Finance groups fret on EU mkt manipulation changes

Finance industry groups are worried proposed changes to the burden of proof on market manipulation shift the focus away from supervisors and on to legitimate market users.

Finance industry trade organizations, responding to the European Commission's revision of the Market Abuse Directive (MAD), on Friday said the onus should be on supervisors to demonstrate market abuse, not for a party accused of market manipulation to show they were acting legitimately.

The groups were responding to a series of questions posed in an EU consultation paper.

The EU also asked if there should be different rules on disclosure and dealing obligations under MAD for small and medium sized enterprises (SMEs) for trading on regulated markets.

The trade groups, in a joint statement from the Association for Financial Markets in Europe, the British Bankers' Association and International Swaps and Derivatives Association, said they opposed any differentiation between SMEs and large issuers, saying it could create a false market in SME stocks.