(March 20, 2001) – These guidelines are an effort to strike the right balance between investor protection and marketplace and technological innovation. They do not attempt to address every possible scenario; there remains a lot of gray area. But these guidelines begin to bring needed clarity to this important area.
In attempting to set out what constitutes a recommendation online, the NASD guidelines ask a seemingly simple question: Is an online communication general, largely neutral information, or is it a more targeted, even personalized, “call to action?” In general, these common-sense guidelines suggest that if a communication is not a recommendation on paper, it is probably not a recommendation online.
As noted in the Policy Statement, state securities regulators worked with the NASD on formulating these guidelines.