Part 43— Transparency obligations and related matters

In Part 6 of the Financial Services and Markets Act 2000 (c. 8) (which makes provision about official listing, prospectus requirements for transferable securities, etc), in section 103(1) (interpretation), at the appropriate place insert— “the transparency obligations directive” means Directive 2004/109/EC of the European Parliament and of the Council relating to the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market; .

In Part 6 of the Financial Services and Markets Act 2000 after the sections inserted by section 1266 above insert— Power of competent authority to call for information Competent authority's power to call for information 89H 1 The competent authority may by notice in writing given to a person to whom this section applies require him— a to provide specified information or information of a specified description, or b to produce specified documents or documents of a specified description. 2 This section applies to— a an issuer in respect of whom transparency rules have effect; b a voteholder; c an auditor of— i an issuer to whom this section applies, or ii a voteholder; d a person who controls a voteholder; e a person controlled by a voteholder; f a director or other similar officer of an issuer to whom this section applies; g a director or other similar officer of a voteholder or, where the affairs of a voteholder are managed by its members, a member of the voteholder. 3 This section applies only to information and documents reasonably required in connection with the exercise by the competent authority of functions conferred on it by or under sections 89A to 89G (transparency rules). 4 Information or documents required under this section must be provided or produced— a before the end of such reasonable period as may be specified, and b at such place as may be specified. 5 If a person claims a lien on a document, its production under this section does not affect the lien. Requirements in connection with call for information 89I 1 The competent authority may require any information provided under section 89H to be provided in such form as it may reasonably require. 2 The competent authority may require— a any information provided, whether in a document or otherwise, to be verified in such manner as it may reasonably require; b any document produced to be authenticated in such manner as it may reasonably require. 3 If a document is produced in response to a requirement imposed under section 89H, the competent authority may— a take copies of or extracts from the document; or b require the person producing the document, or any relevant person, to provide an explanation of the document. 4 In subsection (3)(b) “relevant person”, in relation to a person who is required to produce a document, means a person who— a has been or is a director or controller of that person; b has been or is an auditor of that person; c has been or is an actuary, accountant or lawyer appointed or instructed by that person; or d has been or is an employee of that person. 5 If a person who is required under section 89H to produce a document fails to do so, the competent authority may require him to state, to the best of his knowledge and belief, where the document is. Power to call for information: supplementary provisions 89J 1 The competent authority may require an issuer to make public any information provided to the authority under section 89H. 2 If the issuer fails to comply with a requirement under subsection (1), the competent authority may, after seeking representations from the issuer, make the information public. 3 In sections 89H and 89I (power of competent authority to call for information)— “control” and “controlled” have the meaning given by subsection (4) below; “specified” means specified in the notice; “voteholder” means a person who— holds voting rights in respect of any voting shares for the purposes of sections 89A to 89G (transparency rules), or is treated as holding such rights by virtue of rules under section 89A(3)(b). 4 For the purposes of those sections a person (“A”) controls another person (“B”) if— a A holds a majority of the voting rights in B, b A is a member of B and has the right to appoint or remove a majority of the members of the board of directors (or, if there is no such board, the equivalent management body) of B, c A is a member of B and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in B, or d A has the right to exercise, or actually exercises, dominant influence or control over B. 5 For the purposes of subsection (4)(b)— a any rights of a person controlled by A, and b any rights of a person acting on behalf of A or a person controlled by A,are treated as held by A. .

In Part 6 of the Financial Services and Markets Act 2000 (c. 8), after the sections inserted by section 1267 above insert— Powers exercisable in case of infringement of transparency obligation Public censure of issuer 89K 1 If the competent authority finds that an issuer of securities admitted to trading on a regulated market is failing or has failed to comply with an applicable transparency obligation, it may publish a statement to that effect. 2 If the competent authority proposes to publish a statement, it must give the issuer a warning notice setting out the terms of the proposed statement. 3 If, after considering any representations made in response to the warning notice, the competent authority decides to make the proposed statement, it must give the issuer a decision notice setting out the terms of the statement. 4 A notice under this section must inform the issuer of his right to refer the matter to the Tribunal (see section 89N) and give an indication of the procedure on such a reference. 5 In this section “transparency obligation” means an obligation under— a a provision of transparency rules, or b any other provision made in accordance with the transparency obligations directive. 6 In relation to an issuer whose home State is a member State other than the United Kingdom, any reference to an applicable transparency obligation must be read subject to section 100A(2). Power to suspend or prohibit trading of securities 89L 1 This section applies to securities admitted to trading on a regulated market. 2 If the competent authority has reasonable grounds for suspecting that an applicable transparency obligation has been infringed by an issuer, it may— a suspend trading in the securities for a period not exceeding 10 days, b prohibit trading in the securities, or c make a request to the operator of the market on which the issuer's securities are traded— i to suspend trading in the securities for a period not exceeding 10 days, or ii to prohibit trading in the securities. 3 If the competent authority has reasonable grounds for suspecting that a provision required by the transparency obligations directive has been infringed by a voteholder of an issuer, it may— a prohibit trading in the securities, or b make a request to the operator of the market on which the issuer's securities are traded to prohibit trading in the securities. 4 If the competent authority finds that an applicable transparency obligation has been infringed, it may require the market operator to prohibit trading in the securities. 5 In this section “transparency obligation” means an obligation under— a a provision contained in transparency rules, or b any other provision made in accordance with the transparency obligations directive. 6 In relation to an issuer whose home State is a member State other than the United Kingdom, any reference to an applicable transparency obligation must be read subject to section 100A(2). Procedure under section 89L 89M 1 A requirement under section 89L takes effect— a immediately, if the notice under subsection (2) states that that is the case; b in any other case, on such date as may be specified in the notice. 2 If the competent authority— a proposes to exercise the powers in section 89L in relation to a person, or b exercises any of those powers in relation to a person with immediate effect,it must give that person written notice. 3 The notice must— a give details of the competent authority's action or proposed action; b state the competent authority's reasons for taking the action in question and choosing the date on which it took effect or takes effect; c inform the recipient that he may make representations to the competent authority within such period as may be specified by the notice (whether or not he had referred the matter to the Tribunal); d inform him of the date on which the action took effect or takes effect; e inform him of his right to refer the matter to the Tribunal (see section 89N) and give an indication of the procedure on such a reference. 4 The competent authority may extend the period within which representations may be made to it. 5 If, having considered any representations made to it, the competent authority decides to maintain, vary or revoke its earlier decision, it must give written notice to that effect to the person mentioned in subsection (2). Right to refer matters to the Tribunal 89N A person— a to whom a decision notice is given under section 89K (public censure), or b to whom a notice is given under section 89M (procedure in connection with suspension or prohibition of trading),may refer the matter to the Tribunal. .

In Part 6 of the Financial Services and Markets Act 2000 (c. 8), after the sections inserted by section 1268 above insert— Corporate governance Corporate governance rules 89O 1 The competent authority may make rules (“corporate governance rules”)— a for the purpose of implementing, enabling the implementation of or dealing with matters arising out of or related to, any EU obligation relating to the corporate governance of issuers who have requested or approved admission of their securities to trading on a regulated market; b about corporate governance in relation to such issuers for the purpose of implementing, or dealing with matters arising out of or related to, any EU obligation. 2 “Corporate governance”, in relation to an issuer, includes— a the nature, constitution or functions of the organs of the issuer; b the manner in which organs of the issuer conduct themselves; c the requirements imposed on organs of the issuer; d the relationship between the different organs of the issuer; e the relationship between the organs of the issuer and the members of the issuer or holders of the issuer's securities. 3 The burdens and restrictions imposed by rules under this section on foreign-traded issuers must not be greater than the burdens and restrictions imposed on UK-traded issuers by— a rules under this section, and b listing rules. 4 For this purpose— “foreign-traded issuer” means an issuer who has requested or approved admission of the issuer's securities to trading on a regulated market situated or operating outside the United Kingdom; “UK-traded issuer” means an issuer who has requested or approved admission of the issuer's securities to trading on a regulated market situated or operating in the United Kingdom. 5 This section is without prejudice to any other power conferred by this Part to make Part 6 rules. .

In Part 6 of the Financial Services and Markets Act 2000 (c. 8), after section 90 insert— Compensation for statements in certain publications 90A 1 The publications to which this section applies are— a any reports and statements published in response to a requirement imposed by a provision implementing Article 4, 5 or 6 of the transparency obligations directive, and b any preliminary statement made in advance of a report or statement to be published in response to a requirement imposed by a provision implementing Article 4 of that directive, to the extent that it contains information that it is intended— i will appear in the report or statement, and ii will be presented in the report or statement in substantially the same form as that in which it is presented in the preliminary statement. 2 The securities to which this section applies are— a securities that are traded on a regulated market situated or operating in the United Kingdom, and b securities that— i are traded on a regulated market situated or operating outside the United Kingdom, and ii are issued by an issuer for which the United Kingdom is the home Member State within the meaning of Article 2.1(i) of the transparency obligations directive. 3 The issuer of securities to which this section applies is liable to pay compensation to a person who has— a acquired such securities issued by it, and b suffered loss in respect of them as a result of— i any untrue or misleading statement in a publication to which this section applies, or ii the omission from any such publication of any matter required to be included in it. 4 The issuer is so liable only if a person discharging managerial responsibilities within the issuer in relation to the publication— a knew the statement to be untrue or misleading or was reckless as to whether it was untrue or misleading, or b knew the omission to be dishonest concealment of a material fact. 5 A loss is not regarded as suffered as a result of the statement or omission in the publication unless the person suffering it acquired the relevant securities— a in reliance on the information in the publication, and b at a time when, and in circumstances in which, it was reasonable for him to rely on that information. 6 Except as mentioned in subsection (8)— a the issuer is not subject to any other liability than that provided for by this section in respect of loss suffered as a result of reliance by any person on— i an untrue or misleading statement in a publication to which this section applies, or ii the omission from any such publication of any matter required to be included in it, and b a person other than the issuer is not subject to any liability, other than to the issuer, in respect of any such loss. 7 Any reference in subsection (6) to a person being subject to a liability includes a reference to another person being entitled as against him to be granted any civil remedy or to rescind or repudiate an agreement. 8 This section does not affect— a the powers conferred by section 382 and 384 (powers of the court to make a restitution order and of the Authority to require restitution); b liability for a civil penalty; c liability for a criminal offence. 9 For the purposes of this section— a the following are persons “discharging managerial responsibilities” in relation to a publication— i any director of the issuer (or person occupying the position of director, by whatever name called), ii in the case of an issuer whose affairs are managed by its members, any member of the issuer, iii in the case of an issuer that has no persons within sub-paragraph (i) or (ii), any senior executive of the issuer having responsibilities in relation to the publication; b references to the acquisition by a person of securities include his contracting to acquire them or any interest in them. Power to make further provision about liability for published information 90B 1 The Treasury may by regulations make provision about the liability of issuers of securities traded on a regulated market, and other persons, in respect of information published to holders of securities, to the market or to the public generally. 2 Regulations under this section may amend any primary or subordinate legislation, including any provision of, or made under, this Act. .

In Part 6 of the Financial Services and Markets Act 2000 (c. 8), after section 100 insert— Exercise of powers where UK is host member state 100A 1 This section applies to the exercise by the competent authority of any power under this Part exercisable in case of infringement of— a a provision of prospectus rules or any other provision made in accordance with the prospectus directive, or b a provision of transparency rules or any other provision made in accordance with the transparency obligations directive,in relation to an issuer whose home State is a member State other than the United Kingdom. 2 The competent authority may act in such a case only in respect of the infringement of a provision required by the relevant directive. Any reference to an applicable provision or applicable transparency obligation shall be read accordingly. 3 If the authority finds that there has been such an infringement, it must give a notice to that effect to the competent authority of the person's home State requesting it— a to take all appropriate measures for the purpose of ensuring that the person remedies the situation that has given rise to the notice, and b to inform the authority of the measures it proposes to take or has taken or the reasons for not taking such measures. 4 The authority may not act further unless satisfied— a that the competent authority of the person's home State has failed or refused to take measures for the purpose mentioned in subsection (3)(a), or b that the measures taken by that authority have proved inadequate for that purpose. This does not affect exercise of the powers under section 87K(2), 87L(2) or (3) or 89L(2) or (3) (powers to protect market). 5 If the authority is so satisfied, it must, after informing the competent authority of the person's home State, take all appropriate measures to protect investors. 6 In such a case the authority must inform the Commission of the measures at the earliest opportunity. .

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