Insider Trading under German Law – Market Abuse and Criminal Defence in Frankfurt

Insider trading is treated as an abstract endangerment offence under Article 14 of the Market Abuse Regulation (MAR). The rule aims to keep financial markets fair and transparent: no actual price movement or concrete market harm is required — using inside information alone is sufficient for a breach. For immediate assistance, contact our English-speaking criminal lawyers in Frankfurt or see our overview of criminal defence services.

Article 14 MAR – Blanket Prohibition and Legal Sanctions

Article 14 MAR contains a general prohibition on insider dealing and functions as a blanket provision. The criminal and regulatory sanctions are set out in Sections 119 and 120 of the German Securities Trading Act (WpHG). The content of Article 14 MAR is further specified by other MAR provisions, so it operates as both a sanctions blanket and a content blanket. For case strategy in white-collar contexts, visit our page on white collar crime defence.

Purpose and Structure of the Rule

The core purpose of Article 14 MAR is to secure level playing-field conditions on the capital market, preventing any advantage from exclusive information. It covers three central prohibitions:

• • Trading while in possession of inside information
• • Unlawful disclosure of inside information
• • Recommendations or inducements based on inside information

Together with Article 15 MAR (market manipulation), Article 14 forms the backbone of EU market-abuse law, enforced in Germany by the competent authorities. If you face allegations, our team provides rapid advice on German criminal procedure and defence options.

Supervisory Measures and Sanctions

Authorities may conduct searches, seizures, impose professional bans and withdraw licences. In addition, sanctions can be made public (“naming and shaming”). Criminal courts may impose custodial sentences and substantial fines. Discuss bespoke defence strategies with our attorneys.

No Individual-Loss Requirement

Article 14 MAR primarily protects the integrity of the market, not individual investors. Civil damages claims are therefore generally limited; exceptions may arise only in special situations (e.g. egregious misconduct). We will advise you on parallel criminal defence in Germany and any necessary civil measures.

Acts and Omissions

Insider dealing typically requires active conduct. Exceptionally, omissions can also be relevant — for example, where a compliance officer fails to properly ring-fence inside information. Liability for omissions presupposes a guarantor position (e.g. as a board member).

Mental Element: Intent, Error and Negligence

Criminal liability generally requires intent (Section 119(3) WpHG), including awareness of the decisive legal features (materiality and precision of the information). For regulatory offences, recklessness may suffice (Section 120(14) WpHG). Legal or factual mistakes are excusable only if unavoidable (e.g. reliance on incorrect official guidance).

Attempt, Withdrawal and Corporate Responsibility

The attempt to commit insider dealing is punishable (Section 119(4) WpHG), e.g. placing an order based on inside information. Withdrawal is possible only in narrow circumstances. Companies may face corporate liability where organisational failings enable the offence (Sections 30, 130 OWiG). Our team assists with compliance remediation and defence.

Specific Prohibitions under Article 14 MAR

• • Insider dealing (Art. 14(a) MAR): acquiring or disposing of financial instruments using confidential information.
• • Recommendations/inducements (Art. 14(a) with Art. 8(3) MAR): following a recommendation can be unlawful if it rests on inside information.
• • Issuing recommendations (Art. 14(b) MAR): encouraging others to act on inside information is prohibited.
• • Unlawful disclosure (Art. 14(c) MAR): passing on confidential information — including indirectly through recommendations — is forbidden.

Accused of insider trading? Speak to our English-speaking defence lawyers in Frankfurt or use our contact form for swift help.

FAQ: Insider Trading in Germany

What is insider trading?
Dealing in financial instruments based on non-public, price-sensitive information. Under Article 14 MAR, using such information is already unlawful, even without actual price movement. See our criminal defence overview.

Why is it an abstract endangerment offence?
The offence is designed to prevent market distortion: it is enough that trading occurs while in possession of inside information.

Which provisions apply?
The key rule is Article 14 MAR, complemented by other MAR provisions and by Sections 119/120 WpHG, which set criminal and regulatory consequences.

Which acts are prohibited?
Trading with inside information, disclosure of such information, and recommendations/inducements based on it. For defence strategies in complex matters, see white collar crime defence.

What sanctions are possible?
Searches, seizures, professional bans, licence withdrawal and public announcements of sanctions; in criminal proceedings, imprisonment and fines may follow. Contact our attorneys for tailored advice.

Does Article 14 MAR protect individual investors?
Primarily the rule protects market integrity, not individual loss. Civil claims are therefore limited, with exceptions only in special cases.

Can omissions be punishable?
Yes, where a person with a guarantor duty (e.g. a director or compliance officer) fails to secure inside information adequately.

Is attempt punishable? Can companies be liable?
Yes — attempts are punishable; companies can face regulatory liability if organisational shortcomings contributed. We also advise on compliance and remediation.

Contact Our Criminal Defence Lawyers in Frankfurt and Nationwide

Buchert Jacob Peter advises and defends in insider-trading and market-abuse proceedings throughout Germany.

• • Frank M. Peter – Specialist Lawyer for Criminal Law
• • Dr Caroline Jacob – Specialist Lawyer for Criminal Law
• • Dr Sven Henseler – Diplom-Finanzwirt (FH)
• • Of Counsel: Prof. Dr Frank Peter Schuster
• • Cooperation Partner: Frank Wehrheim – Tax Advisor and former Tax Investigator

📞 Telephone: +49 69 710 33 330
✉️ Email: kanzlei@dr-buchert.de

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