The Financial Markets Standards Board has published a final Statement of Good Practice on Grey Market Trading, giving firms a framework to assess when conditional trading of securities before they are declared free to trade is appropriate. The statement is intended to promote a common understanding of the role, benefits and risks of grey market trading across issuers, investors and syndicate banks, with particular focus on issuer control, pricing, information asymmetries and conflicts of interest. The guidance sets out four good practice statements. Active bookrunners should make issuers aware if they intend to engage in grey market trading and should consider conflicts of interest, the information available to public-side traders and the bank's control framework. Passive bookrunners and co-managers should make the same assessments before engaging in such trading. All syndicate banks that trade in the grey market should have controls to comply with applicable legal and regulatory requirements, including on conflicts of interest, information handling and market abuse. Active bookrunners should also publicly announce when a new issuance is free to trade where practicable.
Financial Markets Standards Board2026-05-20
Financial Markets Standards Board publishes final good practice on grey market trading for syndicate banks
The Financial Markets Standards Board has issued a final Statement of Good Practice on Grey Market Trading, providing a framework for assessing when conditional trading of securities before they are free to trade is appropriate. The guidance sets out four good practice statements covering issuer awareness, management of conflicts of interest and information asymmetries, control frameworks for syndicate banks, and public announcements by active bookrunners when new issuances become free to trade.