On 13 January 2011, the FSA published a consultation on guidance on financial promotions (GC11/2). This is likely to be of most relevance to fund managers and other persons approving financial promotions, particularly promotions that may amount to image advertising, or deal with past performance.

The aim of the guidance is to consolidate previous FSA guidance about what is fair, clear and not misleading in advertising, and how past performance should be dealt with. The issues which the consultation considers include:  

  • the FSA’s approach to the financial promotions regime in COBS 4;  
  • what constitutes “image advertising”;  
  • the presentation of fund performance and key points arising from the past performance rules in COBS4; and  
  • the FSA’s concerns on “risk sandwiches” (i.e., where a financial promotion comprises a section on benefits, then a section on risk warnings, and then another on benefits).  

(Comments can be submitted to the FSA until 25 February 2011.)