227.This section places a duty on the Authority to prepare and issue a code which will allow it to set out the kinds of behaviour which, in its opinion, amount or do not amount to market abuse.  The purpose of this code is to give guidance as to whether or not behaviour is abusive.
228.Subsection (2) makes clear that the code may describe behaviour which, in the opinion of the Authority, either does or does not amount to abuse.  (Section 122 provides that a statement in the code that a particular type of behaviour is not an abuse is conclusive evidence of this fact.)   It may also set out factors which, in the Authority’s opinion, should be taken into account when determining whether an abuse has occurred.  An example of such factors might be an individual’s expertise or the fact that someone holds a position of particular responsibility.  Subsections (6) to (8) place the Authority under a duty to publish the code (including any amended or replacement version under subsections (4) and (5)).  The Authority must consult on its proposed code, or on proposed alterations or replacements under section 121.
Commentary on Sections Part Viii: Penalties for Market Abuse Section 119: The code