Do you carry out confidential work for EU stock exchange quoted companies?

 

The rules introduced in 2016 made significant changes to the information you have to keep and the format you must keep it in.  This means that many suppliers to major UK companies will need to revise their procedures.  These rules particularly apply to printers, financial PR agents, Investment Bankers, NOMADs, accountants and lawyers.

ADVISOR MODULE: THE DETAIL

The EU Market Abuse Regulation (MAR) came into force across Europe on 3 July 2016. Under these new rules for any of your clients who are listed on a EU stock market you must:

 

  • Keep a record of all your employees and contractors who have inside information (retaining specific personal data for each person)

  • Obtain a written confirmation from each person that they understand the new rules

 

For all your employees who hold confidential price sensitive information for a client, you must record:

 

  • Full name

  • Surname at birth

  • Date of birth

  • Email address

  • Home address, landline and mobile telephone numbers

  • Work address, landline and mobile telephone numbers

  • Function (e.g. job title)

  • Reason for being an insider

  • National Identification Number

  • Name and address of the company for which they have access to inside information

  • The date and time (in UTC) when they gained access and then ceased to have access to a client’s inside information

 

These records must be kept up to date and each version must be retained for 5 years.  The format of your insider list is also regulated.

What happens to this information

 

When / if your client is asked for their “insider list” by the Financial Conduct Authority you, the advisor, must be able to send your list to your client. Your client will amalgamate your list with theirs and pass it on to the FCA.

 

There will be very little time in which to do this. It may not be possible for you to obtain all the data required when the request is made by the FCA. In addition, it is likely that the data request will be for some date prior to the date it is made. This means you could benefit from a system on which to record this now!

IMTrack solution for advisors

IMTrack provides a solution to this onerous duty. It is a system specifically built with a module for companies supporting listed entities, This includes printers, financial PR agents, Investment Bankers, NOMADs, accountants and lawyers. 

The system specifications are quite different from a system designed to be used by large listed companies as you will need to retain separate regulatory and confidential lists for each of your clients and be able to issue these separately if called to do so.

 

EXAMPLE

 

You are a financial PR agency. Some months ago you worked on the PR for the potential takeover of Hey plc by Bee plc.

 

You were retained by Hey plc to give advice to them on how to get the best PR on the deal. This meant that you were aware of the potential takeover a few weeks before its announcement. You had a team of three people working on this; their personal assistants would have also been aware. Finally, Hey plc used your print team to prepare the takeover offer documents. In total you had 12 people working on the assignment.

 

In December 2016 you suddenly receive a call out of the blue from the Company Secretary at Hey plc explaining that the FCA has approached them and asked for their full insider list as at 13.00hrs on Wednesday 6th July.

 

If you have a system in which you have recorded this information you should be able to produce this list within minutes. If you don’t, it is likely that you will let your client down. Your client will potentially receive a heavy fine and will look to you for re-imbursement.

 

If you haven’t been asked already, your bigger clients will be undertaking a due diligence exercise to assess whether you have appropriate systems in place to deal with this.

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