Directive 2004/72 - Implementation of Directive 2003/6/EC 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 - Main contents

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Commission Directive 2004/72/EC of 29 April 2004 implementing Directive 2003/6/EC of the European Parliament and of the Council 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 (Text with EEA relevance)

Official Journal L 162 , 30/04/2004 P. 0070 - 0075

Commission Directive 2004/72/EC

of 29 April 2004

implementing Directive 2003/6/EC of the European Parliament and of the Council 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

(Text with EEA relevance)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Community,

Having regard to Directive 2003/6/EC of the European Parliament and of the Council of 28 January 2003 on insider dealing and market manipulation (market abuse)(1), and in particular the second paragraph of point 1 and point 2(a) of Article 1 and the fourth, fifth and seventh indents of Article 6(10) thereof,

After consulting the Committee of European Securities Regulators (CESR)(2) for technical advice,

Whereas:

• (1) 

  Practising fairness and efficiency by market participants is required in order not to create prejudice to normal market activity and market integrity. In particular, market practices inhibiting the interaction of supply and demand by limiting the opportunities for other market participants to respond to transactions can create higher risks for market integrity and are, therefore, less likely to be accepted by competent authorities. On the other hand, market practices which enhance liquidity are more likely to be accepted than those practices reducing them. Market practices breaching rules and regulations designed to prevent market abuse, or codes of conduct, are less likely to be accepted by competent authorities. Since market practices change rapidly in order to meet investors' needs, competent authorities need to be alert to new and emerging market practice.

• (2) 

  Transparency of market practices by market participants is crucial for considering whether a particular market practice can be accepted by competent authorities. The less transparent a practice is, the more likely it is not to be accepted. However, practices on non regulated markets might for structural reasons be less transparent than similar practices on regulated markets. Such practices should not be in themselves considered as unacceptable by competent authorities.

• (3) 

  Particular market practices in a given market should not put at risk market integrity of other, directly or indirectly, related markets throughout the Community, whether those markets be regulated or not. Therefore, the higher the risk for market integrity on such a related market within the Community, the less those practices are likely to be accepted by competent authorities.

• (4) 

  Competent authorities, while considering the acceptance of a particular market practice, should consult other competent authorities, particularly for cases where there exist comparable markets to the one under scrutiny. However, there might be circumstances in which a market practice can be deemed to be acceptable on one particular market and unacceptable on another comparable market within the Community. In case of discrepancies between market practices which are accepted in one Member State and not in another one, discussion could take place in the Committee of European Securities Regulators in order to find a solution. With regard to their decisions about such acceptance, competent authorities should ensure a high degree of consultation and...

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