Means for public disclosure

Under Article 2(1) of Commission Implementing Regulation (EU) 2016/1055, inside information must be disclosed using technical means that ensure:

• that inside information is disseminated as follows:

  • to as wide a public as possible on a non-discriminatory basis,
  • free of charge,
  • simultaneously throughout the EU,

• that inside information is communicated, directly or through a third party, to the media that are reasonably relied upon by the public to ensure its effective dissemination. That communication must be transmitted using electronic means that ensure that the completeness, integrity and confidentiality of the information is maintained during the transmission, and it must clearly identify:

  • that the information communicated is inside information,
  • the identity of the issuer or emissions allowance market participant: full legal name,
  • the identity of the person making the notification: name, surname, position within the issuer or emission allowance market participant,
  • the subject matter of the inside information,
  • the date and time of the communication to the media.

Issuers and emission allowance market participants must ensure the completeness, integrity and confidentiality by remedying any failure or disruption in the communication of inside information without delay.

Requirements under section 3a of the WpAV

Section 26 (4) of the WpHG in conjunction with section 3a of the WpAV supplements the requirements governing the required public disclosure under Article 17(1), (2) and (6) to (9) of the MAR in conjunction with Article 2 of Commission Implementing Regulation (EU) 2016/1055. The legislator sets out various mandatory forms of disclosure, all of which must be complied with, i.e. they are not alternatives.

The inside information to be publicly disclosed must be provided to media that can be relied on disseminate the information throughout the EU and the other signatory states to the Agreement on the EEA.

As a general rule, it is not sufficient for the information to be provided only to a single medium; rather, the information must be provided to a pool of different media. The issuer is not responsible for ensuring that the media actually publish the information provided to them.

The number of different types of media and the media of one media type used is determined by the special circumstances of each individual case including in particular the issuer’s shareholder structure as well as the number and venues of its listings.

Such a media channel routinely comprises:

• news providers,
• news agencies,
• major German and European newspapers,
• financial websites.

To ensure Europe-wide dissemination, it is normally sufficient if one medium from the pool of media is capable of disseminating the information throughout Europe. If an issuer’s registered office is in the Federal Republic of Germany and it only has a listing in Germany, by providing the information to German media it generally fulfils its obligation under section 3a of the WpAV by forwarding the information concerned to German media, if a medium is able to disseminate the information throughout Europe.

Depending on the individual case, the issuer may be required to depart from this constantly applicable minimum standard by increasing the number of media used per media type or media additionally disseminated outside Germany.

For example, if an issuer’s shares are admitted to trading in an additional EU member state or signatory state to the Agreement on the EEA, the issuer must also provide the information to news agencies, news providers, print media and financial market websites that are able to disseminate the information in the country of the additional listing. At least one national print medium and one national website must be used in each additional EU member state or signatory state to the Agreement on the EEA country in which the issuer has a listing.

When information is made public through the media referred to above, section 3a (2) sentence 1 of the WpAV requires issuers to ensure that

• the information is received by media that also include media that are able to actively disseminate the information as quickly and as simultaneously as possible in all EU member states and signatory states to the Agreement on the EEA,

• the text of the information is sent to the media in such a way that

  • the sender of the information can be clearly identified,
  • the data is adequately protected against unauthorised access or modification, and the confidentiality and security of the transmission are also ensured by the nature of the means of transmission used or by state-of-the-art encryption of the data,¹
  • transmission errors or interruptions can be remedied without undue delay and

• for transmission of the information to the media,

  • the name of the entity subject to the disclosure obligation, including its address,
  • a keyword that is recognisable as a reference and summarises the main content of the disclosure,
  • the date and time of transmission to the media, and
  • the aim of disseminating the information as prescribed information throughout Europe

are identifiable.

Under section 3a (2) sentence 2 of the WpAV, the entity subject to the disclosure obligation is not responsible for system faults for which the media to which the information was transmitted are responsible.

Under section 3a (3) of the WpAV, the entity subject to the publication obligation must be able, for a period of six years, to notify BaFin of

• the person who transmitted the information to the media,
• the security measures used for transmission to the media,
• the date and time of transmission to the media,
• the medium used for transmission to the media and
• if applicable, all data concerning any delay in disclosure.

If the entity subject to the disclosure obligation engages a third party to implement disclosure, the disclosure obligations do not pass to that third party and the entity subject to the publication obligation remains responsible for fulfilling its disclosure obligation. The above requirements must then be fulfilled by the third party.

It should be noted that the retention obligation also continues to apply if the engaged third party is no longer involved (e.g. because of insolvency or closure) or changes. If that third party no longer exists, responsibility reverts to the issuer.

Posting information on a website

If the issuer has a website, the disclosure must be posted for a period of at least five years on a page on that website that is easily accessible from the homepage and classified in a descriptive section of the website with relevant content. This obligation also applies if the issuer’s website only has a homepage.

Under Article 3 of Commission Implementing Regulation (EU) 2016/1055, websites must comply with the following requirements:

• they allow users to access the inside information posted on the website in a non-discriminatory basis and free of charge,
• they allow users to locate the inside information in an easily identifiable section of the website;
• they ensure the disclosed inside information clearly indicates date and time of disclosure and that the information is organised in chronological order.

BaFin recommends that issuers arrange a corresponding section for this purpose in the investor relations part of the website. The obligation to post information for a period of five years from the date of disclosure also applies if there is a delisting before that period has ended, as long as the company continues to exist.

Information may not be disclosed on the website before it is disclosed via an electronic system for the dissemination of information. Ad hoc disclosures may additionally be made public simultaneously through social media, but this does not replace disclosure in accordance with disclosure under Article 2(1) of Commission Implementing Regulation (EU) 2016/1055.²

Special requirements for emission allowance market participants

When disclosing inside information, emission allowance market participants must also comply with the requirements of Article 2(1) of Commission Implementing Regulation (EU) 2016/1055 concerning technical means for the dissemination of inside information and sections 3a et seq. of the WpAV.

REMIT disclosures

However, Article 2(2) of Commission Implementing Regulation (EU) 2016/1055 gives emission allowance market participants subject to the obligation under Article 4 of Regulation (EU) No 1227/2011 (REMIT) the option to use the technical means established there also for the disclosure under Article 17 of the MAR, provided that the inside information to be disclosed has substantially the same content and the technical means used for the disclosure ensure that the inside information is communicated to the relevant media.

The REMIT disclosure privilege therefore only applies to emission allowance market participants that are already subject to a REMIT disclosure obligation. All other participants must comply with the MAR disclosure regime. In addition, the wording of Article 2(2) of Commission Implementing Regulation (EU) 2016/1055 means that this privilege only applies if inside information with substantially the same content is involved in the specific case.

In such cases, emission allowance market participants need only make a public disclosure according to REMIT, provided that the information is disclosed using a platform for disclosing inside information and the inside information is notified to the relevant media. These include news agencies, for example, that are disseminated Europe-wide. Conversely, disclosures according to MAR always meet the REMIT requirements. Disclosure solely on the website does not meet the requirements according to MAR. The relief under Article 2(2) of Commission Implementing Regulation (EU) 2016/1055 cannot be exercised if the inside information does not have substantially the same content.

As long as the disclosure privilege applies, reference is made in relation to disclosures according to REMIT to the minimum requirements for effectively and timely public disclosure contained in the guidance notice of the Federal Network Agency (Bundesnetzagentur).³ In addition, it should be indicated – for example in the title – that this additionally concerns a public disclosure in accordance with Article 17(2) of the MAR. It is not necessary to disclose the carbon dioxide equivalent separately, as long as the MAR disclosure contains, as a minimum, precise information about the duration of the transaction, the fuel concerned and the resulting restriction (affected capacity).

Delegation

It is possible that inside information that has arisen at one individual participant could lead to inside information at other participants in the same group (e.g. a change in fuels is resolved at group level), or the question whether information has the potential to have a significant effect on prices can only be answered by top management of the group, taking in account all the installations in the group.

The disclosure obligation is addressed to the holder of the allowances who participates in the market for emission allowances.⁴ If there is inside information within the meaning of Article 17(2) of the MAR concerning the relevant installations, the holder is responsible for the disclosure. However, there is no indication in the MAR that this obligation may not be delegated if certain conditions are met. Nor does such a prohibition appear to be advisable, based on the spirit and purpose.

This means that it is likely to be legitimate in principle for a subsidiary that holds allowances and whose installations are affected in a relevant way to delegate the disclosure obligation to the group parent company. It is hence also likely to be not relevant if the group parent is itself a market participant or not. However, because the group parent is not directly affected by Article 17(2) of the MAR, it must clarify in the public disclosure for which entity it is meeting this disclosure obligation. If there is inside information for several companies or subsidiaries, several disclosures must also be made public. Only the actual disclosure can be delegated; however, this may not lead to a situation where only a summary disclosure is made public for several entities affected by the disclosure requirement. In addition, in this case, too, the subsidiary remains liable in the event of any infringements of its own responsibility.

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