MAR is the European Union's market-integrity regime. It prohibits three behaviours, insider dealing, unlawful disclosure of inside information, and market manipulation, and it layers preventive obligations on issuers and on the firms that arrange or execute transactions. The logic is simple: markets only work if participants trade on an equal informational footing, so MAR targets both the abuse itself and the conditions that let it go undetected.
The regime is Regulation (EU) No 596/2014, in application since 3 July 2016, replacing the earlier Market Abuse Directive (2003/6/EC). It is accompanied by CSMAD, Directive 2014/57/EU, which covers criminal sanctions. This is a plain-language explainer; the binding text is on EUR-Lex.
What it is, and who it binds
| Aspect | Detail |
|---|---|
| Scope | Financial instruments admitted to trading on a regulated market, MTF or OTF (or where a request has been made), instruments whose price depends on those, plus emission allowances and benchmarks, and spot commodity contracts where they interact |
| Reach | Extraterritorial. It applies to acts and omissions inside and outside the Union concerning in-scope instruments. Being outside the EU is not a defence |
| Who it binds | The three prohibitions bind any person, not just regulated firms. The procedural duties (Articles 16 to 20) bind issuers, trading venues, and firms professionally arranging or executing transactions |
The three prohibitions
| Offence | What it covers | Articles |
|---|---|---|
| Insider dealing | Using inside information to acquire or dispose of instruments, for your own or a third party's account. It expressly includes amending or cancelling an order placed before you held the information, and it covers recommending or inducing another person to deal | 8 / 14 |
| Unlawful disclosure | Disclosing inside information to anyone, except where the disclosure is made in the normal exercise of employment, profession or duties. Onward disclosure of a recommendation is caught where the recipient knows it rests on inside information | 10 / 14 |
| Market manipulation | False or misleading signals as to supply, demand or price, or securing an abnormal or artificial price; using a fictitious device or other deception; disseminating false or misleading information, including rumours; and manipulating the calculation of a benchmark | 12 / 15 |
Attempted insider dealing and attempted manipulation are offences in their own right; the trade does not have to complete. Annex I sets out non-exhaustive indicators of manipulation, and the familiar named practices, spoofing, layering, wash trades, marking the close, and painting the tape, all sit within those indicators.
Inside information: the four cumulative tests
| Test | Means | Note |
|---|---|---|
| Precise | Indicates circumstances or an event that exists or may reasonably be expected to come into existence, specific enough to allow a conclusion about the likely effect on price | Certainty is not required; a reasonable expectation suffices |
| Not public | Has not been made available to the market generally | Selective disclosure to a few does not make it public |
| Relates to | An issuer or one or more financial instruments, directly or indirectly | Includes information about clients' pending orders, which is why front-running is caught |
| Price-sensitive | If made public, would likely have a significant effect on the price, that is, information a reasonable investor would use as part of the basis of a decision | The reasonable-investor test is the operative standard |
In a protracted process, a merger, a capital raise, a restructuring, an intermediate step can itself be inside information, even though the final outcome is still uncertain. Firms that wait for deal certainty before starting insider lists or restricting trading are already late. This is the most common practical failure under MAR.
The operational obligations
This is where MAR becomes a controls and systems problem rather than a purely legal one, and where a GRC or IT-risk function actually engages with it.
| Obligation | Requirement | Article |
|---|---|---|
| Public disclosure | The issuer informs the public as soon as possible, posts it on its website, and keeps it there at least 5 years | 17 |
| Delayed disclosure | Permitted only where immediate disclosure would prejudice legitimate interests, delay is not likely to mislead the public, and confidentiality can be ensured. The decision is recorded and the authority notified once disclosed | 17(4) |
| Insider lists | Draw up and maintain a list of everyone with access to inside information, in the prescribed electronic format, updated promptly, retained 5 years, and provided to the authority on request | 18 |
| PDMR dealings | Managers and closely associated persons notify the issuer and the authority within 3 business days. Threshold EUR 5,000 per calendar year, which a Member State may raise to EUR 20,000 | 19 |
| Closed periods | A manager must not deal for 30 calendar days before the announcement of an interim or year-end financial report | 19(11) |
| Prevention and detection | Venues and firms professionally arranging or executing transactions must have arrangements, systems and procedures to prevent and detect abuse, and must report suspicions without delay via a STOR | 16 |
| Investment recommendations | Present recommendations objectively and disclose interests and conflicts | 20 |
Safe harbours and gateways. Buy-backs and stabilisation (Article 5) are exempt where the disclosure, reporting and limit conditions are met. A national competent authority may establish an accepted market practice (Article 13), which then provides a defence to manipulation. Market soundings (Article 11) are the controlled route for disclosing inside information to potential investors ahead of a transaction, and require assessing whether inside information is conveyed, recipient consent, standardised records, and cleansing recipients once the information ceases to be inside information. Legitimate behaviour (Article 9) carves out executing a pre-existing obligation in good faith and legitimate market-making.
Sanctions
| Breach | Natural persons | Legal persons |
|---|---|---|
| Insider dealing, unlawful disclosure, manipulation (Art 14 to 15) | At least EUR 5,000,000 | At least EUR 15,000,000 or 15% of total annual turnover |
| Procedural breaches, disclosure, insider lists, PDMR (Art 16 to 20) | EUR 1,000,000 down to EUR 500,000 depending on the article | EUR 2,500,000 or 2% of turnover, down to EUR 1,000,000 |
| Other measures | Disgorgement of profits, public censure, withdrawal of authorisation, management bans, dealing bans | The same, plus publication of the decision, the naming and shaming under Article 34 |
Criminal sanctions sit under CSMAD (Directive 2014/57/EU), which requires Member States to criminalise serious cases committed intentionally, with maximum terms of at least 4 years for insider dealing and manipulation and 2 years for unlawful disclosure. Whistleblowing under Article 32 requires competent authorities to run reporting mechanisms with protections for reporting persons, and firms to have internal procedures for staff reports.
Where MAR connects
MiCA, Title VI. MiCA Articles 86 to 92 are MAR's architecture transplanted onto crypto-assets admitted to trading: the same inside-information concept, the same three prohibitions, an issuer disclosure duty, and a detection-and-reporting obligation on persons professionally arranging or executing transactions. Seeing a crypto market-abuse regime as MAR adapted, rather than something novel, shows the lineage.
The GRC angle. In practice MAR is mostly a controls problem, which is where an IT-risk or GRC function earns its place:
- Trade and communications surveillance tooling: alert calibration, false-positive rates, coverage gaps, and model tuning.
- Access control and need-to-know around inside information, with information barriers between the advisory and trading sides.
- Insider-list data quality, completeness and prompt updating, a frequent supervisory finding.
- The alert-to-STOR workflow: triage, escalation, a documented rationale for not filing, and an audit trail.
- Retention and integrity of records for 5 years, an availability and integrity control, not just a legal one.
Adjacent regimes. MAR sits alongside MiFID II and the transaction-reporting duty under MiFIR Article 26, and in Luxembourg it is supervised by the CSSF.