EU narrows managers' closed-period trading exemption and expands market-manipulation indicators
Managers discharging responsibilities may trade in closed periods only on reasoned written request the issuer grants in exceptional circumstances alone
Change
On 8 April 2026, the European Commission adopted Delegated Regulation (EU) 2026/788 (published in the Official Journal 16 July 2026) amending Delegated Regulation (EU) 2016/522 under the Market Abuse Regulation to narrow the closed-period trading exemption to a reasoned-written-request-and-exceptional-circumstances test, designate cross-border trading venues for share order-data exchange, and expand the market-manipulation indicators.
Why it matters
The exemption letting managers trade during the 30-day closed period is bounded by a requirement to file a reasoned written request describing the sale and showing it is the only reasonable way to obtain necessary financing, with issuers permitted to grant it only in exceptional circumstances; the exemption now extends beyond shares to other financial instruments. Competent authorities must treat the Annex III venues as having a significant cross-border dimension for shares and fold them into the Article 25a order-data exchange mechanism. Surveillance teams must apply revised Annex II indicators that assess manipulation over timeframes shorter or longer than a trading session, count volume changes (not only price) under Indicators A(a) and A(d), and capture indirect exposures such as margin calls or debt covenants under Indicator A(b).
Implications
- — Persons discharging managerial responsibilities must file a reasoned written request with the issuer before any closed-period trade, describing the sale and demonstrating it is the only reasonable alternative to obtain necessary financing — no request, no exemption, and the trade is barred.
- — Issuer governance and compliance teams must assess each request case-by-case and grant closed-period permission only where circumstances are exceptional — granting outside that test exposes the issuer to market-abuse non-compliance.
- — Competent authorities supervising trading venues must add the Annex III venues (including Turquoise Global Holdings Europe BV) to the Article 25a mechanism for ongoing exchange of share order data — omitting them breaches the Article 25a mandate.
- — Market-surveillance teams at competent authorities and trading venues must reconfigure manipulation detection to run over variable timeframes, trigger on volume changes as well as price under Indicators A(a) and A(d), and capture indirect exposures via margin calls and debt covenants under Indicator A(b) — detection logic keyed only to same-session price moves now misses in-scope manipulation.
Who is affected
- — Persons discharging managerial responsibilities
- — Issuer governance and compliance teams
- — Competent authorities supervising trading venues
- — Market-surveillance teams at competent authorities and trading venues
What to watch
- — Effective: 5 August 2026 — Delegated Regulation (EU) 2026/788 enters into force on the twentieth day after publication, from which the narrowed closed-period exemption, Annex III venue designation, and revised manipulation indicators apply directly in all Member States.
- — Deadline: 5 June 2028 — the Article 25a order-data exchange mechanism must extend beyond shares to cover bonds and futures.