The European Securities and Markets Authority (“ESMA”) has been empowered to draw up RTS establishing a European code of conduct for financial research paid for by issuers, under the Listing Act Directive. Previously, there was no specific regime for sponsored research, beyond the points addressed for research in general by MiFID II.<\/p>\n\n\n\n
To revitalise the investment research market, the Listing Act Directive, which was published in the Official Journal on 14 November 2024 and came into force on 4 December 2024, introduced a framework for this research, which is fully paid for or in part by issuers. To avoid being classified as a commercial communication, this research must be fair, clear and not misleading, and must be clearly identified as such. Finally, investment firms that produce or distribute research that is partially or fully remunerated by the issuer will only use the “sponsored research” label if the research complies with the EU code of conduct. This code is to be developed by ESMA as an RTS.<\/p>\n\n\n\n
ESMA must submit the draft RTS to the European Commission by 5 December 2025.
The basis for ESMA’s thinking is the French charter drawn up with the AFG, AMAFI and SFAF in 2022. It is recommended that there be a good balance between the necessary commitments of issuers, providers and users of sponsored research. Their commitment must be contractually solid and long-term, with an appropriate payment scheme. The degree of constraint proposed in the RTS risks making the use of such a code of conduct less effective.<\/p>\n\n\n\n