Last week, the European Commission proposed a draft to update the 2003 Market Abuse Directive to toughen up penalties on traders who manipulate markets. The new provisions:

• Extend the scope to all financial instruments such as commodities, commodity derivatives and carbon emission allowances
• Come down hard on using derivatives markets to manipulate spot commodity prices
• Give supervisors the powers to ask telecom operators for details on phone calls and raid private premises to seize documents
• Create the obligation for firms to tell regulators of suspicious transactions to orders and off-exchange transactions
• Introduce a new offence of 'attempted' market manipulation that does not succeed
• Require that fines should not be less than the profit made from market abuse
• Create a criminal offence of inciting, aiding and abetting insider dealing and market manipulation

These proposals will take two years to be translated into national regulations. We are keeping a close watch on them and will update our Market Abuse e-learning course as soon as they are confirmed.

However, many of the above provisions are already in force in the UK, which, as usual, leads the way in EU financial regulation.