In its judgment delivered on 28 June 2012, the Court of Justice of the European Union ("ECJ") gave useful clarifications on the notion of "inside information" within the meaning of Directive 2003/6/EC and Directive 2003/124/EC.
For information to qualify as inside information, such information must be, amongst other things, of "a precise nature". Pursuant to Directive 2003/124/EC, the information must refer to a "set of circumstances which exists or may reasonably be expected to come into existence or an event which has occurred or may reasonably be expected to occur and is specific enough to enable a conclusion to be drawn as to the possible effect of that set of circumstances or event on the prices of financial instruments or related derivative financial instruments".
When questioned by the German Federal Court of Justice on the notion of "precise information", in the case where the chairman of a board had discussed internally his early departure from the board before the actual decision had been made and disclosed to the public, the ECJ replied that in the case of a continuing process which is intended to bring about a particular circumstance or generate a particular event, the intermediate steps of that process (whether actual or future) may in themselves constitute a set of circumstances or an event within the meaning of Directive 2003/124/EC and not only the actual circumstance or event that is the result of that continuing process.
These intermediate steps may per se constitute information of a precise nature, and therefore qualify as inside information.
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