The SEC said Tuesday that companies can use social media outletslike Facebook and Twitter to announce key information in compliancewith Regulation Fair Disclosure as long as investors have beenalerted about which outlet will be used to disseminate suchinformation.

A SEC report confirmed that Regulation FD applies to social media and other emerging means of communication used bypublic companies the same way it applies to company websites.

Regulation FD requires companies to distribute materialinformation in a manner reasonably designed to get that informationout to the general public broadly and non-exclusively, the SECsaid. It is intended to ensure that all investors have the abilityto gain access to material information at the same time.

The SEC report said that although every case must be evaluatedon its own facts, disclosure of material, nonpublic information onthe personal social media site of an individual corporate officer —without advance notice to investors that the site may be used forthis purpose — is unlikely to qualify as an acceptable method ofdisclosure under the securities laws.

“One set of shareholders should not be able to get a jump onother shareholders just because the company is selectivelydisclosing important information,” said George Canellos, actingdirector of the SEC's Division of Enforcement.

Personal social media sites of individuals employed by a publiccompany would not ordinarily be assumed to be channels throughwhich the company would disclose material corporate information,the agency said.

“Most social media are perfectly suitable methods forcommunicating with investors, but not if the access is restrictedor if investors don't know that's where they need to turn to getthe latest news,” Canellos said.

In 2008, the SEC said, it issued guidance clarifying thatwebsites can serve as an effective means for disseminatinginformation to investors if they've been made aware that's where tolook for it.

The SEC said its report of investigation stems from an inquiryits division of enforcement launched into a post by Netflix CEOReed Hastings on his personal Facebook page stating that Netflix'smonthly online viewing had exceeded one billion hours for the firsttime.

Netflix did not report this information to investors through apress release or Form 8-K filing, and a subsequent company pressrelease later that day did not include this information, accordingto the SEC.

Neither Hastings nor Netflix had previously used his Facebookpage to announce company metrics, and they had never before takensteps to alert investors that Hastings' personal Facebook pagemight be used as a medium for communicating information aboutNetflix, the SEC said.

Netflix's stock price had begun rising before the posting, andincreased from $70.45 at the time of the Facebook post to $81.72 atthe close of the following trading day. The SEC said it did notinitiate an enforcement action or allege wrongdoing by Hastings orNetflix.

In March, the SEC published a guidance update to clarify theobligations of mutual funds and other investment companies to seekreview of materials posted on their social media sites and whethera filing with the Financial Industry Regulatory Authority would be required.