Market abuse - Draft implementing act introduced in Belgian Parliament - FSMA issues guidance

What has happened?

In the framework of the new Market Abuse Regulation (“MAR”), a draft act amending, among others, the law of 2 August 2002 on the supervision of the financial sector and on financial services has been introduced in Parliament (text). The content of the draft act is limited to what is strictly necessary, and further implementing acts are expected.

In addition, the Belgian securities regulator (the “FSMA”) has published the following documents which will apply as from 3 July 2016:

  • An update of Circular FSMA/2012_01 on the obligations of issuers listed on a regulated market (Dutch text | French text)

The FSMA has indicated that as from 3 July 2016 it will abolish the Q&A on market abuse which is available on its website in relation to the old regime. Also note that the FSMA has updated its circular on share buy-backs.

What do the new rules say?

  • As MAR will have direct effect in Belgium as from 3 July 2016, various provisions of Belgian law will be replaced or repealed (e.g. rules on disclosure of inside information, prohibitions of insider dealing and market manipulation, insider lists).
  • The FSMA’s investigatory powers are fine-tuned to align them with MAR. The maximum amounts of administrative sanctions that can be imposed by the FSMA are increased.
  • The amendments to Circular FSMA/2012_01 are limited and mainly aim at aligning its content with MAR. Circular FSMA_2016_08 contains practical information and templates regarding, among others, insider lists, market soundings and notifiable transactions.
  • The FSMA has confirmed the de minimis threshold of EUR 5,000, which applies to notifiable transactions by persons discharging managerial responsibilities (“PDMRs”) and persons closely associated with them.
  • The FSMA will also set up an application for online notifications through which PDMRs and persons closely associated with them must notify their transactions to the issuer and the FSMA. Issuers must take reasonable precautions to ensure that transactions which are so notified to them are “real and authentic” and that, as the case may be, the proxy holders making the notification on behalf of the PDMRs and persons closely associated with them are duly authorised to do so.
  • The disclosure of notifiable PDMR transactions to the public will continue to be done by the FSMA on its website. In case an issuer opts to also make such transactions public itself, it must ensure that this is done in accordance with the requirements set out in MAR.

What’s next?

In Belgium, further draft acts implementing MAR and transposing the new Directive on Criminal Sanctions for Market Abuse (“CSMAD”) are still to be made public. The FSMA will also publish a manual on the application for online notifications through which PDMRs and persons closely associated with them must notify their transactions.

Authors: Thierry L’Homme, Counsel (+32 2 501 9186) or Ilse Brouwers, Counsel (+32 2 501 9325).

For more information on MAR, please click here.