19.8 Disclosure to the Public 539The Directive on market abuse has a broader scope and is more ambitious than the Di-
rective it replaced. This should limit the value of the judgment of the ECJ in Georgagis.
The fundamental purpose of the Directive on market abuse – reducing investors’ per-
ceived risk and transaction costs – requires more than reducing information asymmetries
between two particular market participants. Investors’ perceived risk can be reduced (mean-
ing that the perceived market integrity can be increased) if investors generally believe that:
issuers disclose all inside information to the public;^125 information disclosed to investors
fulfils the requirement of generic usefulness (it is accurate, comprehensive and timely, see
Volume I); all investors have access to the same information;^126 all investors act in the
market for legitimate reasons (fairness, good faith) and the rule that a party must not deal
on the basis of inside information or manipulate the market is enforced effectively. The
purpose of the Directive on market manipulation will not be met if parties who possess in-
side information are permitted to use inside information in their mutual dealings but other
market participants are kept in the dark; that would not increase “full and proper market
transparency, which is a prerequisite for trading for all economic actors in integrated finan-
cial markets”.^127
19.8 Disclosure to the Public
Public disclosure of inside information may – in addition to Member States’ laws
- be required either by the main rule under the Directive on market abuse or by the
provisions of the Directive on takeover bids.
Main rule. The main rule is that an issuer must disclose inside information
when there is no longer a legitimate interest to delay disclosure, when the issuer
can no more ensure confidentiality, or when delaying disclosure would be likely to
mislead the public.^128
This can be illustrated by English law. In England, DTR 2.5.4 G states that the rule on ne-
gotiations – DTR 2.5.3 R (1) – does not allow an issuer to delay public disclosure of the
fact that it is in financial difficulty or of its worsening financial condition. DTR 2.5.3 R (1)
is thus limited to the fact or substance of the negotiations to deal with such a situation. An
issuer cannot delay disclosure of inside information on the basis that its position in subse-
quent negotiations to deal with the situation will be jeopardised by the disclosure of its fi-
nancial condition.
Announcing a decision to make a bid. In addition to those general requirements,
particular requirements apply in the context of public bids. A decision to make a
bid must be communicated to the supervisory authority and made public without
delay.^129 There can be differences depending on the Member State.
(^125) Article 6(1) of Directive 2003/6/EC (Directive on market abuse).
(^126) Articles 1(1) and 6(1) of Directive 2003/6/EC (Directive on market abuse); Articles 4, 5
and 6 of Directive 2004/109/EC (Transparency Directive); Articles 68(1) and 21(1) of
Directive 2001/34/EC (Listing Directive).
(^127) Recital 15 of Directive 2003/6/EC (Directive on market abuse).
(^128) Article 6(2) of Directive 2003/6/EC (Directive on market abuse).
(^129) Article 6(1) of Directive 2004/25/EC (Directive on takeover bids).