March 24, 2022

Holding Foreign Companies Accountable Act: SEC Begins Identifying Affected Issuers

With final rules under the Holding Foreign Companies Accountable Act adopted late last year, the SEC now has a process in place to fulfill the statute’s requirement to identify companies that use auditors that the PCAOB is unable to inspect or investigate completely because of a position taken by an authority of a foreign jurisdiction where the firm is located. The Staff has now started to list provisional & final determinations of identified issuers in charts on this page.

Six companies have been provisionally identified so far and have 15 business days to submit evidence disputing the identification. The Commission’s role at this stage of the process is solely to identify issuers that have used public accounting firms to audit their financial statements that the PCAOB has determined that it is unable to inspect or investigate completely – and it urges companies to consult the adopting release for information on how the HFCAA will be implemented.

Liz Dunshee