Delegated regulation 2016/958 - Supplement to Regulation 596/2014 with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest - Main contents

EN

Official Journal of the European Union

L 160/15

Harmonised standards on the investment recommendations or other information recommending or suggesting an investment strategy (hereinafter ‘recommendations’) are necessary for the objective, clear and accurate presentation of such information and for the disclosure of interests and conflicts of interest. They should be complied with by persons producing or disseminating recommendations. In particular, in order to ensure high standards of fairness, probity and transparency in the market, recommendations should be presented objectively and in a way that does not mislead market participants or the public.

All persons who produce or disseminate recommendations should have in place arrangements to ensure that information is objectively presented and interests or conflicts of interest are effectively disclosed. Moreover, additional arrangements should be made for those categories of persons who, by virtue of their nature and their activities, generally pose greater risks to market integrity and investor protection. That group would include independent analysts, investment firms, credit institutions, any person whose main business is to produce or disseminate recommendations, and the natural persons working for them under a contract of employment or otherwise, as well as other persons proposing investment decisions in respect of financial instruments who present themselves as having financial experience or expertise, or are perceived as such by market participants (hereinafter ‘experts’). Non-exhaustive indicators to be considered in relation to the identification of such experts include the frequency with which they produce recommendations; the number of followers they have when they propose recommendations; their personal work's history, including whether they have been professionally producing recommendations in the past; and whether their previous recommendations are or have been relayed by third parties, such as the media.

The identity of the persons producing recommendations, their competent authority, if any, and the dates and times when the recommendations were completed and then disseminated should be disclosed, since they may be valuable information for investors in relation to their investment decisions.

Disclosure of valuations and methodologies is useful information in order to understand recommendations, as well as to gauge the extent to which the persons producing them are consistent in the valuations and methodologies they adopt. Recommendations produced by the same person and related to companies that belong to the same industry or to the same country should aim at consistently exhibiting some consistent common factors. For those reasons, independent analysts, investment firms, credit institutions, persons whose main business is to produce recommendations, and the natural persons working...