|Christian Temmel |
The Austrian Stock Exchange Act contains an authorisation for the Austrian Financial Markets Authority (Finanzmarktaufsichtsbehörde, or FMA) to enact a regulation by which the duties and obligations of issuers of financial instruments are specified with respect to the prevention of insider dealing and market manipulation. The FMA has made use of this authorisation and enacted in 2007 the so-called Issuers' Compliance Regulation.
The Issuers' Compliance Regulation was amended in February 2012, and a new term was introduced. The old Regulation referred only to "inside information", being defined as any information of a precise nature which has not been made public, relating, directly or indirectly, to one or more issuers of financial instruments or to one or more financial instruments, and which, if it became public, would be possibly qualified to significantly influence the price of such financial instruments or the price of derivative instruments relating to them, since a rational investor would use such information most likely as the basis of his investment decision.
According to the definition in the Regulation, information is deemed to be precise if it either includes a number of already existing facts and events, for which it has to be assumed with sufficient probability that they will occur, and such information is precise enough that a conclusion can be drawn on the potential effect of such facts or events on the prices of financial instruments or of derivative instruments relating to them. This term corresponds more or less with the definition contained in the European Market Abuse Directive (Directive 2/6EC).
However, the FMA has now introduced a new term, the term of "compliance relevant information". According to the amendment of the Issuers' Compliance Regulation, such information is either inside information (as described above) or any other information which is "confidential and price-sensitive".
Therefore, the compliance relevant information is far more extensive than inside information. According to the FMA, this new term covers also information which may not yet be as precise as inside information, and which may not have a significant effect on the price of a financial instrument, but only an effect. It is no longer required that the effect on the price be of a certain significance.
The FMA argues that any inside information needs to be published immediately. There are many instances, however, where information does not yet qualify as inside information (for example, not a significant influence on the price, just a potential influence on the price; or no sufficient probability that an event or a fact will occur, just a simple probability). Also in such circumstances, confidentiality should be assured.
By introducing this new term, the internal compliance systems of listed companies are to be changed as well: insider lists now need to contain the names and data of all persons who have access to compliance relevant information, not only those who have access to inside information; trading bans apply now to everyone who has access to compliance relevant information (and not only those with access to inside information).
In addition, the FMA has issued a new guideline on the application and use of the Issuers' Compliance Regulation where the FMA now also clearly states that the IT department of an issuer should be regarded as area of special confidentiality, and that any and all persons working in the IT department should be included as insiders on the insider lists.
The same applies to external advisers, such as law firms. This may become a challenge for all international law firms when IT support staff are based outside of Austria, since such persons would be required to sign individual confidentiality agreements on a deal-by-deal basis.