Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

SEC Division of Corporation Finance Issues C&DIs on Proxy Rules and Proxy Statements, Overhauling Telephone Interpretations Manual

Posted in SEC/Corporate

On May 11, the staff of the Division of Corporation Finance of the Securities and Exchange Commission (the Staff) issued 45 Compliance and Disclosure Interpretations (C&DIs) that relate to the proxy rules and proxy statements, replacing the Staff’s prior interpretations that were published in the Proxy Rules and Schedule 14A Manual of Publicly Available Telephone Interpretations (the Manual) and the March 1999 Supplement to the Manual (the Supplement). Thirty-five of the C&DIs reiterate prior guidance from the Manual and the Supplement. This article highlights the six C&DIs that reflect substantive changes and the four C&DIs that reflect technical changes to the prior guidance in the Manual and the Supplement. The Staff also noted that it is in the process of updating other previously published interpretations relating to the proxy rules. Continue Reading

CFTC Grants Relief to Certain Non-US Persons in Determining Swap Dealer and Major Swap Participant Status

Posted in CFTC, Derivatives

On May 16, the Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) provided no-action relief for certain non-US persons from counting swaps with international financial institutions, such as the International Monetary Fund, that are incorporated or based in the United States in determining swap dealer and major swap participant status as specified by the CFTC’s definitions. Continue Reading

CFTC Opens Access to Indian Futures Market for US Customers

Posted in CFTC

On May 17, the Commodity Futures Trading Commission issued an order to the National Stock Exchange of India (NSE) through its Part 30 exemptive program, which affords regulatory deference to foreign regulatory frameworks and provides US customers greater access to certain foreign futures markets. The order allows NSE’s members to directly accept US customer funds to trade in futures and options contracts on NSE without such members being required to register as futures commission merchants with the CFTC, based on substituted compliance with applicable Indian law and the rules of the NSE. Continue Reading

Legal Entity Identifier Regulatory Oversight Committee Issues Second Progress Report

Posted in EU Developments, Financial Markets

On May 2, the Legal Entity Identifier Regulatory Oversight Committee (LEI ROC) published its second progress report, which included an overview of the Global Legal Entity Identifier System (GLEIS), regulatory uses of the LEI and LEI ROC’s activities. The LEI ROC’s first progress report was published on November 5, 2015. Continue Reading

ECB Publishes Article on Impact of Brexit Transition Period

Posted in Brexit, EU Developments, Financial Markets

On May 16, the European Central Bank (ECB) published an article on the impact of a potential Brexit transition period (for more information on the proposed transition period, please see the Corporate & Financial Weekly Digest edition of March 23, 2018).

In the article, the ECB sets out how the transition period affects its expectations of banks’ preparations for Brexit: Continue Reading

Council of EU Adopts MLD5

Posted in EU Developments, Financial Markets

On May 14, the Council of the EU published a press release announcing that it has adopted the proposed Fifth Money Laundering Directive (MLD5). The introduction of MLD5 forms part of the European Commission’s action plan to counter terrorist financing and money laundering, published in February 2016 (further details are available in the Corporate & Financial Weekly Digest edition of February 12, 2016). Continue Reading

SEC Guidance Expanding Exclusions for Non-GAAP Information

Posted in SEC/Corporate

The Securities and Exchange Commission’s Division of Corporation Finance issued two new Compliance and Disclosure Interpretations (C&DI), expanding its previously issued guidance related to the exemption from Item 10(e)(5) under Regulation S-K and Regulation G for non-GAAP financial information provided to a financial advisor in forecasts for business combination transactions. The previously issued guidance was discussed in the November 3, 2017 edition of the Corporate & Financial Weekly Digest. Continue Reading

ISS Launches Help Center

Posted in SEC/Corporate

Institutional Shareholder Services Inc. (ISS) recently launched the ISS Help Center, its new online communications portal that will help facilitate inquiries of ISS from investors, companies (issuers) and company advisors, including law firms and proxy solicitors, as well as responses from ISS to such inquiries. The ISS Help Center will provide a framework to submit questions on a range of matters, including proxy voting, shareholder meeting research, QualityScore corporate profiles/methodology questions and research engagement requests. The ISS Help Center replaces the current process for submitting questions to ISS via email to the Global Research Help Desk.


FINRA Amends Rule 3310 to Reflect FinCEN’s Customer Due Diligence Requirements

Posted in Broker-Dealer

The Financial Industry Regulatory Authority (FINRA) filed amendments to Rule 3310 to conform to the Financial Crimes Enforcement Network’s (FinCEN’s) customer due diligence requirements. Specifically, the amendments to Rule 3310 require each member to include in its anti-money laundering program appropriate procedures for conducting ongoing customer due diligence, including but not limited to, “[u]nderstanding the nature and purpose of customer relationships for the purpose of developing a customer risk profile” and “[c]onducting ongoing monitoring to identify and report suspicious transactions and, on a risk basis, to maintain and update customer information.” For these purposes, “customer information” includes information regarding the beneficial owners of legal entity customers.

FinCEN’s customer due diligence requirements were adopted on May 11, 2016, and went into effect on May 11, 2018. Likewise, FINRA’s amendments to Rule 3310 went into effect on May 11, 2018.

More information is available here.

UK Government Responds to Report on Brexit

Posted in Brexit/UK Developments, Financial Markets

On May 9, the UK government published its response to the House of Lords European Union Committee’s report, entitled “Brexit: The Future of Financial Regulation and Supervision,” which was published on January 27. The Committee’s report includes recommendations under six categories, including:

1. Incorporating the EU acquis (being the accumulated legislation and court decisions) in financial services; and

2. Regulatory innovation, financial technology (FinTech) and the future. Continue Reading