On October 4, the SEC issued an order staying the effectiveness of its recently adopted proxy access rules. As a result, proxy access will not take effect during mid-November 2010, as previously would have been the case based on the publication date of the new rules in the Federal Register.
The order was issued in response to a petition filed by the U.S. Chamber of Commerce and the Business Roundtable with the Court of Appeals for the D.C. Circuit seeking judicial review of Rule 14a-11. Pursuant to the order, the SEC has stayed the effectiveness of both Rule 14a-11 and the companion amendments to Rule 14a-8.
The Chamber of Commerce’s and Business Roundtable’s petition will be handled by the court on an expedited basis. A decision by the court is expected by the summer of 2011, although that schedule could change. Therefore, even if the proxy access rules in their current form are upheld by the court, for most if not all companies they will not be in place until the 2012 proxy season.
For a description of the new proxy access rules, please see our prior Alert.