Market Abuse | Entry into Force of the New Market Abuse Law

On December 30th 2016, the law of December 23rd 2016 on market abuse (the “New Market Abuse Law”) entered into force. The New Market Abuse Law implements Regulation (EU) No 596/2014 of April 16th 2014 on market abuse (the “Market Abuse Regulation”), transposes Directive 2014/57/EU of April 16th 2014 on criminal sanctions for market abuse (the “Market Abuse Directive”) and Commission Implementing Directive 2015/2392 and repeals the Luxembourg law of May 9th 2006 on market abuse (the “Previous Market Abuse Law”).

In addition to describing in detail the administrative sanctions/measures and criminal sanctions applicable in case of violation of certain provisions of the Market Abuse Regulation, the New Market Abuse Law designates the CSSF as the competent authority for the purposes of the Market Abuse Regulation and sets out its powers (with an indication of which powers need prior judicial authorisation before being exercised); the cooperation which is required between the CSSF and the State Prosecutor, when exercising their respective powers is also described. Furthermore, the rules regarding the cooperation of the CSSF with competent authorities of Member States and of third countries are detailed.

Issuers who are subject to the Luxembourg law of January 11th 2008 on transparency requirements for issuers, as amended (the “Transparency Law”) should note that that law has been amended by the New Market Abuse Law so as to extend the definition of “regulated information”. Previously “regulated information” covered all information which the issuer, or any other person who has applied for the admission of securities to trading on a regulated market with the issuer’s consent, is required to disclose under the Transparency Law as well as under Article 6 of Directive 2003/6/EC of the European Parliament and of the Council of January 28th 2003 on insider dealing and market manipulation (which in summary referred to inside information). The new definition of “regulated information” will still cover inside information (by referring to Article 17 of the Market Abuse Regulation) but also the notifications which an issuer is required to make in respect of transactions conducted by persons discharging managerial responsibilities and persons closely associated with them (by referring to Article 19 of the Market Abuse Regulation).

Finally, we refer you to the CSSF press release regarding the entry into force of the New Market Abuse Law.