Market Abuse Regulation – Practical Instructions

Circulaire FSMA_2016_08 dated 18/05/2016 (updated 5 July 2024, 4 December 2024)

This circular is primarily addressed to issuers¹, their managers and persons closely associated with them, market participants making public disclosures, operators of Belgian trading venues, persons who professionally execute transactions in financial instruments, and persons who give investment recommendations.

Practical instructions regarding the notification and reporting obligations arising from market abuse legislation and ESMA guidelines on specific MAR provisions.

1. Introduction

On 3 July 2016, a new administrative market abuse regime entered into force, consisting of the Market Abuse Regulation² (hereinafter referred to as “MAR”) and rules implementing it. This regulation provides, inter alia, for the extension of the market abuse regime to non-regulated markets³ and to new types of financial instruments. In addition, many existing rules and obligations are refined.

The practical instructions contained in this circular aim to clarify the application of the notification and reporting obligations arising from the market abuse regime. It is by no means a summary of the regulation itself, which can be consulted on the FSMA website.

This circular also contains ESMA guidelines in which ESMA, on the basis of Article 16 of the ESMA Regulation⁴, sets out its position on the application of specific MAR provisions with a view to their uniform application in the EU. In addition to the guidelines mentioned in points 3 and 6 below, these are guidelines clarifying the definition of “inside information” for commodity markets contained in Article 7(1)(b) MAR (see Annex G of this circular). The FSMA will integrate these guidelines into its supervision.

1 The term “issuers” used in this circular is equivalent to the term “issuers” within the meaning of Article 3(1)(21) of MAR. Where this term is used in this circular, it should also be understood, mutatis mutandis, to include, with respect to points 2 and 4: participants in an emission rights market, auction platforms, auctioneers, and auction supervisors, and, with respect to point 6: participants in an emission rights market.

2 Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC.

3 For example, issuers whose financial instruments are traded on a Multilateral Trading Facility (MTF), such as Alternext or the Free Market, at their request or with their consent, are now subject to the administrative market abuse regime. The activation of a financial instrument on the Public Auction Market (Expert Market) at the request of members of Euronext Brussels N.V. does not result in the issuer of the relevant financial instrument being subject to the administrative market abuse regime. This also applies when the activation was part of the public sale of bearer securities by the issuer, as provided for by the law of 14 December 2005 abolishing bearer securities.

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4 Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority).

5 The label of “SME growth market” can be assigned to MTFs where predominantly small and medium-sized enterprises are listed, in accordance with Article 33 of MiFID II.

2. Lists of persons with inside information (Article 18 MAR)

When drawing up lists of persons with inside information, issuers (or persons acting on their behalf or for their account) must use the standard forms included in Annex A. These are based on the technical implementing standards contained in Implementing Regulation (EU) 2016/347.

Annex A contains three types of forms:
a) A form for lists that must be kept and updated continuously for each individual case of inside information; b) An optional form allowing a list to be kept of persons who always have access to all inside information, so that they do not need to be mentioned each time on the lists referred to in a); c) A form that issuers on an SME growth market⁵, who are exempt from the continuous keeping and updating of lists (see Art. 18(6) MAR), must use when the FSMA requests a list of persons with inside information.

When the FSMA requests lists of persons with inside information, it specifies to which FSMA employee(s) and in what manner they must be provided. For electronic transmission, it is recommended to secure the files and inform the FSMA in advance of the procedure to ensure correct reading of these files.

3. Documentation of market soundings and guidelines for persons receiving market soundings (Article 11 MAR)

Market participants making public disclosures, as defined in Article 3(1)(32) MAR, must keep the following data regarding their market soundings and be able to present them to the FSMA upon request:

1. Prior to the market sounding: a written record of the assessment of whether the information to be made public in the context of the market sounding constitutes inside information or not (see Art. 11(3) MAR);
2. During the market sounding:
   a) Lists containing identity details of all natural and legal persons to whom the information was made public, compiled per potential investor who accepted the market sounding; b) A list of potential investors who rejected the market sounding; c) All communication with potential investors (who accepted the market sounding) in the context of the market sounding, including the standard set of data⁶.

When communication has taken place in writing or in the form of recorded telecommunications, it is sufficient to keep these as such. The date and time of each communication must be recorded.

In the case of unrecorded telecommunications or face-to-face conversations, a written report must be drawn up using the standard forms included in Annex B, which are based on the technical implementing standards contained in Implementing Regulation (EU) 2016/959.

3. If applicable, when information ceases to constitute inside information: If the information on which the market was sounded constituted inside information, the potential investors (who accepted the market sounding) must be informed when this information no longer constitutes inside information. To communicate this to them and keep a record of this communication, the standard form included in Annex B must be used.

When the FSMA requests the aforementioned data on market soundings, it specifies to which FSMA employee(s) and in what manner they must be provided. For electronic transmission, it is recommended to secure the files and inform the FSMA in advance of the procedure to ensure correct reading of these files.

Persons receiving market soundings follow the ESMA guidelines included in Annex E to avoid the misuse or unlawful disclosure of inside information.

4. Notification obligation for transactions by managers (Article 19 MAR)

Persons with managerial responsibilities at issuers⁷ and persons closely associated with them (hereinafter: “persons subject to notification”) must notify the relevant issuers and the FSMA of transactions for their own account in shares or debt instruments of that issuer, as well as in derivative or other related financial instruments.⁸ This notification must be made within a period of 3 working days after the transaction date. In derogation from Article 19(3), first and second subparagraphs of MAR, the reported transactions are made public by the FSMA on its website, instead of by the issuers.

⁹ Persons subject to notification report their transactions to the relevant issuer and the FSMA via an online notification application “eMT” developed by the FSMA in accordance with the technical implementing standards contained in Implementing Regulation (EU) 2016/523.

¹⁰ Persons subject to notification may authorize someone else to report their transactions, but they remain legally responsible for compliance with their notification obligation and for the content of the notification.

The online notification application eMT provides that reported transactions are confirmed by the issuers and forwarded to the FSMA. Issuers are expected to take reasonable precautions to verify the origin of the notifications and, if necessary, to verify that agents are duly authorized to report transactions on behalf of persons subject to notification.

5. Notification obligation for suspicious orders and transactions (Article 16 MAR)

Operators of a Belgian regulated market and investment firms operating a Belgian trading venue must inform the FSMA of orders and transactions, as well as all cancellations or modifications thereof, which could be considered as insider dealing or market manipulation, or as an attempt to commit insider dealing or market manipulation.

Persons who professionally execute or effect transactions in financial instruments and have their head office in Belgium or provide investment services in Belgium through a branch must inform the FSMA when they have a reasonable suspicion that an order or transaction regarding any financial instrument, executed on or off a trading platform, may involve insider dealing or market manipulation, or an attempt thereof.

The notification to the FSMA must be made via the standard form included in Annex D, which is sent electronically to the central email address info.fin@fsma.be. It is recommended to secure the standard form and supporting documents of the reported suspicious orders or transactions and to inform the FSMA in advance of the procedure to ensure correct reading of the files.

⁸ As long as the sum of transactions carried out within the same calendar year does not exceed the threshold of 5,000 EUR to 20,000 EUR, the notification obligation under Art. 19(8) MAR does not apply. This threshold was increased on 4 December 2024 from 5,000 EUR to the current 20,000 EUR. See Art. 2(8) of Regulation (EU) 2024/2089 of the European Parliament and of the Council of 23 October 2024.

⁹ If issuers nevertheless choose to make the transactions reported to them public themselves, they must comply with the requirements of Article 19(3), first and second subparagraphs of MAR.

¹⁰ Annex C contains a manual for the application.

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6. Guidelines and notification obligation regarding deferral of disclosure of inside information (Article 17 MAR)

When assessing the conditions for deferring the disclosure of inside information, issuers take into account the ESMA guidelines included in Annex F.

Issuers that have deferred the disclosure of inside information must inform the FSMA¹¹ in writing once the inside information has been disclosed, in accordance with the provisions of Article 17(4) MAR and the technical implementing standards contained in Implementing Regulation (EU) 2016/1055.

When a credit institution or financial institution defers the disclosure of inside information to maintain financial system stability, it must contact the FSMA in advance and inform it in writing in accordance with the provisions of Article 17(5) and (6) MAR and the technical implementing standards contained in Implementing Regulation (EU) 2016/1055.

The written notification is sent in both cases to the central email address info.fin@fsma.be, as well as to the email address of the FSMA employee following the relevant issuer. It is recommended to secure the relevant file and inform the FSMA in advance of the procedure to ensure correct reading of it. The FSMA also recommends announcing or confirming the written notification by telephone. For this, you can contact Ms. Lynn Van Thillo (+32 2 220.54.56) or Messrs. Luk Delboo (+32 2 220.59.71) and Kristof Dumortier (+32 2 220.59.70).

7. Safe harbors regarding buyback programs and stabilization (Article 5 MAR)

Under certain conditions, the prohibitions on insider dealing and market manipulation do not apply to trading in own shares in the context of buyback programs and trading in securities and related instruments in the context of stabilization.

To fall under these “safe harbors,” it is required, inter alia, that all transactions (including those carried out on non-Belgian trading venues) are reported to the FSMA. Within seven trading days after execution, transaction data must be reported, both per individual transaction, where the data to be reported corresponds to that of the MiFID/MiFIR regulation, and aggregated per day and trading venue. This data is sent electronically to the central email address info.fin@fsma.be. It is recommended to secure the relevant file and inform the FSMA in advance of the procedure to ensure correct reading of it.

¹¹ With regard to this notification obligation, the FSMA is the competent authority for the following issuers, each time provided that the relevant listing took place at their request or with their consent: (1) Belgian issuers (i.e., issuers whose registered office is located in Belgium) whose shares are listed on a Belgian trading venue, (2) Belgian issuers whose shares are not listed on a trading venue in the EU, but other financial instruments are listed on a Belgian trading venue, and (3) non-Belgian issuers whose shares or – if no shares are listed on a trading venue in the EU – other financial instruments are listed on a Belgian trading venue and Belgium is the first Member State of listing (in case of listing in multiple EU Member States). In case the first Member State of listing cannot be identified, the FSMA is competent if the Belgian trading venue is the “most relevant market in terms of liquidity” (as intended in the MiFID/MiFIR rules).

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8. Investment recommendations (Article 20 MAR)

In the context of its market surveillance and its supervision of the rules on investment recommendations, the FSMA requests persons established or operating in Belgium to systematically receive a copy of investment recommendations they issue regarding financial instruments traded on Belgian trading venues (morning notes, company reports, analyses, investment brochures...). These are preferably sent by email to the central email address info.fin@fsma.be, or by post to FSMA, Financial Markets Supervision, Congresstraat 12-14, 1000 Brussels.

Annexes

• Annex A:
  • Standard forms for lists of persons with inside information: deal-specific & permanent
  • Standard forms for lists of persons with inside information: SME_PME
• Annex B: Standard forms for data on market soundings
• Annex C:
  • Manual for listed companies regarding the online notification application for manager transactions (eMT)
  • Manual for persons subject to notification regarding the online notification application for manager transactions (eMT)
• Annex D: Standard form for the notification of suspicious orders and transactions
• Annex E: ESMA guidelines MAR – Persons receiving market soundings (ESMA/2016/1477 – NL)
• Annex F: ESMA guidelines MAR – Deferral of disclosure of inside information and interactions with prudential supervision (ESMA70-159-4966 – NL)
• Annex G: ESMA guidelines MAR – Information regarding commodity derivative markets or related spot markets with a view to the definition of inside information concerning commodity derivatives (ESMA/2016/1480 – NL)