Lamprell insider dealing and market abuse policy
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Revision 2 | September 2021
Lamprell
insider dealing
and market
abuse policy
This document is in the custody of the
Group General Counsel & Company Secretary
LAMPRELL INSIDER DEALING AND MARKET ABUSE POLICY l a m p r e l l . c o m
Contents
Introduction 4
The criminal offence of insider dealing 4
The civil offence of market abuse 5
Misleading statements and conduct 7
The criminal offence of fraud 8
Theft act 1968 9
Share Dealing Code 9
What should I do to avoid
committing one of the offences? 9
2 3LAMPRELL INSIDER DEALING AND MARKET ABUSE POLICY l a m p r e l l . c o m
1. Introduction indirectly to the Company or such other 3. The civil offence of market In all three cases, the behaviour is judged
company or their respective shares and abuse on the basis of what a ‘regular user’ of the
which would, if generally available, be likely market would regard as a failure to observe
As a listed company, Lamprell plc (the to be used by a reasonable investor as part standards of behaviour which would
Company) and its officers and employees of his investment decision and to have a Sections 118 to 137 of the Financial Services normally be expected in the market.
must comply with the regulations that significant effect on the price of those shares and Markets Act 2000 (FSMA) set out the
involve the misuse of Inside Information, the or related investments and you: market abuse regime. The ‘prescribed markets’ include the London
creation of a false or misleading impression Stock Exchange, which the Company’s
or the distortion of the market. There are The market abuse offence is not a criminal shares are listed on. ‘Qualifying investments’
several relevant areas of legislation which are a. deal (or rely on a professional one, but a civil one. The regime is aimed cover transferable securities (such as shares
summarised below. intermediary to deal) on a regulated at behaviour which undermines market and debt securities). Investments related to
market in the shares of the Company integrity and investor confidence. qualifying investments are also caught. This
It is important to be aware that a breach of or such other company whose price would include the Company’s shares traded
these regulations may be a criminal and/or would be affected if the information Directors, employees, agents and advisers
on the London Stock Exchange.
civil offence. The penalty for certain offences were made public; or of the Company will commit market
is imprisonment for up to a maximum abuse if they base any behaviour on Inside Behaviour includes both action and inaction
of seven years. Therefore, any breach of b. encourage another person to deal in Information (about the Company or another and need not occur in the United Kingdom:
the regulations described in this Insider shares whose price would be affected company) they receive in the course of behaviour will be caught if, wherever it takes
Dealing and Market Abuse Policy will be if the information were made public, their employment, profession or duties or place, it occurs in relation to qualifying
taken seriously and may lead to disciplinary whether or not that other person improperly disclose it. investments (or, as applicable, any related
action being taken against the individual(s) knows that they are price-affected investment) which are admitted to trading
concerned. shares, knowing or having reasonable (or for which a request has been made for
3.1 What is market abuse?
cause to believe that shares would admission to trading) on a prescribed market
Please read this note carefully to ensure that be bought or sold on a regulated situated or operating in the UK.
Market abuse relates to ‘behaviour’ by
you are aware of your responsibilities with market or in reliance on a professional
a person (or a group of people working
regard to the treatment of the Company’s intermediary; or
together) which occurs in relation to
information and the sanctions which apply 3.2 Guidance on market abuse
‘qualifying investments’ on a ‘prescribed
to its misuse or improper circulation. You c. disclose the information, other than as
market’ which satisfies one or more of the
should also familiarise yourself with the required by the Disclosure Policy or in The Code of Market Conduct published
following three conditions:
related Disclosure Policy and Share Dealing the proper performance of your job, by the Financial Conduct Authority (FCA)
Code, and other relevant Company policies then you will be guilty of the criminal provides guidance on the types of behaviour
a. that the behaviour is based on
on this subject matter. offence of insider dealing. which amount to market abuse, and the
information that is not generally
factors to be taken into account in the
available to those using the market
The offence may be committed merely determination of whether market abuse has
and, if it were, would have an impact
2. The criminal offence of insider by disclosing the information to another taken place.
on the price of the investments
dealing person. It is not necessary for an acquisition
concerned;
or disposal of shares to take place or for any As part of the Code of Market Conduct
encouragement to deal to be found. (amended pursuant to the Market Abuse
2.1 What is insider dealing? b. that the behaviour is likely to give
Regulation (MAR)), the FCA sets out the
a false or misleading impression of
types of behaviour which are caught by the
2.2 Penalties the supply, demand or value of the
If you are aware of information relating market abuse regime. There are seven such
investments concerned; and/or
to the Company or another company The penalty for committing the criminal behaviour types:
(for example, one of the Company’s offence of insider dealing is imprisonment c. that the behaviour is likely to distort
customers) and such information is precise, for up to a maximum of seven years and/or the market in the investments a. Insider dealing - where someone
not generally available, relates directly or a fine. concerned. deals, or attempts to deal, in financial
4 5LAMPRELL INSIDER DEALING AND MARKET ABUSE POLICY l a m p r e l l . c o m
instruments or related investments of the market a false or misleading which would amount to market abuse if the Section 397(3) of FSMA also provides that a
(such as options or other derivatives) impression as to the supply, demand, requirer/encourager had carried out the person will be guilty of a criminal offence if
on the basis of price- sensitive price or value of the shares or financial behaviour. This secondary offence applies to he does any act or engages in any course of
confidential information relating to the instrument (or an investment which all of the market abuse offences set out in conduct which creates a false or misleading
investment in question; relates to the shares or financial paragraph 2.4.2 above. impression as to the market in, or the
instrument) and fall below the price or value of, any shares or financial
b. Improper disclosure - where an insider standard expected by that regular instruments if it is done for the purpose
discloses price-sensitive confidential 3.4 Penalties
user; and of creating that impression and of thereby
information to another person inducing the acquisition or disposal of
otherwise than in the proper course h. Distortion – behaviour which would such shares or financial instruments or the
If the FCA finds that market abuse has taken
of the exercise of his employment, be, or would be likely to be, regarded exercise of any rights relating to such shares
place, it can impose a fine, or issue a public
profession or duties; by a regular user of the market as likely or financial instruments.
censure, or it can seek an injunction or a
to distort the market in the shares or
restitution order. Penalties can be imposed
c. Misuse of information - which involves financial instrument (or an investment An offence under section 397 of FSMA
on companies and other legal entities as well
the misuse of information relevant to which relates to the shares or financial could be committed if directors of a listed
as individuals.
the shares or financial instrument (or instrument) and fall below the company deliberately avoid disclosing Inside
an investment which relates to the standard expected by that regular user. Information to the market pursuant to the
shares or financial instrument) and 4. Misleading statements and Disclosure Rules, without any justification for
which is not generally available to Whether or not behaviour does in fact conduct delay, or if directors of an issuer deliberately
the market and which falls below the amount to market abuse will depend release false information to the market via a
standard expected by a ‘regular user’ on how a ‘regular user’, a hypothetical Regulatory Information Service.
4.1 What are misleading statements and
of the market; person who acts reasonably and is
conduct?
familiar with the market in question, Companies can commit the offence under
d. Manipulating transactions - where
would view the behaviour. If such a section 397 of FSMA. In addition, if the
transactions are effected which give or Under Sections 397(1) and (2) of FSMA, it is a
person feels that the behaviour falls offence is shown to be committed with
are likely to give a false or misleading criminal offence for a person to:
below the standards expected in the the consent or connivance of an officer of
impression as to the supply, demand
market in question, then the behaviour the company, or to be attributable to any
or price of one or more financial a. make a statement, promise or forecast
will be deemed to be market abuse. neglect on his part, that officer may also be
instruments; which he knows to be misleading, liable in relation to the criminal offence.
false or deceptive in a material
e. Manipulating devices - where The market abuse offences set out in particular;
transactions or orders are effected paragraphs (A), (B), (C) and (F) are likely 4.2 Penalties
which employ fictional devices or to be the most relevant for officers b. conceal dishonestly any material
other forms of deception; and employees of the Company. facts (whether in connection with a
The penalty for making a misleading
statement, promise or forecast made
f. Dissemination - where information is statement or creating a false impression
by him or otherwise); or
disseminated which is likely to give a 3.3 Requiring or encouraging market under section 397 of FSMA is imprisonment
false or misleading impression as to abuse c. make recklessly (dishonestly or for up to a maximum of seven years and/or
a financial instrument, where such otherwise) a statement, promise or a fine.
behaviour is carried on by a person forecast which is misleading, false
There is also a secondary offence of
who knew, or could reasonably be or deceptive in a material particular,
requiring or encouraging market abuse
expected to have known, that the for the purpose of inducing (or being
under which the FCA may take action against
information was false or misleading; reckless as to whether it may induce)
a person who has required or encouraged
g. Misleading behaviour – behaviour another person to engage in behaviour another person to buy or sell shares or
which is likely to give regular user exercises any rights relating to shares.
6 7LAMPRELL INSIDER DEALING AND MARKET ABUSE POLICY l a m p r e l l . c o m
5. The criminal offence of fraud criminal fraud charge if accompanied by the 6. Theft act 1968 responsibilities when ‘dealing’ in the
appropriate guilty intent. Company’s shares;
5.1 What is the offence? Section 19 of the Theft Act 1968 makes it an b. not disclose information, which
5.3 Failure to disclose information offence for an officer of a corporate body is not generally available, to other
to publish or concur in publishing a written employees unless the information is
The offence of fraud can be committed in
statement which he knows is or may be necessary for the proper performance
three different ways under the Fraud Act Section 3 of the Fraud Act 2006 makes it
misleading, false or deceptive in a material of their functions and only then with
2006. In each case the relevant behaviour an offence to fail to disclose information
particular if it is with intent to deceive the the consent of your manager; and
must: be dishonest and intended to secure where there is a legal duty to do so (e.g.
shareholders or creditors of a company
either a gain for the defendant or a loss or statutory, contractual, custom from a trade
about its affairs. The offence is punishable by c. not disclose information which is
risk of loss to another of money or any other or market, or a fiduciary relationship). Those
up to seven years’ imprisonment. not generally available to persons
property, however no gain or loss need who fail to make full disclosure pursuant to
outside the Company unless you
actually be suffered for the offence to be legal obligations will therefore be at risk of
have a legitimate purpose and the
committed. prosecution. This could include a deliberate 7. Share Dealing Code disclosure is in confidence (e.g. they
failure to make an announcement in breach
are advisers or counter-parties to a
In addition the Fraud Act 2006 explicitly of the Disclosure Rules requirements.
transaction), and you have the consent
recognises that a corporate body may The Company’s Share Dealing Code seeks
of your manager or a member of the
commit the offences and also provides to adopt policies that will protect the
5.4 Abuse of privileged position Disclosure Committee.
that any director, manager, secretary or Company’s officers against allegations of
other similar officer of the company (or any insider dealing and market abuse. However,
person purporting to act in such a capacity) permission to deal in shares in accordance
Where a position that a person holds means
will also commit the relevant offence if the with the Share Dealing Code will not, in
that he would be expected to safeguard the
company’s offence is proved to have been itself, provide a defence to a claim of insider
victim’s financial interests, Section 4 of the
committed with the consent or connivance dealing under the relevant legislation if, for
Fraud Act makes it an offence for him to
of that individual. This is of importance for example, an individual is in possession of
abuse that privileged position. Such an abuse
directors as it leads to the risk of prosecution any information of which the Disclosure
is capable of being committed by omission.
for those who merely acquiesce in, as Committee is unaware.
The types of relationships which might lead
opposed to positively promote, dishonest to the expectation include that of a director
conduct (of the type outlined above) by their The Share Dealing Code is supplemented
with a company. A director who covertly by other relevant Company policies and
company. fails to act in the best financial interests of procedures including the Group-wide
his company, its staff or its clients (e.g. by Dealing Policy and the Disclosure Policy.
5.2 False representation failing to take up the opportunity of a crucial
contract) could therefore fall foul of this
proposed provision, if the other requisite 8. What should I do to avoid
Section 2 of the Fraud Act 2006 makes it elements are present. committing one of the
an offence to make a false representation offences?
(by words or conduct as to any fact, law
or state of mind of any person) whether 5.5 Penalties
express or implied either: knowing that You should:
the representation is false or misleading, The offence is punishable with up to ten
or being aware that it might be. The victim years’ imprisonment and/or an unlimited a. comply with the Company’s Share
of the representation need not actually fine. Dealing Code, particularly if you are
rely upon it. A false representation in an a person discharging managerial
announcement could therefore lead to a
8 9Hamriyah Free Zone, Sharjah
P.O. Box 42149, Sharjah
United Arab Emirates
T: +971 6 528 2323
F: +971 6 528 4325
This document is in the custody of the
Group General Counsel & Company
Secretary
Copyright © Lamprell Energy Ltd. 2021
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