On the 17 April 2020, the MFSA issued a circular on Regulation (EU) 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (the “Market Abuse Regulation” or “MAR”) which is addressed to listed entities whose financial instruments are listed on a trading venue and should be read in conjunction with preceding circulars recently issued by the MFSA in reaction to the COVID-19 outbreak.
The MFSA has reiterated that in terms of MAR, issuers should immediately disclose any precise, non-public information that is likely to have a significant effect on their business, performance, or prospects. The information should be published in an accurate and honest manner which ensures that all investors are provided with such information in a timely manner.
Lists of Insiders
As soon as a significant effect is considered as inside information by the issuer, the latter shall ensure that individuals who are in possession of inside information (“Insiders”), including designated individuals who are responsible to monitor the issuer’s exposure to risks relating to COVID-19, are included in the issuer’s temporary List of Insiders. Naturally, this requirement does not apply if such individuals have already been included in the permanent List of Insiders.
The MFSA also noted that besides having the obligation not to disclose inside information, Insiders are also prohibited from trading in the securities of the issuer until the inside information has been published by the issuer.
Persons discharging managerial responsibilities within an issuer are prohibited from conducting any transactions, both on own account or on behalf of a third party, relating to the transferable securities or derivatives of the issuer throughout a closed period of 30 calendar days prior to the public announcement of an interim financial report or a year-end report. However, if the information disclosed in the public announcement made in relation to the year-end financial report has changed since its publication, no other closed periods are triggered but the issuer should address this occurrence in terms of the public disclosure requirements laid down in MAR.
Issuers are also reminded that preliminary financial statements should only be published once the auditor has provided the consent on the audit opinion and persons discharging managerial responsibilities should be aware that they are subject to prohibitions laid down in MAR including, prohibiting insider dealing and attempted insider dealing, unlawful disclosure of inside information, as well as market manipulation and attempted market manipulation.
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