11/27/2017 Insider Trading: Comparing U.S. and E.U.

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University of Pennsylvania Journal of International Law

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By Konstantinos Georgiou - University of Pennsylvania Law School, LLM

August 2016

Abstract:
The United States regulated insider trading much earlier than the rest of the European jurisdictions. Not only did the United States
adopt traditionally a more aggressive and successful pattern of enforcement than its European counterpart, but also the results brought by
each sides authorities veri ed the same reality. Many different opinions were expressed on the differences between the two systems,
stemming from their diverging cultural behaviors towards insiders, towards regarding enforcement and nally, towards regulator
expenditures to suppress insider trading. Nevertheless, Europe throughout the years began to follow the United States footsteps as it
adopted more advanced prohibition measures to treat insider trading. Overall, both the United States and the European Union have evolved
gradually in the area of insider trading, with each of them presenting unique characteristics due to their philosophical and historical
differences. At the end, despite those differences, insider trading is enforced (maybe unequally) on both sides of the Atlantic, showing the
United States and the European Unions common desire to protect their particularities, while developing a common ef cient ground through
which to deal with future insider dealing prohibitions.

Introduction
The United States began to regulate insider trading earlier than in the European Union. Not only has the United States adopted a more
direct approach about dealing with insider trading issues, but also its enforcement tactics are more aggressive than those found in
Europe. 01 In Europe, insider dealing is the more-commonly used term, while the United States more-commonly uses the term insider

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trading. The reason that these differences exist can be attributed to the different ways that the two counterparts developed their legislations
throughout their history. 02 Edward Greene & Olivia Schmid, Duty-Free Insider Trading?, 2013 COLUM. BUS. L. REV. 369, 371 (2013).

Differences in philosophical approaches, as well as variations on the understanding of insider trading and its enforcement, resulted in
the parallel evolution of two different insider regulation systems. On the one hand, there is the American approach, proven to be a more
speci c and regulated approach on insider trading, which supports the ideas of duciary duties as an important element before determining
the prosecution of those violating insider trading prohibitions. On the other hand, there is the European approach, 03 Id. where the protection
of trading inside information is placed at the regulatory center. 04 Utpal Bhattacharya & Hazem Daouk, The World Price of Insider Trading, 57 J.
FIN. 75 (2002).

To better understand the current debate over which of the two counterparts offers better protection for its citizens, this paper rst
discusses the evolution of insider trading both in the United States and in the European Union, before undertaking a comparative perspective
to discuss the differences between substantive provisions of American and European rules dealing with insider trading issues.

1. Insider Trading Regulations Evolution in the United States and the European Union
1.1. Insider Trading in the United States

Insider trading in the United States has been extensively de ned and limited by the United States court system. In particular, the
insider trading rule has been applied either for disclosure or non-disclosure purposes in cases where a duciary duty was breached. This
situation takes into account occasions where that breach refers to the source of the information or to the investors negotiating on the other
side. 05 The United Kingdom and European Union regimes not only de ne the offense of insider trading by statute, but they also differ
signi cantly from the United States antifraud framework. Under a European perspective the concept of parity information premises more the
notion of offense. In particular, there is no need to there be any breach of duciary duty or any other equivalent relation or any misleading or
deceptive conduct in general. The SEC urged more the parity-of-information approach; however, it was rejected as too broad in scope
concept by the United States Supreme Court in Chiarella v. United States, taking into account 10b-5 rules explanation on fraud driven
violations.

Overall, the concept of insider trading liability in the United States has been in uenced by three general theories which have set the
path for clear identi cation of this concept. To be more speci c: (1) the misappropriation theory, 06 See, e.g., United States v. OHagan 117 S.
Ct. 2199 (1997); Marc Steinberg, Insider Trading, Selective Disclosure, and Prompt Disclosure: A Comparative Analysis, 22 U. PA. J. INTL L. 639
(2001), available at http://scholarship.law.upenn.edu/jil/vol22/iss3/4. (2) the common theory of primary and secondary (also called
constructive) insiders, 07 Id. at 641. and (3) the classical theory, which focuses on tippees. 08 Id. at 669. Regarding the misappropriation
theory, it has been argued that liability can accounted when the duty of trust is violated in cases where information is traded to the detriment
of the source of the information. Secondly, when material private information is traded by corporate insiders, violating their duciary duty to
the detriment of the corporations shareholders and to the corporation itself, the trade establishes the liability for the insiders. Moreover,
along with the primary insiders, such as the executives or directors of the corporation, there are also other entities who have a duciary duty
to the issuer, such as the lawyers or underwriters. Lastly, tippees can be also considered liable for trading. However, that would be the case
only if a duciary duty is violated by the tipper who would disclose the information pursuing personal gain, and the tippee is fully informed
about that. 09 Greene, supra note 2, at 102.

The above relationships have been identi ed by SECs 10b5-2 rule, 10 United States Securities and Exchange Commission, Insider
Trading, SEC.GOV (Jan. 15, 2013), https://www.sec.gov/answers/insider.htm. but the rule also covers other situations in which con dential
information has been agreed to be kept in con dence. The con dentiality must have been expressed in terms of an agreement between the
parties in cases where the one who uses the information retains either a familial relationship or another close relationship characterized by a
history of sharing information with the other person. 11 Gloria Esteban De la Rosa, The Insider Trading in the European Union Law, J. CIV. LEGAL
SCI. 3:135 (2014).

1.2. Insider Trading in the European Union

Doctrines describing egalitarian ideas regarding regulation of insider trading in Europe have been the trend for the last few years. In
particular, if the society de nes its pre-eminent goals as the well-functioning of the markets or the preservation of investors con dence, that
could mean that the source of the inside information would not be so relevant. Nevertheless, the source of the information could be
considered important if duciary duties are implicated in cases where this information is traded in a prohibited way. 12 Id. At the core, this is
one of the principle differences between the United States and the European Unions approaches to regulate insider trading.

The European Union, in order to set the legal standards on insider trading, adopted the Market Abuse Directive (hereinafter MAD), by
which it de ned the notion of the term inside information. 13 Directive 2014/57/EU, of the European Parliament and of the Council of 16 Apr.
2014 on Criminal Sanctions for Market Abuse (Market Abuse Directive or MAD), 2014 O.J. (L. 173) 179, 17778, arts. 1(1), 2(4). The exact nature
of the inside information must be con dential, and must not have been provided to the public, either directly or indirectly. It may refer to one
or more securities or to one or more issuers. 14 See Committee of European Securities Regulators Public Consultation on the Market Abuse
Directive Level 3 No. CESR/06-562 of Nov. 2006, arts. 1.1516 at

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https://www.esma.europa.eu/sites/default/ les/library/2015/11/06_562.pdf. In particular, based on the de nition of the directive, the
inside information is regarded as precise in cases where it signals the existence of current events or situations that may arise, or an act that
has happened or is expected to happen, bearing such a precision based on which someone would conclude that the information affected the
prices. 15 CHRISTOPHER BATES, Market Abuse: European Commission Proposes New EU Regime, CLIFFORD CHANCE CLIENT BRIEFING 2 (Oct. 20, 2011),
https://www.cliffordchance.com/brie ngs/2011/10/market_abuse_europeancommissionproposesnewe.html. In addition, the
information needs to be suf ciently sensitive to the securitys price, meaning that if the information became known to the public, it would
shift the securitys price accordingly. 16 The meaning of the American notion towards price-sensitive matters seems to approach the meaning
of Article 1(2) of MAD. Here, an investor, before taking any decision to act or invest, must rst be advised of this information. See also Id.; Inc. v.
Levinson, 485 U.S. 224, 23132 (1988).

2. Comparing Important Provisions Between the United States and the European Union
Based on the above, it is arguable that the United States and the European Union have taken important measures regarding insider
tradings development in both continents. Nevertheless, to further understand the existing particularities of each legal system, it is necessary
to compare the substantive American and European provisions on insider trading, to clearly de ne those rules which better-satisfy the
interests of each participant.

To begin, when comparing the American and European approaches, there are those who argue that the American prohibition
conceptually embraces the violation of a duciary duty, whereas the European prohibition is based on the idea that everyone should have an
equal opportunity to access the information provided. 17 NAIMH MOLONEY, EC SECURITIES REGULATION, 73943 (2002). The United States, in its aim to
differentiate and limit its position in comparison to the broader notion of equal access to information, adopted a narrower approach which
focuses on the notion of a duciary breach.

2.1. Access to Information Theory

2.1.1. Understanding Information Theorys Concept in the United States

Insider trading in the United States is de ned under rule 10b-5, 18 Deepa Sarkar, Securities Exchange Act of 1934, (April, 22, 2016, 6:21PM),
https://www.law.cornell.edu/wex/securities_exchange_act_of_1934. which was developed through SECs regulations as well as legislative
acts and other case law. A full understanding of the rule can be only achieved by examining its historical development throughout the years.
When the rule was rst enacted by the SEC, it was not evident that it made direct reference to insider trading, and was originally considered
more of an antifraud provision. Of course, today, it constitutes the basis of insider trading under United States law, giving it high
importance. 19 17 C.F.R. 240.10b-5 (1996), https://www.law.cornell.edu/cfr/text/17/240.10b-5.

2.1.2. Approaching the Access to Information Theory in Europe

The way that access to information is approached in Europe, which focuses on explaining either market abuse in the context of insider
trading or disclosing obligations, has been at the center of the European Court of Justice on many occasions. However, one case that really
touched signi cantly upon that issue was the Geltl v. Daimler AG, according to which disclosure is proposed as the solution when there are
indications that information is relevant to a possible future event. 20 Case C-19/11, Geltl v Daimler, 3 C.M.L.R. 762 (2012). Moving further,
European law stipulates that informations disclosure should be delayed to the market, if there is valid cause for such an action. Otherwise,
that would be contrary to the current understanding of MAD. Nevertheless, some of the most important differences between the two
positions stem from a difference in understanding MAD Article 4. 21 Market Abuse Directive art. 4. This provision could be interpreted as an
extension of the prohibitions found in both Articles 2 and 3 of MAD. 22 Market Abuse Directive arts. 12. Those prohibitions concern those who
possess inside information and who are supposed to know that the information is, in fact, inside information. 23 Market Abuse Directive art. 4.
It becomes clear, then, that the European prohibition approach on insider trading is not based upon duciary duties, as is more often the case
in the United States, but upon an equally divided access to information. 24 Reinier Kraakman, The Legal Theory of Insider Trading Regulation in
the United States, in EUROPEAN INSIDER DEALING 467 (1991).

2.2. Duty to Disclose Information

Towards the same direction, the reporting obligations of corporations in the United States mirror those different
approaches. 25 Roberta Karmel, Outsider Trading on Con dential Information A Breach in Search of a Duty, 20 CARDOZO L. REV. 83, 114 (1998). In
the United States there is no general duty to disclose material nonpublic information, whereas the European Union imposes a general duty
obliging European corporations to disclose all material information.

2.2.1. No General Duty to Disclose Material Nonpublic Information Under American Law

The continuous disclosure obligation for American corporations is most apparent under the Exchange Act. A major comparative
difference between the current European and American approach has been the concept of continuous disclosure. Compared to the current
European approach, under the American legal system, there is no general duty to disclose all material information under the Exchange
Act. 26 Id. at 114. Although this statement is well de ned under the terms of the Exchange Act, there are some prerequisites which must be
satis ed.

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Pursuant to Section 13 of the Exchange Act, extensive periodic reports must be published. Moreover, a duty to update the published
information is assigned to corporations, which focuses particularly on signi cant (material) changes related to either the issuers operation or
its nancial condition. 27 Sarbanes-Oxley Act of 2002, Pub. Law 107-204, 409 (2002). This leads to the conclusion that, practically speaking,
the duty to update is based on a continuous and extensive disclosure obligation, since that duty is triggered by changes to the price or by
inside exchanges of information. Furthermore, SECs Form 8-K has further clari ed the items that need to be disclosed when the corporation
is acting under an increased obligation to regularly disclose certain information. 28 THOMAS HAZEN, THE LAW OF SECURITIES REGULATION 496, 551 (6th
ed. 2009). Nevertheless, as to the information previously released to the public by the corporation, there are no of cial obligations to publish
any material information before the end of the following quarterly report. 29 Id.

According to Section 10(b) of the Securities Act, a disclose or abstain duty is imposed to the corporations which, on the basis of inside
information, deal with their own securities. There are occasions, however, in which corporations can keep their silence when a material
development may occur, thereby satisfying their abstain duty without breaching their duty to disclose. Nevertheless, based on the demands of
the stock exchanges, companies listed in the United States are required to make available to the public any material information requested by
an investor. 30 American Stock Exchange Company Guide (CCH) 10,121; Sec.Exch.Act Rel. No. 34-8995 (Oct. 15, 1970). Although some may
argue that these rules seem to inspire greater security, they are not enforced as actively as one would hope. Not only does the SEC lack
suf cient resources to prosecute every violation of the listing requirements, but also the violations of these rules are severely sanctioned in
general. 31 HAZEN supra note 29, at 511.

As such, it is not always easy to establish that a corporations of cer or director violated their duciary duty to not reveal their
corporations private information. Although issuers could ignore market rumors before giving any public answer, they do sometimes engage in
such situations since they are not prohibited from doing so. 32 James Koenig, The Basics of Disclosure: The Market for Information in the Market
for Corporate Control, 43 U. MIAMI L. REV. 1021, 1074 (1989). Since selective disclosure to any third parties is prohibited by the 2000 Regulation
FD, this reaf rms the United States position not to impose any obligation to disclose material information. 33 17 C.F.R. 243.100243.103,
https://www.law.cornell.edu/cfr/text/17/243.101. The SEC adopted these rules to satisfy its past stock exchange rules, which aimed to
restrict disclosures made only to nancial related professors or to analysts in general. 34 NEW YORK STOCK EXCHANGE CO. MANUAL art. 202.02(a)
(2016), http://nysemanual.nyse.com/LCMTools/PlatformViewer.asp?selectednode=chp_1_3_2_6&manual=%2Flcm%2Fsections%2Flcm-
sections%2F.

All kinds of communication and information disclosed to analysts must be made available to the public as well. Both professional
investors and the corporations board should comply with Regulation FD whenever they have to satisfy their disclosure obligation.
Nevertheless, the provision does not always apply, especially where information needs to be disclosed to rating agencies or to the press. In
these cases, different standards need to be satis ed. Regulation FD is important to further understand the comparison between the European
Unions and the United States application of the equal access to information, as it sets the basis for the acceptance of any existing duciary
duties, without confusing each time the requirements for the ful llment of each position.

2.2.2. Disclosure Obligation Under European Union Standards

The European Union has also set its standards regarding the disclosure obligations, found in MAD Article 6. More speci cally, according
to this provision, the European Member States need to provide to the public any inside information that has been communicated (used) by the
issuers of the nancial instruments for any transaction. Therefore, Europes default rule is that the market should be the place where inside
information should be disclosed. Oddly enough, under European Union law the issuer does not own its own inside information, and thus, it
cannot inappropriately use it with other insiders. Instead, the investing public should be given access to inside information, under the theory
that it belongs to all investors. 35 Mathias Siems, The EU Market Abuse Directive: A Case-Based Analysis, 2 L. & FIN. MKTS. R. 39 (2008).

Like every rule, there are a few exceptions. In particular, MAD Article 6 clari es those particularities and sheds more light on the
current exceptions. First, any delay to disclose any public inside information to the public may be excused in cases where the issuers
legitimate interests are not prejudiced, and are thus not seriously considered. 36 Market Abuse Directive art. 6. This is the case if the public is
not misled as a result of such an omission, provided that the informations con dentiality is ensured by the issuer. 37 MOLONEY supra note 18.

In addition, one may argue that MAD Article 6 acts as an analog to the United States Regulation. 38 United States Securities and
Exchange Commission, Final Rule: Selective Disclosure and Insider Trading, SEC.GOV (Aug. 21, 2000), https://www.sec.gov/rules/ nal/33-
7881.htm. The Article suggests that effective and complete disclosure of inside information is requested for the issuer, or the person acting for
his account or on his behalf, whenever the issuer needs to complete his normal professional duties. Whether the inside information is
disclosed intentionally or not, the issuer is obliged to simultaneously make an effective, prompt, and complete disclosure to the public.

2.3. Other Substantive Differences

According to the American regulatory system, whenever the existence of a duciary duty or its breach is questioned, the plaintiff bears
the burden of establishing the violation of such a duty. 39 Steinberg, supra 6, at 643. The European law, however, adopts a broader approach,
under which enforcement does not follow the same patterns as under American law; this gives the European law more exibility when
arguing insider trading violations.

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Despite the above theoretical differences, it could be argued that there are few similarities with respect to how insider trading laws are
applied. There are occasions in which the American rules would not apply, while the European Union rules would be enforceable (and vice-
versa), especially related to matters regarding tippees. 40 As discussed, the European Union and the United States approaches present many
differences in the light of the tactics surrounding the prohibition on insider trading. However, due to the various European Member States,
and the non-existence of an Pan-European Regulation on Corporate and Securities Matters (except of course of the Directives), each
Member State could have its own individual and unique differences in comparison to the United States. Thus, the differences described so far
have focused on the issues affecting all (or most) Member States.

Most likely, the biggest difference between the two legal systems could be summarized by the issues related to burden of proof
questions. In particular, in the United States, a breach of duciary duty must be established in the majority of cases, and also, especially in the
case of tippees, the awareness of that breach. 41 United States v. Whitman, 2012 WL 5505080, at *6 (S.D.N.Y. Nov. 19, 2012).

At the same time, although Section 16(b) of the Exchange Act 42 Securities Exchange Act of 1934, Pub. Law 73-291, 16(b) (1934),
https://www.sec.gov/about/laws/sea34.pdf. seems to be a rule of signi cant importance under American law, Europe has nothing which
approaches it in equivalence. By interpreting this rule, private litigation is offered as a legal way for American investors to go against primary
insiders for committing trading violations. In Europe, however, such enforcement is not that common and is rarely met; most European
jurisdictions tend to make use of public enforcement as the principal tool to remedy insider trading issues. 43 Thomas Newkitk & Melissa
Robertson, Insider Trading A U.S. Perspective, Remarks at the 16th International Symposium on Economic Crime at Jesus College (Sept. 19,
1998), http://www.sec.gov/news/speech/speecharchive/1998/spch221.htm.

3. Conclusion
To conclude, it is well known that the United States is regarded as the forerunner in the capital markets eld, as it relates to
introducing rules for better-regulated issuance of securities. Thus, as the country that proposes and implements these laws, it bears all the
drawbacks and the bene ts from such an action. One could certainly argue that the United States has been one of the very few countries
distinguished as active in both private and public insider trading enforcements.

The United States attempt to satisfy its private and public promises for ef cient enforcement enacted Section 10(b) of the 1934
Exchange Act and, later, Section 16(b) of the Exchange Act. By examining the rst Section of the Act, it is obvious that it is a broader provision,
covering may anti-fraud issues, including insider trading, although it is not mentioned directly. The second section is narrower, focusing more
on insider trading information, based on the timing that the inside information is used (before or during the insider trading). Despite the
dif culties in nalizing these rules throughout the years, in both cases, it has been the SEC, along with court decisions, which contributed to
the evolution of these American rules.

Some may argue that Europes regulations follow the United States footsteps while adding its own insider trading tactics. As is the case
when regulating most European issues, directives are enacted rst, which makes the procedure more time-consuming compared to the
United States, as the target of those directives is the adoption of cohesive and harmonized legal measures, incorporated by all European
Member States. Overall, compared to the American rules, Europe is more direct when dealing with insider trading issues.

In short, despite their obvious differences, both the European Union and the United States seem to contribute immensely to laws
related to insider dealing. Practically speaking, the reason that these differences exist are justi ed by differences in each counterparts
evolutionary process and as well as different cultural understandings on the nature of insider trading. Overall, however, both the European
and the American legal system deal ef ciently in prohibiting insider trading. Only time will tell if these two different regulatory approaches
will continue to converge, as the securities world becomes more globalized than ever before, meaning that actions of a United States
corporation almost immediately affect other corporations in Europe, and vice versa.

References

01. In Europe, insider dealing is the more-commonly used term, while the United States more-commonly uses the term
insider trading.

02. Edward Greene & Olivia Schmid, Duty-Free Insider Trading?, 2013 COLUM. BUS. L. REV. 369, 371 (2013).

03. Id.

04. Utpal Bhattacharya & Hazem Daouk, The World Price of Insider Trading, 57 J. FIN. 75 (2002).

05. The United Kingdom and European Union regimes not only de ne the offense of insider trading by statute, but they also
differ signi cantly from the United States antifraud framework. Under a European perspective the concept of parity
information premises more the notion of offense. In particular, there is no need to there be any breach of duciary duty or
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11/27/2017 Insider Trading: Comparing U.S. and E.U. Rules
any other equivalent relation or any misleading or deceptive conduct in general. The SEC urged more the parity-of-
information approach; however, it was rejected as too broad in scope concept by the United States Supreme Court in
Chiarella v. United States, taking into account 10b-5 rules explanation on fraud driven violations.

06. See, e.g., United States v. OHagan 117 S. Ct. 2199 (1997); Marc Steinberg, Insider Trading, Selective Disclosure, and Prompt
Disclosure: A Comparative Analysis, 22 U. PA. J. INTL L. 639 (2001), available at
http://scholarship.law.upenn.edu/jil/vol22/iss3/4.

07. Id. at 641.

08. Id. at 669.

09. Greene, supra note 2, at 102.

10. United States Securities and Exchange Commission, Insider Trading, SEC.GOV (Jan. 15, 2013),
https://www.sec.gov/answers/insider.htm.

11. Gloria Esteban De la Rosa, The Insider Trading in the European Union Law, J. CIV. LEGAL SCI. 3:135 (2014).

12. Id.

13. Directive 2014/57/EU, of the European Parliament and of the Council of 16 Apr. 2014 on Criminal Sanctions for Market Abuse
(Market Abuse Directive or MAD), 2014 O.J. (L. 173) 179, 17778, arts. 1(1), 2(4).

14. See Committee of European Securities Regulators Public Consultation on the Market Abuse Directive Level 3 No. CESR/06-
562 of Nov. 2006, arts. 1.1516 at https://www.esma.europa.eu/sites/default/ les/library/2015/11/06_562.pdf.

15. CHRISTOPHER BATES, Market Abuse: European Commission Proposes New EU Regime, CLIFFORD CHANCE CLIENT BRIEFING 2 (Oct. 20,
2011), https://www.cliffordchance.com/brie ngs/2011/10/market_abuse_europeancommissionproposesnewe.html.

16. The meaning of the American notion towards price-sensitive matters seems to approach the meaning of Article 1(2) of MAD.
Here, an investor, before taking any decision to act or invest, must rst be advised of this information. See also Id.; Inc. v.
Levinson, 485 U.S. 224, 23132 (1988).

17. NAIMH MOLONEY, EC SECURITIES REGULATION, 73943 (2002).

18. Deepa Sarkar, Securities Exchange Act of 1934, (April, 22, 2016, 6:21PM),
https://www.law.cornell.edu/wex/securities_exchange_act_of_1934.

19. 17 C.F.R. 240.10b-5 (1996), https://www.law.cornell.edu/cfr/text/17/240.10b-5.

20. Case C-19/11, Geltl v Daimler, 3 C.M.L.R. 762 (2012).

21. Market Abuse Directive art. 4.

22. Market Abuse Directive arts. 12.

23. Market Abuse Directive art. 4.

24. Reinier Kraakman, The Legal Theory of Insider Trading Regulation in the United States, in EUROPEAN INSIDER DEALING 467 (1991).

25. Roberta Karmel, Outsider Trading on Con dential Information A Breach in Search of a Duty, 20 CARDOZO L. REV. 83, 114 (1998).

26. Id. at 114.

27. Sarbanes-Oxley Act of 2002, Pub. Law 107-204, 409 (2002).

28. THOMAS HAZEN, THE LAW OF SECURITIES REGULATION 496, 551 (6th ed. 2009).

29. Id.

30. American Stock Exchange Company Guide (CCH) 10,121; Sec.Exch.Act Rel. No. 34-8995 (Oct. 15, 1970).

31.
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HAZEN supra note 29, at 511.

32. James Koenig, The Basics of Disclosure: The Market for Information in the Market for Corporate Control, 43 U. MIAMI L. REV.
1021, 1074 (1989).

33. 17 C.F.R. 243.100243.103, https://www.law.cornell.edu/cfr/text/17/243.101.

34. NEW YORK STOCK EXCHANGE CO. MANUAL art. 202.02(a) (2016), http://nysemanual.nyse.com/LCMTools/PlatformViewer.asp?
selectednode=chp_1_3_2_6&manual=%2Flcm%2Fsections%2Flcm-sections%2F.

35. Mathias Siems, The EU Market Abuse Directive: A Case-Based Analysis, 2 L. & FIN. MKTS. R. 39 (2008).

36. Market Abuse Directive art. 6.

37. MOLONEY supra note 18.

38. United States Securities and Exchange Commission, Final Rule: Selective Disclosure and Insider Trading, SEC.GOV (Aug. 21,
2000), https://www.sec.gov/rules/ nal/33-7881.htm.

39. Steinberg, supra 6, at 643.

40. As discussed, the European Union and the United States approaches present many differences in the light of the tactics
surrounding the prohibition on insider trading. However, due to the various European Member States, and the non-
existence of an Pan-European Regulation on Corporate and Securities Matters (except of course of the Directives), each
Member State could have its own individual and unique differences in comparison to the United States. Thus, the
differences described so far have focused on the issues affecting all (or most) Member States.

41. United States v. Whitman, 2012 WL 5505080, at *6 (S.D.N.Y. Nov. 19, 2012).

42. Securities Exchange Act of 1934, Pub. Law 73-291, 16(b) (1934), https://www.sec.gov/about/laws/sea34.pdf.

43. Thomas Newkitk & Melissa Robertson, Insider Trading A U.S. Perspective, Remarks at the 16th International Symposium on
Economic Crime at Jesus College (Sept. 19, 1998), http://www.sec.gov/news/speech/speecharchive/1998/spch221.htm.

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11/27/2017 Insider Trading: Comparing U.S. and E.U. Rules

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