February 5, 2013

Iran & Syria Disclosures: The Challenges of Determining Who Is An “Affiliate”

Recently, many members have been reaching out about how to determine who is an “affiliate” for purposes of the Iran Threat Reduction and Syria Human Rights Act of 2012 and the new disclosures that are required for any periodic report due after tomorrow. As noted during our recent “The ‘Former’ Corp Fin Staff Speaks” webcast, the “affiliate” definition is quite broad – and might elicit disclosure of transactions that may not even be prohibited by any of these law’s restrictions. See this part of the webcast’s transcript (there is also good stuff about the need for ongoing diligence regarding insiders given this new law is not just an annual disclosure). We have been posting memos regarding this new disclosure requirement in our “Iran Sanctions” Practice Area.

Many of the questions we have been getting relate to recent informal SEC Staff acknowledgement that “affiliate” might pick up brother-sister private equity portfolio companies. This Staff acknowledgement is informal (ie. even more informal than the 7 CDIs issued in December; Staff guidance is considered “informal” since it’s not blessed by the Commissioners) – but seems to be based on the fact that Congress didn’t limit the broad “affiliate” definition of Exchange Act Rule 12b-2 when it passed this legislation. As always, companies should make reasonable efforts to obtain the necessary information in order to comply with the disclosure requirements.

FINRA’s New FAQs on Public Offering Reviews

Thanks to David Jenson for alerting us to these new FAQs from FINRA on its public offering review process in this blog

Transcript: “The Latest Developments: Your Upcoming Proxy Disclosures–
What You Need to Do Now!”

We have posted the transcript from our recent webcast: “The Latest Developments: Your Upcoming Proxy Disclosures–What You Need to Do Now!”

– Broc Romanek