Following the compromise reached between the European Council (the “Council”) and the European Parliament (the “Parliament”) on December 20, 2013, the Parliament has approved the proposal for a new Directive on criminal sanctions for market abuse (“MAD”) on February 4, 2014.
This new directive proposal would require from member states to provide in their national legislation for criminal sanctions related to (i) insider dealing, (ii) market manipulation and (iii) unlawful disclosure of inside information. Inciting, aiding and abetting such criminal offenses would be also punishable. In order to ensure that the sanctions are effective and dissuasive, the MAD provides for minimum levels for the maximum terms of imprisonment (between two and four years) and ensures that legal persons can be held responsible.
The MAD would amend and replace the existing European Directive 2003/6/EC on insider dealing and market manipulation and apply together with a revised market abuse regulation (“MAR”, which draft has already been approved by the Council and the Parliament on June 20, 2013).
The MAD and the MAR are expected to be finalized and published in the Official Journal of the European Union in the first half of 2014.The MAR would apply two years after it has been published whereby Member States would have two years after the publication of the MAD to transpose such new provisions in their existing market abuse laws.