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ES - Amendment of the circular on Liquidity contracts

09/01/2020

On 27 November 2019, the Spanish Official State Gazette (BOE) has published CNMV Circular 2/2019 amending Circular 1/2017 on liquidity contracts.

The new circular eases certain requirements to facilitate the use of liquidity contracts by companies traded on the Alternative Stock Market (MAB) and by less liquid companies traded on Stock Exchanges. The main amendments incorporated are:

  • The establishment of a new alternative limit for the maximum daily volume that a financial intermediary may trade under a liquidity contract, expressed in absolute terms (20,000 euros) per session. Issuers whose shares do not have a liquid market (in accordance with the criteria under MIFID II) and are traded on a multilateral trading system (such as the MAB) or on a regulated market through a fixing trading system may benefit from this alternative limit. 

  • The elimination, in general, of the restriction whereby purchase and sale orders for shares are not maintained simultaneously at any time during the auction period. The financial intermediary shall adopt measures in order to prevent their purchase and sale orders from being executed against each other in the auction.

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