GC100: Listing Rules Guidelines Part II: Guidelines on the requirement to maintain insider lists | Practical Law

GC100: Listing Rules Guidelines Part II: Guidelines on the requirement to maintain insider lists | Practical Law

Note that these guidelines have been superseded by Practice note, GC100: MAR: guidelines on the requirement to maintain insider lists.

GC100: Listing Rules Guidelines Part II: Guidelines on the requirement to maintain insider lists

by GC100 and Practical Law Corporate with assistance from Stephanie Maguire, Freshfields Bruckhaus Deringer LLP
Law stated as at 01 Aug 2015 • United Kingdom
Note that these guidelines have been superseded by Practice note, GC100: MAR: guidelines on the requirement to maintain insider lists.
These guidelines have been seen by the FCA which has agreed to add the following wording: "The FCA has not reviewed these guidelines but believes that the provision of material of this nature by industry bodies is a helpful initiative."

Scope of this note

These guidelines have been drawn up by the GC100 Listing Rules Working Group to assist members of GC100 to implement procedures for the purposes of complying with the requirements of the Disclosure and Transparency Rules (DTRs) for listed companies to maintain insider lists.
For GC100's guidelines on:
GC100 is the association of general counsel and company secretaries working in FTSE 100 Companies. These guidelines, which do not necessarily reflect the views of all individual members of the GC100 or their employing companies, have been produced for guidance only. Nothing in these guidelines or the accompanying appendices represents advice by the GC100 or any of its members, Practical Law, Thomson Reuters Professional (UK) Limited or any of the participants in the Listing Rules Working Group to any person and none of the GC100, its members, Practical Law, Thomson Reuters Professional (UK) Limited and the participants in the Listing Rules Working Group accepts any responsibility or liability to any person for or in respect of the guidelines. It is the responsibility of individual companies to ensure that they understand, and comply with, the DTRs and to take specific external advice (legal or otherwise) as they deem appropriate.
Note that, for the purposes of the Listing, Prospectus, Disclosure and Transparency Rules, the FSA was replaced by the FCA on 1 April 2013. For convenience, we refer to the FCA throughout these guidelines, although the FSA was the regulatory body responsible for decisions made and publications issued before 1 April 2013.

Section 1: The requirement to maintain insider lists

1.1 Overview

The requirement to maintain insider lists is contained in the DTRs.
A company must:
  • Draw up and keep updated a list of its employees and other people working for it with access to inside information relating directly or indirectly to the company. This list must be retained for five years.
  • Ensure that persons acting on its behalf or on its account keep a list of their employees and other people working for them with access to inside information relating directly or indirectly to the company.
(DTR 2.8.1R and DTR 2.8.5R.)
Although the FCA guidance says that companies have ultimate responsibility for the maintenance of all required insider lists, including advisers' lists, the guidance also says that companies do not need to maintain lists of all the individuals working for another firm or company acting on its behalf or its account (DTR 2.8.6G and DTR 2.8.8G). Instead, a company can meet its obligations in relation to advisers' (which includes anyone acting on behalf of the company or for its account) insider lists by:
  • Maintaining a list of the principal contacts at its advisers with whom it has direct contact and who have access to inside information.
  • Having effective arrangements in place with its advisers (which the FCA envisages are likely to be contractual) (see section 2.10 What are the obligations of the company to external advisers and agents and vice versa?) to ensure that such parties:
    • maintain their own lists of all people working for them with access to inside information on the company for the relevant period;
    • will obtain the necessary acknowledgements (that each person on its insider list acknowledges the legal and regulatory duties) from those on the list; and
    • are obliged to provide such lists to the company as soon as possible on request.
A pro forma insider list is set out in Appendix 1: Pro forma insider list.
The sanctions available to the FCA in the event of a breach of the DTRs include a financial penalty and/or publication of a censure statement. These sanctions may be imposed on the company concerned, on persons discharging managerial responsibilities (PDMRs), or a connected person (DTR 1.5.3G). For examples of final notices issued by the FSA or FCA for breaches of the DTRs, see Practice note, FCA and FSA final notices regarding breaches of the DTR and LR.

1.2 Identification of inside information

Information will be inside information if it meets certain cumulative criteria. The flowchart below is designed to assist with identifying whether information arising is or might be inside information.
For guidance on establishing procedures for the identification of inside information, see Practice note, GC100: Listing Rules Guidelines Part I: Guidelines for establishing procedures, systems and controls to ensure compliance with the Listing Rules.
Image 1 within GC100: Listing Rules Guidelines Part II: Guidelines on the requirement to maintain insider lists​

Section 2: Frequently asked questions

2.1 What information needs to be on the insider list?

Insider lists must contain the following:
  • The identity of each individual with access to inside information. The FCA is likely to expect the list to include a name or other unique identifier (for example, employee or time recorder numbers) to which the company can link the individual's name and home address.
  • The reason why the individual is on the insider list. The FCA has indicated that it would be sufficient to state that an individual is on the list because he/she has "access to the inside information in question". The FCA expects that the insider list will indicate the time from when the individual had access to the relevant information.
  • The date when the insider list was created and updated.
(DTR 2.8.3R.)
Companies will want to adopt a consistent approach to the reasons why someone has been included on the list (for example, because they have access to financial results or because they have access by virtue of being involved in a particular project which involves inside information).
Companies should also consider whether certain types of employees should be included on the list (for example, secretaries of senior executives). The FCA has emphasised the importance of considering which support staff have access to inside information, particularly those with IT access to relevant materials, and secretarial staff. In Market Watch issue no. 24 (MW24), the FCA (on page 5) refers to the need for "super insiders" to be included on the list, being those in senior management who are not directly involved in transactions but who receive management information on potential events or sit on review committees for such transactions. It is thought that this is more likely to be relevant for advisers rather than issuers.

2.2 When should the list be updated?

Insider lists must be updated promptly:
  • When there is a change of reason for an individual being on the list.
  • When any individual who is not already on the list is given access to inside information.
  • To give the date on which an individual on the list ceases to have access to inside information.
(DTR 2.8.4R.)
The date when an individual ceases to have access to inside information may be:
  • The date when an individual on the list ceases to be employed by the company.
  • When the inside information is made public.
A company may wish to consider what arrangements (if any) it should have in place with individuals on the list who leave while they have inside information, for example, it may wish to remind them that they owe a duty of confidentiality to the issuer and that they have previously acknowledged the legal and regulatory duties entailed and are aware of the sanctions attaching to the misuse or improper circulation of inside information. A company may also wish to remind them that some obligations (such as insider dealing offences under the Criminal Justice Act 1993) will still apply to them or to suggest that they should still clear any dealings with the company for a certain period of time after they leave. The FCA has suggested the need for an exit interview for staff who hold sensitive information to remind them of the ongoing confidentiality of inside information.
Companies may also want to consider their approach to removing someone from a list in other cases. It may be difficult to adopt workable processes for removing someone from a list relating to a particular project or transaction and adding them at a later date, rather than including them on the list for the duration of that project or transaction.
Companies may also want to consider a standard approach to recording a change in the reason for a person being on the list (for example, a change in a person’s responsibilities, a move from one company to another or leaving the company).
When a person is removed from an insider list there ought to be a method by which the dates he or she was on the insider list are recorded. Versions of the insider list at differing points in time should therefore be saved in order to preserve the audit trail. Issuers will need to be able to respond to requests from the FCA for details of who had access to inside information of a particular event, what the information was and when they had access to it.

2.3 How long should an insider list be kept?

An insider list must be kept for at least five years from the date when it is drawn up or updated (whichever is later) (DTR 2.8.5R).

2.4 How quickly must the list be submitted to the FCA?

Where requested, a company must provide an insider list to the FCA as soon as possible (DTR 2.8.2R).
In practice, the company will want to consider how it will reproduce the insider list at any given moment and ensure that adequate procedures are put in place so that any request is directed to the right individual who can access the list and provide a copy (see also section 2.6 Where and how should insider lists be kept? and LR 9.2.11R).
If there is a leak of inside information and the FCA investigates this, it is likely to ask for a detailed timetable or chronology of discussions, actions and decisions surrounding the price-sensitive event so that it can work out how widely disseminated the relevant information was at any particular time. The FCA will generally ask for the timetable to be supplied to it within two weeks.

2.5 Can more than one insider list be maintained?

Yes. From a practical perspective, companies may want to keep separate lists of:
  • People with access to inside information on an ongoing basis – this should make the ongoing lists more manageable.
  • Deal-specific or other matter-specific lists – this will allow such lists to be closed (with the five year retention period starting from the last update).
Although companies may keep separate lists, the FCA only requires issuers to maintain a single insider list. As referred to in section 2.4 above, pursuant to DTR 2.8.2R, an insider list must be provided as soon as possible if so requested by the FCA. It is clear from the comments on page 10 of the UKLA technical note: Disclosure and Transparency Rules that the FCA expects to receive a single DTR-compliant insider list, implying that issuers should be in a position to bring together any separate lists if required.
Where a list of those with knowledge of a project is compiled before the project constitutes inside information, those on the list must be moved to the DTR-compliant list as and when the project becomes inside information. The DTR- compliant list must show the date on which persons moved onto it from the project list.

2.6 Where and how should insider lists be kept?

The DTRs do not impose any location requirements as to where the list should be kept. Companies with operations in more than one country or location may find it easier to keep project lists in more than one place. Where a company operates different divisions, it may be helpful to keep divisional lists. In either case, please refer to section 2.5 above.
A company will want to decide whether to keep an insider list or lists in hard copy or electronic form or a combination of both.
A company will want to consider how a list or lists are to be kept for the relevant period, stored and retrieved so they can be accessed and provided quickly and also used to create a detailed timetable should the FCA request one. A company may also wish to consider restricting access to the list or lists to a select number of people (for example, the individual(s) maintaining the list(s) and the company secretary and/or general counsel) to facilitate management of the lists.
If a company decides to keep more than one list, it also needs to consider how the keepers of each list will liaise and co-ordinate regularly with someone centrally who has overall responsibility for all of the lists.

2.7 Who in the company is responsible for maintaining an insider list?

There is no express requirement under the DTRs to specify an individual who is responsible for maintaining the list. However, a company may want to consider:
  • Which individual or individuals are to be responsible for ensuring that the various requirements are met, how this fits with the company's other systems and controls and how to publicise the arrangements for insider lists to others in the company who may be asked to provide a list to the FCA or who deal with engagement letters with advisers.
  • How the arrangements for insider lists are integrated with the procedures adopted by the company for the identification and control of inside information to comply with the DTRs.
  • Who is, and whether more than one person should be, responsible for:
    • maintaining and updating the list (for example, adding someone to the list, removing them or changing the reason for their being on the list);
    • deciding who can be given access to inside information either generally or in specific cases;
    • keeping the details of principal contacts at advisers up-to-date.
A company may want to consider what tests to apply to decide if someone should be added to, or removed from, a list, so a consistent approach is adopted across its organisation. In practice, the tests adopted are likely to be company-specific (depending on how each company is run and its internal controls and procedures).

2.8 What are the company's obligations to its employees?

A company must ensure that each of its employees with access to inside information:
  • Acknowledges the legal and regulatory duties entailed in having access to inside information (including dealing restrictions in relation to the company’s shares or other financial instruments).
  • Is made aware of the sanctions for misuse or improper circulation of inside information.
(DTR 2.8.9R.)
A company should have procedures in place to ensure that an appropriate memorandum is automatically given to people added to insider lists and that a copy is promptly signed and returned as acknowledgement. A company may want to consider who is responsible for keeping the memorandum up-to-date in case of any changes. Appendix 3: Memorandum on inside information contains a form of such a memorandum and Appendix 4: Acknowledgement of receipt of inside information contains a form of an acknowledgement. Companies should also consider refresher training for employees on the importance of keeping information secret and the implications of improper disclosure.
There is a general requirement for the company to allow access to inside information only to those who require it for the purpose of their work (that is, on a "need to know" basis). Companies should have in place policies regarding access to confidential information that are consistent with this requirement and ensure that they have robust IT controls to limit access to inside information.
A company should also ensure that, if inside information exists, it does not give clearance to deal to those subject to the Model Code, it suspends any share buyback programme (unless it has given an irrevocable authority to its brokers to buy back its shares) and it ceases the award of share options or performance shares etc.

2.9 Can employee acknowledgements be made electronically?

A company must ensure that every person whose name is on the insider list acknowledges the legal and regulatory duties entailed and is aware of the sanctions attached to the misuse or improper circulation of such information (DTR 2.8.10R).
A company may wish to keep an electronic insider list and send insider notifications out in email format. If the insider is required to electronically accept the terms of being an insider, the following may need to be considered:
  • The email address of the recipient to which the insider notification is forwarded should only be accessible by the individual being made an insider.
  • For the insider to provide email confirmation there should be more than just one option for him to select, that is:
    (a) I accept;
    (b) I do not accept that I am an insider; or
    (c) Please ring to discuss further.
    If options (b) or (c) are selected, then further discussion will be required.
  • The time and date that the individual confirmed acceptance should be logged on the system.
The email confirmation should also make the recipient aware that:
  • By selecting the "I Accept" button, he is signing his insider's acceptance electronically.
  • By selecting "I Accept" he consents to be legally bound by the company's insider terms and conditions.
  • He agrees that his electronic signature is the legal equivalent of a manuscript signature of acceptance.

2.10 What are the obligations of the company to external advisers and agents and vice versa?

A company must have effective arrangements in place with all persons acting on its behalf or for its account (the FCA envisages that these arrangements are likely to be contractual) to ensure that such parties:
  • Draw up and keep updated their own lists of all individuals working for them with access to inside information relating directly or indirectly to the company.
  • Are obliged to provide such lists to the company as soon as possible on request.
  • Are obliged to keep such lists for at least five years.
  • Will take the necessary measures to ensure everyone on the insider list will acknowledge the legal and regulatory duties entailed and is aware of the sanctions attaching to misuse or improper circulation of inside information about the company.
(DTR 2.8.8G.)
A company will want to consider how best to put these arrangements in place. In some cases, it may wish to write to its advisers agreeing that, in all cases where it gives the adviser inside information, the adviser will keep an insider list. Advisers are likely to require the company to tell the adviser if it considers that information it is providing is inside information. In other cases, a company may wish to have ad hoc arrangements with its advisers on a case-by-case basis. The FCA has expressed concern about companies disclosing inside information to advisers, for example, without going through the formal steps of warning that the information is inside information which needs to be protected. It is keen for explanations to be given and recommends that there should not be over-reliance on confidentiality agreements.
Section 2.4 above refers to the need for companies to be able to respond to FCA requests for detailed timetables should it come to investigate a leak of inside information. The request is likely to come via a regulated firm (for example, the company's financial adviser) who the FCA will expect to co-ordinate replies. The FCA will equally expect the regulated firm to be in a position to hand over detailed timetables and insider lists in relation to its own handling of the information. MW24 contains a pro forma timetable and insider list showing the level of detail the FCA expects from firms. These requirements go beyond the DTR 2 requirements.
Where a company's advisers are not UK-based or otherwise are unlikely to be familiar with the insider list requirements, the company may want to consider if it will need to provide such advisers with further information.

2.11 Contractual arrangements

If a company decides to use contractual arrangements, it may wish to consider using pro forma contracts (or model clauses) with its advisers and agents. For examples of model clauses, see Appendix 2: Insider lists: Model clauses for adviser's engagement letter.
Given that the company is ultimately responsible for ensuring that its advisers and agents maintain lists, it may also wish to discuss the approach its advisers and agents will take so that it is satisfied that the arrangements will be effective.

Section 3: Practical guidance on insider lists

3.1 Allocate responsibility for compliance with the rules

  • Allocate responsibility to a person/team for:
    • deciding when to start an insider list and the criteria to be used in determining how and when information becomes inside information;
    • maintaining and updating the list;
    • deciding who can be given access to inside information either generally or in specific cases; and
    • keeping the details of principal contacts at persons acting on behalf of or for the account of the company up-to-date.

3.2 Compiling lists

3.3 Updating lists

  • Adopt procedures to ensure that lists are promptly updated:
    • to give the date on which an individual on the list ceases to have access to inside information (for example, if that person ceases to be employed by the company and no longer has access to inside information or because the information is made public);
    • when any individual who is not already on the list is given access to inside information; and
    • when there is a change of reason for an individual being on the list.
  • Consider arrangements for individuals on the list who leave while they have inside information.
  • Adopt a consistent approach for removal from the list. (For a notification of removal from an insider list, see Appendix 5: Notification of removal from insider list.)

3.4 External advisers and agents

  • In each insider list for a project that involves external advisers and agents, include details of the principal contacts at advisers and agents who have access to inside information.
  • Consider whether certain advisers have regular access to inside information and should be required to maintain standing insider lists.
  • Review all contractual arrangements with advisers and agents and consider the use of pro forma contracts (see Appendix 2: Insider lists: Model clauses for adviser's engagement letter) to ensure that the company has effective arrangements in place so that advisers or agents:
    • keep their own lists of all individuals working for them with access to inside information about the company;
    • are obliged to provide such lists to the company as soon as possible on request;
    • are obliged to keep such lists for at least five years; and
    • take the necessary measures to ensure everyone on the insider list acknowledges the legal and regulatory duties entailed and is aware of the sanctions attaching to misuse or improper circulation of inside information about the company.
  • Consider discussing the approach to insider lists with advisers and agents.
  • Consider whether to provide further information to non-UK based advisers and agents unfamiliar with the UK insider list requirements.

3.5 Employment arrangements

  • Review existing employment arrangements in light of procedures for keeping insider lists.

3.6 Memorandum and acknowledgement

  • Produce a memorandum on the legal and regulatory duties entailed in having access to inside information and the sanctions for misuse or improper circulation of inside information and give it to those individuals included on the company's insider list(s) (see Appendix 3: Memorandum on inside information).
  • Require each individual receiving such memorandum to acknowledge receipt of the memorandum (and the legal and regulatory duties referred to in it) in writing (see Appendix 4: Acknowledgement of receipt of memorandum on inside information).
  • Allocate responsibility for keeping the memorandum up-to-date.

3.7 Training

  • Implement appropriate communication and training programmes so that existing employees and future employees who have access to inside information are aware of and understand their obligations in relation to inside information under the DTRs. Consider the need for refresher training. Ensure training covers the need for secrecy and the need to comply with established procedures to protect inside information.
  • Ensure that all employees understand the potential liabilities for the company and the PDMRs for a breach of the DTRs.
  • Keep a record of all training received.
  • Review periodically whether the training programme continues to be adequate to protect any inside information.

3.8 Employee arrangements in relation to dealing and share schemes

  • Reasonable consideration should be given to establishing personal account dealing policies; those policies should be made clear to staff together with the civil and criminal penalties for dealing on the basis of inside information or enabling such dealing.
  • Where relevant, make insiders aware that there are company share schemes and trading plans which may be subject to the company's Share Dealing Code and prior clearance might be required.
  • List in the company's Share Dealing Code, those share plans under which the disposal or exercise of shares would trigger a clearance requirement.
  • List in the company's Share Dealing Code, those share plans where initial application, variation or cancellation of the scheme would trigger a clearance requirement.
  • List in the company's Share Dealing Code, the common transactions allowed at any time without prior clearance.
  • Ensure insiders are aware that any transaction contemplated in relation to share schemes which does not appear on the list should be discussed in the first instance with a member of the relevant department.
  • Require each individual to submit and obtain clearance in writing (see Appendix 6: Share dealing clearance and notification form and Appendix 7: Share schemes clearance form).

3.9 Co-ordination

  • Consider liaison and co-ordination between the keepers of each list (if applicable) and the person with central responsibility for insider lists. Ensure that they can compile a central insider list quickly and easily to satisfy a request from the FCA.
  • Make sure that the company’s nominated UKLA contact knows who to contact to respond to an FCA request for a copy of an insider list.

3.10 Access and control of inside information

  • Restrict access to insider lists to a select number of individuals. Where practicable apply a "need to know" policy.
  • Review access to the company's IT systems and consider passwording procedures and restricted access to sensitive documents. Consider using secure access databases and/or encryption software for storing and protecting inside information.
  • Review procedures for protecting physical copies of sensitive documents and consider the use of project names and codes that are not easy to decode.

3.11 Administrative/IT systems

  • Review and ensure appropriate consideration is given to the security of and access to inside information on IT systems, including the implementation of controls to limit access on a regular basis.
  • Consider the range of people with access to inside information and whether any administrative/IT staff and other individuals working for the company (such as external contractors where administrative/IT functions are outsourced) who have overriding access to such information should be included on the insider list. However, it should generally be sufficient if companies can identify any such individuals who have in fact accessed files containing inside information and include those individuals on the insider list. Protecting information using secure databases and/or encryption systems can help reduce this risk.
  • Where administrative "pools" (for example, word processing and photocopying) are used to process documents that contain inside information, consider whether there are any individuals who may need to be included in an insider list.

3.12 Storage and retrieval

  • Consider whether to keep insider lists in hard copy or electronic form or both.
  • Consider storage and retrieval facilities for insider lists to ensure speedy access.
  • Keep all insider lists for five years from when compiled or updated (whichever is later).

Appendix 1: Pro forma insider list

Click here for document.

Appendix 2: Insider lists: Model clauses for adviser's engagement letter

1. Compliance with Disclosure and Transparency Rules

1.1 We understand that, under DTR 2.8.1R of the Disclosure and Transparency Rules, you must ensure that we meet various requirements relating to insider lists. We agree to:
(a) [[If engagement for a specific project] draw up a list (an Insider List) of individuals working for us and who have access to information relation to [the Project];]
OR [[If general retainer] draw up a list (an Insider List) of individuals working for us (under a contract of employment or otherwise) who are acting on behalf of the Company and who:
(i) in respect of each separate engagement that you inform us involves or may involve inside information (each a Project), have access to information relating to the Project; and
(ii) in respect of our general retainer, from time to time have or may have access to inside information relating directly or indirectly to the Company;]
(b) include the following information in any Insider List:
(i) the identity of each individual referred to in Clause [1.1(a)] above;
(ii) the reason why each individual is on the Insider List; and
(iii) the date on which the Insider List was created and updated;
(c) promptly update any Insider List:
(i) when there is a change in the reason why an individual is already on the Insider List;
(ii) when any individual who is not already on the Insider List is provided with access to inside information; and
(iii) to indicate the date on which an individual already on the Insider List no longer has access to inside information; and
(d) provide you, as soon as possible upon your request, with a copy of any Insider List.
1.2 We agree to take such measures as may be necessary to ensure that each individual whose name is on any Insider List:
(a) acknowledges the legal and regulatory duties entailed in having access to inside information (including dealing restrictions in relation to your shares or other financial instruments); and
(b) is aware of the sanctions attaching to misuse or improper circulation of inside information.
1.3 We agree to keep any Insider List for a period of not less than five (5) years from the date on which such Insider List was created or updated (whichever is later).
1.4 We agree that our principal contact with you in connection with this letter and our obligations under it is [NAME] or such other person as we may from time to time notify to you in writing.
1.5 You agree:
(a) to inform us when you [or any of your authorised persons] provide us with any information which you reasonably consider to be inside information relating to the Company; and
(b) that we can discuss any queries we may have in relation to this Clause [1] with [NAME] and [NAME].
1.6 We agree that we will not engage another third party to act on your behalf unless either:
(a) the relevant third party agrees, in relation to inside information relating to you, to substantially the same terms as are set out in this letter; or
(b) you confirm to us that you have made satisfactory arrangements with them.
We are entitled to assume that you have secured the necessary agreements with other parties acting for you whom we have not engaged.

Appendix 3: Memorandum on inside information

MEMORANDUM ON INSIDE INFORMATION: [NAME OF COMPANY] – PROJECT [NAME OF PROJECT]
You have received this memorandum because you have, or are likely to have, access to inside information about [NAME OF COMPANY] (the Company). You must read this memorandum carefully and sign and return the acknowledgement slip on page [NUMBER] of this memorandum to [NAME] as soon as possible.
Please remember that this memorandum is a summary and is not exhaustive. It should therefore not be used as a substitute for specific legal advice. If you need any more detailed information, you should contact [NAME].

1.Applicable laws and possible sanctions

1.1 Insider dealing provisions

It is a criminal offence for an individual who has price sensitive information that has not been made public, which he knows is inside information from an inside source, to deal in securities whose price would be likely to be significantly affected by that information if made public. It is also an offence to disclose inside information other than in the proper performance of the functions of your employment or office, as well as to encourage others to deal.
"Inside information" is specific information relating to particular securities or to a particular issuer or issuers of securities which has not been made public; and if it were made public, it would be likely to have a significant effect on the price or value of any securities. Note that in terms of price sensitivity, traditionally the "reasonable investor test" required an assessment of whether the information in question would be likely to both:
  • Be used by "a reasonable investor" as part of the basis of his investment decision.
  • Have a significant effect on the price of the issuer's securities.
The FCA has, however, indicated, in its arguments in Massey v FSA (2011) (with which the tribunal agreed), that the reasonable investor test is now to be viewed as the sole test applicable to determine price sensitivity. Thus, if the reasonable investor would have taken the information into consideration as part of the basis of his investment decision, then the information will meet the price sensitivity criterion. If this new test is followed then the ambit of what will be classified as inside information will be very much wider.
An individual guilty of insider dealing may be liable to a fine and/or to imprisonment.

1.2 The Company's Code in respect of dealings and the Model Code

You are subject to the Company's code in relation to dealings in the Company's securities (the Code) [if it has been agreed that you are a person discharging managerial responsibilities, also referred to as a PDMR]. [Note: This will depend on the scope of the Company's code which may only apply to PDMRs or may also apply to other categories such as those on an insider list]. A copy of the Code is attached.
You must comply with the Code and you must not deal in the Company's securities without obtaining the necessary clearance in accordance with the Code.
The Company must take all reasonable steps to secure your compliance with the Model Code. The FCA can publicly censure or impose financial penalties on the Company for any breaches of the Listing Rules (including the Model Code).

1.3 Duty of confidentiality

You are under a duty of confidentiality in respect of any confidential information you receive (whether about the Company or a third party) and you must not use or disclose such information without due authorisation. We (or others) may take action against you if you breach this duty of confidence, including seeking an injunction to prevent the disclosure of any confidential information or damages for any losses suffered.

1.4 Market abuse provisions

The market abuse regime prohibits the following types of behaviour:
  • Dealing, or attempting to deal, on the basis of inside information.
  • Disclosing inside information other than in the proper course of a person’s employment, profession or duties.
Market abuse also includes requiring or encouraging another to undertake these types of behaviour. Market abuse is not a criminal offence and therefore it is not punishable with imprisonment. However, the Financial Conduct Authority may impose unlimited financial penalties, publicly censure a person and/or make an order to compensate or disgorge profits to affected persons. Injunctions to prevent market abuse (and to freeze assets) may also be available.
If the abusive behaviour falls within the scope of the insider dealing provisions of the Criminal Justice Act 1993, it will be a criminal offence and will be punishable with imprisonment (see section 1.1 above).

2.Insider list obligations

Now that you are included on an insider list, you must:
  • Inform [NAME] in advance if you propose to communicate inside information on this matter to any person for the first time. It is important that you comply with the communication requirements in section 3 below. If you are not sure whether you should make a particular communication, you should discuss the question with [NAME]. If you are proposing to make a communication outside the Company, you must not do so without the prior agreement of [NAME].
  • Inform [NAME] of the date when you do communicate inside information to another person.
  • Inform [NAME] of any changes in your personal details (for example, name, personal address, the office in which you are based).
If the person to whom inside information is to be communicated in either of the first two bullet points above is a director or employee of the Company, you need only give [NAME] their name. In other cases, you must give [NAME] their name, the name and address of their firm or company and their telephone number.

3.Communication requirements

Inside information [relating to Project [NAME OF PROJECT]] should be communicated only on a "need to know" basis. Incidental access to inside information needs to be eliminated so far as possible.
[Set out here the practical steps the issuer has decided to adopt to help restrict access to inside information, for example, using passwords to access certain documents on data management systems and restricting access to persons on a secure distribution list; the use of project names and codes; and the use of sealed non-transparent envelopes for internal circulation of hard copy documents.]

Appendix 4: Acknowledgement of receipt of memorandum on inside information

Acknowledgement slip
I hereby acknowledge receipt of the memorandum dated [DATE] on inside information (the Memorandum) and confirm that:
(a) I have read the Memorandum;
(b) I am aware of the legal and regulatory duties entailed in having access to inside information (including dealing restrictions in relation to the Company's shares or other financial instruments); and
(c) I am aware of the sanctions attaching to the misuse or improper circulation of inside information.
_________________________________
Name:
Title:
Department:
Date:

Appendix 5: Notification of removal from insider list

This is to inform you that with effect from [DATE] you are no longer considered an insider in accordance with the [Company's] Share Dealing Code (Code) and therefore you do not need to seek pre-clearance in accordance with the Code should you wish to deal in the Company's securities.
You are, however, reminded that it remains a criminal offence in the UK to deal in the securities of a company when you are in possession of inside information.
If you are in any doubt as to the interpretation of inside information, please contact a member of the [NAME OF RELEVANT DEPARTMENT] in the first instance.

Appendix 6: Share dealing clearance and notification form

Share Dealing Clearance and Notification Form
In accordance with the Financial Conduct Authority's Listing Rules and Disclosure and Transparency Rules, Directors and certain employees are subject to the [NAME OF COMPANY]'s Share Dealing Code (the Code). The Code requires that those persons bound by the Code must obtain clearance as set out in section [NUMBER] of the Code prior to dealing in [NAME OF COMPANY]'s shares.
You are asked to complete this form after reading the Code, and either fax it to [NAME] on [FAX NUMBER] or scan and email it to [EMAIL ADDRESS]. You must not deal until you have received back signed approval of this transaction.
PRE-DEALING - OBTAINING CLEARANCE TO DEAL
Name (please print):....................................................................................
Department: ........................................................................
Location:..............................................................................
Tel:.....................................................................................
Email address: .............................................................................. 
Fax:.................................................................................... 
I wish to carry out the following transaction in the shares of [NAME OF COMPANY]: 
......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
(Please detail the nature and timing of the proposed transaction and in whose name it is being carried out.)
I confirm that I am not in possession of any inside information.
Signed:........................................................................
Date:............................................................................ 
Clearance given for a period of two business days from the time of this authorisation or to the beginning of the next close period if sooner. 
(Not to be completed by employee - for completion by authorising signatory only)
Signed:........................................................................
Date:............................................................................
Time:............................................................................
Name:...........................................................................
Position:.......................................................................

Appendix 7: Share schemes clearance form

Share Schemes Clearance Form
In accordance with the Financial Conduct Authority's Listing Rules and Disclosure and Transparency Rules, Directors and certain employees are subject to the [NAME OF COMPANY]'s Share Dealing Code (the Code). The Code requires that those persons bound by the Code must obtain clearance as set out in section [NUMBER] of the Code prior to joining, altering or stopping their contributions to the [list the relevant share schemes pursuant to which clearance is required, for example SIP].
You are asked to complete this form after reading the Code and either fax it to [NAME] on [FAX NUMBER] or scan and email it to [EMAIL ADDRESS]. You must not join, alter or stop your contributions until you have received back a signed form.
PRE-DEALING - OBTAINING CLEARANCE TO DEAL
Name (please print):....................................................................................
Department: ........................................................................
Location:..............................................................................
Tel:.....................................................................................
Email address: .............................................................................. 
Fax:.................................................................................... 
I wish to: 
(a) Join the [Company Share Scheme] and contribute £/$…… per month.*  
(b) Change my monthly contributions to the [Company Share Scheme] to £/$……. per month.*  
(c) Restart my contributions to the [Company Share Scheme] at £/$ …….. per month.*  
(d) Stop my monthly contributions to the [Company Share Scheme].* 
* Please delete as appropriate.
Signed:........................................................................
Date:............................................................................ 
Clearance given for a period of two business days from the time of this authorisation or to the beginning of the next close period if sooner. 
(Not to be completed by employee - for completion by authorising signatory only)
Signed:........................................................................
Date:............................................................................
Time:............................................................................
Name:...........................................................................
Position:.......................................................................
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