On 26 October 2016, the European Securities and Markets Authority ("ESMA") published an updated version of its Q&A on the Market Abuse Regulation ("MAR") confirming:

  • Under Article 19(1) of MAR (Managers' transactions), with regards to the EUR 5,000 threshold for the reporting of managers' transactions, that when the transaction currency is not euro, the exchange rate that should be used to determine if the threshold set out in Article 19(8) of MAR of EUR 5,000 has been crossed is the official daily spot foreign exchange rate which is applicable at the end of the business day when the transaction is conducted. Where available, the daily euro foreign exchange reference rate published by the European Central Bank on its website should be used.
  • In relation to MAR's application to "investment recommendations", material which concerns financial instruments is considered as information implicitly recommending or suggesting an investment strategy insofar as it contains a valuation statement as to the price of the relevant financial instruments, or contains an estimated value such as a "quantitative fair value estimate" that is providing a projected price level or "price target". This catches statements indicating that the financial instruments are "undervalued", "fairly valued" or "overvalued".

On 20 December 2016, ESMA published a further updated version of its Q&As on MAR, confirming, amongst other points:

  • That, for the purposes of calculating whether the EUR 5,000 threshold triggering the notification of managers' transactions under MAR has been reached, the transactions carried out by a manager (i.e., a person discharging managerial responsibilities ("PDMR")) and by closely associated persons to that PDMR are not to be aggregated.
  • How to calculate the price of gifts, donations and inheritances for the purpose of the notification and disclosure of managers' transactions under MAR.
  • That, if a PDMR enters into a remuneration package contract entitling the PDMR to receive shares upon the occurrence of certain conditions, a notification only has to be made upon the occurrence of those conditions and the actual execution of the transaction.
  • That a communication containing purely factual information on financial instruments or issuers does not constitute an investment recommendation for the purposes of MAR, unless it explicitly or implicitly recommends or suggests an investment strategy.
  • That, if the price or value of a derivative traded outside a trading venue does not depend on or have an effect on the price or value of a financial instrument referred to in Article 2(1)(a), (b) or (c) of MAR, the derivative is not in scope of MAR and neither is any recommendation relating to the financial instrument.

The full Q&A which includes both updates can be accessed at:

https://www.esma.europa.eu/sites/default/files/library/2016-1664_mar_qa_december_2016.pdf

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