August 29, 2012

IPO Process Overhaul: Chair Schapiro Responds to Rep. Issa

Related to this WSJ article, here’s news from Cydney Posner of Cooley: The Wall Street Journal has posted SEC Chair Mary Schapiro’s response letter to the inquiry from Darrell Issa, Chair of the House Committee on Oversight and Government Reform. [Broc’s note: The WSJ’s link to the letter is now dead.]

You may recall that Chair Issa’s letter was prompted by concerns over the Facebook IPO and asked a number of questions regarding IPO pricing mechanisms, communications and other matters, with a view toward revamping the IPO process. Chair Schapiro indicates in her letter that the staff is monitoring the impact of the JOBS Act and that she has previously asked the staff to review the offering communications rules and to consider issuance of a concept release. She noted that “[e]nsuring that our communications rules facilitate, not hinder, the ability of an issuer to communicate with all investors is an important aspect of the staffs review of these rules.” However, not surprisingly, she seemed to detect a few more benefits in the current system than did Chair Issa.

SEC: Today’s Open Commission Meeting Could Be Interesting

As Dave blogged last week, the SEC pushed back consideration of changes to Rule 506 and general solicitation in the wake of a highly publicized fracas of whether the new rules should be proposed first or instead adopted as interim final rules. The open Commission meeting to consider these changes is today. Cooler heads seemed to have prevailed and the rules appear that they will be proposed first.

Here’s a short WSJ opinion piece penned by Corp Fin Director Meredith Cross from earlier this week, defending the decision to first propose the rules. Heavy duty politics continue to place pressure on the SEC, during a time when the agency is adjusting to new demands placed upon it by the courts (as well as others including the Office of Information and Regulatory Affairs as noted in this WaPo article). Not a good mix.

Tune in next Wednesday for our webcast – “JOBS Act Update: Where Are We Now” – to discuss the results of this open meeting, plus much more about what the SEC has done lately – and what is becoming standard market practice – under the JOBS Act.

More on our “Proxy Season Blog”

We continue to post new items regularly on our “Proxy Season Blog” for members. Members can sign up to get that blog pushed out to them via email whenever there is a new entry by simply inputting their email address on the left side of that blog. Here are some of the latest entries:

– Proxy Advisor Regulation: European Style
– It Was Written in The Stars – Not the Merger Agreement
– The Future of Private Ordering of Proxy Access
– Exclusive Forum Provisions Update
– Mid-Season Proxy Season Update: UK and US

– Broc Romanek