17.Insider_Dealing.pdf

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A person/parties have price sensitive information
about a company’s performance and deals in
shares of that company in order to make a profit
His membership of the
administrative/management/supervisory bodies of the
company issueing the financial instrument
Holding capital in the company
Having access to the information through the exercise of his
employment/duties
Criminal activities
Any person who possesses the inside information concerned
where the person knows/ought to have known that it is inside
information
Information that is specific enough to enable a conclusion to be
drawn as to the possible effect of that information on the prices of
the financial instruments or related derivative financial instruments
Information that a reasonable investor would be likely to use
as part of their investment decision
Information that has not yet been made public
Information that relates to the issuer of the securities or the
securities themselves
Information that is price sensitive and if disclosed, is likely to
materially affect the price of the securities being traded
Information that is of precise nature
The insider deals with shares and makes use of information
which is not generally available
Forms
Insider
: any person
possessing inside
information due to
The insider makes his knowledge known to an outsider who
uses this knowledge to deal with shares, where the outsider
should have known was precluded from dealing with the
shares because of his access to the sensitive information
The use of insider information
The disclosure of insider information
Inducing another person to use/disclose
insider information
Prohibited
Actions
Insider
Dealing
Insider
Information
Financial
instruments
Civil
: if found guilty, they must compensate
any other party who was not in possession of
the relevant information and compensate the
company for any profits made
Sanctions
Criminal
: imprisonment for a term up to 10
years and/or fine up to €10 million
If committed by a company officer, the
ODCE may seek a disqualification order
Monetary contracts between parties
Can be created, traded, modified and settled
Cash (currency)
Examples
Transferable
securities
Evidence of an ownership
interest in an entity (share)
Contractual right to receive or
deliver cash (bond)

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