The U.S. SEC released a proposal this week directing national securities exchanges to require compliance with new independence requirements for compensation committees. The proposed requirements address matters such as independence of compensation consultants, the compensation committee's ability to retain independent advisers and the compensation committee's responsibility for appointing, compensating and supervising the work of such advisers.

While foreign private issuers (FPIs) would be exempt from the proposed requirements where they provide annual disclosures to shareholders of the reasons for not maintaining an independent compensation committee, those subject to U.S. proxy rules would be subject to similar requirements and the proposal further requests comments as to whether FPIs should have to provide such disclosure on Forms 20-F and 40-F. The SEC is accepting comments on its proposals until April 29, 2011.