29 January 2016
Market soundings: The buy-side perspective
The Market Abuse Regulation (MAR) comes into force on 3 July 2016. The MAR provisions relating to market soundings will be of particular interest to many buy-side institutions. Yesterday, ESMA published for consultation its long-awaited proposed guidance for firms receiving market soundings and related enquiries.
This article summarises key aspects of the proposed guidelines and considers their potential practical impact by reference to the recommendations from the FCA’s thematic review, “Asset management firms and the risk of market abuse”, in which the FCA set out good and poor practices on soundings last year (TR15/1).
In summary, many of the proposed guidelines are similar to practices endorsed by the FCA in TR15/1. Therefore a firm that has followed the FCA’s recommendations should not need to make significant operational or procedural changes.