On 23 December 2016, the Luxembourgish Law on Market Abuse was published in Memorial A n°279. It repeals the previous Law of 9 May 2006 on Market Abuse and supplements Regulation (EU) n° 596/2014 of the European Parliament and of the Council of 16 April 2014. It also transposes the Directive 2014/57 (EU) on criminal sanctions applicable to market abuses.

The Law clarifies the powers of the CSSF and provides the authority with a strengthened leeway regarding market abuse. It features procedures for investigations, supervision as well as cooperation with foreign competent authorities.

The Law also provides with detailed administrative and criminal sanctions in relation to market abuse.

The term of imprisonment applicable to a natural person committing market manipulation or insider dealing ranges from 3 months to 4 years. This includes attempts of the said offences. Unlawful disclosure of inside information can amount to 8 days to 2 years of imprisonment.

Along with significant criminal or administrative fines (ranging from EUR 500 000 to EUR 5 000 000 for a natural person and from 1 000 000 to 15 000 000 or 15 percent of the annual turnover for a legal person), legal and natural persons committing market abuse may notably be subjected to the following administrative measures:

  • an order requiring the person responsible for the infringement to cease the conduct and to desist from a repetition of that conduct;
  • withdrawal or suspension of the authorisation of an investment firm;
  • a temporary or permanent ban of a person discharging managerial responsibilities within an investment firm or any other natural person, who is held responsible for the infringement, from exercising management functions in investment firms;

Eventually, the Law emphasizes on whistleblowing procedures and mechanisms of reporting in case of actual or potential infringements of the Regulation.

The Law entered into force on the 30th December 2016, three clear days after its publication on 27 December 2016.

The Law (only in French) is available on this Link.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.