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AFM fines SBM Offshore for non-timely disclosure of inside information

Measure

Fine

On 28 March 2019, the Dutch Authority for the Financial Markets (AFM) imposed an administrative fine of €2,000,000 on SBM Offshore N.V. The fine was imposed because SBM Offshore failed to disclose inside information (previously referred to as price-sensitive information) in a timely manner on four occasions during the period between March 2012 and November 2014.

The violations

SBM Offshore is a publicly listed company that supplies installations for the production and storage of oil and gas products worldwide. The AFM has established that SBM Offshore has failed to disclose the following information (inside information) in a timely manner:

  1. In 2012, SBM Offshore became aware of possible bribery practices in Brazil, where it achieved about half of its turnover;
  2. In 2014, SBM Offshore again became aware of possible bribery in Brazil after receiving further information from the Fiscal Information and Investigation Service (FIOD) about the bribery issue;
  3. SBM Offshore's most important customer decided in 2014 to exclude it from two tenders; and
  4. This customer subsequently decided to uphold the exclusion.

Because of the violations of SBM Offshore, investors were unable to make their investment decisions based on the correct information. This has damaged confidence in the market. The AFM is committed to fair and transparent financial markets and therefore considers a fine to be an appropriate course of action in this case. Furthermore, this fine helps to raise awareness of the importance of a timely provision of information to investors about indications of corruption or bribery and the consequences thereof.

Size of the fine

The fine of €2,000,000 imposed by the AFM only relates to the way in which SBM Offshore informed its investors between 2012 and 2014 about the developments in the bribery case. The AFM has not investigated that case itself. The base amount of the fine in this case is €2,000,000 and the AFM considers that amount to be appropriate. The AFM considers the violations to be serious and culpable but it also takes into account the fact that SBM Offshore may, as a result of the decision of the AFM, once again be negatively associated with the (alleged) bribery itself, with regard to which SBM Offshore has already reached settlements with the Dutch Public Prosecutor's Office and the American and Brazilian authorities.

Interested parties can submit the decision of the AFM to the courts for review.

The full decision can be downloaded below in PDF format. If you have questions or complaints, you can contact the AFM's Financial Markets Information Line: 0800-5400 540 (free of charge). Please note: The AFM may change or supplement the aforementioned publication text depending on the circumstances at the time of publication.

Journalists may contact Michiel Gosens, AFM Spokesperson, on +31 (0)20 797 2771 or michiel.gosens@afm.nl.

The AFM is committed to promoting fair and transparent financial markets.

As an independent market conduct authority, we contribute to a sustainable financial system and prosperity in the Netherlands.

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