On July 6, the Securities and Exchange Commission (SEC) announced that it had voted to adopt rule amendments to establish an expedited review process for applications for exemption for funds under the Investment Company Act. The new process is intended to make the process of applying for more routine exemptions quicker and less expensive for applicants. Release.
On May 20, the Securities and Exchange Commission (SEC) adopted a final rule amending the existing rules for registrants that determine whether a subsidiary or an acquired or disposed business is significant and the relevant disclosure requirements for the related financial statements. The changes will become effective on January 1. Rule.
On March 26, the SEC announced temporary measures to assist market participants in response to COVID-19. The actions include i) temporary relief from Form ID notarization requirements through July 1, ii) extended filing deadlines for certain reports and forms required under Regulation A and Regulation Crowdfunding issuers, and iii) a temporary exemption, subject to certain conditions, for required filings for municipal advisors through June 30. Release.
On March 25, the SEC announced a 45-day filing extension for certain public company disclosure reports due between March 1 and July 1. The SEC also announced certain filing and delivery requirement exemptions under the Investment Advisers Act of 1940 as well as additional time to hold in-person board meetings. Release.
On February 14, the SEC proposed to modernize the infrastructure for the collection, consolidation, and dissemination of market data for exchange-listed national market system (NMS) stocks. Comments on the proposed SEC Rule are due 60 days after publication in the Federal Register. Release.
On December 18, the Securities and Exchange Commission by a three to two vote, voted to propose amendments to the definition of “accredited investor,” one of the principal tests applied under the federal securities laws for determining who is eligible to participate in transactions that are not required to be registered with the SEC. Such transactions are commonly referred to as “private capital markets” transactions. In the words of the SEC, the proposal “seeks to update and improve the definition to more effectively identify institutional and individual investors that have the knowledge and expertise to participate in our private capital markets.”
In announcing the proposal, Jay Clayton, Chairman of the SEC, asserted that: “The current test for individual accredited investor status takes a binary approach to who does and does not qualify based only a person’s income or net worth. . . The proposal would add other means for natural persons to qualify to participate in our private capital markets based on established, clear measures of financial sophistication . . . .” For example, natural persons could qualify as accredited investors based on their professional knowledge and experience, as evidenced by them having obtained professional certifications. Another welcomed aspect of the proposal highlighted by the Chairman is that it “specifically recognizes that certain organizations, such as tribal governments, should not be restricted from participating in private capital markets” transactions if they meet certain investment thresholds. Proposed Rule.
On January 7, the SEC Office of Compliance Inspections and Examinations announced its 2020 examination priorities, which include a focus on risks related to retail investors (including seniors and those saving for retirement), market infrastructure, information security, anti-money laundering programs and financial technology (including digital assets and electronic investment advice), among others. The SEC publishes its examination priorities annually to enhance the transparency of its examination program and to provide insights into its risk-based approach, including the areas it believes present potential risks to investors and the integrity of the U.S. capital markets. SEC Release.
On September 26, the Securities and Exchange Commission (SEC) announced three significant rulemakings. Summarized in a Public Statement by Chairman Jay Clayton, they are designed to achieve the following objectives.
Chairman Clayton emphasized that these rulemakings “share common themes.” Foremost, they “modernize decades-old regulations . . . taking account of our experience, advances in communications technology and changes in the operation of our markets.” Significantly, these “common sense actions better align our regulations with the preferences and investor protection interests of our long-term Main Street investors, while also facilitating capital formation.”
On September 19, the SEC adopted new rules and amendments under Title VII of the Dodd-Frank Act establishing recordkeeping and reporting requirements for security-based swap dealers and major security-based swap participants, and amending those requirements for broker-dealers. The new rules aim to allow the SEC to better monitor compliance and reduce risk to the market. Release.
