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Ministers told to avoid share price talk

Monday 7 Jan 2013 11:40 a.m.

The Government is preparing for a showdown with the Maori Council

The Government is preparing for a showdown with the Maori Council

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Ministers and officials have been given a new set of rules outlining how they can talk about listed companies as the Government gets ready to kick off its partial privatisation programme this year.

Public service bosses, Government ministers and their staff, and state sector spin doctors and legal teams have been told they need to treat information about public companies with caution and take care when commenting about listed firms even when they don't have any inside information.

That includes telling ministers to be wary of making any comment to media about a listed company, and to steer clear from talking about share prices.

"Ministers should focus comments on government policy rather than commenting on the value of particular securities or the prospects of a particular public issuer," acting cabinet secretary Michael Webster says in the note.

"A minister should never directly or indirectly encourage or advise people to buy, sell or hold the securities of a public issuer and must take care to ensure that comments cannot be interpreted or perceived as false or misleading."

The how-to note comes as the Government prepares for a final showdown with the Maori Council in the Supreme Court over its decision to proceed with partial privatisations of state-owned energy companies via floats on the New Zealand Stock Exchange.

The Department of the Prime Minister and Cabinet issued the new guidelines for dealing with inside information about public issuers on December 20.

The guidelines set out how ministers and officials should talk publicly about listed companies, stressing the importance of making any market-moving decision outside trading hours.

Ministers should only make a major statement that could affect a listed company when trading is open when there is a compelling reason, the note said.

If inside information will be announced by the Government, it should be given to the affected company under embargo to let it figure out whether it needs to halt trading in its shares or make a statement of its own to meet disclosure rules.


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