The Market Abuse Regulation (MAR) has significantly impacted buy-side firms since its introduction in 2016, with provisions relating to market soundings and insider lists being of particular interest. Compliance with MAR requirements is crucial for buy-side firms to avoid penalties and ensure market integrity. This article delves into the MAR requirements and ESMA guidelines for buy-side firms, focusing on insider lists, market soundings, and how Logwise Solutions makes your compliance easier. By understanding and implementing the necessary internal procedures, training, and solutions buy-side firms can effectively navigate the complex regulatory landscape and maintain a high standard of market conduct. 

Market Soundings

1. Establishing Internal Procedures and Staff training

The MSR should establish, implement and maintain internal procedures that are appropriate and proportionate to the scale, size and nature of their business activity, to ensure that the 4 guidelines laid out in this article are properly followed.

2. Communication

Effective communication plays a critical role in handling market soundings under MAR. When buy-side firms, acting as Market Soundings Recipients (MSRs), are contacted by Disclosing Market Participants (DMPs), it’s important for these MSRs to clearly articulate their preferences regarding participation in market soundings. This decision could encompass withdrawing from all upcoming market sounding opportunities or just specific transaction types.

For streamlined communication and operational efficiency, it’s advisable for MSRs to designate specific contact points or individuals responsible for receiving market soundings and make this information available to the DMP. This ensures that the information provided by DMPs is promptly and accurately directed to the right channels. Furthermore, it’s imperative that any information gained through market soundings is disseminated internally following strict guidelines. This means the information should be confined to those who require it due to their role or involvement in potential transactions, strictly adhering to predetermined channels of communication within the organisation.

In the event of unrecorded market sounding interactions, where DMPs draft minutes or notes, MSRs are obligated to review and respond within five working days. This response can either be in the form of agreement and subsequent signing of the document or, if discrepancies arise, supplying an alternative version of the minutes, duly signed, to accurately reflect the MSRs perspective of the interaction.

3. The Flow of Inside Information

Though MSRs most often do not have an obligation to maintain insider lists in relation to market soundings (more on this in Part II: Insider Lists), they do need to implement internal procedures to manage and control the flow of inside information arising from the market sounding within the MSR and in relation to its staff, in order f to ensure compliance with Articles 8 and 10 of MAR.

The MSR should also ensure that the staff receiving and processing information obtained in the course of market soundings are properly trained on the relevant internal procedures and on the prohibitions, arising from being in possession of inside information. The training should be appropriate and proportionate to the scale, size and nature of MSRs business activity.

4. Assessing Inside Information

When participating in market soundings, Market Soundings Recipients (MSRs) should independently determine whether the information they receive qualifies as inside information. This judgement should be based not only on the assessment and material provided by the Disclosing Market Participant (DMP) but also on a broader scope of information from sources independent of the DMP available to the designated individual(s), group, or department within the MSR entrusted to conduct the assessment. Crucially, the assessment should be done without necessitating access to data beyond established information barriers within the MSR.

Once a DMP informs the recipient that it has been “cleansed”, meaning the DMP believes that information previously shared in a market sounding no longer constitutes inside information, MSRs must re-evaluate their own position on the inside status of the information. This re-assessment should incorporate the DMPs view and all other pertinent information accessible to the MSRs appointed assessor. Again, it’s important that this reassessment occurs without the need for crossing any internal information barriers.

If an MSR takes part in a market sounding devoid of inside information they may want to ensure that they still receive an update from the DMP when the market sounding is concluded, as the DMP has no formal requirement to cleanse the MSR if inside information is not involved, so that the MSR can assess the status of the information that has been received and update any trade restrictions or stop lists.

When an MSR concludes that they hold inside information as a result of taking part in a market sounding, it’s imperative for compliance with Article 8 of MAR that they identify every issuer and all financial instruments to which they believe that inside information relates. 

They may also place such issuers and financial instruments on internal trade restriction lists so as to avoid incidents of prohibited trading and resulting sanctions.

6. Record Keeping and Retention

For compliance purposes, Market Soundings Recipients (MSRs) must maintain a rigorous record-keeping system. This system should securely store information, ensuring that the records remain both accessible and legible for a minimum duration of five years. Key documents and data to be archived include:

a. The internal procedures outlined in section 1

b. Notifications as discussed in section 2, specifically those pertaining to MSRs communications and decisions regarding participation in market soundings.

c. The detailed evaluations and judgments conducted as per section 3, along with their underlying rationale, particularly concerning the assessment of whether received information constitutes inside information.

d. The assessment of instruments and issuers related to inside information , also covered in section 3.

e. A comprehensive list of employees and any other individuals who, through their employment or engagement, are privy to the information communicated in the course of the market soundings, listed in a chronological order for each market sounding

Through meticulous documentation and retention of these records, MSRs maintain compliance with MAR, mitigating the risks associated with handling inside information.

Insider List Management for Buy-Side Firms

When Are Buy-Side Firms Required to Keep Insider Lists?

While Buy-Side Firms regularly engage with inside information through market soundings, the necessity to establish and uphold formal insider lists, which carry specific legal responsibilities and potential sanctions for non-compliance under MAR, is not applicable unless they are working on the account of an issuer (article 18 of MAR). In instances where they operate independently, maintaining insider lists is not required.

However, irrespective of this, it’s essential for these firms to effectively oversee and restrict the internal dissemination of inside information acquired from market soundings and any other source. This vigilance is critical to ensure adherence to Articles 8 and 10 of MAR by both the MSR and its personnel.

Logwise Solution

1. Enhanced Management of Market Soundings with Logwise

Logwise delivers a robust and comprehensive approach to managing market soundings and wall-crossings, directly addressing the guidelines highlighted earlier for Market Soundings Recipients (MSRs).

Logwise’s advanced features cater to Gatekeepers managing multiple market soundings. The platform streamlines the compilation of documentation, the assessment of inside information, and wall-crossing of relevant fund managers. With Logwise you gain control of all ongoing and archived market soundings lists and stand ready to respond to both internal and external requests for information. 

Addressing the need for a strict ‘need-to-know’ basis in handling market soundings. Logwise offers an automated wall-crossing procedure. This feature involves an initial communication providing an introduction to the market sounding, followed by full information upon acceptance, ensuring that all relevant timestamps and events are correctly captured in an audit trail. This level of detail in tracking guarantees adherence to MAR’s compliance mandates, significantly reducing the risk of regulatory infractions. Logwise provides a robust reporting tool and a specific compliance officer access model to ensure efficient monitoring of all activities.

2. Data Storage

The platform securely stores and organises all essential documents and data for 5 years. This automated organisation and retention of records facilitate easy access and review, ensuring ongoing compliance with MAR requirements. Click to find out more about how we keep your data protected.

3. Staff Training

We can provide clients with comprehensive training on the platform for their employees as well as expert support and guidance on MAR compliance, helping users navigate the complex regulatory landscape and stay up-to-date with the latest requirements on an ongoing basis.

4. Logwise when Obligated to Keep Insider Lists

For MSRs representing issuers and thus required to maintain insider lists, Logwise’s automated list management system provides a hassle-free method of creating and updating these lists. The platform’s automatic collection of confirmations, reminders, and distributed personal data updates addresses the complexities of insider list management, thereby supporting compliance effortlessly.


Through Logwise, buy-side firms can confidently address the comprehensive requirements set by MAR for handling market soundings. The platform’s efficiency, combined with its compliance-oriented features, provides a much-needed solution, turning a complex regulatory obligation into a manageable and streamlined process.

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