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Part B Commentary, 1 General Provisions, Art.5: Exemption for buy-back programmes and stabilisation

Edited By: Marco Ventoruzzo

From: Market Abuse Regulation: Commentary and Annotated Guide (2nd Edition)

Edited By: Marco Ventoruzzo, Sebastian Mock

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2023. All Rights Reserved.date: 15 April 2024

Subject(s):
Money market instruments (MMIs) — Insider dealing — Conduct of business regulation — Investment business — Market abuse — Market Abuse Directive (MAD) — Regulated activities

This chapter discusses Article 5’s exemption for buy-back programmes and stabilization measures. Although constituting a market manipulation, buy-back programmes and stabilization measures are widely accepted in most jurisdictions. This is because they can be justified and can be carried out for legitimate reasons. Therefore, Article 5 states that the prohibition of insider dealing and market manipulation as set out in Articles 14 and 15 does not apply to these kinds of transactions and establishes a safe harbour. To limit the effect of these transactions on the market price of the financial instruments, Article 5 sets out several conditions for buy-back programmes and stabilization measures.

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