1. Taking into account considerations of effectiveness, efficiency and proportionality, the ECB and the NCAs shall adopt internal rules applicable to members of staff and the members of bodies who in the performance of SSM tasks have access to market sensitive information, other than on a one-off basis (hereinafter ‘persons with access to market sensitive information’), introducing the specific restrictions set out in paragraph 2 concerning private financial transactions that are or may be perceived to be closely related to the performance of SSM tasks (hereinafter ‘critical private financial transactions’).
2. The internal rules referred to in paragraph 1 shall:
a) | prohibit critical private financial transactions in: i) equity and debt instruments issued by a regulated entity; ii) derivatives related to equity and debt instruments issued by a regulated entity; iii) units of collective investment schemes that have a stated investment policy aimed exclusively at regulated entities; and |
b) | restrict other critical private financial transactions as necessary; and |
c) | restrict short-term trading. |
3. Taking into account considerations of effectiveness, efficiency and proportionality, internal rules adopted pursuant to points b) and c) of paragraph 2 may consist of any one or more of the following restrictions on the relevant transaction:
a) | a prohibition; |
b) | a requirement for prior authorisation; |
c) | a requirement for ex ante or ex post reporting; |
d) | an embargo period within which such transaction shall not be conducted. |
4. In their internal rules, the ECB and the NCAs: (i) shall provide that persons with access to market sensitive information report their legacy assets whenever holding these assets raises a conflict of interest with their involvement in SSM tasks; and (ii) shall establish a mechanism to ensure that conflicts of interest arising from legacy assets are resolved within a reasonable period of time, including that it may be requested that legacy assets raising any conflicts of interest be sold within a reasonable period of time. The ECB and the NCAs may provide in their internal rules that legacy assets that do not raise conflicts of interest may be retained.
5. The ECB and the NCAs shall specify in their internal rules the conditions and safeguards under which persons with access to market sensitive information who entrust the management of their private financial assets to an independent third party under a written asset management agreement are exempt from the specific restrictions laid down in this Article.
6. The ECB and the NCAs may adopt internal rules that apply restrictions as set out in this Article to their members of staff and the members of their bodies other than persons with access to market sensitive information.
7. The ECB and the NCAs shall take the necessary measures to adjust their internal rules imposing specific restrictions on critical private financial transactions as referred in paragraph 2 to reflect decisions of the Governing Council.