EU Market Abuse Regulation: The Puzzle of Enforcement

Aimed at establishing an effective and consistent enforcement of market abuse regulation, the regime introduced by Regulation (EU) No. 596/2014 (‘MAR’) and Directive 2014/57/EU (‘MAD II’) relies on a mix of criminal penalties and administrative sanctions, both of which are subject to the principles of double jeopardy and due process. In the light of a few cases decided by the Court of Justice of the European Union and the European Court of Human Rights (‘ECtHR’), the features of this regime are, however, unclear, and it is doubtful whether the current framework is adequate to achieve its goals. This article criticizes the decision to criminalize market abuse at the EU level and argues that a credible EU supervisory system is better served by an enforcement system based on administrative sanctions. Moreover, the article discusses the solution offered by the ECtHR to the trade-off between efficiency and fairness in administrative proceedings and proposes an allocation of prosecution and decision-making to independent bodies within the same supervisory authority as a means to better balance efficiency and fairness.