Disclosure and delayed disclosure of inside information in the light of the EU Market Abuse Regulation

Show full item record


Title: Disclosure and delayed disclosure of inside information in the light of the EU Market Abuse Regulation
Author: Hellstén, Linda
Other contributor: Helsingin yliopisto, Oikeustieteellinen tiedekunta
University of Helsinki, Faculty of Law
Helsingfors universitet, Juridiska fakulteten
Publisher: Helsingfors universitet
Date: 2015
Language: eng
URI: http://urn.fi/URN:NBN:fi:hulib-201508063246
Thesis level: master's thesis
Discipline: Commercial law
Abstract: The EU securities market regulation is under a reform. The new Market Abuse Regulation (the MAR) was passed in summer 2014 and it will come into force and replace the current Market Abuse Directive (the MAD) in July 2016. The MAR has been enacted as a regulation and it thus has a direct effect, i.e. it will be directly applicable in all Member States. The MAR will tighten the ongoing disclosure regulation, which means in practice that issuers are required to disclose more information than ever before. Most importantly, the MAR extends the obligation to disclose also to uncertain information relating to future events. Consequently, such a far-reaching disclosure obligation requires correction not to jeopardise issuer interests. Correction is provided by the delayed disclosure provision, the interpretation of which will be the hot question of the EU disclosure regulation in the near future. The delayed disclosure mechanism will serve as a safe harbour to issuers. However, entry to the safe harbour is strictly regulated by three criteria (i.e. legitimate interests of the issuer, misleading the public and confidentiality of the information) which need to be met in order to grant the access to the harbour. The interpretation of the criteria is a dilemma and a solution to it needs to be found to strike an optimal balance between disclosure and delayed disclosure. In other words, there is a conflict of transparency, favoured by investors, and confidentiality, favoured by issuers, and a balance between these conflicting interests is needed. Finding the optimal balance is not only in the interest of issuers and investors but also of the market in general, as disclosure is a key to efficient and well-functioning securities markets. The answer to the dilemma lies in how broadly or narrowly the criteria for delayed disclosure are interpreted, and this thesis thus focuses on searching for the optimal balance by means of interpretation. The thesis concentrates on the following research problems: 1) what is the current status of the disclosure regulation across Europe, 2) on what grounds may an issuer delay the disclosure of inside information, and 3) how should the disclosure and delayed disclosure be balanced i.e. what should the balance be between transparency and confidentiality? Discussing the first question lays the foundation for the thesis. The implementation of MAD in chosen Member States, i.e. Germany, France, the UK, Italy, Finland, Sweden and Denmark, will be discussed in order to map the current status of the disclosure regulation and the challenges that will be faced in the era of the MAR. Discussing the second question includes a thorough analysis of the criteria for delayed disclosure, the interpretation of which is the key to finding the optimal balance for transparency and confidentiality. Again, the practices adopted across Member States will be analysed in order to get an overall picture of the functioning of the delayed disclosure mechanism. Finally, the third question leads to the core of the thesis and to the proposed solution on how the conflict of transparency and confidentiality should be solved and how the disclosure and delayed disclosure should be balanced. The thesis contributes mainly to the EU securities market law, but interfaces to other fields of law, company and criminal law in particular, have also been taken into account. A pluralistic method has been adopted in the thesis and it contains elements from legal dogmatics, law and economics as well as from comparative law. Legal dogmatics is the core, whereas law and economics and comparative law bring perspective to the thesis and diversify the analysis. Further, a market-based interpretation method has been applied, which combines the teleological interpretation method typical for EU law and economic argumentation needed in securities market law. Using the market-based method in interpreting the disclosure regulation is crucial in order to take into consideration the market environment and the purpose of the regulation and to find an optimal balance for disclosure and delayed disclosure.

Files in this item

Total number of downloads: Loading...

Files Size Format View
Masters thesis Linda Hellsten.pdf 833.1Kb PDF View/Open
Master's thesis Linda Hellsten.pdf 833.1Kb PDF View/Open

This item appears in the following Collection(s)

Show full item record