On 20 August 2018, the Association for Financial Markets in Europe (AFME) and the European Association for Independent Research Providers published guidance on how unconnected research analysts can access issuer information in UK Initial Public Offerings (IPOs) under the FCA’s new rules governing IPOs, which came into force on 1 July 2018.
The guidance mentions that amongst other things, the FCA’s rules require that, if connected research analysts wish to be in communication with the issuer team, the syndicate banks on an IPO (Firms) must ensure that a range of unconnected analysts will have the opportunity to be in communication with the issuer team, with the objective of giving such analysts the opportunity to publish research relating to the IPO. Firms have two options to provide such access:
- by arranging for unconnected analysts to join connected analysts in any communication with the issuer team prior to the dissemination of connected research; or
- by separately giving unconnected analysts the opportunity to be in communication with the issuer team in a manner that results in unconnected analysts being given access to all the information that the issuer has provided to connected analysts, and that is relevant for the purposes of producing research on the issuer in question, prior to the dissemination of connected research, but subject to the requirement that the information that each of the unconnected analysts receives or can access must be identical as between the unconnected analysts.
The guidance sets out:
- how unconnected analysts will be able to register their interest in order to be in communication with issuers through both options; and
- the manner and form that such communication with the issuer team should take.
Any unconnected analyst who wishes to be in communication with an issuer pursuant to the guidance will be required to confirm that they agree to and will comply with the Market Standard Research Guidelines – contained within Appendix I of the guidance.
