PRM 12.1 Advertisements and other disclosure of information

This chapter applies to:

(1) the communication and content of an advertisement; and

(2) the disclosure of information otherwise than in an advertisement,

that relates to the admission to trading or proposed admission to trading of transferable securities where the issuer is subject to an obligation to draw up a prospectus or is permitted and elects to draw one up pursuant to PRM 1.4.15R.

All information disclosed in oral or written form, as an advertisement or otherwise disclosed, must be consistent with and:

(1) not contradict information included in the prospectus or in a supplementary prospectus, where already published; 

(2) not contradict information to be included in the prospectus or in a supplementary prospectus, where the prospectus or supplementary prospectus is to be published at a later date; and

(3) not refer to information which contradicts the information in the prospectus or supplementary prospectus.   

In the event that material information is disclosed by or on behalf of an issuer or offeror, and addressed to one or more selected investors in oral or written form, that information must, in a case where:

(1) the offer is conditional on the transferable securities being admitted to trading; or 

(2) the transferable securities being offered are at the time of the offer already admitted to trading,

be included in the prospectus or supplementary prospectus. 

[Note: regulation 13(2) of the Public Offers and Admissions to Trading Regulations]

In addition to the requirements in PRM 12.1.2R, an advertisement must comply with the requirements contained in (1) to (3): 

(1) an advertisement must state that, where applicable, a prospectus has been or will be published and indicate where investors are or will be able to obtain it, noting the identification requirements in PRM 12.1.7R; 

(2) an advertisement must be clearly recognisable as such and identify itself as an advertisement; and

(3) an advertisement must be accurate and not misleading.

Information disclosed in oral or written form concerning an admission to trading, whether as an advertisement or otherwise disclosed, must not:

(1) present the information in the prospectus in a materially unbalanced way, including by presenting negative aspects of such information with less prominence than the positive aspects or by omitting or selectively presenting certain information; or

(2) contain alternative performance measures unless they are contained in the prospectus.

For the purpose of PRM 12.1.5R(2), ‘alternative performance measures’ means financial measures of historical or future financial performance, financial position or cash flows, other than financial measures defined in the applicable financial reporting framework.

An advertisement must clearly identify the relevant prospectus by:

(1) where the advertisement is disseminated in written form and by means other than electronic means, identifying the website where the prospectus and the relevant final terms of a base prospectus are published, or will be published;

(2) where the advertisement is disseminated in written form by electronic means, including a hyperlink to the prospectus and to the relevant final terms of a base prospectus or by including a hyperlink to the page of the website where the prospectus and any final terms will be published if the prospectus and any final terms have not yet been published; and

(3) where the advertisement is disseminated in a form or by means not falling within the scope of (1) or (2), including accurate information on where the prospectus and any final terms may be obtained, and accurate information on the admission to trading of transferable securities to which it relates.

Advertisements disseminated to potential retail investors must include the following:

(1) the word ‘advertisement’, in a prominent manner. Where an advertisement is disseminated in an oral form, the purpose of the communication must be clearly identified at the beginning of the message;

(2) a statement that the approval of the prospectus should not be understood as an endorsement of the transferable securities offered or admitted to trading where the advertisement contains a reference to a prospectus approved by the FCA;

(3) a recommendation that potential investors read the prospectus before making an investment decision in order to fully understand the potential risks and rewards associated with the decision to invest in the transferable securities, where the advertisement contains a reference to a prospectus approved by the FCA; and

(4) the comprehension alert at PRM 12.1.9R, where:

     (a) the advertisement relates to complex securities other than the financial instruments referred to in COBS 10A.4.1R(2)(a),(b) and(d); and

     (b) the comprehension alert is, or will be, included in the summary of the prospectus.

The comprehension alert required by PRM 12.1.8R(4)is: ‘You are about to purchase a product that is not simple and may be difficult to understand.’

Advertisements in written form, which are disseminated to potential retail investors, must be sufficiently different in format and length from the prospectus that no confusion with the prospectus is possible.

Subject to PRM 12.1.13R, advertisements disseminated to potential investors must be amended where:

(1) a supplementary prospectus is subsequently published in accordance with PRM 10; and

(2) (a) the significant new factor, material mistake or material inaccuracy mentioned in a supplementary prospectus required under PRM 10.1.1R; or

      (b) revised or additional information mentioned in a supplementary prospectus prepared in accordance with PRM 10.1.7R,

            renders the previously disseminated advertisement materially inaccurate or misleading.

With the exception of orally disseminated advertisements, advertisements amended pursuant to PRM 12.1.11R must be disseminated through, at a minimum, the same method as the previous advertisement.

PRM 12.1.11R does not apply after the time when trading on a regulated market begins.

1. Advertisements amended pursuant to PRM 12.1.11R must be disseminated to potential investors without undue delay following the publication of thesupplementary prospectus and must contain all of the following:

2. (1) a clear reference to the inaccurate or misleading version of theadvertisement;

3. (2) an explanation that theadvertisement has been amended as it contained materially inaccurate or misleading information; and

4. (3) a clear description of the differences between the 2 versions of theadvertisement.