397Misleading statements and practices
(1)This subsection applies to a person who—
(a)makes a statement, promise or forecast which he knows to be misleading, false or deceptive in a material particular;
(b)dishonestly conceals any material facts whether in connection with a statement, promise or forecast made by him or otherwise; or
(c)recklessly makes (dishonestly or otherwise) a statement, promise or forecast which is misleading, false or deceptive in a material particular.
(2)A person to whom subsection (1) applies is guilty of an offence if he makes the statement, promise or forecast or conceals the facts for the purpose of inducing, or is reckless as to whether it may induce, another person (whether or not the person to whom the statement, promise or forecast is made)—
(a)to enter or offer to enter into, or to refrain from entering or offering to enter into, a relevant agreement; or
(b)to exercise, or refrain from exercising, any rights conferred by a relevant investment.
(3)Any person who does any act or engages in any course of conduct which creates a false or misleading impression as to the market in or the price or value of any relevant investments is guilty of an offence if he does so for the purpose of creating that impression and of thereby inducing another person to acquire, dispose of, subscribe for or underwrite those investments or to refrain from doing so or to exercise, or refrain from exercising, any rights conferred by those investments.
(4)In proceedings for an offence under subsection (2) brought against a person to whom subsection (1) applies as a result of paragraph (a) of that subsection, it is a defence for him to show that the statement, promise or forecast was made in conformity with price stabilising rules or control of information rules.
(5)In proceedings brought against any person for an offence under subsection (3) it is a defence for him to show—
(a)that he reasonably believed that his act or conduct would not create an impression that was false or misleading as to the matters mentioned in that subsection;
(b)that he acted or engaged in the conduct—
(i)for the purpose of stabilising the price of investments; and
(ii)in conformity with price stabilising rules; or
(c)that he acted or engaged in the conduct in conformity with control of information rules.
(6)Subsections (1) and (2) do not apply unless—
(a)the statement, promise or forecast is made in or from, or the facts are concealed in or from, the United Kingdom or arrangements are made in or from the United Kingdom for the statement, promise or forecast to be made or the facts to be concealed;
(b)the person on whom the inducement is intended to or may have effect is in the United Kingdom; or
(c)the agreement is or would be entered into or the rights are or would be exercised in the United Kingdom.
(7)Subsection (3) does not apply unless—
(a)the act is done, or the course of conduct is engaged in, in the United Kingdom; or
(b)the false or misleading impression is created there.
(8)A person guilty of an offence under this section is liable—
(a)on summary conviction, to imprisonment for a term not exceeding six months or a fine not exceeding the statutory maximum, or both;
(b)on conviction on indictment, to imprisonment for a term not exceeding seven years or a fine, or both.
(9)“Relevant agreement” means an agreement—
(a)the entering into or performance of which by either party constitutes an activity of a specified kind or one which falls within a specified class of activity; and
(b)which relates to a relevant investment.
(10)“Relevant investment” means an investment of a specified kind or one which falls within a prescribed class of investment.
(11)Schedule 2 (except paragraphs 25 and 26) applies for the purposes of subsections (9) and (10) with references to section 22 being read as references to each of those subsections.
(12)Nothing in Schedule 2, as applied by subsection (11), limits the power conferred by subsection (9) or (10).
(13)“Investment” includes any asset, right or interest.
(14)“Specified” means specified in an order made by the Treasury.