This website uses cookies to help us give you the best experience when you visit our website. By continuing to use this website, you consent to our use of these cookies.
Read more
Before deciding on operations involving share issuance or sale, companies or shareholders may seek to disclose information to selected investors, in order to gauge their opinion on the envisaged market operation.
Such ‘market soundings’ risk violating the prohibition of insider trading and yet such selective disclosures have been partially accepted in several European jurisdictions. Market soundings have been recently regulated in the Market Abuse Regulation, which clarifies under which circumstances they are allowed and the position of the involved parties.
This Article analyses the rules on market soundings in the Market Abuse Regulation with regard to initial public offers of securities, issuance in the secondary market and accelerated bookbuildings. Additionally, it will be stressed that market soundings might also violate national company law rules and principles, mostly those related to directors’ duties and liabilities. This Article addresses how Italian and English company law regimes react towards selective disclosures. It will be shown that a tension may still exist between national company law rules and uniform rules on the prohibition of market abuses.
In this essay, we propose a principled approach for government bailouts of critical/systemic firms who find themselves in COVID-19-induced financial...