Interim Final Rule

Securities-based swaps exemptions extended. The expiration dates have been extended to February 11, 2017, for the SEC’s interim final rules providing exemptions under the Securities Act of 1933, the Securities Exchange Act of 1934, and the Trust Indenture Act of 1939 for those security-based swaps that, prior to July 16, 2011, were security-based swap agreements and that, as of July 16, 2011, are defined as “securities” under the Securities Act and the Exchange Act pursuant to Title VII of the Dodd-Frank Act. The interim final rules exempt offers and sales of security-based swap agreements from all but the anti-fraud provisions of the securities laws, provided that certain conditions are met. (2/5/2014) SEC Release No. 33-9545. See also SEC Release No. 34-71485.


Compliance guide on credit rating references for small entities. A small entity compliance guide has been issued by the SEC. The guide addresses the December 27, 2013 amendments to Rule 5b-3 and Forms N-1A, N-2, and N-3 under the Investment Company Act of 1940, which replace the reference to credit ratings in Rule 5b-3 with an alternative standard designed to retain a similar degree of credit quality to that in current Rule 5b-3, and eliminate in the Forms the required use of credit ratings from a nationally recognized statistical rating organization when a fund chooses to depict its portfolio holdings by credit quality. The amendments are effective July 7, 2014. (2/4/2014)

Other Developments

SEC announces cybersecurity roundtable. On March 26, 2014, the SEC will host a roundtable to discuss cybersecurity and the issues and challenges it raises for market participants and public companies. (2/14/2014) SEC press release. 

Reorganization. Changes that SEC Chair Mary Jo White is making at the agency in an effort to address the Commission’s recent trial losses were discussed by the Wall Street Journal. (2/13/2014) Reorganization. 

Fee rates. Starting on March 18, 2014, the fee rates applicable to most securities transactions will be set at US$22.10 per million dollars. The assessment on security futures transactions will remain unchanged at US$0.0042 for each round turn transaction. (2/12/2014) Fee rate. 

Variable Annuities. An Investor Bulletin on variable annuities has been published by the SEC’s Office of Investor Education and Advocacy. (2/5/2014)

New staff named. New SEC staff have been announced. Michael F. Maloney has been named the chief accountant in the SEC’s Division of Enforcement; David Fredrickson has been named associate director and chief counsel in the agency’s Division of Corporation Finance; Paul A. Leder has been named director of its Office of International Affairs; and Rick A. Fleming has been named as the first head of the agency’s Office of the Investor Advocate. Elizabeth Murphy has been named an associate director in the Division of Corporation Finance.