On 12 December 2024, the European Securities and Markets Authority (ESMA) published a consultation paper to gather feedback on proposed technical advice on the Market Abuse Regulation (MAR) and Markets in Financial Instruments Directive II (MiFID II) as amended by the Listing Act.

Background

The consultation paper covers a range of topics on MAR and MiFID II as amended by the Listing Act that the European Commission (Commission) has requested ESMA to provide technical advice on. In relation to MAR the Commission has requested technical advice on:

  • A non-exhaustive list of final events or final circumstances in protracted processes and, for each event or circumstance, the moment when it is deemed to have occurred and is to be disclosed pursuant to the new Article 17(1) MAR.
  • A non-exhaustive list of situations in which the inside information that the issuer or the emission allowance market participant intends to delay is in contrast with the latest public announcement or other type of communication by the issuer or emission allowance market participant on the same matter to which the inside information refers, as referred to in Article 17(4)(b) MAR.
  • Trading venues with cross-border activity above 50%, along with their share turnover over the past four years, to help identify those that will be subject to the Cross Market Order Book Mechanism established by Article 25a MAR.

As regards MiFID II the Commission’s request for technical advice relates to the delegated acts that it should adopt regarding the requirements necessary for a multilateral trading facility (MTF) or a segment thereof to be registered as an SME growth market (SME GMs). The technical advice should ensure that these requirements maintain high levels of investor protection and confidence in SME GMs while minimising the administrative burdens for issuers on these markets.

Consultation

Section 4 of the consultation paper sets out ESMA’s draft advice on the implementation of the amendments to MAR.  Among other things, ESMA:

  • Groups protracted processes into (i) internal processes of the issuer; (ii) processes involving the issuer and another party; and (iii) processes involving a public authority. For each category of processes, ESMA sets out principles to identify the moment of disclosure that were followed for the specific protracted process.
  • Lays down new conditions to delay disclosure of inside information. For the purpose of establishing a non-exhaustive list of examples where there is a contrast between the inside information to be delayed and the latest public announcement by the issuer, ESMA considers different situations in the lifecycle of an issuer where the inside information to be delayed would represent a material change compared to the issuer’s latest public communication.
  • Identifies the types of communication by the issuer which would have the ability of generating and influencing market expectations.
  • Sets out a methodology and preliminary results for identifying trading venues with a significant cross-border dimension, aimed at supporting the establishment of the new mechanism for exchanging order data to detect and enforce cross-border market abuse cases (the CMOB mechanism).

Section 5 of the consultation paper covers the request for technical advice on MiFID II and presents a systematic review of the relevant legal provision in Commission Delegated Regulation 2017/565 and proposes some targeted adjustments to ensure that the registration of a segment of an MTF as an SME GM complies with the relevant requirements in revised Article 33 of MiFID II.

Annex IV of the consultation paper contains the proposed delegated act.

Next steps

The deadline for comments on the consultation is 13 February 2025.

ESMA will deliver its technical advice to the Commission before the deadline set on 30 April 2025. 

A final report containing a summary of all consultation responses and a final version of ESMA’s technical advice is expected to be delivered to the Commission and published on ESMA’s website in Q2 2025.