Can Fluctuations in Prices or Volumes of a Security Trigger a Duty for Listed Companies to Disclose Inside Information?

摘要

The European market abuse rules require issuers to disclose inside information which directly concerns them ('price-sensitive information') as soon as possible. Delaying disclosure is possible under strict conditions, one of them being that confidentiality of the information is ensured. This paper analyses the question of whether the duty to disclose can be re-activated in case of considerable fluctuations in the price or volume of the traded securities, as confidentiality may no longer be ensured. In the Dutch VEB/SdB case, the Court of Appeal decided that an issuer did not timely disclose, considering the market developments, which constituted a tort towards investors. The paper analyses this case, the questions it raises, and its relevance for European jurisdictions. The implication of VEB/SdB is that issuers would be wise to carefully monitor the development of prices and volumes when they delay disclosure of inside information which directly concerns them, as failure to disclosure could result in civil liability or penalties.