market abuse

The Company has been using for some time a procedure for the internal management and external communication concerning Edison, with special emphasis on insider information. This procedure, which is an integral part of Model 231, was revised in 2006 by the Board of Directors, acting upon a proposal by the Oversight Board and based on the findings of a preliminary review by the Audit Committee, in order to make it more responsive to changes in statutory requirements introduced by the inclusion in the Italian legal system of EU regulations on market abuse.

One of the functions of this procedure was to specify the functions, responsibilities and operating procedures that apply to the management of insider information (including both insider information “in process” and those for which a market communication obligation already exists), taking into account how insider information should be verified and data should be entered in the Insider Register; the treatment, internal circulation and communication to outsiders (when certain conditions are met) ofinsider information; and the communication of insider information to the market in accordance with the deadlines and methods set forth in current regulations.

All members of the corporate governance bodies, employees and associates of Edison and its subsidiaries who have access to insider information are required to comply with the abovementioned procedure. All of the abovementioned parties are required to comply with the following obligations:

• They shall safeguard the confidentiality of documents and information obtained in the course of their work and, more specifically, make sure that the sharing of documents containing insider information, whether internally or with third parties, is handled will all necessary attention and care.
• They shall never communicate to anyone, unless required to do so for work reasons, insider information of which they may become aware in the course of their work.
• They shall require that the owners of a project and/or a significant asset (normally the manager in charge of a department or office) and third parties to whom insider information is disclosed in connection with an assignment sign a confidentiality agreement, which, among other covenants, may require them to maintain an Insider Register, if applicable.
• They shall promptly inform the applicable Company Compliance Office of any act, action or omission that may constitute a violation of this Procedure.

Insofar as roles and responsibilities are concerned, Senior Management has Group-wide responsibility for distributing to the market press releases that contain insider information and for activating the procedure used to embargo the disclosure of insider information to the market, when applicable. Heads of departments, offices, business units or subsidiaries are responsible for identifying the existence of insider information and implementing all security measures required to ensure that insider information is treated confidentially and segregated, limiting its circulation only to those parties who need access to it to perform their job or assignment.

In addition, senior managers and other management personnel (each for the information over which he or she has jurisdiction) must inform employees and outsiders who possess insider information concerning the Group of the nature of the information they possess and must ensure that all outsiders who receive insider information are required pursuant to law, Company Bylaws or contract to respect the confidentiality of the documents and information they are receiving, verifying, when applicable, the existence of secrecy/confidentiality clauses or commitments. Prior to being placed into circulation, paper and electronic documents that contain insider information must be labeled “Confidential” and must be appropriately safeguarded. The electronic transmission of these documents must be protected with access keys. In all cases, the senior managers and other management personnel with whom the “Confidential” documents originated must keep track of the parties (employees and outsiders) to whom the documents were provided. Specific provisions of the procedure deal with the method for entering data in and updating the register of parties who have access to insider information. Specifically, parties may be entered in the register on a permanent or on an occasional basis and Edison’s senior managers and other management personnel are responsible for identifying the parties whose names should be communicated to the office charged with keeping the register for entry therein on a permanent or occasional basis.

The procedure also deals with the method for informing the parties entered in the register, updating their information and deleting their names. Entry in the register on a permanent basis is used for those parties who, because of their function, the position they hold or the specific responsibilities entrusted to them, have access to insider information on a regular and continuing basis. Entry on an occasional basis is used for those parties who, because of their involvement in certain nonrecurring projects or activities and/or their temporary performance of certain functions/responsibilities, or because of a specific assignment, have access for a limited period of time to potential insider information.

The data of all Directors and Statutory Auditors were entered in the abovementioned register on a permanent basis at the time of their election and they were informed about their duties and responsibilities. Upon being elected, Directors and Statutory Auditors were informed of any changes that occurred in the regulatory framework regarding internal dealing issues and the communication obligations that they are required to comply with through the Company. No transactions requiring disclosure to the market and the relevant authorities were executed by Directors and Statutoty Auditors in 2009. The filing models concerning transaction executed in previous years, may be consulted at the Company website. Without prejudice to the obligation to comply with the provisions governing market abuse, in 2007, the Board of Directors introduced, for specific periods of the year, the additional obligation of refraining from executing transactions that involve financial instruments issued by the Company. The periods in question have been defined as time periods that begin 30 days before the date of a meeting of the Board of Directors convened to review regularly reported financial statements and end five days after the publication of the corresponding press release. The 2011 blackout periods are as follows:

• from January 14 to February 18
• from March 25 to May 2
• from June 24 to July 29
• from September 26 to October 31