On August 6, the UK Financial Conduct Authority (FCA) published its guidance consultation on social media and customer communications (Guidance). The Guidance is intended to clarify and confirm the FCA’s approach to the supervision of customer communications and, more specifically, financial promotions published using social media platforms. It also proposes guidance to assist those firms that use social media to communicate financial promotions to their clients as to how they might do so while still complying with the relevant rules of the FCA. In the Guidance, the FCA acknowledges the increasing use of various forms of social media by firms (including blogs and microblogs, such as Twitter) to issue financial promotions and other communications to clients—something that the FCA recognizes in the Guidance as forming an integral part of many firms’ marketing strategies, and therefore a method of communicating it does not wish to prevent. The FCA accepts the significant potential benefits from the use of all digital media (including social media) by firms when communicating with clients so long as this is done in a responsible and customer-focused manner.
The FCA highlights in the Guidance possible difficulties with communicating financial promotions via social media platforms, particularly those that are character-limited, and reminds firms that (no matter what the media) all financial promotions to clients must be clear, fair and not misleading and comply with all relevant FCA rules. In the Guidance, the FCA also emphasizes the need for consideration to be given as to the appropriateness of character-limited media as a means of promoting complex features of financial services or products. It also provides general guidance using a number of examples as to what would be generally considered appropriate by the FCA in terms of the format and content of such financial promotions published via social media.
The Guidance has been published so that market participants might comment on the FCA’s current position. The Guidance is available here. The Guidance is open for consultation until November 6. The FCA will incorporate any feedback it receives where it considers it appropriate to do so into its final guidance on the subject prior to publication.