Section 942(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) eliminated the automatic suspension of the duty to file under Section 15(d) of the Exchange Act for asset-backed securities issuers; it also granted the SEC the authority to issue rules providing for the suspension or termination of such duty.
Before the enactment of the Dodd-Frank Act, Section 15(d) of the Exchange Act provided that for issuers without a class of securities registered under the Exchange Act the duty to file ongoing reports is automatically suspended as to any fiscal year, other than the fiscal year within which the registration statement for the securities became effective, if the securities of each class to which the registration statement relates are held of record by fewer than 300 persons.
On August 17, 2011, pursuant to Section 942(a) of the Dodd-Frank Act, the SEC adopted final rules to provide certain thresholds for suspension of the reporting obligations for asset-backed securities issuers.
The final rules, as adopted, provide that the duty to file annual and other reports under Section 15(d) is suspended in either of these instances:
- as to any semi-annual fiscal period, if, at the beginning of the semi-annual fiscal period, other than a period in the last fiscal year within which the registration statement became effective or, for shelf offerings, a takedown occurred, there are no asset-backed securities of such class that were sold in a registered transaction held by non-affiliates of the depositor and a certification on Form 15 has been filed
- when there are no asset-backed securities of such class that were sold in a registered transaction, immediately upon the filing with the SEC of a certification on Form 15 if the issuer has filed all required reports for the most recent three fiscal years