What rules apply to investment recommendations, statistics and information given to the media?

An investment recommendation is information that recommends or suggests an investment strategy, explicitly or implicitly, about one or more financial instruments or issuers, including any opinion on their present or future value or price, and is intended for distribution channels or the public. It covers the research notes of analysts, investment firms and banks, which express an investment proposal directly or indirectly, and statements by anyone else that directly propose a particular investment decision, such as a 'buy' call posted on a website or social media.

Everyone who produces or disseminates such recommendations must take reasonable care that they are objectively presented, and must disclose their own interests or indicate conflicts of interest in the instruments concerned. Delegated Regulation (EU) 2016/958 spells this out. Producers state who they are, and investment firms and banks also name their regulator. Facts must be clearly distinguished from interpretation and opinion, material sources indicated, projections and price targets labelled with their main assumptions, and the date and time of completion shown. Producers disclose relationships and circumstances that could impair objectivity, including those of their group or closely associated persons. Professional producers, and self-presented experts who repeatedly recommend investments, add specific statements, for example if they hold a net long or short position above 0.5% of the issuer's share capital, make a market in its instruments, or led an offer of its instruments in the last 12 months. Anyone passing on another person's recommendation must identify themselves, disclose their own relevant interests and clearly flag any substantial alteration. None of this needs the regulator's prior approval.

When a public body releases statistics or forecasts that might move financial markets significantly, such as a statistics office publishing inflation figures or a central bank publishing growth forecasts, it must present them objectively and transparently. The exam material states the duty for any statistics or forecasts; MAR places it on public institutions. Forecasts by private firms fall under the recommendation rules only if they recommend or suggest an investment strategy.

Information disclosed or disseminated, and recommendations produced or spread, for the purposes of journalism or other expression in the media are assessed in the light of the rules on freedom of the press and freedom of expression and the codes governing the journalistic profession. This applies to unlawful disclosure, to spreading false or misleading information and to the recommendation rules. The protection falls away where the people concerned, or persons closely associated with them, derive an advantage or profit, directly or indirectly, from the disclosure, or where it is made with the intention of misleading the market about supply, demand or price. Journalists subject to equivalent regulation, including self-regulation, are also outside the detailed technical rules on presentation and disclosure. A commentator who takes a position and then praises the instrument on air without disclosing the position risks committing market manipulation.