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M&A and CorporateRegulatory & Competition
Mantas Gofmanas, TGS Baltic Senior Associate
As the Board of the Bank of Lithuania adopted new Information Disclosure Rules (the “Rules”), the Lithuanian national regulation in connection with prevention of market abuse, disclosure of inside information, disclosure of information about managers’ transactions, also regulation in connection with persons in possession of inside information, etc., has been finally fully harmonised with requirements of Regulation No. 596/2014 on market abuse (the “MAR”) and related regulatory technical standards and implementing technical standards.
The MAR came into effect on 3 July 2016 and from this date it is directly applicable in the whole of the EU. However, as Lithuanian legal acts on issues regulated by the MAR were not amended accordingly, it was often the case that the MAR and Lithuanian legal acts repeated each other, their regulation did not always coincide and certain issues were regulated by them in different scope (e.g. they set different time limits for giving notices about transactions of the issuer’s managers (persons discharging managerial responsibilities) in the issuer’s securities, the possible forms of market abuse did not fully coincide, regulation of the possibility for issuers to postpone disclosure of inside information, categories of persons closely associated to a person discharging managerial responsibilities partially overlapped and did not fully coincide, etc.).
According to general principles of law, if national legal acts are not amended, their requirements, that were not contrary to the MAR, were to be further applied and were applied along with the MAR provisions. And though the Bank of Lithuania had issued several explanations regarding application and non-compatibility of the MAR and non-amended Lithuanian legal acts, in this transitional period market participants still had a lot of questions, uncertainties and ambiguities.
After the Seimas amended the Law on Securities and the Law on Markets in Financial Instruments at the end of June 2017 and the Board of the Bank of Lithuania adopted the Rules at the end of August 2017, which, inter alia, harmonised requirements for prevention of market abuse, disclosure of inside information and managers’ transactions with provisions of the MAR and invalidated irrelevant national legal acts, all the said non-conformities and uncertainties were basically eliminated.
Thus, from now on, participants of the financial market, that are subject to requirements in connection with issues regulated by the MAR, will have in fact to follow only the MAR itself, the said laws and the Rules, which have been already harmonised.
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