19.2 Information Management: Secrecy v Disclosure 523There can be personal confidentiality obligations on a number of grounds. A person can
owe fiduciary duties based on the general law.^24 The City Code, which regulates takeover
bids and certain other transactions, requires secrecy before the announcement of the bid,^25
and even rumours may trigger a duty to make an announcement under the City Code.^26
The general law relies on civil remedies. There are regulatory sanctions and penalties for
market abuse under the Financial Services and Markets Act 2000 (FSMA). The Criminal
Justice Act 1993 makes insider dealing a criminal offence.^27
The information rights and duties depend on the parties. There are generic infor-
mation rights and duties applicable to a party in relation to a certain other party
(see Volume I).^28 In the context of a takeover, the core parties are the acquirer, the
vendor or vendors, and the target. The rules governing information management
can be applied to each party separately, and there can be different rules depending
not only on the identity of this party (for example, the duty of the target under rule
X to disclose information) but also on the identity of the other party in the infor-
mation relationship (for example, the duty of the target to keep information secret
from the acquirer under rule Y).
In other words: Where a party is a company whose shares have been admitted
to trading on a regulated market, it will be subject to the information management
regime applicable to issuers. Where it is not such a company, it must nevertheless
comply with rules that apply to any market participant (like the prohibition of
market abuse) or to any person (like rules that make the gathering, use or disclo-
sure of information a criminal offence). The identity of the party will influence
another party’s information rights and obligations.
Furthermore, those rules can be relevant in many situations in the context of
takeovers. Usual situations in which the management of information is regulated
by laws include the following:
(^24) Percival v Wright [1902] 2 Ch 421; Schering Chemicals Ltd v Falkman Ltd [1982] QB
- (^25) Rule 2.1 of the City Code on Takeovers and Mergers.
(^26) Rule 2.2 of the City Code on Takeovers and Mergers.
(^27) Section 52(1) of the Criminal Justice Act 1993.
(^28) They include: the right to ask for information; the duty to ask for information; the right
to disclose information; the duty to disclose information; the duty not to reveal informa-
tion; the duty not to use information; the characteristics of information; the allocation of
risk inherent in information; and similar questions.