On 29 October 2020, the European Securities and Markets Authority (ESMA) published a final report on amendments to the Market Abuse Regulation (MAR) for the promotion of the use of SME growth markets.

Regulation (EU) 2019/21158 on the promotion of the use of SME growth markets (SME GM Regulation) amended Articles 13 of MAR (by inserting new paragraphs 12 and 13) and 18 of MAR. Article 13(13) of MAR mandates ESMA to submit to the European Commission draft Regulatory Technical Standards (RTS) to draw up a contractual template for a liquidity contract available to issuers of financial instruments admitted to trading on an SME growth market (SME GM) and their liquidity providers. The amended Article 18(6) of MAR mandates ESMA to draft Implementing Technical Standards (ITS) specifying the format of the insider list that issuers admitted to trading on SME GMs are required to provide to Member State national competent authorities upon request.

Earlier this year ESMA issued a consultation paper setting out proposals for draft RTS on liquidity contracts and draft ITS specifying the format of the insider list. The consultation also set out proposals on the current state of play of SME GMs in the EU and suggested initiatives to improve the attractiveness of the SME GM regime from issuers’, investors’ and venues’ perspectives, as mandated by Article 90(1)(b) of MiFID II. The final report now published follows up on the proposals in the consultation paper regarding the draft RTS and ITS, presenting drafts which take into account the feedback from stakeholders.

The final report is being sent to the European Commission, and ESMA is submitting the proposed RTS and the proposed ITS for endorsement in the form of Commission Delegated Regulations, i.e. legally binding instruments applicable in all Member States. Following endorsement, the RTS and the ITS are then subject to non-objection by the European Parliament and the Council.

Article 1 of the SME GM Regulation applies as of 1 January 2021. Considering the steps mentioned above that the draft RTS and the draft ITS need to go through before being finalised and entering into force, ESMA considers it unlikely that they will be adopted by that date.