Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

Tag Archives: SEC

Delaware Chancery Reiterates Directors’ Right to Access Corporation Information

Posted in SEC/Corporate
In a recently issued letter decision, the Delaware Court of Chancery reiterated the general rule that directors have an unencumbered right to access corporate information (with certain exceptions). The case involves a dispute between two groups of directors—those affiliated with a controlling stockholder, and those that are not. An affiliated director filed a motion to… Continue Reading

SEC Disapproves BZX Proposed Rule Change to List Shares of Bitcoin-Based Exchange-Traded Product

Posted in Broker-Dealer, Digital Assets and Virtual Currencies
On July 26, the Securities and Exchange Commission disapproved a Bats BZX Exchange proposed rule change that would have permitted the listing and trading of shares of the Winklevoss Bitcoin Trust (Trust) on BZX. This is the SEC’s second disapproval of the proposed rule change as it has previously disapproved the exchange’s original proposal in… Continue Reading

SEC Amends the Definition of “Smaller Reporting Company”

Posted in SEC/Corporate
On June 28, the Securities and Exchange Commission announced that it adopted amendments to the definition of “smaller reporting company,” which will allow more companies to take advantage of accommodations such as scaled disclosure. The amendments were adopted generally as proposed on June 27, 2016, with a few significant changes. The proposed amendments were previously… Continue Reading

SEC Approves Amendment to Rule 701 and Issues a Concept Release Regarding Form S-8 and Rule 701

Posted in SEC/Corporate
As previously reported in the Corporate & Financial Weekly Digest edition of June 1, 2018, on May 24, President Trump signed into law the Economic Growth, Regulatory Relief and Consumer Protection Act (the Act), Section 507 of which directs the Securities and Exchange Commission to adopt an amendment to Rule 701 under the Securities Act… Continue Reading

SEC Adopts New Form ATS-N and Amendments to Regulation ATS and Exchange Act Rule 3a1-1 to Enhance Transparency and Oversight of Alternative Trading Systems

Posted in Broker-Dealer
On July 18, the Securities and Exchange Commission adopted new Form ATS-N and amendments to Regulation ATS and Exchange Act Rule 3a1-1. The new requirements are designed to enhance transparency of alternative trading systems (ATSs) that trade stocks listed on a national securities exchange (NMS Stock ATSs) by requiring them to publicly disclose detailed information… Continue Reading

Regulators Publish Changes to the Volcker Rule

Posted in Banking, CFTC, Dodd-Frank Developments
On July 17, the Federal Register published proposed changes to the Volcker Rule that were jointly approved by the Federal Reserve Board, the Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency and the Securities and Exchange Commission. As described in greater detail in the June 1,… Continue Reading

CFTC Issues Customer Advisory on Digital Coins and Tokens

Posted in CFTC, Digital Assets and Virtual Currencies
The Commodity Futures Trading Commission has issued an advisory warning customers of the dangers of purchasing digital coins or tokens. Among other things, the advisory warns customers that buying digital coins or tokens for speculative purposes carries significant risk and identifies various factors that could affect the current or longer-term value of a digital coin… Continue Reading

OCIE Issues Risk Alert on Compliance Issues Related to Best Execution by Investment Advisers

Posted in Investment Advisers, Investment Companies and Investment Advisers
On July 11, the Office of Compliance Inspections and Examinations (OCIE) of the Securities and Exchange Commission issued a Risk Alert to provide investment advisers and other market participants with information concerning many of the most common deficiencies that OCIE staff has found in recent examinations of investment advisers’ compliance with their best execution obligations… Continue Reading

SEC Sets Agenda for Fixed Income Market Structure Advisory Committee Meeting

Posted in Broker-Dealer
On July 16, the Securities Exchange Commission will host a meeting of the Fixed Income Market Structure Advisory Committee. The agenda includes the following items for discussion: Pre-Trade Transparency Under MiFID II Current State of Pre-Trade Transparency in the US Corporate Bond Market Current State of Pre-Trade Transparency in the US Municipal Securities Market Electronic… Continue Reading

SEC Open Meeting Agenda Announced

Posted in Broker-Dealer
On July 18, the Securities Exchange Commission will host an open meeting to discuss various regulatory proposals. Among other agenda items, the meeting will cover whether the SEC should adopt amendments to Rule 3a1-1 and Regulation ATS and new Form ATS-N under the Securities Exchange Act of 1934 related to certain alternative trading systems (ATSs).… Continue Reading

SEC and CFTC Approve New MOU

Posted in Broker-Dealer
On June 28, the Securities and Exchange Commission and Commodity Futures Trading Commission announced the approval of a new Memorandum of Understanding (MOU) aimed at ensuring continued information sharing between the agencies. The MOU updates and enhances a 2008 MOU between the agencies by adding various elements that reflect current market conditions. For example, the… Continue Reading

Update: 5th Circuit Confirms Decision To Vacate DOL Fiduciary Rule

Posted in Executive Compensation and ERISA
After much anticipation, the US Court of Appeals for the Fifth Circuit on Thursday confirmed its earlier decision to vacate the Department of Labor’s “fiduciary advice rule.” The controversial rule became effective June 2017 and significantly expanded the universe of broker-dealers and other financial advisers subject to ERISA’s fiduciary standards. In March of this year,… Continue Reading

SEC Releases Updates to Custody Rule Frequently Asked Questions

Posted in Investment Advisers, Investment Companies and Investment Advisers
On June 5, the Securities and Exchange Commission’s Division of Investment Management staff (Staff) updated its “Staff Responses to Questions About the Custody Rule” (Custody Rule FAQs). The Custody Rule FAQs address questions regarding Rule 206(4)-2 of the Investment Advisers Act of 1940, the “Custody Rule.” The update to the Custody Rule FAQs specifically addressed… Continue Reading

SEC Charges 13 Private Fund Advisers for Repeated Form PF Filing Failures

Posted in Investment Advisers, Investment Companies and Investment Advisers
On June 1, the Securities and Exchange Commission announced settlements with 13 registered investment advisers who repeatedly failed to annually file or update reports on Form PF. Form PF is a confidential reporting form required for private fund investment advisers managing $150 million or more of assets. The SEC began requiring that applicable registered investment… Continue Reading

FINRA Proposes Rule Change Regarding ATS Reporting of Transactions to TRACE

Posted in Broker-Dealer
The Financial Industry Regulatory Authority recently filed a proposed rule change with the Securities and Exchange Commission to amend FINRA Rule 6730 regarding transaction reporting. Currently under Rule 6730, US Treasury Securities transactions executed on an alternative trading system (ATS) must be reported to the Transaction Reporting and Compliance Engine (TRACE) by the ATS itself… Continue Reading

Dodd-Frank Legislation Directs SEC to Amend Rule 701 and Regulation A+

Posted in SEC/Corporate
On May 24, President Trump signed into law the Economic Growth, Regulatory Relief and Consumer Protection Act. While the Act primarily serves to relieve smaller financial institutions from the burden of complying with certain requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Act also directs the Securities and Exchange Commission to… Continue Reading

FINRA Proposes Rule Change to FINRA Regulation, Inc. District Committee Structure and Governance

Posted in Broker-Dealer
On May 18, the Financial Industry Regulatory Authority (FINRA) filed a rule change with the Securities and Exchange Commission to amend the by-laws of FINRA Regulation, Inc. (FINRA Regulation)—FINRA’s regulatory subsidiary. The rule change would reorganize FINRA Regulation’s District Committees (Rule Change), converting FINRA Regulation’s District Committees into Regional Committees, which mirror the regions covered… Continue Reading

SEC Division of Trading and Markets Director Gives Remarks Regarding Regulation Best Interest

Posted in Broker-Dealer
On May 22, Brett Redfearn, the Director of the Securities and Exchange Commission’s Division of Trading and Markets spoke at the Financial Industry Regulatory Authority’s Annual Conference regarding the newly proposed Regulation Best Interest. (For a more complete discussion of Regulation Best Interest, please refer to Katten’s “SEC Proposes Fiduciary Rule for Broker-Dealers” advisory, available… Continue Reading

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… 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… 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… Continue Reading