Prevention of Financial Markets Abuse

Suppliment tal-Gazzetta tal-Gvern ta’ Malta, Nru. 17,753, 12 ta’ April, 2005

L.N. 108 of 2005

PREVENTION OF FINANCIAL MARKETS ABUSE ACT, 2005

(ACT NO IV OF 2005)

Prevention of Financial Markets Abuse

(Disclosure and Notification) Regulations, 2005

IN exercise of the powers conferred by article 25 of the Prevention

of Financial Markets Abuse Act, 2005, the Prime Minister and Minister

of Finance, after consultation with the Malta Financial Services

Authority, has made the following regulations>-

(1) These regulations may be cited as the Prevention of Citation and

commencement.

Financial Markets Abuse (Disclosure and Notification) Regulations,

2005. (2) These regulations shall come into force on the 1 st April,

2005.

(1)

In these regulations, unless the context otherwise Interpretation.

requires>

“the Act” means the Prevention of Financial Markets Abuse

Act<

“implementing measures” means any acts or Directives issued

under the Market Abuse Directive as amended from time to time,

including in particular for the purpose of these regulations the

provisions of Articles 2 and 3 of Commission Directive

2003#124#EC of 22 December 2003 implementing the Market

Abuse Directive as regards the definition and public disclosure of

inside information and the definition of market manipulation< and

the provisions of Articles 5 to 11 of Commission Directive

2004#72#EC of 29 April 2004 implementing the Market Abuse

Directive as regards accepted market practices, the definition of

inside information in relation to derivatives on commodities, the

drawing up of lists of insiders, the notification of managers’

transactions and the notification of suspicious transactions< and

“promptly” means within not more than one working day from

the relevant date unless otherwise justified by exceptional

circumstances.

(2) Words and expressions found in these regulations which

are also used in the Act shall have the same meanings as in the Act.

(1) The objective of these regulations is to implement the

relevant provisions of sub-articles (1) to (4) and sub-article (9) of Article

6 of the Market Abuse Directive and all related implementing measures

and these regulations shall be interpreted and applied accordingly.

(2) Pursuant to article 4 of the Act, the provisions of

regulations 4, 5 and 7 of these regulations shall not apply to any issuer

who has not requested or received approval for admission of his financial

instruments to trading on a regulated market in Malta or in any other

Member State or EEA State.

PART 1 – PUBLIC DISCLOSURE

Duty of public disclosure of inside information.

(1) Subject to the provisions of regulation 5, for the purposes

of applying sub-article (1) of article 9 of the Act an issuer, upon the

coming into existence of any set of circumstances or the occurrence of

an event, even if not yet formalised, giving rise to inside information,

shall act promptly to issue a public announcement of any inside

information which directly concerns the said issuer.

(2) The public announcement shall take the form of a notice

containing the inside information and shall be>-

(a) posted as a notice on the internet site of the company

the financial instruments of which are in question, for as long as

such inside information may be relevant< and

(b) be published in one or more newspaper widely

distributed in Malta and, if applicable, in any other Member State

or EEA State or States concerned>

Provided that where it is not practical to publish all the relevant

inside information in a newspaper the issuer shall instead publish

a public announcement widely distributed as described above,

which indicates where and at what times such information is freely

available to the public. The inside information shall be made

available to the public upon request either in writing or by other

equivalent means approved by the competent authority< and

(c)

be drawn up in>

(a) the official language or languages of the Member

State or EEA State concerned< or

(b) one of the official languages of the Member State

or EEA State concerned< or

(c) in any other language>Provided that, in all the above

cases, the language used is customary in the sphere of finance

in the Member State or EEA State concerned and is accepted

by the competent authority or the foreign authority as the case

may be.

(3) The issuer shall ensure that the inside information is

made public in a manner which enables fast access and complete, correct

and timely assessment of the information by the public. In addition, the

issuer shall not combine, in a manner likely to be misleading, the

provision of inside information to the public with the marketing of the

issuer’s activities.

(4) Any significant changes concerning already publicly

disclosed inside information shall be publicly disclosed promptly after

these changes occur, through the same channel as the one used for public

disclosure of the original information.

(5) Where an issuer has requested or received approval for

admission to trading of financial instruments on a regulated market in a

Member State or EEA State other than Malta, such issuer shall take

reasonable care to ensure that the disclosure of inside information to

the public is synchronised as closely as possible between all categories

of investors in all relevant Member States and EEA States.

(1) For the purposes of applying sub-article (2) of article 9 Delay of Disclosure

of Inside

of the Act an issuer may under his own responsibility delay the public Information.

disclosure of inside information required such as not to prejudice his

legitimate interests> Provided that such omission shall not be likely to

mislead the public and provided that the issuer is able to ensure the

confidentiality of the information the disclosure of which, was delayed.

(2) The issuer shall promptly inform the competent authority

of its decision to delay the public disclosure of inside information.

(1) For the purposes of applying sub-article (2) of article 9

of the Act legitimate interests may, in particular, relate to the following

non-exhaustive circumstances>-

(a) negotiations in course, or related elements, where the

outcome or normal pattern of those negotiations would be likely

to be affected by public disclosure. In particular, in the event that

the financial viability of the issuer is in grave and imminent danger,

although not within the scope of the applicable insolvency law,

public disclosure of information may be delayed for a limited period

where such a public disclosure would seriously jeopardise the

interest of existing and potential shareholders by undermining the

conclusion of specific negotiations designed to ensure the long-

term financial recovery of the issuer< and

(b) decisions taken or contracts made by the management

body of an issuer which need the approval of another body of the

issuer in order to become effective, where the organisation of such

an issuer requires the separation between these bodies> Provided

that a public disclosure of the information before such approval

together with the simultaneous announcement that this approval is

still pending would jeopardise the correct assessment of the

information by the public.

(2) So as to be able to ensure the confidentiality of inside

information, an issuer shall control access to information the disclosure

of which is delayed, and, in particular shall ensure that the issuer has>-

(a) established effective arrangements to deny access to such

information to persons other than those who require it for the

exercise of their functions within the issuer<

(b) taken the necessary measures to ensure that any person

with access to such information acknowledges the legal and

regulatory duties entailed and is aware of the sanctions attaching

to the misuse or improper circulation of such information< and

(c) in place measures which allow immediate public

disclosure in case the issuer was not able to ensure the

confidentiality of the relevant inside information, without prejudice

to the proviso of sub-article (3) of Article 9 of the Act.

PART II – NOTIFICATION

(1) For the purposes of applying sub-article (4) of article 9 Duty to provide

Lists of insiders.

of the Act the provisions of this regulation shall also apply.

(2) Lists of insiders shall state at least>-

(a) the identity of any person having access to inside

information<

(b) the reason why any such person is on the list<

(c) the date at which the list of insiders was created and

updated.

(3) An issuer when drawing up the required lists of insiders,

must take the necessary measures to ensure that any person on such a

list that has access to inside information acknowledges the legal and

regulatory duties entailed and is aware of the sanctions attaching to the

misuse or improper circulation of such information.

(4) Lists of insiders shall be updated promptly>-

(a) whenever there is a change in the reason why any person

is already on the list<

(b) whenever any new person has to be added to the list<

and

(c) when any person already on the list has no longer access

to inside information.

(5) Lists of insiders will be kept by both the issuer and the

competent authority for at least five years after being drawn up or

updated.

(1) For the purposes of applying article 10 of the Act the Duty of Notification

by Persons

persons referred to in such Article shall ensure that the competent discharging

authority is notified within five working days of the existence of any managerial

responsibilities

transactions conducted on their own account where such transactions within an issuer etc.

relate to>-

(i) bonds and shares of the said issuer admitted to trading

on a regulated market<

(ii) derivatives linked to the shares of the said issuer< or

(iii) other financial instruments linked to the shares of the

said issuer.

(2) The competent authority shall answer on an individual

basis all public requests for information concerning transactions referred

to in sub-regulation (1) where the request is made in writing and relates

to a named issuer and a clearly identifiable person who is either a person

discharging managerial responsibilities within such issuer or any other

person closely associated to him.

(3) (a) The Minister may by regulation under the Act

prescribe that, until the total amount of transactions, as computed in

paragraph (b) hereunder, has reached the equivalent of five thousand

Euros at the end of a calendar year, no notification is required or

notification may be delayed until the 31 st January of the following year.

(b) The total amount of transactions shall be computed

by summing up the transactions conducted on the own account of persons

discharging managerial responsibilities within an issuer with the

transactions conducted on the own account of persons closely associated

with a person discharging managerial responsibilities within an issuer.

(4) The rules of notification to which those persons have to

comply with shall be those of the Member State or EEA State where

the issuer is registered. Where the issuer is registered in Malta, the

notification to the competent authority shall be made in the form

prescribed in Schedule I to these regulations.

(5) Where the issuer is not registered in a Member State or

EEA State, the notification shall be made to the competent authority of

the particular Member State or EEA State which is defined as the home

Member State in terms of Directive 2003#71#EC in relation to Article

10 of the aforementioned Directive.

Duty of Notification of persons professionally arranging

transactions in financial instruments.

(1) For the purposes of applying article 11 of the Act, any

person professionally arranging transactions in financial instruments

who reasonably suspects that a transaction might constitute the

prohibited use of inside information or market manipulation shall

promptly notify the competent authority in the form prescribed in

Schedule II to these regulations.

(2) Any person professionally arranging transactions in

financial instruments shall decide on a case-by-case basis whether there

are reasonable grounds for suspecting that a transaction involves the

prohibited use of inside information or market manipulation, taking

into account the elements constituting the prohibited use of inside

information or market manipulation, referred to in the Act and

regulations issued under the Act as regards the definition and public

disclosure of inside information and the definition of market

manipulation and inside information in relation to derivatives on

commodities.

(3) Without prejudice to the provisions of territorial

application in Article 5 of the Act persons professionally arranging

transactions shall be subject to the rules of notification of the Member

State or EEA State in which they are registered or have their head office,

or in the case of a branch, the Member State or EEA State where the

branch is situated.

(4) The notification shall be addressed to the competent

authority of the Member State or EEA State referred to in sub-regulation

(3).

(5) Upon receiving the notification of suspicious

transactions related to regulated markets outside Malta the competent

authority shall transmit such information immediately to the competent

authorities of the regulated markets concerned.

(1) Persons subject to a notification obligation in regulations Means of

notification.

8 and 9 of these regulations may provide the completed form prescribed

in the relevant Schedule to these regulations to the competent authority>-

(a)

in written form by mail,

(b) electronic mail< and

(c)

telecopy or fax>

Provided that in all the above cases the means used is secure

and allows the competent authority to identify the sender with

reasonable certainty.

(2) Persons subject to a notification obligation in regulations

8 and 9 of these regulations may also provide the information required

to the competent authority by telephone>

Provided that in this case confirmation is notified by means

of a completed form prescribed in the appropriate Schedule to these

regulations upon the request of the competent authority.

(3) Where that information required by the competent

authority is not available at the time of notification, the notification

shall include at least the reasons why the notifying person suspects that

the transactions might constitute the prohibited use of inside information

or market manipulation.

All remaining information shall be provided to the competent

authority as soon as it becomes available.

(1) The persons notifying to the competent authority as

referred to in regulation 9 shall not inform any other person, in particular

the persons on behalf of whom the transactions have been carried out

or parties related to those persons, of this notification, except by virtue

of provisions laid down by law.

(2) The fulfilment of the requirement referred to in

regulation 9 shall not involve the notifying person in liability of any

kind, providing the notifying person acts in good faith.

(3) The competent authority shall not disclose to any person

the identity of the person having notified these transactions, if disclosure

would, or would be likely to harm the person having notified the

transactions. This provision is without prejudice to the requirements of

the enforcement and the sanctioning regimes under the Market Abuse

Directive and to the rules on transfer of personal data laid down in

Directive 95#46#EC.

(4) The notification in good faith to the competent authority

as referred to in regulation 9 shall not constitute a breach of any

restriction on disclosure of information imposed by contract or by any

legislative, regulatory or administrative provision, and shall not involve

the person notifying in liability of any kind related to such notification.

Schedule I

Notification by Persons discharging managerial responsibilities etc within an

Issuer pursuant to Article 10 of the Prevention of Financial Markets Abuse Act,

Date

Notification

Ref. No

Part 1: Notification of Managers’ Transactions

Name of person discharging

managerial responsibility

within the issuer/name of

person closely associated with

such a person

Capacity of person making

notification and the reasons

for his responsibility to notify

(eg in own name, mandate,

delegated authority)

Name of the relevant issuer

Description of the Financial

Instrument

Nature of Transaction

(acquisition or disposal)

Date and Place of the

transaction 1

transaction

Part 2: Further Information (if any)

Has the competent authority, and/or a Recognised Investment Exchange already been advised by telephone, written

communication or otherwise?

If so, indicate the organisation and person contacted ___________________________________________________________

I, as the person making the notification, hereby understand that the competent authority is duty-bound to ensure that public

access to information concerning the transaction herein notified is readily available as soon as possible .

Regulation 8 of the Prevention of Financial Markets Abuse (Disclosure and Notification) Regulations, 2005

requires that notification is made within five (5) working days of the transaction being conducted. Any delay

shall bring about liability in terms of Article 22 of the Prevention of Financial Markets Abuse Act.

Name of person making

notification

Date of Notification

Official Rubber Stamp of the Licence Holder

Signature of person making

notification.

Schedule II

Notification by persons professionally arranging transactions in

financial instruments pursuant to article 11 of the Prevention of

Financial Markets Abuse Act 2005 2

Date

Notification

Ref. No

Check appropriate box

o Initial Notification/Disclosure

o Supplemental Notification

Connected Notification

Ref. No. ______________________________

Ref. No. ______________________________

Part 1: Notifying Person/Entity –Details of Person Making Notification

Name of entity

Name of Individual (making

Notifications)

Position Held

Capacity in which the person is

making the notification

o Dealing on own account.

o On behalf of third Parties.

o As underwriter.

o other.

Telephone Number/s

Fax Number/s

Home

Home

Work

Work

Part 2: Identification Details

Name of

person/persons/entity who

carried out the transaction/s.

Capacity in which the

person(s) performing the

transaction(s) acts –e.g.

broker, underwriter, agent

Address of

person/persons/entity

Article 11 of the Prevention of Financial Markets Abuse Act requires that notification is made without

delay. Any delay shall bring about liability in terms of Article 22 of the Act.

Telephone Number(s) of

person/persons/entity

Date of birth (where

applicable)

Name of

person/persons/entity – on

behalf of whom the

transaction/s has/have been

carried out.

Address of

person/persons/entity

Telephone Number(s) of

person/persons/entity

Date of birth (where

applicable)

Name(s) of any other

person/persons/entity

(Identities of any persons known

to be involved in the

transaction/s)

Relation to person carrying

out the transaction.

Position Held

Address of

person/persons/entity

Telephone Number(s) of

person/persons/entity

Date of birth (where

applicable)

Part 3: Details of Transaction

Description of the

Transaction: (including all

characteristics of order and

market and at least the

ISIN Code of the

instrument; the market(s)

Concerned; the original

order’s entry date/time,

and sizes of the

transaction(s); the type and

characteristics of the

order).

Reasons for suspicion

that the transaction

might constitute market

abuse (all relevant

information)

Part 4: Further Information

Further information which may be of significance. The notification form should be described in a complete and clear manner.

(please list any accompanying material you are supplying)

Continue on a separate page if necessary.

Total number of Attachments – please list any accompanying material you are supplying

Has the competent authority and/or the law enforcement authorities and/or a Recognised Investment Exchange already been

advised by telephone, written communication or otherwise?

If so, indicate the organisation and person contacted ___________________________________________________________

DECLARATION

I, as the undersigned person making the notification, understand that where any of the information requested in this form

has not been submitted due to it not being available at the time of notification shall provide the competent authority with any

remaining information as soon as it becomes available.

Name of person making

notification.

Date of Notification

Official Rubber Stamp of the Licence Holder

Signature of person making

notification.

Mitbug[ fl-Istamperija tal-Gvern – Printed at the Government Printing Press