Primer on the Reporting of Insider Trades in Europe

We are pleased to present a primer on the reporting of equity-related transactions by company insiders across the European Union. This primer has been authored by a member of MOI Global who is also an industry participant with deep knowledge of related regulations. This article not only explains various reporting requirements but also contains links to the reporting databases in various EU member states.

Since July 3, 2016 all managers, directors, senior officers and their “closely associated persons” (partners, children, close family and any affiliated and controlled legal persons) of European public companies must disclose all their transactions in the securities of their publicly listed companies.

Such disclosures of the so-called “managers’ transactions” are regulated by the EU Market Abuse Regulation 596/2014 and several EU implementing acts. This disclosure regime of “managers’ transactions” reporting applies in 28 EU Member States and 3 EEA countries (Norway, Liechtenstein, Iceland).

This EU disclosure regime is closely mirroring the U.S. insider reports filings with the SEC (Forms 3, 4, 5 – EDGAR database).

Example 1: If Mr. Sergio Marchionne, CEO of Fiat Chrysler Automobiles listed at Borsa Italiana, buys, sells (or even pledges, inherits or disposes in any other way) shares or bonds or related derivatives of Fiat Chrysler above EUR 5,000 all such insider dealings must be notified within 3 business days.

Example 2: If a wife or close relative of Mr. Patrick de la Chevardiere, a CFO of Total S.A. (FP: PAR), or a company in which Mr. de la Chevardiere is a manager or controlling officer purchases or sells or transacts in any other way in the shares or related securities of Total S.A. above EUR 000, this natural or legal person must disclose such dealings within 3 business days.

EU rules require such notifications to be published at the so-called Officially Appointed Mechanisms (OAMs), i.e. nationally appointed media channels, and notified to the relevant EU regulators with very granular level of disclosure (amounts, dates, values, description of the transaction, etc). There is a single reporting template for all such insider dealings.

Under EU and national law, a failure to report insider dealings is an administrative offence and is subject to punishment by relevant national regulator.

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