Preventing Insider Trading
"The Company asks all and any employees who, by virtue of their professional activity, may have access to confidential information that may influence the share price of any of the Group’s companies, not to disclose such information, buy or sell shares or other securities in the Company in question or to do so via third parties. This is not only in keeping with the law, but also a sign of respect for and equality with the other shareholders.”
Michelin Performance and Responsibility Charter (2002), Implementing our values, exercising our responsibilities
Context and Definitions
As a publicly traded or “listed” company, European regulations impose particularly strict obligations on the Group’s managers, employees and partners with regard to the prevention of market abuse.
No employee or partner should profit from buying or selling shares of a listed company, based on confidential information.
Any person who holds Inside Information in the performance of their duties or as a result of the preparation of a particular transaction is considered to be an "Insider".
"Inside Information" is non-public, precise information likely to influence the Group's stock market price before it becomes public.
Guiding Principles
European regulations and French criminal law punishing violations of securities laws are applicable to any natural person or legal entity, regardless of their nationality and country of residence. Any breach of the rules on insider trading may be subject to severe penalties (fines or prison terms).
The rules on market abuse and the measures taken by Michelin are specified in the Group Deontology Charter.
To prevent insider trading, the Group must maintain and update a list of people with occasional access to Inside Information.
- For each situation or project classified as inside information, the Group has drawn up a list of specific insiders. The Group ensures at the outset that these people or third parties are aware of their obligations and the penalties applicable in the event of violation of the rules.
- For persons exercising managerial responsibilities and similar persons who may have access, by virtue of their functions, to inside information, the Group has set up annual periods of abstention called "negative windows.” These people must refrain from any transaction in the shares of the Group during these periods. The Group ensures that they are aware of their obligations, the timetable to be respected and the penalties applicable in the event of violation of the rules.
Do: I must
- Refrain from any transaction on the shares of the Group in the event of notification of my inclusion on a one-off list of insiders or on the list of persons subject to "negative windows.”
- Call the Corporate Legal Direction/Corporate & Financial ethics officer in case of doubt about my insider status (see below ''Whom to Contact?'').
Don't: I must not
- Ignore a notification received informing of my registration on one of the "insider" lists.
- Buy or sell shares of a listed company as the holder of confidential information that could significantly influence its stock market price.
- Buy shares in a company if I know that the Group’s business dealings with that company could affect that company’s value.
Practical case
You are a Group employee-shareholder thanks to the BIB'Action employee shareholding plan. You have just heard an office rumor that the Group will soon publish poor results. You still want to sell Michelin shares, which you have held for more than 5 years*, to initiate the purchase of a new vehicle. Can you do this?
*Shares issued in Group employee shareholder plans are “blocked” for 5 years.
No. The rumor that you heard is indeed important information that can have an effect on the price of the Michelin shares. As an employee-shareholder of the Group, you are most likely considered an "insider;" therefore, the obligation to avoid transactions will apply to you, even if before you knew this rumor you had no particular prohibition. As a result, you cannot buy or sell Michelin shares until the information is published in a press release.
