Draft Policy Rule on investment recommendations

The AFM has commenced a consultation (in Dutch) on its new Policy Rule on investment recommendations, which will replace the current policy rule with respect to the role of the investigation, investigative reports, publications and advice. The current policy rule is considered by the AFM to be inadequate in view of the Implementing Directive of the Market Abuse Directive regarding the correct interpretation of investment recommendations and the disclosure of conflicts of interest17. The new policy rule will clarify when information is “intended for the general public” and therefore concerns an investment recommendation. According to the AFM, individual advice cannot be considered as intended for the general public. Public information based on research and estimates is not considered insider trading.

The AFM continues to consider publication of an investment recommendation can result in inside information as regards trade. A new element is that the proposed policy rule assumes that an investor who acts reasonably will make use of an investment recommendation. It is therefore no longer necessary to consider the anticipated impact of an investment recommendation.

The new policy rule clarifies how risks should be handled regarding price-sensitive information. Simultaneous distribution is the best way to manage these risks according to the AFM. An investment recommendation that reaches the public has been made publicly and can therefore not constitute price-sensitive information. It is possible to respond to the draft policy rule until 25 September 2009.

Interpretation of bidding rules

The AFM has commenced consultation (in Dutch) on the interpretation of a number of bidding rules on the following subjects:

  • an increase in the offer price,
  • the existence of mandatory offers during an offer that started voluntarily, and
  • the prohibition on potestative conditions (conditions to an offer may not be dependent either in formulating or in effect on the influence of the offeror).

The consultation period is until 18 September 2009.