Fleet Street editors urged the FSA to reconsider its recommendations around controlling leaks, saying they would 'only injure the market integrity they purport to protect'.
A letter was sent to Hector Sants, CEO of the FSA, and signed by Lionel Barber, editor, the Financial Times; Alan Rusbridger, editor-in-chief, Guardian News & Media; David Schlesinger, editor-in-chief, Thomson Reuters, and James Harding, editor, The Times.
The letter said the proposals 'reflect a wilful misunderstanding of the relationship between the City and the press and will ultimately do more harm than benefit to the flow of reliable information.
'By adopting an overly prescriptive approach to preventing leaks, the recommendations would greatly restrict the capacity of the media to carry out investigations of regulated firms.'
It pointed out that the US-adopted Regulation Fair Disclosure has 'had little measurable effect on reducing the amount of insider-trading'.
Sants responded by saying: 'I'm afraid I cannot see how reminding firms of the importance of seeking to minimise the opportunity for employees to commit market abuse is constraining press freedom.'
But he did point out that the best practice suggestions did not constitute new rules.