The Securities and Markets Stakeholder Group (SMSG) helps facilitate consultation by the European Securities and Markets Authority (ESMA). The SMSG is composed of 30 individuals drawn across 17 Member States who come from varying backgrounds including those who are academics and those employed by financial institutions.
The SMSG has recently published its response to ESMA’s consultation on draft technical standards on the Market Abuse Regulation (MAR) and on ESMA’s draft advice on possible delegated acts under MAR.
Key points raised by the SMSG include:
- the SMSG welcomes that MAR provides an exemption from the prohibition of market abuse provided that certain conditions are met. ESMA’s approach determining appropriate arrangements, procedures and record keeping requirements principally seems flexible and practical. In particular, the SMSG strongly supports ESMA’s emphasis on the need to protect market soundings as a means of managing relations between the issuer and investors. However, some processes proposed by ESMA seem to be too complex;
- insider lists are an important tool for competent authorities when investigating market abuse. The SMSG welcomes the harmonisation of insider lists. However, the SMSG is concerned about the extensive information that ESMA wants insiders to provide;
- the SMSG generally agrees with ESMA’s approach to provide stricter rules for qualified persons, such as the disclosure of financial interests and conflicts of interest; and
- disclosure of manager transactions is an important part of the MAR and plays a great role in practice. The SMSG is concerned about ESMA’s proposal defining the respective obligations in a broad way. A further concern relates to ESMA’s advice on how to interpret the closed period for managers.
