Key takeaway
Check the issuer, speaker, recipient and information before relying on confidentiality. A Regulation FD exception is not an insider-trading clearance.
Describe the proposed disclosure before choosing a route
A company wants to discuss unpublished order trends or operating interruptions with a prospective data recipient. The commercial team says that the recipient will sign an NDA. The first useful step is a restricted review of what would be revealed, who is speaking, who would receive it and how that recipient could use it. Do not send the material merely to establish whether the other party finds it interesting.
US Regulation FD applies to specified issuers and disclosures by the issuer or a person acting on its behalf to enumerated recipient categories. Its material-nonpublic-information test and recipient conditions matter. The rule is not a universal confidentiality law for every private business record. Current sections 243.100 and 243.101 supply the scope; responsible issuer counsel must decide how those facts apply.
A fictional route map with the same proposed metric
In this hypothetical example, issuer Juniper is within Regulation FD’s issuer definition and its authorized spokesperson is considering disclosing an unpublished operating metric. Materiality and public status have not been resolved. Two proposed recipients have different stated roles. This table supplies facts for counsel’s review; it neither classifies the metric nor approves either communication.
The completed preparatory decision is to withhold the metric from both routes until the missing facts are resolved. An ordinary metadata description can still reveal a nonpublic trend, so reducing a spreadsheet to a paragraph does not settle the question. The permitted initial description itself needs the appropriate company approval.
| Proposed recipient | Evidence available | Unresolved route question |
|---|---|---|
| Securities analyst | Analyst role stated; no express confidentiality commitment | Enumerated recipient, materiality/public status and disclosure obligations |
| Technical evaluator | Draft expressly promises confidentiality; role/access incomplete | Actual exception, entity, onward access and other securities duties |
| A wider product audience | Redistribution feature proposed | Who ultimately receives the metric and under what authority? |
Read the actual confidentiality undertaking
Section 243.100(b)(2) distinguishes, among other exceptions, a person who owes the issuer a duty of trust or confidence and a person who expressly agrees to maintain the disclosed information in confidence. The SEC’s Regulation FD interpretations explain that a promise merely not to violate securities laws is insufficient for the express-confidentiality exception. Inspect the undertaking that actually governs this recipient and information.
Those SEC interpretations also explain that an express confidentiality undertaking for this exception does not need an additional promise not to trade. That limited point must not be rewritten as permission to trade. In Juniper’s fictional review, counsel receives the precise draft language and the recipient’s legal entity, intended users, onward access and proposed purpose. A sales representative’s assurance that everyone is covered is recorded as an unverified assertion.
Keep an accidental-disclosure response separate
Where Regulation FD applies, section 243.100 distinguishes simultaneous public disclosure for an intentional selective disclosure from prompt public disclosure for a nonintentional one. Section 243.101 defines the relevant terms and public-disclosure routes. Do not let a generic incident checklist replace the issuer’s actual disclosure process. The legal and disclosure officers need the real chronology and information immediately if an exposure is suspected.
For the fictional proposal, no disclosure has happened and no public filing is recommended here. The work product is a pre-disclosure briefing note. If the recipient changes its role, adds a subscription product or proposes sharing results with an investment team, reopen the analysis before broadening access. A conclusion tied to one recipient and one purpose should not silently follow the data into another product.
Do not confuse one exception with a trading decision
The SEC interpretations warn that a recipient of material nonpublic information under the confidentiality exception may still face insider-trading liability. Other laws, duties and contractual limits can therefore remain relevant even if issuer counsel finds a Regulation FD exception. The company should not advertise a proprietary data route as cleared merely because an NDA exists or the recipient is described as technical.
Juniper’s completed packet identifies the stipulated issuer and speaker, proposed information, actual recipient roles, draft confidentiality wording and unresolved questions. It contains no public claim that the metric is immaterial, no recommendation to buy or sell securities and no permission to disclose. This is a US federal review agenda for the authorized specialists. Rights in the records, competition concerns and privacy remain separate decisions alongside the disclosure route.
Use this review agenda with your legal and privacy advisers. Requirements depend on the records, jurisdictions and intended use.