HAVING REGARD to Article 5 b) of the Convention on the Organisation for Economic Co-operation and Development of 14 December 1960;

HAVING REGARD to the Resolution of the Council of 26 January 1965 concerning the Improvement of Capital Markets of Member States [C/M(65)2(Final), Item 19];

HAVING REGARD to the terms of reference of the Committee on Financial Markets and, in particular, paragraph 4 of the Resolution of the Council of 17 November 1969, as amended [C(69)131(Final), C(71)28(Final)], which invites the Committee to report to the Council on its work and propose to it, as necessary, recommendations on questions concerning financial markets;

HAVING REGARD to the Report by the Committee on Financial Markets of 3 April 1974 concerning the Admission of Securities to Public Sale and to Stock Exchanges [C(74)61] and in particular its paragraphs 30 to 37, 69 and 70;

CONSIDERING that in the interest of sound development of domestic and international capital markets it is desirable to create and maintain maximum confidence in portfolio investment;

CONSIDERING that in respect of security standards the investor is entitled to the highest practical degree of protection which can be devised and implemented with regard to disclosure requirements as well as to procedures for exercising the rights and privileges of the investor and that the ultimate responsibility in this area, not only at the time when securities are issued but also thereafter, rests with the Government;

CONSIDERING the intricacies of the securities industry and the high degree of professional expertise required for the efficient performance of its functions;

I.          RECOMMENDS that Member countries should, in consultation with the securities industry, lay down and keep up to date appropriate initial and continuing disclosure requirements regarding the securities and the issuers thereof and ensure that procedures are available for the continuous exercise of the rights and privileges of the investor which apply to all securities that are offered for sale to the public.

II.         INSTRUCTS the Committee on Financial Markets to review the implementation of this Recommendation and report thereon to the Council before the end of 1976.