The Market Abuse Regulation: How Does it Apply to Energy and Commodities?

Aviv Handler

The Market Abuse Regulation (MAR), EU No. 596/2014, has been in force since July 3, 2016. It replaced the Market Abuse Directive (MAD) 2003/6/EC, which had been in force since 2003, although some jurisdictions – such as the UK – extended the scope of the rules considerably prior to MAR. In general, MAR prohibits insider trading and market manipulation in many classes of financial instruments, extending the original MAD to cover derivatives, including commodity derivatives, as well as physical spot commodities in some cases. Some parts of MAR, in particular those about insider trading and market manipulation, apply to non-investment firms. MAR also introduces the “emissions allowance market participant” (EAMP), which covers several groups that trade in and utilise EU allowance (EUA) certificates or their equivalent, which became financial instruments with the start of MiFID II (see Chapter 2).

The further provisions of MAR for investment firms, especially those that issue securities, are extensive. In addition, there are rules around dealing in a company’s own securities. While the extension of MAD to the commodities world is important, the key consideration for many was the