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16 December 2013

BaFin publishes WpHG Administrative Fine Guidelines


With the WpHG Administrative Fine Guidelines, BaFin discloses its practice for pursuing and punishing administrative offences. The WpHG Administrative Fine Guidelines are addressed to all market participants falling under the scope of the WpHG.

In its Securities Supervision directorate, BaFin punishes breaches of supervisory law provisions – for example on ad hoc publication, voting rights and financial reporting – by imposing administrative fines. BaFin has now set out the principles it applies to assessing administrative fines in WpHG Administrative Fine Guidelines. These guidelines reflect the specifics of securities legislation and also help create a level playing field in the assessment of administrative fines.

Administrative fines have both a special and general deterrence effect: on the one hand they make a perceptible appeal to those directly concerned as well as to interested parties to comply with their duties. On the other, they send a clear signal to all other market participants to observe the capital market rules laid down in the Securities Trading Act (Wertpapierhandelsgesetz – WpHG).

By issuing the WpHG Administrative Fine Guidelines, BaFin provides for more legal certainty by clarifying how it punishes breaches of the WpHG and which criteria it uses as basis for assessing the fines. The WpHG Administrative Fine Guidelines are also designed to strengthen efficiency and to ensure that the principle of proportionality is observed in assessing the fines.

BaFin can punish intentional breaches of significant publication requirements – such as the requirement of a domestic issuer to publish inside information (ad hoc publication) or threshold events for voting rights – by a fine of up to €1 million. In cases of recklessness, the maximum administrative fine is €500,000. Breaches of the requirement to transmit annual financial reports, half-yearly financial reports and interim statements are punishable by an administrative fine of up to €200,000 in cases of intent and by an administrative fine of up to €100,000 in cases of recklessness or negligence.

Assessment of WpHG Administrative Fine Guidelines

WpHG Administrative Fine Guidelines



© BaFin


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