Market abuse and Parliamentary supremacy: Difference between pages

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imported>Doug Williamson
(Make expected implementation date less specific, in case of delay or other changes between now and then.)
 
imported>Doug Williamson
(Amend to 'when the UK joined the EU'. Amend 'cede' to 'surrender'.)
 
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Market abuse is the term used to describe any misuse of confidential or non public information so as to attempt to gain a trading advantage.  
''Law''.


Market abuse also encompasses:
The historical legal principle in the UK that the UK Parliament was 'supreme' in its law-making powers.
# Insider dealing.
# Improper disclosure.
# Manipulating transactions.
# Manipulating devices.
# Misleading dissemination.


For example trading in a company's shares whilst in the possession of inside information that a profits warning was about to be announced would be insider trading and therefore market abuse.
This principle was fundamentally affected when the UK joined the EU in 1973.


====Legislation====
Parliamentary supremacy meant that:


Legislation exists in most financial markets to specify the detail of what is prohibited as market abuse and within the EU this was covered by the Market Abuse Directive (Directive 2003/6/EC).
#The UK Parliament was able to make law for the UK as it saw fit either by repealing earlier statutes, over-ruling case law or by making new law.
#No UK Parliament could bind its successor.  Parliament could not make laws that a subsequent Parliament was prevented from altering or repealing.
#The courts in the UK had to apply the relevant statute law enacted by the UK Parliament.  


The Market Abuse Directive (MAD) was revised and replaced by MAD II which widens its scope to include new markets and instruments.
When the UK joined the EU, UK Parliamentary supremacy was fundamentally affected and it is no longer true to say that only the UK Parliament has the power to make new law for the UK.


The Market Abuse Regulation (MAR) and the Criminal Sanctions for Market Abuse (CSMAD) form the legislative proposals which make up MAD II.
The effect of the UK becoming a member of the EU was to surrender the UK Parliament's supremacy on certain matters of European Union law which have direct effect on member states.


MAD II came into force across the EU in 2014.
The position now is that: 


#The EU may pass legislation directly for the UK.
#The UK cannot, generally, make laws that conflict with EU law.
#Overall, EU law enjoys supremacy over domestic national law and is applied in priority to domestic law. 


MAD II is due to become law across the EU during 2016.


== See also ==
* [[European Union ]]
* [[Sovereignty]]


==See also==
[[Category:Compliance_and_audit]]
* [[Insider dealing]]
 
 
===Other links===
 
[https://www.esma.europa.eu/system/files/Dir_03_6.pdf Directive 2003/6/EC of the European Parliament and of the Council of 28 January 2003]
 
[http://www.treasurers.org/node/3244 ACT briefing note: The New Market Abuse and Disclosure Regime in the UK - A Guide for Listed Companies; 2005]
 
[http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32014R0596 MAR]
 
[http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32014L0057 CSMAD]

Revision as of 17:04, 11 March 2015

Law.

The historical legal principle in the UK that the UK Parliament was 'supreme' in its law-making powers.

This principle was fundamentally affected when the UK joined the EU in 1973.

Parliamentary supremacy meant that:

  1. The UK Parliament was able to make law for the UK as it saw fit either by repealing earlier statutes, over-ruling case law or by making new law.
  2. No UK Parliament could bind its successor. Parliament could not make laws that a subsequent Parliament was prevented from altering or repealing.
  3. The courts in the UK had to apply the relevant statute law enacted by the UK Parliament.


When the UK joined the EU, UK Parliamentary supremacy was fundamentally affected and it is no longer true to say that only the UK Parliament has the power to make new law for the UK.

The effect of the UK becoming a member of the EU was to surrender the UK Parliament's supremacy on certain matters of European Union law which have direct effect on member states.

The position now is that:

  1. The EU may pass legislation directly for the UK.
  2. The UK cannot, generally, make laws that conflict with EU law.
  3. Overall, EU law enjoys supremacy over domestic national law and is applied in priority to domestic law.


See also

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