Market manipulation

Assured support in developing and enhancing compliance strategies and strategic defence advice during market manipulation investigations.

The pan-European market abuse regime is intended to enhance market integrity and investor protection by harmonising the rules on market abuse across member states.

The Market Abuse Regulation (MAR) is directly effective in the UK and other European states (via delegated acts, technical standards and guidance on MAR itself). The scope of the market abuse regime extends to financial instruments admitted to trading, or in respect of which an application for admission to trading has been made, on regulated markets, and for specific strategically important markets, most notably the wholesale energy market (through the Regulation on Wholesale Energy Market Integrity and Transparency (REMIT)).

Regulators expect organisations and businesses to have dynamic and focused compliance processes, and enforcement is supported by conduct penalties, fines and criminal sanctions (for some REMIT breaches). All market participants should expect continued and increasing scrutiny from regulators, while ensuring that their compliance and monitoring processes meet best regulatory standards.

REMIT introduced an EU-wide monitoring regime to detect and deter market manipulation and insider trading that could distort wholesale energy markets, leading to higher retail energy prices. REMIT requires disclosure of price-sensitive information in relation to energy generation, storage and transmission, and makes provision for a shared compliance responsibility between the Agency for the Cooperation of Energy Regulators and national regulatory authorities. The number of REMIT investigations continues to grow, and significant fines continue to be imposed across the EU.

Information and data requests under REMIT are highly intrusive, and advice on the lawful scope of investigations, together with advice on the scope to challenge such requests, is critically important for market participants, and regulators, during sensitive abuse investigations.

We have particular expertise in all aspects of REMIT, advising a national regulatory authority outside the UK on the overarching legal framework and domestic legislation, while advising on its conduct of sensitive market abuse investigations. We also advise individual market participants on their compliance obligations, design of compliance processes and effective ongoing monitoring.

Our services

Compliance and monitoring design

Regulators place considerable importance on the design, responsiveness and scope of compliance processes, and ongoing monitoring of those processes. We have significant expertise in working with organisations in designing compliance programmes across sectors, and in particular in relation to REMIT compliance in the energy sector.

Investigation support

A particular hallmark of market abuse investigations is the volume and richness of data available to investigators as a result of compliance obligations to retain information. We have extensive experience in data collection and interrogation, especially under REMIT, and in identifying weakness before they become part of an investigation. We use our broad understanding of legal requirements generally (and public law principles in particular) to assess the prospects for challenging the scope of investigative requests.

National Regulatory Authority

Advising a national regulatory authority on its legal obligations under REMIT generally. Drafting notices under relevant legislation in relation to ongoing REMIT investigations and advising on the scope of investigative approaches.

REMIT Investigations

Advising, and supporting, market participants in the UK during several REMIT investigations. Providing extensive document recovery support and advice, advice on the legitimate scope of the regulator’s inquiry and on compliance and monitoring improvements.