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CF > 6. Market Abuse & Insider Dealing > Flashcards

6. Market Abuse & Insider Dealing Flashcards

1
Q

Which offence is a civil offence for insider dealing

A

14 MAR

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2
Q

What procedure must be followed if sounding out Ms/potential investors to avoid being liable under 14 MAR

A

11(3) - (7) MAR

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3
Q

Where is ‘engaging in ID’ defined for 14 MAR

A

8(1)

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4
Q

What test do you use to work out if ‘significant effect’ on price from II

A

Reasonable investor test under 7(4)

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5
Q

How is ‘inside source’ defined for 52 CJA

A

E.g. D of issuer or access through employment/profession

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6
Q

What consequences are there for the firm if insider dealing

A

Breach confidentiality Uts in letter of engagement, and issuer may sue firm

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7
Q

What two markets are included in ‘RM’ for 52(1) CJA

A

MM and AIM

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8
Q

What are the penalties for committing offence under 52 CJA

A

Fine and/or imprisonment for up to 7 years

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9
Q

Why will issuer have included confidentiality UTs in LoE w/ firm

A

To comply w/ 17(8) MAR (selective disclosure)

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10
Q

Why is 52 CJA less commonly used

A

Standard of proof is criminal BRD

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11
Q

Definition of II under 7 MAR

A

Precise, not public, relate to shares, ‘significant effect’ on price

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12
Q

What other consequences may there be for individual who engaged in ID, beyond civil/criminal offence

A

Breach of mandatory principles + Ch.4 CoC (if S), as well as confidential provisions of employment contract

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13
Q

Which offence is a criminal offence for insider dealing

A

52 CJA

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14
Q

Where are the defences to 52 CJA

A

53

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15
Q

How is ‘insider’ defined for 52 CJA

A

Subjective - if knows II from inside source

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16
Q

What are the offences under 14 MAR

A

Engaging, recommending/inducing ID or unlawfully disclosing

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17
Q

Where is ‘unlawfully disclosing II’ defined for 14 MAR

A

10(1)

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18
Q

What two possible offences apply if insider dealing

A

52 CJA and 14 MAR

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19
Q

When will it not be considered ‘unlawful disclosure’ for the purposes of 10(1) MAR

A

If sounding out selected Ms/potential investors + follow 11(3) - (7) MAR

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20
Q

What are the defences under 9 MAR

A

Legit behaviours, e.g. info barriers

21
Q

What part of CJA defines ‘inside info’

A

56

22
Q

How is ‘inside info’ defined for 52 CJA

A

Similar to 7 MAR - particular shares, specific/precise info, not public + significant effect on price

23
Q

Geographical limit on 52 CJA

A

Individual must be in UK, or market is UK RM

24
Q

Where are the penalties for 52 CJA

A

61

25
Q

Where is ‘insider’ defined for 52 CJA

A

57(1)

26
Q

Under what provision is FCA empowered to enforce breaches of MAR

A

Article 23

27
Q

Restitution orders under what provisions

A

383 - 386 FSMA

28
Q

What offence is also likely if encouraging another to deal on II

A

Disclosing

29
Q

Where is ‘recommending/inducing ID’ defined for 14 MAR

A

8(2)

30
Q

What has there been a shift towards recently by FCA to do with II and ID

A

Towards criminal prosecutions - 89 FSA (false impression) and 52 CJA

31
Q

How do the defences apply to 52 CJA

A

They are offence specific

32
Q

Where are the defences to 14 MAR

A

9 MAR

33
Q

What other powers does FCA have for breach of Article 14, other than enforcement powers under 122 - 123 FSMA

A

Restitution orders

34
Q

Where is ‘inside source’ defined for 52 CJA

A

57(2)

35
Q

What provision defines geographical limits on 52 CJA

A

62 CJA

36
Q

Why can issuer sue firm of individual who engaged in ID for BoC

A

C would have ensured people on insider list acknowledged duties (per 18(2)) + would have included as term in LoE

37
Q

If a legit behaviour under 9 MAR is proven, what happens

A

Burden falls on FCA to prove individual did engage in ID

38
Q

What are the offences under 52 CJA

A

Dealing, encouraging and disclosing inside info

39
Q

Where are FCA’s enforcement powers for breach of MAR

A

122A - I and 123 FSMA

40
Q

Which offence for ID only applies to individuals

A

52 CJA

41
Q

What provision gives circumstances in which individual must have obtained II to be liable under 14 MAR

A

8(4) MAR

42
Q

When does Article 14 MAR aply

A

If person has II due to being e.g. D of issuer or through employment

43
Q

What provision gives definition of II for 14 MAR

A

7

44
Q

What powers generally apply whenever MAR has been breached

A

122 + 123 FSMA

45
Q

What FCA power only applies for breach of Article 14 MAR

A

Restitution orders under 383 - 386

46
Q

Under 123(2) FCA can do what

A

Unlimited fine

47
Q

Under 123(3) FCA can do what

A

Issue statement censuring

48
Q

8(4) MAR for possessing inside info applies to which offences under 14

A

All of them

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