ARTICLE
27 February 2018

FCA Imposes First Fine On AIM Company For Late Disclosure Under MAR

SS
Shearman & Sterling LLP

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On 14 December 2017, the FCA announced that it had fined an AIM company for failing to inform the market of inside information as required by Article 17(1) of MAR.
United Kingdom Finance and Banking

On 14 December 2017, the FCA announced that it had fined an AIM company for failing to inform the market of inside information as required by Article 17(1) of MAR.

The company in question failed to inform the public as soon as possible after being notified that there was a reasonable expectation that it would be required to sell one of its two material investments for no initial consideration, with only a possibility of receiving deferred consideration that was materially lower than the company's valuation of its investment. The failure to disclose inside information prevented investors from making fully informed investment decisions.

The breach arose because of a misunderstanding of the legal effect of a share purchase agreement. The FCA commented that issuers "must have regard to their disclosure obligations at all times and misunderstanding the commercial reality of a transaction is no excuse."

The FCA announcement can be accessed here:

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