Market Abuse Regulation one year in: key issues for employee share plans

January 7, 2017

The Market Abuse Regulation (“MAR”) came into force throughout the EU one year ago, with significant impact for companies operating employee share plans.  In this article we summarise the impact of the MAR on employee share plans, and some important points of clarification from its first year of operation.

The MAR: what’s it all about?                                       

The MAR is intended to create a common framework for the corporate governance of listed companies.

What does MAR mean for employee share plans?

The MAR regime includes a number of provisions which affect when options and other share awards can be granted to employees, and when persons discharging managerial responsibilities (“PDMRs”) can deal in shares (which could include exercising options).   These provisions:

The MAR and the associated MAR Delegated Regulation also contain a number of exemptions which are relevant for the operation of employee share plans. There is, for example, an exemption which can apply to the acquisition of shares by PDMRs in a closed period where the acquisition is the automatic result of an action taken outside a closed period (e.g. the acquisition by a PDMR of shares on the vesting of restricted stock units in a closed period).

What’s new – and what does this mean for employers?

When MAR was first introduced, the precise interpretation of a number of its provisions remained uncertain.  The European Securities and Markets Authority (“ESMA”) has since published a number of Q&A on some of these issues affecting share plans and employee equity:

Companies should check that their compliance is in accordance with the most up-to-date guidance in light of ESMA’s clarification of previously uncertain areas.  For further information and assistance please contact Guy Abbiss, Partner, or Alasdair Friend, Partner (Compensation & Benefits), on +44 203 051 5711, or email us at


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