On 15th July 2021, the European Security and Markets Authority ("ESMA") announced that it had published a consultation paper in relation to the review of its guidelines on the delay of disclosure of inside information under the Market Abuse Regulation (Regulation (EU) 596/2014) ("MAR"), in particular in relation to the banking sector ( ESMA70-156-3934).

By way of derogation from the general obligation incumbent upon issuers to publicly disclose inside information as soon as possible, MAR permits issuers to delay the disclosure of inside information in the event that the immediate disclosure of such inside information is likely to (i) prejudice an issuer's legitimate interest; (ii) the delay of disclosure is not likely to mislead the public and (iii) confidentiality of the inside information is ensured. ESMA's Guidelines on MAR relating to the disclosure of inside information contain an indicative list of legitimate interests of issuers which are likely to be prejudiced in the event of an immediate disclosure of inside information.

By virtue of this latest consultation paper, ESMA is seeking to enhance these Guidelines insofar as the prudential supervisory framework is concerned. The consultation paper proposes to amend ESMA's current MAR Guidelines by:

  1. Clarifying that, in respect of redemptions, reductions and purchases of own funds, pending authorisation from the relevant prudential supervisor, the institution has a legitimate interest to delay the disclosure of inside information until such authorisation is granted;
  2. Clarifying that, in connection with draft Supervisory Review and Evaluation Process (SREP) decisions and associated preliminary information, the institution has a legitimate interest in delaying the disclosure of inside information until such information is finalised; and
  3. Adding a separate section in order to clarify that Pillar 2 Capital Requirements and Pillar 2 Capital Guidance contained in the SREP under the Capital Requirements Regulation and Directive package are likely to meet the definition of 'inside information' as defined in article 7(1)(a) of MAR and would, accordingly, require disclosure as soon as possible once finalised.

Stakeholders, particularly those from the banking sector, are invited to send ESMA their feedback on the consultation paper by 27th August 2021. ESMA is expecting to publish a final report, including its amended MAR Guidelines, by the end of 2021.

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