Issuer has key role in obligation to report managers’ transactions
The objective of the regulations on manager’s transactions (Article 19 of the Market Abuse Regulation (EU) No 596/2014 (MAR)) is to increase transparency regarding the transactions of persons discharging management responsibilities in an issuer, and of persons closely associated with them, to prevent market abuse, to provide information to investors and to promote the supervisory work of the authorities.
Over the past year or so, the Financial Supervisory Authority (FIN-FSA) has imposed a number of administrative sanctions on managers and persons closely associated with managers for omissions related to the obligation to report transactions and on the issuer for omissions related to the obligations of a listed company with regard to transactions. Three decisions of the FIN-FSA were appealed to the Administrative Court. The Administrative Court rejected the appeals. At the time of writing, the Administrative Court decisions are not final.
With this article, the FIN-FSA reminds issuers of their obligations in this regard.
Under Article 19(5) of MAR, the issuer must notify persons discharging managerial responsibilities of their obligations in writing and draw up a list of all persons discharging managerial responsibilities and their close associates (including legal persons). The issuer must update the list to reflect changes regarding those obliged to report and ensure that it is kept up to date.
In addition, Article 19(3) of MAR requires the issuer to ensure that information reported by managers and their close associates is made public promptly and no later than two working days after receipt of the report.
Although the obligations of Article 19 of MAR are primarily directed at persons discharging management responsibilities, the issuer also has a key role in ensuring the implementation of the regulations, based on the above-mentioned points. Issuers must actively ensure that their obligations in this respect are implemented in practice.
Next year, the FIN-FSA will pay particular attention to the above-mentioned obligations of issuers in its ongoing supervision. The FIN-FSA therefore encourages issuers to review their internal guidelines and processes and to ensure that all obligations under Article 19 of MAR are properly considered and documented.
For further information, please contact:
- Matti Tulkki, Senior Supervisor, matti.tulkki(at)finanssivalvonta.fi, tel. +358 9 183 5277.