting consumers, enhancing market integrity and promoting competition (Financial Services and Markets Act 2000, section 1b.). Set against the increasing likelihood that the UK economy is about to enter a deep phase of recession, this focus shows no sign of abating. However, there remains ongoing debate over the most effective means of neutralizing the threat posed by market abusers. One potential model, already developed in other areas of economic crime – specifically in the area of corporate bribery and tax offending – is an extension of the so-called failure to prevent (‘FTP’) model of corporate liability (3 April 2019, Lisa Osofsky ‘Fighting fraud and corruption in a shrinking world’ available at https://www.sfo.gov.uk/2019/ 04/03/fighting-fraud-and-corruption-in-a-shrinking-world/.). This approach would see a shift away from the ‘identification’ principle, in which corporate criminal liability is predicated on establishing a ‘directing mind and will’ of the company and towards a focus on wider corporate malfeasance. While the desire for such an extension of liability is easy to understand from a regulatory perspective, the existing FTP model in force in this country, in the area of corporate bribery and tax offending, requires close examination before serious consideration is given to such a course, as well as careful consideration given to the effectiveness of the FCA’s existing policy of personal accountability, given effect through the Senior Managers Certification Regime (‘SMCR’). Market abuse, corporate criminal offence, failure to prevent, EU Market Abuse Regulation 2014, whistleblowers.

‘Madamina, Il Catalogo E’ Questo…’. the Duty to Disclose Inside Information and the Proper Organization of the Company: The Market Abuse Regulation (‘MAR’) and Italian Company Law.

The duty of an issuer to disclose inside information to the public as soon as possible is set out by Article 17 MAR, and notoriously aims at satisfying market transparency, and facilitating the price formation mechanism. This requirement is primarily addressed to satisfy the needs of the public and of the market, in line with the Efficient Capital Markets Hypothesis that underpins the entire construction of MAR. However, the disclosure obligation also has significant internal impacts on the organization of the company, which also need to be adequately framed and understood according to the general provisions of company law contained in the Italian civil code. The interrelationships between MAR and general corporate law provisions seem to entail many consequences as to the matter under discussion. First of all, with regard to the ways in which directors provide adequate safeguards for compliance with disclosure regulations; secondly, with regard to liability profiles; finally, with regard to the flow of information within companies and groups of companies. In fact, the disclosure regime of inside information is relevant both in terms of compliance with MAR and in terms of compliance with the rules that refer to the need for companies to have a proper business organization (as set out, first of all, for all kinds of companies by Article 2086 of the Italian Civil Code, as recently amended). Therefore, the disclosure of inside information also plays an internal role, as complying with those rules has a relevant impact within the company’s structure and organization. This also entails several consequences upon the issuer in terms of liability for breach of the disclosure regime set out by the European Regulation.

Some Reflections on the Self-insider and the Market Abuse Regulation – The Self-insider as a Monopoly-Square Insider

This article deals with the self-insider, i.e. the possible creation of the inside information by a person and its (abusive) exploitation. It describes the situation in Italy and Germany and then provides a taxonomy of the several cases of self-insider. The article then analyzes the case law of the ECJ and the MAR regulatory provisions for justifying/neglecting the existence of the self-insider (Article 9.5 and 9.6 MAR). Given the unclear regulatory answer regarding its sanctionability, the article proposes, based on the economics of MAR, a law and economics reason of why the self-insider sometime should be sanctioned, by describing it as a peculiar monopolistic behavior able to distort investors’ confidence and market integrity. Finally, the article suggests that the European legislator should explicitly deal with the problem.

SREP Exercise and Resolution Planning Outcomes as Inside Information under MAR

When it comes to banks, disclosure – as a means towards market discipline – can be considered from the standpoint of both Basel’s Pillar 3 and (in case of listed banks) the Market Abuse Regulation. Especially in the latter context, it is controversial whether the specific layer of information consisting of a) the ECB’s measures taken when performing the yearly Supervisory Review and Evaluation Process (SREP), i.e. the so called SREP decision, and b) the resolution planning (including the setting of MREL levels), which the Single Resolution Board is responsible for, have to be considered as inside information under MAR. As it is apparent, this issue is highly critical when such disclosure reveals that a bank is in financial distress, as far as disclosure could potentially prompt an idiosyncratic crisis. According to the ESMA’s position, in both of the above-mentioned cases each credit institution has to assess, under its own responsibility, whether decisions taken by Supervision and Resolution Authorities, under SREP and resolution planning, actually have to be disclosed. This paper focuses on SREP exercise and resolution planning (including MREL calibration) decisions, assessing their relevance as inside information under the requirements of precision and price-sensitivity set out in Article 7 MAR, and the subsequent existence of an obligation to disclose under Article 17 MAR. The relevance of the SREP’s draft letter is also considered in this respect. Moreover, the paper investigates whether, and to what extent, a single bank’s stability concern can be considered as a «legitimate interest» for delaying disclosure, either under Article 17(5) MAR (that is, when there is a public interest in delaying disclosure in order to preserve the financial system’s stability) or under Article 17(4) MAR (when delay meets the need of preserving the issuer’s legitimate interests).

Can Finance Help Save the Planet? The Case of Emission Allowances and MiFID II.

While the structure and the mechanisms that underpin the functioning of the EU ETS system are, by now, well known, discussions on the protection of the environment, and the development of secondary markets for emission allowances have stimulated a process of gradual inclusion of CO2 allowances in the perimeter of financial markets regulation. A first, significant step in this direction was taken by MiFID I: building on the definition of commodity derivatives introduced by the Investment Services Directive of 1993, MiFID I enlarged and amplified the catalogue of derivatives that would be considered as falling into its scope. The catalogue included then derivatives on emission allowances. The landscape set by MiFID I was, however, just a first step towards the inclusion of emissions trading in the scope of financial markets legislation. A second step has been taken by MiFID II, as the latter directly classifies rights on emissions allowances falling in the EU regime, as financial instruments. The reasons that led to the qualification of emissions allowances as financial instruments in MiFID II are basically a consequence of the tremendous evolution that secondary markets of allowances have seen in the last few years. The growing amount of transactions and the need to preserve and ensure the transparency and integrity of secondary markets convinced the Commission of the opportunity to include emissions allowances in the scope of MiFID II and, therefore, in the scope of the Market Abuse Directive (now, Market Abuse Regulation). Looking at the positive effects that, on environmental protection, may derive from the inclusion of emission allowances in the scope of capital markets legislation, these are basically linked to the fact that - as a consequence of the approach stemming from MiFID II - secondary markets should effectively become more transparent, efficient and secure. There are, however, some potential drawbacks to be considered. Trading in emission allowances becomes more expensive after MiFID II, and transaction costs might impact negatively on the liquidity of the market. The application of CRD IV (now, CRD V) prudential requirements might also require the absorption of important level of capitals, that would be distracted from direct investments in the industry: the effect that this might have on the system is, at the moment, unclear. The landscape introduced by MiFID II is also quite complex: there are at least two, if not three different sets of comprehensive legislation that may potentially be relevant for trading emission allowances, either on the spot, or on the derivatives market: the “old” EU-ETS; MiFID II-MAR; more tangentially, REMIT. The paper discusses the implications of each of them. Opting in and out of each of these systems, through a complicated system of exemptions and exclusions, does not benefit the overall coherence of the regulatory approach.

EU Market Abuse Regulation: The Puzzle of Enforcement

Aimed at establishing an effective and consistent enforcement of market abuse regulation, the regime introduced by Regulation (EU) No. 596/2014 (‘MAR’) and Directive 2014/57/EU (‘MAD II’) relies on a mix of criminal penalties and administrative sanctions, both of which are subject to the principles of double jeopardy and due process. In the light of a few cases decided by the Court of Justice of the European Union and the European Court of Human Rights (‘ECtHR’), the features of this regime are, however, unclear, and it is doubtful whether the current framework is adequate to achieve its goals. This article criticizes the decision to criminalize market abuse at the EU level and argues that a credible EU supervisory system is better served by an enforcement system based on administrative sanctions. Moreover, the article discusses the solution offered by the ECtHR to the trade-off between efficiency and fairness in administrative proceedings and proposes an allocation of prosecution and decision-making to independent bodies within the same supervisory authority as a means to better balance efficiency and fairness.

The Subtle Relationship between Paragraphs 1, 4, 7 and 8 of Article 17 of the Market Abuse Regulation

Article 17 MAR sets out the legal framework with respect to the disclosure of inside information. Article 17(1) MAR contains the primary duty to disclose inside information and stipulates that the issuer must disclose inside information that directly concerns that issuer. Article 17(4) MAR grants the issuer the possibility to delay the disclosure of inside information if three cumulative conditions are met; once one or more conditions are no longer met, the primary duty revives. In addition to the primary duty, two separate duties to disclose have been included in Article 17 MAR: i) Article 17(8) MAR stipulates that the issuer must make complete and public disclosure of inside information that is disclosed to selected parties and ii) if the issuer had opted to delay the disclosure of inside information, Article 17(7) MAR stipulates that the issuer must make complete and public disclosure of that information if it has lost its confidential nature. One could raise doubts over the necessity and function of Paragraphs 8 and 7 of Article 17 MAR. However, in this Paper we defend the independent status of these Paragraphs. If the inside information has lost its non-public nature, the duty to disclose that information can no longer be based on Article 17(1) MAR. Paragraphs 8 and 7 of Article 17 MAR contribute to legal certainty and to achieving the goals of the MAR.