The London Stock Exchange has responded to the joint HM Treasury and FSA consultation on the UK implementation of the Market Abuse Directive. We welcome the introduction of a common EU framework for the prevention and detection of market abuse as this is fundamental to ensuring the integrity of Europe’s financial markets. However, we believe the Directive should be implemented in a manner that is effective, consistent and, in particular, proportionate. We urge HM Treasury and FSA not to gold plate the Directive - there needs to be demonstrable benefits if the UK regime is to be wider in scope or superequivalent to the EU Directive.
In particular, we support HM Treasury proposals that the scope of the UK market abuse regime should continue to encompass prescribed markets such as AIM, as this is necessary to preserve the integrity of all UK prescribed markets. In contrast, we believe that the provision relating to behaviour in relation to "relevant information not generally available" (s118(4) FSMA) should be deleted, since it overlaps other offences and risks complicating the definition of insider dealing, for little benefit.
The original consultation can be found at:
http://www.hm-treasury.gov.uk/consultations_and_legislation/market_abuse_directive/consult_market_index.cfm