MOL penalised for failure to inform the market about the Company

The Hungarian Central Bank has imposed a financial penalty on MOL, one of the country's largest energy companies, due to its failure to adequately inform the market about damage to the Družba oil pipeline and the subsequent halt in crude oil deliveries toward the end of January. According to the official statement released by the central bank, MOL must pay a fine of 43 million forints (approximately 122,000 euros). This penalty was issued because the company violated its obligation to disclose information regarding extraordinary situations affecting its operations. The disclosure should have been made by February 12, but MOL delayed it until February 16, after media reports and government statements highlighted the severity of the situation, which could potentially impact Hungary’s energy policy.

The delay in disclosing this critical information came under scrutiny following complaints from the Association for the Protection of Individual Investors of the Budapest Stock Exchange (TEBÉSZ), which raised concerns about potential violations of public interest in trading activities involving MOL shares. According to TEBÉSZ, MOL likely breached transparency obligations by failing to report the damage to the Družba pipeline and the suspension of oil transportation on January 27 on its stock exchange website. This issue was emphasized by Gábor Dióslaki, president of TEBÉSZ, who drew a comparison between this incident and MOL's emergency announcement in mid-February concerning the release of oil from strategic reserves to ensure fuel supply stability.

In response to inquiries from Reuters, the Hungarian Central Bank confirmed that it had launched an investigation into potential suspicious transactions related to MOL shares during late January. However, the bank did not specify who submitted the complaint, citing ongoing proceedings as a reason for withholding such details. The central bank stated that it was examining whether certain transactions on the capital market linked to MOL might have violated regulations against insider trading based on privileged information.

MOL responded to these allegations by asserting that it always complies with relevant laws and follows the principle of market transparency. In an email sent to Reuters in February, the company emphasized that it adheres to transparency rules for directors of listed companies and remains available to the Hungarian Central Bank on all matters. Despite this, data from the Budapest Stock Exchange indicated that four MOL executives sold shares worth approximately 1.57 billion forints (around 4.14 million euros) between January 27 and February 6. MOL noted that it disclosed these transactions on its website in accordance with transparency requirements for directors of publicly traded companies.

The incident has sparked broader discussions about corporate accountability and regulatory oversight within Hungary’s energy sector. The timing of the delayed disclosure and the subsequent share sales by top executives have raised questions about potential conflicts of interest and the adequacy of existing safeguards against insider trading. While MOL maintains its compliance with legal standards, the Hungarian Central Bank continues its probe into whether any insider knowledge influenced these transactions. As the investigation progresses, further details may emerge that could influence both the company’s reputation and the regulatory landscape governing financial markets in Hungary.