Decree No. 536 / 2004 Coll.
Decree implementing certain provisions of the Capital Market Enterprise Act in the field of protection against market abuse
Valid
Order
Effective from 01.01.2005
536
DECLARATION
of 22 September 2004
implementing certain provisions of the Capital Market Enterprise Act in the field of protection against market abuse
According to § 199 (2) (p) and (q) of Act No. 256 / 2004 Coll., on the Capital Market Business, hereinafter referred to as "the Act":
BASIC PROVISIONS
Subject matter
This decree implements the relevant provisions of the European Community1) and provides for more detailed rules for:
(a) the definition of the concept of inside information;
(b) disclosure of inside information pursuant to Article 124 (1) of the Act and its transmission to the Czech National Bank by the issuer of a financial instrument (hereinafter referred to as the "issuer");
(c) postponement of disclosure of inside information, including the definition of the grounds for postponement of publication and the manner in which confidentiality of inside information is ensured;
(d) keeping a list of persons who have access to inside information, including details of the persons to be kept on that list;
(e) the notification of transactions in securities of the issuer or financial instruments derived from these securities to the Czech National Bank by persons pursuant to Article 125 (5) of the Act, including the way in which the notification is sent to the Czech National Bank and a more detailed definition of the types of transactions to which the reporting obligation applies;
(f) assessment of market manipulation;
(g) notification of a reasonable suspicion of the use of inside information or market manipulation, including the way in which the notification is sent to the Czech National Bank.
DETAILED DETERMINATION OF THE NAME OF INTERNAL INFORMATION AND LETTING WITH INTERNAL INFORMATION
More detailed definition of the concept of inside information
(1) The information is accurate if:
(a) its content is a fact which has occurred or a fact which can reasonably be expected in the future; and
(b) it is so certain that on its basis it is possible to conclude on the effect of the fact referred to in (a) on the rate, price or yield of the relevant financial instrument or derivative.
(2) Information that could significantly affect the rate or yield of a financial instrument after becoming publicly known is information that can be expected to be taken into account by a reasonable investor in making investment decisions.
(3) The internal information in relation to a commodity derivative shall be considered to be accurate information that relates directly or indirectly to a commodity derivative, is not publicly known and that participants in the regulated market on which such a derivative is traded may expect to be disclosed to them in accordance with the usual practice of trading on that market. Such information is in particular information which
(a) is normally available to participants in a regulated market; or
(b) is published in accordance with the laws, regulations and practices of the organiser of a regulated market, contractual obligations or practices relating to a regulated market in which a commodity derivative is traded or a market in which the underlying commodity of such a commodity derivative is traded.
Disclosure of internal information
(1) The internal information to be published by the issuer under the law in a way that allows remote access shall be published by the issuer in full on its website immediately after it has become aware of it, in the manner in which the issuers normally publish information on their activities. In doing so, they shall in particular ensure that:
(a) the Internet address has been accessible to the public without restriction via the Internet data network and can be easily searched by business or by the name of the issuer and provided free of charge by the issuer,
(b) the internal information published took the form of a data file suitable for download, in a commonly used format;
(c) the internal information disclosed in this way has been made available continuously since publication for at least 5 years, or as long as the financial instrument is admitted to trading on a regulated market of a Member State of the European Union if this period is less than 5 years.
(2) At the same time, the issuer shall ensure the publication of internal information in its full version or by reference to its website to which internal information is published through a mass and regularly visited financial server dealing with the dissemination of information relating to the capital market; the list of servers will be published by the Czech National Bank in the Czech National Bank Bulletin and at its website. This shall not apply if the issuer has simultaneously published internal information in addition to the method referred to in paragraph 1:
(a) at least one national distribution diary; or
(b) as a report from the Agency dealing with the dissemination of information relating to the capital market.
(3) If there is a significant change in the internal information already published or if the issuer finds that the internal information disclosed contains incorrect information, it shall be a new internal information which the issuer must publish without delay in the same way as the original inside information was published; in case of correction of incorrect data, indicate the reason for the correction.
(4) The issuer distinguishes internal information from its commercial and promotional information in such a way that it cannot be confused with it, in particular in its name it clearly uses the word link "internal information."
(5) Where an issuer also publishes internal information in another Member State of the European Union under the legislation of that other Member State, it shall ensure that publication takes place simultaneously.
Sending inside information to the Czech National Bank
(1) The issuer will send inside information to the Czech National Bank to the address published in the Czech National Bank Bulletin by e-mail immediately after it has heard about it; in the heading of the e-mail message, the item shall indicate the text "issuer '.
(2) A report containing inside information shall be provided by the issuer by a guaranteed electronic signature based on a qualified certificate issued by an accredited certification service provider (3).
Deferred disclosure of inside information
(1) The serious reasons for which the issuer may delay the disclosure of internal information are in particular:
(a) ongoing negotiations and related facts where the outcome or orderly conduct of such negotiations could be adversely affected by the disclosure of internal information, in particular when the conduct is conducted for the purpose of the long-term financial recovery of an issuer whose financial situation is seriously and immediately compromised;
(b) decisions made or contracts negotiated by a senior employee or an issuer's authority whose effectiveness requires approval by another issuer's authority if the disclosure of inside information before such approval, together with a current declaration that the decision or contract has not yet been approved, would jeopardise the correct assessment of inside information by investors.
(2) An issuer may defer disclosure of internal information only if it takes measures to enable it to disclose internal information without delay after it has ceased to be able to safeguard its confidentiality and ensures that access to such information is checked at least by:
(a) implement effective measures to prevent access to inside information to persons other than those who are essential to the proper performance of their functions within the issuer;
(b) take the necessary measures to inform any person with access to inside information of the obligations arising from legislation in relation to inside information and of penalties relating to misappropriation or unauthorised dissemination of inside information.
(3) If any of the conditions referred to in paragraph 1 or 2 are no longer met or the confidentiality of inside information has been infringed, the issuer shall be obliged to disclose the inside information immediately after it has become aware of that fact.
Notification of postponement of disclosure of inside information
The issuer shall immediately notify the Czech National Bank by e-mail, using a form, the model of which contains Annex 1 to this Order, the postponement of the publication of internal information, together with the reasons for the postponement and the measures taken pursuant to § 5 (2). This notification shall be provided by the issuer with a guaranteed electronic signature based on a qualified certificate issued by an accredited certification service provider (3).
IMPLEMENTATION OF THE LIST OF PERSONS WHO HAVE ACCESS TO INTERNAL INFORMATION
Persons listed
The list of persons who have access to internal information (hereinafter referred to as "the list ') shall include all persons who have regular or occasional access to internal information relating directly or indirectly to the issuer and who:
(a) the authorities or bodies of the issuer are members;
(b) are employees of the issuer;
(c) perform a contract activity for the issuer, in particular those providing advisory or legal services to the issuer; or
(d) are employees or other persons who have access to internal information with a person referred to in (c).
Rules governing the keeping of the list
(1) The list shall include at least:
(a) details of each person (4) pursuant to § 7, except for residence or residence;
(b) the reason for listing that person, in particular what internal information or the circle of internal information he has access to;
(c) the date of establishment of the list and the date of each update of the list.
(2) The issuer shall ensure that the list is updated without undue delay,
(a) if the particulars referred to in paragraph 1 (a) or (b) are changed,
(b) if another person is to be added to the list,
(c) if any of the persons listed no longer has access to internal information.
(3) Where a person listed has access or no longer has access to internal information, it shall be apparent from the list when that fact occurred.
(4) The list is kept by the issuer in electronic form.
(5) The list shall be kept by the issuer for at least five years from its creation and any update thereof.
(6) The issuer shall ensure that the persons listed are aware of the obligations laid down by the legislation on the handling of internal information and penalties which are linked to the misuse or unauthorised dissemination of internal information.
NOTIFICATION OF TRANSACTIONS BY VICTIMS
More detailed definition of the types of transactions covered by the notification obligation
(1) The notification obligations under Section 125 (5) of the Act shall be subject to transactions in shares or provisional certificates issued by the issuer and transactions in financial instruments the value of which is derived from those shares or provisional certificates.
(2) The person referred to in Section 125 (5) of the Act fulfils the notification requirement if the sum of the transaction values in a calendar year exceeds EUR 5 000 in respect of all transactions made in a calendar year.
(3) For the purposes of assessing whether a condition referred to in paragraph 2 is met, the issuer or the person who is a member of the supervisory authority of the issuer shall be added to the value of the transactions made in the same calendar year for his own account.
(a) spouse,
(b) an uninsured child;
(c) other relatives living with her in the same household for at least one year;
(d) another person who is, for at least one year, a member of the supervisory body of the issuer, who is in a similar family relationship to the leading person of the issuer or of the person who is a member of the supervisory body of the issuer, who has lived with him in the same household for at least one year, and who would have suffered harm from one of them, the other would reasonably have felt his own harm; or
(e) a legal person pursuant to § 125 (5) of the Act.
(4) In the case of a person referred to in paragraph 3 (a) to (e), the value of transactions executed in the same calendar year shall be added to the transaction values for the purposes of assessing whether the condition referred to in paragraph 2 is met for the purposes of the management of the issuer or the person who is a member of the supervisory authority of the issuer.
(5) The transaction value referred to in paragraph 2 shall be the market value of the transaction object at the date of the transaction; in the case of options, the value means the market value of the underlying asset.
Notification procedure
(1) The notification shall include at least:
(a) the trading firm or name of the issuer;
(b) the issuer's identification number, where assigned,
(c) details of the person (4) under the obligation under Article 125 (5) of the Act, with the exception of the address of the natural person's residence;
(d) the reason why the notifier is the person referred to in (c);
(e) the date of the transaction;
(f) the type of financial instrument to which the notification relates and its identification marking according to the international numbering system for securities identification (ISIN), if allocated;
(g) the nature of the transaction (purchase, sale or other transaction);
(h) the market in which the transaction was carried out and, if the transaction was closed outside the market, details of how the transaction was carried out;
(i) the volume and unit price of the transaction.
(2) The person referred to in paragraph 1 (c) shall send the notification to the Czech National Bank without delay after the transaction has been carried out on the data forms according to the type of transaction notified, the model of which shall include Annexes 2 to 4 to this Order.
(3) The person referred to in paragraph 1 (c) shall send a notification to the Czech National Bank:
(a) by e-mail to the address published in the Czech National Bank Bulletin in the .xls format, stating in the field of the e-mail message the item "Notes about the transaction"; and
1. affix notifications with a guaranteed electronic signature based on a qualified certificate issued by an accredited certification service provider (3); or
2. Sends the same day of notification to the Commission in writing, signed by hand, or
(b) in writing, signed in manuscript, accompanied by a data medium (disk, CD, DVD) with an electronic form of notification in the .xls format
ASSESSMENT OF THE MARKET MANAGEMENT
More detailed rules for assessing market manipulation
When assessing whether a market manipulation has occurred (Section 126 (1) of the Law), account shall be taken in particular of:
(a) whether the share of the orders to trade or executed transactions in the total daily volume of trading in the financial instrument in question on the relevant regulated market is significant, in particular if it results in a significant change in the price of that financial instrument;
(b) the extent to which the orders given to the transactions or transactions of persons with significant purchase or sale positions lead to substantial changes in the rate of the financial instrument, its underlying asset or its derivative;
(c) whether the transaction carried out results in a change in the person benefiting from the financial instrument;
(d) whether the orders or transactions entered into contain changes in the position (in particular purchase-sale) over a short period of time and whether the scope of such orders or transactions corresponds to a significant share of the total daily volume of trading in the financial instrument in question on the relevant regulated market and whether it results in a significant change in the price of that financial instrument;
(e) whether the orders for trade or transactions executed are concentrated in a short period of time during the business day and whether they lead to a change in the price of the financial instrument in question, the trend of which will subsequently be reversed;
(f) the extent to which the orders entered change the best announced prices of the supply or demand of the financial instrument in question admitted to trading on a regulated market or the accessible list of orders to the participants in the regulated market, and in which such orders are subsequently cancelled before implementation;
(g) the extent to which orders for trade or transactions are entered at the time when reference prices or settlement prices are set and where they result in a significant change in the price of the financial instrument affecting such pricing;
(h) whether the orders for trade or the execution of transactions have been preceded or followed by the dissemination of false, misleading or misleading information by the person who entered the orders or executed the transaction, or by a person connected to it,
(i) whether the award of orders for trade or the execution of transactions has been preceded or followed by the creation or dissemination of erroneous, misleading or manifestly material interest in the investment recommendations affected pursuant to Section 125 (6) of the Act by the person who has entered the orders or executed the transaction, or by the person associated with it; and
(j) whether the procedure or trade fulfilled the conditions for the recognition of a market practice under § 126 (8) of the Act.
NOTIFICATION OF MARKET DISEASES
More detailed rules on compliance with the notification obligation
(Articles 124 (5) and 126 (5) of the Law)
(1) When assessing whether the use of internal information or market manipulation for the purpose of fulfilling the notification requirement under § 124 (5) or § 126 (5) of the Act is concerned, the person referred to in § 124 (5) or § 126 (5) of the Act (hereinafter the notifier) shall assess whether the particular circumstances of the transaction reasonably justify the suspected use of internal information or market manipulation; In doing so, it assesses the facts which are normally available to it in its activities and is based in particular on the assessment of factors under Section 11.
(2) The notifier shall notify the suspected use of inside information or market manipulation
(a) by e-mail to an electronic address published by the Czech National Bank in the Czech National Bank Bulletin;
b) by fax to a fax number published by the Czech National Bank in the Czech National Bank Bulletin,
(c) in writing to the address of the Czech National Bank, or
d) exceptionally, if there is a danger of delay, by telephone to the Czech National Bank for a telephone number published by the Czech National Bank in the Bulletin of the Czech National Bank; the notifier shall then notify the suspicion within 5 days by one of the methods referred to in points (a) to (c).
(3) The notification shall include at least:
(a) details of the notifier;
(b) the reason why the notifier is a obliged person pursuant to § 124 (5) or § 126 (5) of the Act;
(c) the date of execution of the transaction if it has already been carried out;
(d) the designation of the financial instrument to which the notification relates and its ISIN, if assigned;
(e) the nature of the transaction (purchase, sale or other transaction) and the description of the order (price-limited order, order to execute the transaction at the current market price or other characteristic of the order);
(f) the market on which the transaction was carried out and, if the transaction was closed outside the market, details of how the transaction was carried out;
(g) volume and unit price of the transaction;
(h) details of participants in the transaction;
(i) the reasons which lead the notifier to suspect that internal information or market manipulation has been used in the transaction and any other information which may be relevant for the examination of the notification.
(4) If the notifier does not have the data referred to in points (c) to (h) of paragraph 3 at the time of the notification, it shall notify the Czech National Bank immediately after it becomes aware of them, in accordance with paragraph 2.
FINAL PROVISIONS
Repeal
Decree No. 379 / 2004 Coll., on rules on the management of internal information is hereby repealed.
Efficacy
This Decree shall take effect on 1 January 2005.
Member of the Presidium acting as Chairman:
Ing. Shimáček v. r.
Příloha č. 1
Annex No 1 to Decree No 536 / 2004 Coll.
Model
Notification of postponement of disclosure of inside information
Příloha č. 2
Annex No 2 to Decree No 536 / 2004 Coll.
Model
Notification of transactions in shares and provisional notes
Příloha č. 3
Annex No 3 to Decree No 536 / 2004 Coll.
Model
Notification of an option transaction
Příloha č. 4
Annex No 4 to Decree No 536 / 2004 Coll.
Model
Notification of a transaction with other financial instruments
1) Commission Directive 2003 / 124 / EC of 22 December 2003 implementing Directive 2003 / 6 / EC of the European Parliament and of the Council as regards the definition and publication of confidential information and the definition of market manipulation. Commission Directive 2004 / 72 / EC of 29 April 2004 implementing Directive 2003 / 6 / EC of the European Parliament and of the Council as regards accepted market practices, the definition of confidential information in relation to commodity derivatives, the compilation of insider lists, the notification of transactions of persons with managerial responsibility and the notification of suspicious transactions.
3) Article 11 of Act No. 227 / 2000 Coll., on Electronic Signature and on the amendment of certain other laws (Act on Electronic Signature), as amended by Act No. 226 / 2002 Coll. and Act No. 440 / 2004 Coll.
4) § 2 (b) of Act No. 256 / 2004 Coll., on Capital Market Business.
Sign in for notes, favorites and notifications
Regulation Information
| Citation | Decree No. 536 / 2004 Coll., implementing certain provisions of the Capital Market Enterprise Act in the field of protection against market abuse |
|---|---|
| Regulation Type | Order |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 20.10.2004 |
|---|---|
| Effective from | 01.01.2005 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
Comments 0