Do you provide financial services in the Netherlands and do you have a reasonable suspicion of insider trading or market manipulation? You must report this suspicion as quickly as possible to the Netherlands Authority for the Financial Markets (AFM).
What is market abuse?
Market abuse is the practice of misusing the financial market by:
- trading with inside information that other market players do not have (insider dealing).
- transmitting inside information to another player (illegitimate communication of inside information)
- giving false or misleading information on financial instruments (market manipulation)
Report market abuse
You must report market abuse as soon as you have a reasonable suspicion, and you must report immediately. You report through the electronic form, which is available via the AFM portal. Reporting market abuse is compulsory for:
- market operators of regulated markets
- investment firms that operate a trading platform
- (legal) persons who professionally conduct transactions in financial instruments
Prevent market abuse
Does your organisation issue financial instruments that are admitted to trading on a regulated market in the Netherlands, such as shares or bonds? You are obliged to make price-sensitive information about your company public as quickly as possible. You must also submit the press release to AFM Investors must be able to assess the information accurately and completely, and in a timely manner (disclosure of inside information).
Do you give investment recommendations? Then you must be clear, making it easy for the investor to determine the value of your recommendation. See the transparency requirements for investment recommendations at the AFM.
Do you engage in market sounding where you check the interest of one or more potential investors for transaction? You must keep a record of the information you share with whom and make it clear that your client cannot use this information for any other purpose. See the conditions for market sounding in the Public disclosure of inside information Brochure of the AFM.