MAR v2

Question 1

What are the 3 offences under MAR?

Answer 1

1) Insider Dealing
2) Unlawful disclosure of insider information
3) Market Manipulation

Question 2

What is insider dealing

Answer 2

Dealing based upon non-public information

Question 3

How is non-public information defined?

Answer 3

It must be:

1) Specific or precise
2) non-public
3) if made public would significantly influence price

Question 4

What is dealing defined as?

Answer 4

1) Acquiring
2) Disposing
3) Modifying or cancelling an order
4) Encouraging another to deal

Question 5

What punishments are there for insider dealing?

Answer 5

Prison Sentence + Fine

Question 6

What assets are in scope for insider dealing, as defined in the CJA

Answer 6

stocks, bonds, certificates, warrants, options, futures and CFDs

Question 7

What is market manipulation?

Answer 7

Using deceitful tactics to influence or anchor the price of a financial instrument

Question 8

What four actions constitute market manipulation

Answer 8

1) Giving false or misleading signals about the supply, demand or price of an instrument
2) Using ficticious devices to alter the price of a security
3) Disseminating false information that in order to anchor the price of an instrument
4) Other actions such as colaborating to gain a dominant market position in order to influence the price of a security

Question 9

What other instrument is in scope for market manipulation?

Answer 9

Benchmarks

Question 10

What are the provisions for unlawful disclosure?

Answer 10

1) General disclosure agreement requires firms to release insider information to the public when it concerns them
2) Maintaining insider lists
3) Requiring directors and senior executives to disclose all relevant trades to the regulator (stocks, bonds etc)