Two letters were issued by the Malta Financial Services Authority ("MFSA") on the 21st October, 2015 addressed to the Directors and Compliance Officers of Investment Services licence holders and company secretaries of listed companies regarding the Market Abuse Regulation ("MAR") and the Market Abuse Directive ("MAD II"). The provisions of both these legal instruments will apply as of the 3rd July 2016.
Whilst the MAD establishes a minimum standard of criminal sanctions across the EU, the MAR provides for the substantive law which prohibits market abuse and stipulates transparency requirements applicable to listed companies and investment firms.
The implementation of MAR and MAD II requires changes to the Prevention of Financial Markets Abuse Act ("PFMA"). Provisions that deal with certain definitions and with the main concept of market abuse under the PFMA will be deleted and the MAR provisions will automatically apply instead.
Administrative penalties will be altered to reflect at least the minimum penalties laid down by the MAR. Criminal sanctions will also be altered to reflect the changes that will be brought by MAD II.
The MFSA is currently drafting a bill for implementation of the above-mentioned changes and a consultation document will be issued in due course.
Kindly find a copy of the MFSA Circular here.
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