The MNB reminds the issuers to comply with MAR

The MNB recently issued an official circular to public issuers of securities intending to enhance compliance with the MAR (Market Abuse Regulation).

The MNB repeatedly highlighted that issuers have to disclose inside information directly or indirectly concerning them or the financial instruments they issue as soon as possible. Such disclosure may be delayed exceptionally if conditions set under the MAR are met. The MNB circular concludes that the issuers should organise their work organisation in such a way that inside information is disclosed promptly irrespective of the level of the organisation where it is generated, and replacement of the person responsible for the disclosure shall always be ensured.

The MNB also recalls that the 30-day prohibition on managers to enter into transactions prior to the publication of financial reports is an objective prohibition. This prohibition, therefore, applies even if the issuer does not consider that there is inside information in the financial reports. However, it cannot be excluded that the issuer may also identify inside information in connection with the reports. In that case, the general prohibition on insider dealing applies to all persons who have access to inside information.

The MNB also reiterates that if the issuer has decided to delay the disclosure of inside information, it must inform the MNB without delay. Issuers of securities listed exclusively on the SME capital market, such as issuers of Xtend market at the Budapest Stock Exchange are exempted from this rule, as they are only required to justify the delay upon request by the MNB.

The MNB stressed that insider lists should accurately record the date on which the inside information was generated (the date of identification of the inside information is also the date of inclusion in the insider list) and the person who obtained it.

Issuers may keep a 'permanent list of insiders' listing those who by virtue of their function or position, have access to all inside information at all times. The MNB, however, noted that such a list should only include persons who have access to all inside information at all times. If this is not the case for a particular person, the issuer has to include him or her in the list of deal-specific insiders.

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