Publication
Keeping your dawn raid guidance current
Unannounced inspections or ‘dawn raids’ are used by antitrust authorities to obtain evidence when there are suspicions that individuals or businesses have infringed the antitrust rules.
Global | Publication | July 8, 2016
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On July 5, 2016 the City of London Law Society (CLLS) and Law Society Company Law Committees' Joint Working Parties on Market Abuse, Share Plans and Takeovers Code published a Q&A on the Market Abuse Regulation (MAR).
The Q&A sets out a suggested approach to implementing certain aspects of MAR, and provides answers to questions including the following:
PDMR Dealings (Article 19)
Share BuyBacks (Article 5)
Disclosure (Article 17)
Insider Lists (Article 18)
Investment Recommendations (Article 20)
The Joint Working Parties note that the Q&A is an explanation of how, in their view, MAR should apply to certain practical situations, but is subject to review and amendment in the light of practice on the implementation of MAR and to any relevant future UK or EU guidance published in relation to MAR.
On July 4, 2016 the Investment Association (IA) published an updated version of its share capital management guidelines, previously published in July 2014.
Section 1 (Directors' Power to Allot Shares) has been updated to state that IA members support the Pre-emption Group’s template resolutions for the disapplication of pre-emption rights. These resolutions relate to the disapplication of pre-emption rights over five per cent of the issued share capital to be used on an unrestricted basis and a second resolution, to be put forward by companies when appropriate, requests the disapplication of pre-emption rights for an additional five per cent in cases when the board considers the use to be for the purposes of an acquisition or specified capital investment in accordance with the Statement of Principles. IA members have requested the Institutional Voting Information Service to amber top any company seeking such a disapplication of pre-emption rights which does not provide two separate resolutions as set out in the template from August 1, 2016, and to red top any such company from January 1, 2017.
(The Investment Association, Share Capital Management Guidelines, 04.07.16)
On July 4, 2016 the Investment Association (IA) published a notice stating that the implementation of the Market Abuse Regulation (MAR) will have an effect on the guidance in its Principles of Remuneration (the Principles) regarding the timing of share awards. Accordingly, given the change in definition of closed periods in MAR and the ongoing uncertainty regarding the long term implementation of this provision, the IA has amended Section C.2 (viii) of the Principles to state that the rules of a long-term incentive scheme should provide that share or option awards should normally be granted within a 42 day period immediately following the end of the closed period under MAR.
The IA also notes that, as previously announced, it will review the Principles following the Executive Remuneration Working Group’s final report, which is due to be published by the end of July 2016 and will incorporate its annual review into this process.
(Investment Association, Principles of Remuneration, 05.07.16)
On July 4, 2016, the Financial Conduct Authority (FCA) published its thirteenth quarterly consultation paper, which, among other things, proposes changes to the Handbook Glossary and the requirements in the Disclosure Guidance and Transparency Rules (DTRs).
Specifically, these proposals entail:
The FCA has requested comments on the proposals by September 1, 2016.
On July 5, 2016 the Association for Financial Markets in Europe (AFME) published guidance on research meetings and material prior to the award of a capital markets mandate.
The guidance covers:
On July 5, 2016 the European Commission published a proposal for a directive to amend the Fourth Money Laundering Directive (Directive 2015/849/EU) and the First Company Law Directive (Directive 2009/101/EC).
Proposed provisions include:
The European Commission proposes that member states must implement the Directive by January 1, 2017.
On July 4, 2016 the European Securities and Markets Authority (ESMA) published a peer review on the prospectus approval process with the objectives of assessing the effectiveness of the application of the prospectus regime, the efficiency of the approval process and the proportionality of the resource allocation to prospectus scrutiny, and of assessing the nature and consistency of prospectus approval processes employed by national competent authorities (NCAs), both internally and on a cross-NCA basis.
The main findings of the review are:
The review sets out a number of recommendations for enhancing supervisory convergence and those include the identification of legislative clarifications as well as other areas for consideration.
(ESMA, Peer Review on Prospectus Approval Process, 04.07.16)
On July 7, 2016 the Government Equalities Office announced a new review on improving female representation in leadership positions of British business, broadening the ambition to the entire FTSE 350 and raising the target to 33 per cent of women on boards by 2020. The review will focus on ensuring the very best of female talent make their way up the pipeline by removing barriers to their success, and continue to drive forward the momentum from Lord Davies’s work as chair of the Women on Boards Review - which pushed the numbers of females on FTSE 100 boards up from 12.5 per cent to 26 per cent.
The review will consider current research on how to drive improvements and the obstacles preventing women’s progress, and findings are expected to be presented to the Government by the end of 2016. Further appointments have also been made to the Women’s Business Council.
Publication
Unannounced inspections or ‘dawn raids’ are used by antitrust authorities to obtain evidence when there are suspicions that individuals or businesses have infringed the antitrust rules.
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