The Financial Conduct Authority has now adopted in full the
European Securities and Markets Authority's guidelines issued
under the Market Abuse Regulation and made changes to its
Disclosure Guidance in DTR 2 to bring it in line with ESMA's
guidelines. The main change is the removal of a statement that
delaying disclosure of inside information is only likely to be
allowed where there is an ongoing negotiation that would be
jeopardised by early disclosure, as this conflicts with ESMA's
non-exhaustive list of situations when delay might be
Under Article 17 MAR, an issuer must announce inside information
as soon as possible unless it can satisfy three criteria: that
immediate disclosure would prejudice the issuer's legitimate
interests, that delay is not likely to mislead the public and that
confidentiality will be preserved. ESMA issued guidelines under MAR
which include a non-exhaustive list of situations where an issuer
might delay to protect its legitimate interests, as well as
guidance on misleading the public.
Conflict between ESMA guidelines and DTR 2.5.5G
The FCA's Disclosure Guidance contained a statement that,
other than in relation to ongoing negotiations, there are unlikely
to be other situations in which delay might be possible to protect
the issuer's legitimate interests. The FCA has now deleted this
statement, following a consultation.
This change is welcome as it clarifies once and for all that the
ESMA list of legitimate reasons for delay is indicative and
non-exhaustive. It will allow issuers to delay in the other
circumstances specified in the ESMA guidelines, and it potentially
opens the door to delaying disclosure in circumstances not set out
in the guidelines, as the list is non-exhaustive. However, the FCA
has said that it and ESMA both interpret Article 17(4) MAR (ability
to delay) narrowly.
The changes to DTR 2 took effect on 24 February 2017. Click here for the FCA's policy statement.
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