We point to the fact, that starting with July 3rd, 2016 the Market Abuse Regulation (EU) No. 596/2014 (MAR) shall apply. The corresponding national provisions will follow.
Market manipulation can occur in various forms. Executing transactions under certain circumstances can be an act of manipulation, while even the placing of orders or executing transactions under false pretences as well as the mere dissemination of incorrect or misleading information can constitute manipulation.
Definition of Market manipulation
Pursuant to Article 48a para. 1 no. 2 BörseG, market manipulation refers to transactions or buy/sell orders that:
- give, or are likely to give, false or misleading signals as to the supply of, demand for or price of financial instruments; or
- influence the price of one or more financial instruments in such a way that an abnormal or artificial price level is reached.
This does not apply where there were legitimate reasons, and where accepted market practices were not violated.
Market manipulation also means transactions entered into or buy or sell orders placed under false pretences or by any other deceitful action.
The dissemination, via the media, of information, rumours or news that send out false or misleading signals about financial instruments to the market is also defined as market manipulation.
Market manipulation practices
Article 48a para. 2 BörseG lists practices that are considered to constitute market manipulation:
- securing a dominant market position, which has the effect of fixing, directly or indirectly, buy and sell prices or creating other unfair trading conditions;
- buying or selling financial instruments at the close of the market with the consequence of misleading investors acting on the basis of closing Prices;
- taking advantage of access to the media by expressing an opinion about a financial instrument and subsequently profiting from the impact on the price of that instrument.
Pursuant to Article 48c BörseG, market manipulation is an administrative offence and will be sanctioned by the FMA with a fine of up to EUR 150 000. In addition, any financial advantage gained will be declared void.