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Market abuse regulation (MAR) - primary market aspects
The Market Abuse Regulation (MAR) regime replaced the previous Market Abuse Directive (MAD) regime from 3 July 2016. It focuses on financial markets’ integrity - notably insider dealing and market manipulation. It also provides for a number of preventive measures such as prompt disclosure of inside information.

Among other things, the MAR regime (including subsidiary ‘Level 2’ rules) acknowledges there are legitimate reasons for sounding investors ahead of, and for stabilising, a new securities issue and provides for ‘safe harbours’ for such activities if certain conditions are met. Certain materials relating to soundings and stabilisation are set out in the ICMA Primary Market Handbook (though MAD to MAR updates are pending).

ICMA sought to provide constructive feedback to the European Commission and ESMA during MAR’s legislative process and to assist industry in implementation. See further coverage in the ICMA Quarterly Report, notably the following editions:
  • at Level 1: July 2009 (at p.9 / ICMA response to European Commission call for evidence), 2012Q1 (at p.35 / European Commission proposal), 2012Q4 (at p.34 / European Council Presidency compromise proposal), 2013Q1 (at p.31 / European Council general approach and European Parliament ECON report), and 2013Q4 (at pp.33-34 / European Parliament adopted text);
  • at Level 2: 2014Q1 (at p.25 / ESMA Discussion Paper), 2014Q2 (at pp.31-32 / ICMA response to ESMA Discussion Paper), 2015Q1 (at pp.36-38 / ESMA Consultation Paper and ICMA response), and 2016Q1 (at p.43 / ESMA Final Report);
  • implementation: 2016Q2 (at pp.17-18 / Potential practical implications), 2016Q3 (at p.27 / Ongoing ICMA work), 2016Q4 (at pp.26-27 / Ongoing ICMA work and ESMA sounding guidelines for investors) and 2017Q1 (at p.21 / Ongoing ICMA work).

For more information and a briefing note on the regulatory technical standards of MAR with respect to the presentation of investment recommendations and associated disclosure obligations, click here.




New market soundings regime:

MAR introduced a new market soundings regime which applies to the disclosure of both inside information and non-inside information.

This is a key area of focus for ICMA’s members with profound implications, particularly because the new regime gives rise to a number of questions and uncertainties. ICMA has been discussing the implications of the new regime with its primary market sell-side constituency through its Committees and working groups in Europe and Asia. This topic has also been discussed in a number of other fora including regional conferences, the ICMA Board and the ICMA Committee of Regional Representatives.

The main focus has been the implications of the rules for sounding information other than inside information, especially in relation to investor meetings (where a transaction might subsequently follow) and the posting of MTN (and SSA) price levels. Considerations have included what constitutes a ‘transaction announcement’, ‘acting on the issuer’s behalf’ and ‘gauging interest’, noting that there is currently limited (or no) guidance from regulators on these and other relevant points. In addition, there is a question surrounding the scope of the MAR soundings regime, which ICMA understands is being considered by ESMA.

ICMA, with input from major law firms, has been developing a paper outlining the emerging sell-side consensus on these points. ICMA is intending to discuss this with relevant regulators before making it available more broadly, to assist market participants in their understanding of the rules. In the meantime, ICMA has also held a number of briefing calls that have been open to members, investors and issuers (see further the slides below).




Related documents - MAR:

27 April 2017
ICMA slides on MAR soundings

27 January 2017
ICMA slides on MAR soundings


13 December 2016
ICMA slides on MAR soundings

4 November 2016
ICMA slides on MAR soundings

22 June 2016
ICMA slides on MAR soundings, stabilisation and STORs

15 October 2014
ICMA response to ESMA Consultation Paper on draft technical standards on the Market Abuse Regulation

27 January 2014
ICMA response to ESMA discussion paper – ESMA’s policy orientations on possible implementing measures under the Market Abuse Regulation


Related documents - MAD:

10 June 2009
BBA / ICMA Joint Response to European Commission call for evidence on the review of the Market Abuse Directive

9 January 2009
BBA / ICMA Joint Response to CESR Consultation PaperLevel 3: Third set of CESR guidance and information on the Common Operation of the Directive to the Market

30 September 2008
BBA / ICMA / LIBA Joint Response to CESR Consultation Paper Level 3 - Third Set of CESR Guidance and Information on the Common Operation of the Directive Market


7 May 2008
BBA response to HM Treasury Consultation Paper FSMA Market Abuse Regime: A review of the sunset clauses

3 December 2007
ICMA letter to CESR regarding stabilisation

5 February 2007
Joint BBA-ICMA response to CESR consultation on the Market Abuse Directive level 3 second set of guidance and information on the common operation of the Directive to the market

31 October 2006
ICMA Response to CESR Call for Evidence

12 December 2004
Response to CESR Concept Paper Annex 1

10 September 2004
Supporting Document to IPMA Response to UK Implementation of the Market Abuse Directive re Price Stabilising Rules

10 September 2004
Supporting Document to IPMA Response to UK Implementation of the Market Abuse Directive re Price Stabilising Rules

10 September 2004
IPMA Response to UK Implementation of the Market Abuse Directive re Price Stabilising Rules

22 April 2003
Amendments proposed by IPMA to Mr Karl Peter Repplinger

22 April 2003
Letter to Karl Peter Repplinger re Commission Working Document ESC 14/2003

28 February 2003
IPMA Letter to CESR re Market Abuse Mandates - Second Call for Evidence

27 September 2002
Letter to CESR re Stabilisation

27 September 2002
Letter to CESR re Stabilisation Annex 1




Contact:

Ruari Ewing
Senior Director, Market Practice and Regulatory Policy; secretary to the ICMA Primary Market Practices Committee and related groups
Direct line: +44 20 7213 0313
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