Delegated regulation 2016/1052 - Supplement to Regulation 596/2014 with regard to regulatory technical standards for the conditions applicable to buy-back programmes and stabilisation measures - Main contents
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official title
Commission Delegated Regulation (EU) 2016/1052 of 8 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the conditions applicable to buy-back programmes and stabilisation measures| Legal instrument | delegated regulation |
|---|---|
| Number legal act | Delegated regulation 2016/1052 |
| CELEX number i | 32016R1052 |
| Document | 08-03-2016; Date of adoption |
|---|---|
| Publication in Official Journal | 30-06-2016; OJ L 173 p. 34-41 |
| Effect | 01-07-2016; Entry into force Date pub. +1 See Art 9 03-07-2016; Application See Art 9 |
| End of validity | 31-12-9999 |
30.6.2016 |
EN |
Official Journal of the European Union |
L 173/34 |
COMMISSION DELEGATED REGULATION (EU) 2016/1052
of 8 March 2016
supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the conditions applicable to buy-back programmes and stabilisation measures
(Text with EEA relevance)
THE EUROPEAN COMMISSION,
Having regard to the Treaty on the Functioning of the European Union,
Having regard to Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation), and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (1), and in particular the third subparagraph of Article 5(6) thereof,
Whereas:
(1) |
To benefit from the exemption from the prohibitions on market abuse, trading in own shares in buy-back programmes and trading in securities or associated instruments for the stabilisation of securities should comply with the requirements and conditions set out in Regulation (EU) No 596/2014 and in this Regulation. |
(2) |
Although Regulation (EU) No 596/2014 allows stabilisation through associated instruments, the exemption for transactions relating to buy-back programmes should be limited to actual trading in the own shares of the issuer and should not apply to transactions in financial derivatives. |
(3) |
As transparency is a prerequisite for the prevention of market abuse, it is important to ensure that adequate information is disclosed or reported prior to, during and after the trading in own shares in buy-back programmes and trading for the stabilisation of securities. |
(4) |
In order to prevent market abuse, it is appropriate to set conditions regarding the purchase price and permitted daily volume of trading in own shares in buy-back programmes. To avoid circumvention of such conditions, the buy-back transactions should be carried out on a trading venue where the shares of the issuer are admitted to trading or traded. However, negotiated transactions that do not contribute to price formation could be used for the purpose of a buy-back programme and benefit from the exemption, provided that all the conditions referred to in Regulation (EU) No 596/2014 and this Regulation are met. |
(5) |
To avoid the risk of abusing the exemption for trading in own shares in buy-back programmes, it is important that this Regulation sets out restrictions with regard to the type of transactions an issuer can carry out during a buy-back programme and the timing of the trading in its own shares. Those restrictions should therefore prevent the selling of own shares by the issuer during the duration of a buy-back programme and take into account the possible existence of temporary prohibitions to trade within the issuer and the fact that an issuer may have legitimate reasons to delay public disclosure of inside information. |
(6) |
Stabilisation of securities is intended to provide support for the price of an initial or secondary offering of securities during a limited time period if the securities come under selling pressure, thus alleviating sales pressure generated by short term investors and maintaining an orderly market in those securities. It thus contributes to greater confidence of investors and issuers in the financial markets. Therefore, in the interest of investors having subscribed or purchased the securities in the context of a significant distribution, and in the interest of the issuer, block trades that are strictly private transactions should not be considered a significant distribution of securities. |
(7) |
In the context of initial public offers, certain Member States allow for trading prior to the commencement... |
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