June10th, 2009

Call for evidence of the European Commission

Review of Directive 2003/6/EC on insider dealing and market manipulation

(Market Abuse Directive)

The French Banking Federation (FBF) represents the interests of the banking industry in France. Its membership is composed of all credit institutions authorised as banks and doing business in France, i.e. more than 500 commercial, cooperative and mutual banks. FBF member banks have more than 25,500 permanent branches in France. They employ 500,000 people in France and around the world, and service 48 million customers.

The FBF welcomes and fully supports the initiative of a review of the MAD.

TheFBFbroadly agreeswiththeanswermadebytheAMAFI and would like to underline three points:

-The FBF agrees that the MAD should be extended beyond regulated markets (i.e. alternative trading platform) but the perimeter of the markets and tradable instruments concerned should be discussed at the level 2 as, for example, there is no sense to apply the MAD to the very illiquid markets and products.

-The FBF agrees that the rules on insider lists should be re-examined, and, as announced by the European Commission, with the primary objectives of reducing the administrative burden, but also of better targeting those persons who are in actual possession of inside information. There also should be a clear distinction between the special situation of banks as intermediaries and the issuers, as even if banks have a larger number of cases to observe in which they need to monitor which employees have insider information, they also have stringent compliance functions and procedures in place. Hence, the requirements for insider lists should be more flexible and give more discretion to compliance departments.

-The FBF would also like one point to be precised. Indeed, concerning the suspicious transaction reporting, article 11 of Directive 2004/72/EC states that “competent authorities do not disclose to any person the identity of the person having notified these transactions, if disclosure would, or would be likely to harm the person having notified the transactions”. This provision is insufficient in FBF's view, as the protection of the notifying person’s identity is ensured only under certain conditions, and the identity of the notifying person can be transmitted from the receiving authority to another one while this information is not critical to the investigation. It is important to underline to the Commission that the identity of compliance officers who prepare and sign these reports should be absolutely safeguarded when the report is transmitted from one MemberState to another one, i.e. it should be removed from the set of data transmitted. As serious as it can be, acts of market abuse can involve dangerous and powerful organisations or individuals and the physical integrity of firm’s staff in charge of the notifications should be protected by all means.

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