TheCorporateCounsel.net

Thanks to Markel’s Karl Strait for noticing that the SEC’s “Small Entity Compliance Guide” for the new rules on insider trading arrangements and related disclosures confirms the compliance dates for the new exhibit requirement and other disclosures under Regulation S-K Items 408 and 402(x). I blogged earlier this year that Corp Fin Director Erik Gerding had shared thoughts on these dates – but it’s great to see it laid out:

Smaller reporting companies will be required to begin compliance with the:

– Item 408(a) quarterly disclosure and tagging requirements in an Exchange Act report on Form 10-Q that covers the first full fiscal quarter (or on Form 10-K if the first full fiscal quarter is the issuer’s fourth fiscal quarter) that begins on or after October 1, 2023; and

– Item 408(b), Item 402(x), and Item 16J (for foreign private issuers) disclosure and tagging requirements in the annual report on Form 10-K or Form 20-F that covers the first full fiscal year that begins on or after October 1, 2023.

Companies that are not smaller reporting companies will be required to begin compliance with the:

– Item 408(a) quarterly disclosure and tagging requirements in an Exchange Act report on Form 10-Q that covers the first full fiscal quarter (or on Form 10-K if the first full fiscal quarter is the issuer’s fourth fiscal quarter) that begins on or after April 1, 2023; and

– Item 408(b), Item 402(x), and Item 16J (for foreign private issuers) disclosure and tagging requirements in the annual report on Form 10-K or Form 20-F that covers the first full fiscal year that begins on or after April 1, 2023.

Remember that the changes to Section 16 are also now in effect – requiring insiders to report gifts within two business days and indicate on the Form 4 cover page whether the transaction is occurring pursuant to a Rule 10b5-1 plan.

The Guide notes that it was prepared by the Staff as a “small entity compliance guide” under Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996, as amended. The Guide summarizes and explains rules and form amendments adopted by the Commission, but is not a substitute for any rule or form itself. The Staff wants readers to remember that only the rule or form itself can provide complete and definitive information regarding its requirements.

– Liz Dunshee