The European parliament voted on Tuesday (10th September) in favour of a new regulation that will extend market abuse legislation to commodity markets.
The market abuse regulation (MAR) updates the market abuse directive.
Final adoption of MAR will happen once a political agreement is reached on the Markets in Financial Instruments Directive (MiFID II). Parts of MAR depend on the text of MiFID II, and so they will need to be aligned, the commission said in a statement on Tuesday.
MAR extends legislation for market abuse to commodity and related derivatives markets, as well as technology-related developments such as high-frequency trading.
All financial instruments traded on platforms and over the counter will come under its scope.
The regulation is intended to improve cooperation between Europe’s financial and commodity regulators, and will provide regulators with greater sanctions against those who abuse the market.
But possible criminal sanctions for market abuse are included in a separate proposal. It is hoped that negotiations between the European parliament and Council will conclude by the end of this year, the commission said.
EU states agreed on MAR in June (see EDEM and ESGM 26 June 2013).
Price benchmarks in energy markets are governed by Regulation on Energy Market Integrity and Transparency (REMIT), which states that manipulation of indices is illegal.
(THE ICIS HEREN REPORTS - EDEM 17175 / 10 September 2013)