09 January 2014

Leading Parliamentary Committee backs criminal sanctions for market abuse

The ECON Committee unanimously backed an agreement on the proposal reached with Member States, represented in the Council of Ministers, late last year (IP/13/1299). Under the new rules for countering insider dealing and market abuse, Member States will have to make sure that such behaviour, including the manipulation of benchmarks, is a criminal offence, punishable with effective sanctions everywhere in Europe. The agreement is now expected to be confirmed by the European Parliament in plenary in February 2014.

"We welcome today’s vote in favour of the Commission’s proposal, which confirms that Europe is willing to take all measures necessary to counter insider dealing and market abuse in its financial markets", said Vice-President Viviane Reding, the EU's Justice Commissioner and Michel Barnier, Internal Market and Services Commissioner. "We would like to thank the ECON Committee and its rapporteur, Arlene McCarthy, for their support and we now look forward to a swift adoption of this important proposal by Parliament and Council. We need to safeguard the integrity of our markets and protect the money of our citizens."

The agreement voted on today means that:

• There will be common EU definitions of market abuse offences such as insider dealing, unlawful disclosure of information and market manipulation;
• There will be a common set of criminal sanctions including fines and imprisonment with a maximum sanction of at least four years for insider dealing/market manipulation and of two years for unlawful disclosure of inside information;
• Legal persons (companies) will be held liable for market abuses;
• Member States need to establish jurisdiction for these offences if they occur in their country or the offender is a national;
• Member States need to ensure that judicial and law enforcement authorities dealing with these highly complex cases are well trained.

Press release

© European Commission