The forthcoming amendment of the Criminal Code on offences concerning financial markets
The Council of Ministers has recently approved the Preliminary Draft Bill amending the Criminal Code to transpose directives on the fight against fraud and counterfeiting of means of payment.
The new law transposes three EU directives into Spanish law: Directive (EU) 2019/713 on combating fraud and counterfeiting of non-cash means of payment; Directive 2014/57 (EU) aims to combat economic corruption, especially anti-competitive practices; and Directive (EU) 2019/884 on the exchange of criminal records information on third-country nationals.
Directive (EU) 2019/713 aims to provide the legal system of European Union countries with new tools to combat cybercrime and to punish the fraudulent use of new digital means of payment (e.g. mobile phones), which is becoming increasingly common as a result of the development of new technologies. Therefore, the offences of fraud in Article 248 and counterfeiting regulated in Article 390 et seq. will be reworded, as they have been included in the Criminal Code until now.
Directive 2014/57 (EU) aims to combat economic corruption, and especially anti-competitive practices.
The transposition of this Directive into the Spanish Criminal Code will amend the legal text to punish market abuse that occurs through the use of privileged information known as “insider trading”, a practice that undermines the transparency and security of financial markets.
To this end, Article 285 of the Criminal Code will be reformed. Until now, Article 285 of the Criminal Code punishes acts of acquisition, transfer or assignment of a financial instrument, or cancellation or amendment of an order relating to a financial instrument, using privileged information, with a prison sentence of six months to six years, a fine of two to five years, or three times the profit obtained. It will be understood that the members of the administrative bodies are the ones that have access to privilege information, the management or supervisory of the issuer or of the participant in the emission allowance market, also who becomes aware of it in the course of his professional or business activity or in the performance of his duties, and who obtains it through criminal activity.
On the other hand, Article 285 bis of the Criminal Code provided for a lighter penalty of imprisonment of six months to four years, a fine of twelve to twenty-four months and special disqualification from the exercise of the profession or activity for one to three years to whom possessed privileged information and discl it outside the normal exercise of his job, profession or duties, endangering the integrity of the market or the confidence of investors.
Article 285 of the Penal Code will be amended in order to equalise the penalties for all those who make use of privileged information, regardless of whether they hold a specific position or practice a specific profession.
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