Market Abuse Directive (MAD) meaning

Background Adopted in 2003, the Market Abuse Directive 2003/6/EC (MAD) set an EU‑wide legal framework to safeguard market integrity against insider dealing and market manipulation. In the wake of the extensive harm caused by the financial crisis, MAD’s effectiveness was reviewed, leading the European Commission to recommend its repeal and replacement. Consequently, on 12 June 2014, two new instruments were published in the Official Journal of the European Union: Regulation (EU) 596/2014 (EU Market Abuse Regulation) Directive 2014/57/EU on criminal sanctions for market abuse (CSMAD) In combination, the EU Market Abuse Regulation and CSMAD displaced MAD and introduced a refreshed EU market abuse regime, capturing a wider array of markets, products and behaviours than before. Both measures took effect on 3 July 2016. For further detail on the EU Market Abuse Regulation, see Practice Note: EU Market Abuse Regulation (MAR)—essentials... Purpose of CSMAD Minimum rules for criminal sanctions CSMAD sets minimum rules for criminal penalties covering insider dealing, the...

Background The Market Abuse Directive 2003/6/EC (MAD) was enacted in 2003, creating a legal framework across the EU to safeguard market integrity against insider dealing and market manipulation. In the wake of the extensive harm caused by the financial crisis, however, an assessment of MAD’s effectiveness was undertaken, leading the European Commission (Commission) to propose its repeal and replacement. Consequently, on 12 June 2014, the Official Journal of the European Union published the texts of two new legislative instruments: Regulation (EU) 596/2014 (EU Market Abuse Regulation), Directive 2014/57/EU on criminal sanctions for market abuse (CSMAD) Together, the EU Market Abuse Regulation and CSMAD displaced MAD and ushered in a new EU‑wide market abuse regime that spans a broader range of markets, products and behaviour than before. The EU Market Abuse Regulation and CSMAD took effect on 3 July 2016. During the 2009 Lisbon Treaty negotiations, the UK and Ireland secured the Protocol on the Position of the United Kingdom and Ireland in...

ARCHIVED: This Practice Note is archived and is not maintained. In each section of this Practice Note, links are provided to the relevant provisions of EU and/or UK legislation, as applicable, and any significant divergence between the relevant EU and UK legislation is clearly identified. EU Market Abuse Regulation—background and purpose The Market Abuse Regulation (the EU Market Abuse Regulation) annulled and superseded the former Market Abuse Directive (Directive 2003/6/EC) (OJ L 96/16) (MAD) and its implementing legislation on 3 July 2016. The EU Market Abuse Regulation established a refreshed and bolstered EU market abuse framework, introducing a broader scope and more stringent sanctions. Outside of the UK, the Market Abuse Regulation was supplemented by Directive 2014/57/EU on criminal sanctions for market abuse (CSMAD). The UK used its powers to opt out of CSMAD, as it already has an established criminal regime for market abuse under the Criminal Justice Act 1993 and the Financial Services Act 2012. For an overview of CSMAD, see Practice Note: Directive 2014/57/EU...