European Securities and Markets Authority Opines on Regime for Disclosure of Inside Information by Emission Allowance Market Participants

The European Securities and Markets Authority published its Opinion on the proposed requirements for Emission Allowance Market Participants to disclose inside information under the Market Abuse Regulation. ESMA's Opinion is in response to the European Commission's notification that it intended to endorse, subject to certain amendments, ESMA's Implementing Technical Standards on the public disclosure of inside information by issuers and EAMPs and on the means for delaying public disclosure of inside information. The European Commission is concerned that the ITS will lead to EAMPs being subject to duplicative disclosure requirements under the EU Regulation on wholesale energy market integrity and transparency, known as REMIT. The Commission's view is that the ITS should deem the REMIT disclosure requirements sufficient for the purposes of disclosure requirements under MAR, so as to avoid imposing duplicative requirements on EAMPs.

MAR requires issuers and EAMPs to inform the public as soon as possible of information which directly concerns the issuer or EAMP. However, such disclosure may be delayed if certain criteria are met, including that the delay protects a legitimate interest of the issuer, that the information remains confidential and that procedures are put in place to ensure this is the case.

ESMA does not agree with the European Commission's position and has not proposed revised draft ITS for consideration. ESMA's view is that if EAMPS were not obliged to make the required disclosure under MAR then there would be no active disclosure or dissemination of inside information and the information would not be marked as inside information. If the requirements were removed, ESMA believes that investor protection would be decreased.

ESMA recently consulted on draft Guidelines for issuers and EAMPs on delaying the disclosure of inside information and for persons receiving a market sounding. ESMA's proposed Guidelines include a non-exhaustive list of the legitimate interests of an issuer or EAMP that may be prejudiced by immediate disclosure of inside information and situations in which delay of disclosure is likely to mislead the public. The final Guidelines are expected to be published in Q3 2016.

View ESMA's Opinion.

View the final draft ITS.

View ESMA's draft Guidelines.