Market Abuse

What is the Code of Market Conduct?

The Code of Market Conduct provides guidance on FCA’s implementation of the Market Abuse Directive. It offers assistance in determining whether or not behaviour amounts to market abuse, The Code applies to all who use the UK financial markets.

Behaviour which could constitute market abuse is summarised below:

  1. Insider dealing - an insider deals or attempts to deal in qualifying investments or related investment on the basis of inside information relating to the investment in question;
  2. Improper disclosure – an insider discloses inside information to another person otherwise than in the proper course of the exercise of his employment, profession or duties;
  3. Misuse of information –behaviour which is based upon information which is not generally available but which would affect an investor’s decision about the terms on which to deal
  4. Manipulating transactions – trading, or placing orders to trade, that gives a false or misleading impression of the supply of, or demand for, one or more investments, raising the price of the investment to an abnormal or artificial level
  5. Manipulating devices - behaviour which consists of effecting transactions or orders to trade which employ fictitious devices or any other form of deception or contrivance;
  6. Dissemination – behaviour which consists of the dissemination of information that conveys a false or misleading impression about an investment or the issuer of an investment where the person doing this knows the information to be false or misleading; or
  7. Misleading behaviour and distortion - which gives a false or misleading impression of either the supply of, or demand for an investment; or behaviour that otherwise distorts the market in an investment.
  8. Requiring or encouraging - another person or persons to engage in behaviour which, if engaged in, would amount to market abuse

Penalties can vary from public censure to imprisonment.

For further information please see the Code which is located in the FCA Handbook. Code of Market Conduct

If you have any suspicion of market abuse, please speak to your Compliance Officer as soon as possible.