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December 1, 2022

Rule 15c2-11: SEC Extends Relief for Private Debt Issuers to 2025

John blogged a few weeks ago that private debt issuers would soon be finding themselves between a rock (significantly expanded disclosure requirements) & a hard place (reduced liquidity), due to expiring relief for broker-dealer quotation obligations under amended Rule 15c2-11. According to this Simpson Thacher memo, the SEC swooped in with a no-action letter yesterday to postpone doomsday to 2025. Here’s an excerpt:

The original compliance date for amended Rule 15c2-11 was September 28, 2021, which, pursuant to a series of no-action letters issued by the staff of the SEC’s Division of Trading and Markets, was extended to January 4, 2023 for issuers of fixed income securities. Following requests from market participants for additional relief, on November 30, 2022, the SEC issued a no-action letter temporarily extending the compliance date for issuers of fixed income securities to January 4, 2025.

In this memorandum, we briefly describe the scope of information typically provided by private issuers of fixed income securities under current practice and how amended Rule 15c2-11 will result in changes to that approach if permanent relief is not provided.

This blog from Bass Berry’s Jay Knight summarizes the comment letter submitted earlier this week by the ABA’s Fed Reg Committee – which requested an extension of the no-action relief that had been slated to expire this January, until the SEC can determine whether further exemptive relief and additional rulemaking would be useful.

Last week, the National Association of Manufacturers & the Kentucky Association of Manufacturers submitted a comment letter to request that Rule 15c2-11 be amended to permanently exempt Rule 144a fixed-income securities from the new requirements.

Liz Dunshee