UT (Tax & Chancery) UT-2022-000134 UT-2022-000135 UT-2022-000137 - [2025] UKUT 00214 (TCC)

The Tribunal has set out the relevant law on market abuse at [36] to [51] above and set out the allegations made by the Authority in taking the referred actions.

The issue for this Tribunal is whether the Traders undertook an abusive trading strategy in Futures on the Exchange, alone and in collaboration with each other, by placing the Large Orders to facilitate the execution of the Small Orders on the opposite side of the order book and which they did not have an intention to trade, and whether such conduct was dishonest and lacked integrity. The critical question is whether the Traders each had a (subjective) intention to trade the Large Orders, as explained by Andrew Baker J in Burford - the impression or signal given or likely to be given is only false or misleading if the Traders did not have an intention that the orders they placed would trade.

It is not necessary for the Authority to establish that the conduct had an actual market impact. It is about the impression or signal that the orders gave or were likely to give. In Hannam v The Financial Conduct Authority [2014] UKUT 0233 (TCC) the Tribunal concluded at [118] that the word “likely” in s118C(2)(c) FSMA 2000 is properly to be construed as meaning that there is a “real (in contrast with fanciful) prospect of that information having an effect on the price of qualifying instruments”, rejecting the submission that it meant “more probable than not”.

In making its findings of fact above, the Tribunal has not considered it necessary (or helpful) to set out the trading activity in all of the 233 Instances relied upon by the Authority (or even the 40 Specified Instances). The facts of that trading activity are agreed between the parties. We have taken account of all of the activity to which we were referred by the parties (whether in the course of oral or written submissions, witness statements, expert reports or cross-examination of witnesses) and refer to some of the Instances during the course of the Evaluation.

The Tribunal has found it helpful to address first the expert evidence in relation to market impact.