Regulations have been made to extend the life of sections 118(4) (misuse of information) and 118(8) (behaviour likely to give rise to false or misleading impressions or to distort the market) of the Financial Services and Markets Act 2000. Those sections and related ancillary provisions were due to expire on 31 December 2009 but will now remain in force until 31 December 2011.
The UK market abuse regime is broader than that required by the EU Market Abuse Directive. In particular, two of the seven types of behaviour that can constitute market abuse derive from the market abuse regime that existed in the UK before the Directive and are super-equivalent (i.e. they are not required by the Directive). These are misuse of information (section 118(4)) and behaviour likely to give rise to false or misleading impressions or to distort the market (section 118(8)). When the Directive was first implemented in the UK these provisions were given a limited lifespan by sunset clauses. These sunset clauses were extended to 31 December 2009, so that the UK could align its regime with the rest of Europe based on the outcome of a review of the Directive. However, the European Commission only launched its consultation on the Directive in April 2009 and has not yet published proposals to amend it. The UK has therefore decided to further extend the sunset clauses until 31 December 2011.
See The Financial Services and Markets Act 2000 (Market Abuse) Regulations 2009 (SI 2009/3128 (available here) and the accompanying explanatory memorandum (available here).
