In a February 23 speech at the Annual Conference on Securities Regulation and Business Law, John White, the Director of the Division of Corporation Finance of the Securities and Exchange Commission, outlined various projects that are on the Division’s near-term calendar for 2007.
Two items that Mr. White indicated were imminent were foreign issuer deregistration and internet availability of proxy materials (or E-Proxy). In December 2006, the Commission voted to issue a revised proposal concerning amendments to its rules regarding how foreign private issuers may terminate their registration with the Commission. Mr. White indicated that the Division hopes to make a recommendation for a final rule in the very near future.
In 2006, the Commission also adopted rules allowing companies to deliver proxy materials by a “notice and access” model, which would allow the posting of proxy materials electronically rather than sending paper copies. However, the Commission has also proposed and sought comments on an expansion of this model which would require that electronic proxy materials be available for shareholders of all public companies. Mr. White indicated that the Division will move quickly following the end of the comment period on March 30 to make a recommendation for a final rule to the Commission.
Mr. White also discussed the Commission’s upcoming roundtable on International Financial Reporting Standards (IFRS), which will explore the current state of the “roadmap” laid out by the former SEC Chief Accountant as to how the Commission might eliminate the requirement that companies filing IFRS financial statements reconcile those with U.S. Generally Accepted Accounting Principles. Mr. White suggested that the Commission will be devoting considerable attention following the roundtable to developing and announcing next steps and indicated that he believed the time when the staff would recommend the “end of reconciliation” was clearly in sight.
Among the other things Mr. White discussed were the following:
- The Division is developing a plan for targeted reviews of the newly required executive compensation disclosure in proxy statements and will issue guidance to assist in conveying the Division’s observations to issuers for the 2008 proxy season;
- To further its focus on Extensible Business Reporting Language, or XBRL, the SEC plans to apply interactive data to certain of the new executive compensation disclosures, and will make some of such data available to the public on a demonstration basis;
- The Commission continues to look at possible rulemaking in the area of shareholder access to corporate proxies, with a goal to act in time for the 2008 proxy season; and
- The Division is studying various methods of private offering reform and relief for small business capital raising and hopes to issue a proposal by this summer.