Request for Comment on Subpart 400 of Regulation S-K Disclosure Requirements Relating to Management, Certain Security Holders and Corporate Governance Matters, 59927-59929 [2016-20906]
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Federal Register / Vol. 81, No. 169 / Wednesday, August 31, 2016 / Proposed Rules
Bulletin A340–57–5036, dated September 18,
2015; as applicable.
ehiers on DSK5VPTVN1PROD with PROPOSALS
(k) Other FAA AD Provisions
The following provisions also apply to this
AD:
(1) Alternative Methods of Compliance
(AMOCs): The Manager, International
Branch, ANM–116, Transport Airplane
Directorate, FAA, has the authority to
approve AMOCs for this AD, if requested
using the procedures found in 14 CFR 39.19.
In accordance with 14 CFR 39.19, send your
request to your principal inspector or local
Flight Standards District Office, as
appropriate. If sending information directly
to the International Branch, send it to ATTN:
Vladimir Ulyanov, Aerospace Engineer,
International Branch, ANM–116, Transport
Airplane Directorate, FAA, 1601 Lind
Avenue SW., Renton, WA 98057–3356;
telephone: 425–227–1138; fax: 425–227–
1149. Information may be emailed to: 9ANM-116-AMOC-REQUESTS@faa.gov.
Before using any approved AMOC, notify
your appropriate principal inspector, or
lacking a principal inspector, the manager of
the local flight standards district office/
certificate holding district office. The AMOC
approval letter must specifically reference
this AD.
(2) Contacting the Manufacturer: For any
requirement in this AD to obtain corrective
actions from a manufacturer, the action must
be accomplished using a method approved
by the Manager, International Branch, ANM–
116, Transport Airplane Directorate, FAA; or
the European Aviation Safety Agency
(EASA); or Airbus’s EASA Design
Organization Approval (DOA). If approved by
the DOA, the approval must include the
DOA-authorized signature.
(3) Required for Compliance (RC): If any
service information contains procedures or
tests that are identified as RC, those
procedures and tests must be done to comply
with this AD; any procedures or tests that are
not identified as RC are recommended. Those
procedures and tests that are not identified
as RC may be deviated from using accepted
methods in accordance with the operator’s
maintenance or inspection program without
obtaining approval of an AMOC, provided
the procedures and tests identified as RC can
be done and the airplane can be put back in
an airworthy condition. Any substitutions or
changes to procedures or tests identified as
RC require approval of an AMOC.
(l) Related Information
(1) Refer to Mandatory Continuing
Airworthiness Information (MCAI) EASA
Airworthiness Directive 2016–0082, dated
April 27, 2016, for related information. This
MCAI may be found in the AD docket on the
Internet at https://www.regulations.gov by
searching for and locating Docket No. FAA–
2016–8851.
(2) For service information identified in
this AD, contact Airbus SAS, Airworthiness
Office—EAL, 1 Rond Point Maurice Bellonte,
31707 Blagnac Cedex, France; telephone: +33
5 61 93 36 96; fax: +33 5 61 93 45 80; email:
airworthiness.A330-A340@airbus.com;
Internet: https://www.airbus.com. You may
view this service information at the FAA,
VerDate Sep<11>2014
14:16 Aug 30, 2016
Jkt 238001
Transport Airplane Directorate, 1601 Lind
Avenue SW., Renton, WA. For information
on the availability of this material at the
FAA, call 425–227–1221.
Issued in Renton, Washington, on August
18, 2016.
Dorr M. Anderson,
Acting Manager, Transport Airplane
Directorate, Aircraft Certification Service.
[FR Doc. 2016–20696 Filed 8–30–16; 8:45 am]
BILLING CODE 4910–13–P
SECURITIES AND EXCHANGE
COMMISSION
17 CFR Part 229
[Release No. 33–10198; 34–78687; File No.
S7–18–16]
Request for Comment on Subpart 400
of Regulation S–K Disclosure
Requirements Relating to
Management, Certain Security Holders
and Corporate Governance Matters
Securities and Exchange
Commission.
ACTION: Request for comment.
AGENCY:
The Commission is requesting
public comment on certain disclosure
requirements in Regulation S–K relating
to management, certain security holders,
and corporate governance matters
contained in Subpart 400. This request
is part of an initiative by the Division of
Corporation Finance to review the
disclosure requirements in Regulation
S–K to consider ways to improve them
for the benefit of investors and
registrants. Comments received in
response to this request for comment
will also inform the Commission’s study
on Regulation S–K, which is required by
Section 72003 of the Fixing America’s
Surface Transportation Act (‘‘FAST
Act’’).
SUMMARY:
Comments should be received on
or before October 31, 2016.
ADDRESSES: Comments may be
submitted by any of the following
methods:
DATES:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/other.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number S7–
18–16 in the subject line; or
• Use the Federal eRulemaking Portal
(https://www.regulations.gov). Follow the
instructions for submitting comments.
Paper Comments
• Send paper comments to Brent J.
Fields, Secretary, Securities and
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59927
Exchange Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number S7–18–16. This file number
should be included in the subject line
if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Web site (https://www.sec.gov/rules/
other.shtml). Comments also are
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. All comments
received will be posted without change;
we do not edit personal identifying
information from submissions. You
should submit only information that
you wish to make available publicly.
FOR FURTHER INFORMATION CONTACT:
Eduardo A. Aleman, Special Counsel,
Office of Rulemaking, Division of
Corporation Finance, at (202) 551–3430,
100 F Street NE., Washington, DC
20549.
SUPPLEMENTARY INFORMATION:
Background and Discussion
Over the years, the Commission has
evaluated its disclosure regime and
engaged periodically in rulemakings
designed to enhance its disclosure and
registration requirements.1 Most
recently, the Commission published a
concept release to seek public comment
on modernizing certain business and
financial disclosure requirements in
Regulation S–K.2 The purpose of the
Regulation S–K Concept Release is to
assess whether the business and
financial disclosure requirements in
Regulation S–K continue to provide the
information that investors need to make
informed investment and voting
decisions. The Regulation S–K Concept
Release focuses on the business and
financial disclosures that registrants
provide in their periodic reports, which
are a subset of the disclosure
requirements in Regulation S–K,
because many of them have changed
little since they were first adopted and
are often the foundation of the
disclosures investors look to when
making investment decisions. These
requirements have also been revisited
by the Commission or the staff less
1 For a summary of the relevant history and
background of Regulation S–K, see Business and
Financial Disclosure Required by Regulation S–K,
Release No. 33–10064 (Apr. 13, 2016) [81 FR 23916
(Apr. 22, 2016)] (‘‘Regulation S–K Concept
Release’’).
2 See id.
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Federal Register / Vol. 81, No. 169 / Wednesday, August 31, 2016 / Proposed Rules
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frequently in the recent past than other
disclosure requirements in Regulation
S–K, such as executive compensation
and governance contained in Subpart
400 of Regulation S–K.3 Last year, the
Commission also published a request for
comment to seek public input about the
financial disclosure requirements in
Regulation S–X for certain entities other
than a registrant.4
These efforts, in addition to this
request for comment, are part of a
comprehensive evaluation of the
Commission’s disclosure requirements
recommended in the staff’s Report on
Review of Disclosure Requirements in
Regulation S–K (‘‘S–K Study’’), which
was mandated by Section 108 of the
Jumpstart Our Business Startups Act
(‘‘JOBS Act’’).5 As noted in the
Regulation S–K Concept Release, based
on the S–K Study’s recommendation
and at the request of the Chair,
Commission staff initiated a
comprehensive evaluation of the type of
information our rules require registrants
to disclose, how this information is
presented, where and how this
information is disclosed, and how the
Commission can leverage technology as
part of these efforts (collectively,
‘‘Disclosure Effectiveness Initiative’’).
Section 72003(a) of the FAST Act 6 also
requires the Commission to carry out a
study of the requirements contained in
Regulation S–K.7 Specifically, Section
3 See, e.g., Executive Compensation and Related
Person Disclosure, Release No. 33–8732A (Aug. 29,
2006) [71 FR 53157 (Sept. 8, 2006)]; Proxy
Disclosure Enhancements, Release No. 33–9089
(Dec. 16, 2009) [74 FR 68333 (Dec. 23, 2009)]; Staff
Observations in the Review of Executive
Compensation Disclosure, Division of Corporation
Finance (Oct. 9, 2007), available at https://
www.sec.gov/divisions/corpfin/guidance/
execcompdisclosure.htm. As the Commission noted
in the Regulation S–K Concept Release, the scope
of that release does not include certain disclosure
requirements for information other than business
and financial disclosures, such as Subpart 400,
which requires disclosure about management and
certain security holders as well as corporate
governance matters. See Regulation S–K Concept
Release, supra note 1, at Section I, n. 4. This request
for comment directly covers those subjects.
4 See Request for Comment on the Effectiveness
of Financial Disclosures about Entities Other Than
the Registrant, Release No. 33–9929 (Sept. 25, 2015)
[80 FR 59083 (Oct. 1, 2015)].
5 Public Law 112–106, Sec. 108, 126 Stat. 306
(2012). Section 108 of the JOBS Act requires the
Commission to conduct a review of Regulation S–
K to determine how such requirements can be
updated to modernize and simplify the registration
process for emerging growth companies. The S–K
Study is available at https://www.sec.gov/news/
studies/2013/reg-sk-disclosure-requirementsreview.pdf. For a further discussion of the S–K
Study, see the Regulation S–K Concept Release,
supra note 1, at Section II.C.
6 Public Law 114–94, Sec. 72003, 129 Stat. 1312
(2015).
7 In conducting this study, the Commission is
required to consult with the Investor Advisory
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Jkt 238001
72003(a) requires that the study of
Regulation S–K:
• Determine how best to modernize
and simplify such requirements in a
manner that reduces the costs and
burdens on issuers while still providing
all material information;
• Emphasize a company-by-company
approach that allows relevant and
material information to be disseminated
to investors without boilerplate
language or static requirements while
preserving completeness and
comparability of information across
registrants; and
• Evaluate methods of information
delivery and presentation and explore
methods for discouraging repetition and
the disclosure of immaterial
information.8
Request for Comment
The initiative to review the disclosure
requirements in Regulation S–K is
intended to result in recommendations
and proposals that will improve our
disclosure system for the benefit of
investors and registrants. The purpose
of this request for comment is to solicit
public input on Subpart 400 of
Regulation S–K, which requires certain
disclosures about a registrant’s
management, certain security holders,
and corporate governance matters.9 The
input can include comments on existing
requirements in these rules as well as on
potential disclosure issues that
commenters believe the rules should
address.10 The comments received in
response to this request for comment, as
well as comments received in response
to the Regulation S–K Concept Release,
will inform the Commission in carrying
out the study of Regulation S–K
required by Section 72003(a) of the
FAST Act.11
• Item 401 of Regulation S–K
generally requires certain disclosures
about a registrant’s directors, executive
officers, promoters and control
persons.12
Committee and the Advisory Committee on Small
and Emerging Companies.
8 Public Law 114–94, Sec. 72003, 129 Stat. 1312
(2015).
9 17 CFR 229.401 et seq.
10 For example, as noted in the Regulation S–K
Concept Release, supra note 1, this could include
industry-specific disclosure requirements,
information about sustainability and governance
matters, and additional instances in which scaled
disclosure could be implemented.
11 Comment letters received in response to this
request for comment will be considered in
connection with any future rulemaking related to
the disclosure requirements in Subpart 400 of
Regulation S–K. If the Commission proposes
changes to these disclosure requirements the
proposed changes will be subject to public notice
and comment.
12 17 CFR 229.401.
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• Item 402 of Regulation S–K
generally requires disclosure of all plan
and non-plan compensation awarded to,
earned by, or paid to a registrant’s
named executive officers and
directors.13
• Item 403 of Regulation S–K
generally requires a description of the
security ownership of certain beneficial
owners and management.14
• Item 404 of Regulation S–K
generally requires a description of
certain transactions with related
persons, promoters and certain control
persons.15
• Item 405 of Regulation S–K
generally requires a registrant to identify
certain persons who failed to file on a
timely basis, as disclosed in certain
forms, reports required by Section 16(a)
of the Securities Exchange Act 16 during
the most recent fiscal year or prior fiscal
years.17
• Item 406 of Regulation S–K
generally requires disclosures about
whether the registrant has adopted a
code of ethics that applies to certain of
the registrant’s executive officers, or
persons performing similar functions,
and, if it has not adopted such a code
of ethics, an explanation why it has not
done so.18
• Item 407 of Regulation S–K
generally requires certain corporate
governance disclosure about director
independence, board meetings, various
board committees (e.g., nominating,
audit and compensation committees)
and any process for shareholder
communications.19
In connection with the staff’s
continuing Disclosure Effectiveness
Initiative and corresponding work on
the FAST Act mandate, the Commission
welcomes public comments on the
issues that the staff should consider in
conducting its review of Subpart 400 of
Regulation S–K, including, among other
things, how best to modernize and
13 17 CFR 229.402. Item 402 also describes the
disclosure requirements for certain categories of
registrants such as foreign private issuers and
smaller reporting companies. The Commission has
a number of outstanding proposals related to
executive compensation disclosure and listing
requirements. See Disclosure of Hedging by
Employees, Officers and Directors, Release No. 33–
9723 (Feb. 9, 2015) [80 FR 8485 (Feb. 17, 2015)];
Pay Versus Performance, Release 34–74835 (Apr.
29, 2015) [80 FR 26329 (May 7, 2015)]; Listing
Standards for Recovery of Erroneously Awarded
Compensation, Release No. 33–9861 (July 1, 2015)
[80 FR 41143 (July 14, 2015)]. This release requests
comment on the disclosure requirements in Item
402 generally and is not intended to solicit specific
comment on those proposals.
14 17 CFR 229.403.
15 17 CFR 229.404.
16 15 U.S.C. 78p.
17 17 CFR 229.405.
18 17 CFR 229.406.
19 17 CFR 229.407.
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Federal Register / Vol. 81, No. 169 / Wednesday, August 31, 2016 / Proposed Rules
simplify these disclosure items in view
of the objectives of the Regulation S–K
study set forth in Section 72003 of the
FAST Act and whether additional
disclosures in these areas are necessary
or appropriate to facilitate investor
protection, to maintain fair, orderly, and
efficient markets, and/or to facilitate
capital formation. In addition to the
substance of the disclosure
requirements, the Commission
welcomes comments on how
information can be presented to
improve its readability, navigability and
comparability and how technology and
structured data can facilitate data
aggregation and analysis. All interested
parties are invited to submit their views
and any data, in writing, on any matter
relating to Subpart 400 of Regulation
S–K.
By the Commission.
Dated: August 25, 2016.
Brent J. Fields,
Secretary.
[FR Doc. 2016–20906 Filed 8–30–16; 8:45 am]
BILLING CODE 8011–01–P
DEPARTMENT OF JUSTICE
Drug Enforcement Administration
21 CFR Part 1308
[Docket No. DEA–442]
Schedules of Controlled Substances:
Temporary Placement of Mitragynine
and 7-Hydroxymitragynine Into
Schedule I
Drug Enforcement
Administration, Department of Justice.
ACTION: Notice of intent.
AGENCY:
The Administrator of the Drug
Enforcement Administration is issuing
this notice of intent to temporarily
schedule the opioids mitragynine and 7hydroxymitragynine, which are the
main active constituents of the plant
kratom, into schedule I pursuant to the
temporary scheduling provisions of the
Controlled Substances Act. This action
is based on a finding by the
Administrator that the placement of
these opioids into schedule I of the
Controlled Substances Act is necessary
to avoid an imminent hazard to the
public safety. Any final order will
impose the administrative, civil, and
criminal sanctions and regulatory
controls applicable to schedule I
controlled substances under the
Controlled Substances Act on the
manufacture, distribution, possession,
importation, and exportation of, and
ehiers on DSK5VPTVN1PROD with PROPOSALS
SUMMARY:
VerDate Sep<11>2014
14:16 Aug 30, 2016
Jkt 238001
research and conduct of instructional
activities of these opioids.
DATES: August 31, 2016.
FOR FURTHER INFORMATION CONTACT:
Michael J. Lewis, Office of Diversion
Control, Drug Enforcement
Administration; Mailing Address: 8701
Morrissette Drive, Springfield, Virginia
22152; Telephone: (202) 598–6812.
SUPPLEMENTARY INFORMATION: Any final
order will be published in the Federal
Register and may not be effective prior
to September 30, 2016.
Legal Authority
The Drug Enforcement
Administration (DEA) implements and
enforces titles II and III of the
Comprehensive Drug Abuse Prevention
and Control Act of 1970, as amended. 21
U.S.C. 801–971. Titles II and III are
referred to as the ‘‘Controlled
Substances Act’’ and the ‘‘Controlled
Substances Import and Export Act,’’
respectively, and are collectively
referred to as the ‘‘Controlled
Substances Act’’ or the ‘‘CSA’’ for the
purpose of this action. The DEA
publishes the implementing regulations
for these statutes in title 21 of the Code
of Federal Regulations (CFR), chapter II.
The CSA and its implementing
regulations are designed to prevent,
detect, and eliminate the diversion of
controlled substances and listed
chemicals into the illicit market while
providing for the legitimate medical,
scientific, research, and industrial needs
of the United States. Controlled
substances have the potential for abuse
and dependence and are controlled to
protect the public health and safety.
Under the CSA, each controlled
substance is classified into one of five
schedules based upon its potential for
abuse, its currently accepted medical
use in treatment in the United States,
and the degree of dependence the drug
or other substance may cause. 21 U.S.C.
812. The initial schedules of controlled
substances established by Congress are
found at 21 U.S.C. 812(c), and the
current list of all scheduled substances
is published at 21 CFR part 1308.
Section 201 of the CSA, 21 U.S.C. 811,
provides the Attorney General with the
authority to temporarily place a
substance into schedule I of the CSA for
two years without regard to the
requirements of 21 U.S.C. 811(b) if she
finds that such action is necessary to
avoid an imminent hazard to the public
safety. 21 U.S.C. 811(h)(1). In addition,
if proceedings to control a substance are
initiated under 21 U.S.C. 811(a)(1), the
Attorney General may extend the
temporary scheduling for up to one
year. 21 U.S.C. 811(h)(2).
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Sfmt 4702
59929
Where the necessary findings are
made, a substance may be temporarily
scheduled if it is not listed in any other
schedule under section 202 of the CSA,
21 U.S.C. 812, or if there is no
exemption or approval in effect for the
substance under section 505 of the
Federal Food, Drug, and Cosmetic Act
(FDCA), 21 U.S.C. 355. 21 U.S.C.
811(h)(1). The Attorney General has
delegated scheduling authority under 21
U.S.C. 811 to the Administrator of the
DEA. 28 CFR 0.100.
Background
Section 201(h)(4) of the CSA, 21
U.S.C. 811(h)(4), requires the
Administrator to notify the Secretary of
the Department of Health and Human
Services (HHS) of his intention to
temporarily place a substance into
schedule I of the CSA.1 The
Administrator transmitted notice of his
intent to place mitragynine and 7hydroxymitragynine in schedule I on a
temporary basis to the Assistant
Secretary by letter dated May 6, 2016.
The Assistant Secretary responded to
this notice by letter dated May 18, 2016,
and advised that based on review by the
Food and Drug Administration (FDA),
there are currently no investigational
new drug applications or approved new
drug applications for mitragynine and 7hydroxymitragynine. The Assistant
Secretary also stated that the HHS has
no objection to the temporary placement
of mitragynine and 7hydroxymitragynine into schedule I of
the CSA. Neither mitragynine nor 7hydroxymitragynine is currently listed
in any schedule under the CSA, and no
approved new drug applications or
investigational new drug applications
for mitragynine or 7hydroxymitragynine exist, 21 U.S.C.
355. The DEA has found that the control
of mitragynine and 7hydroxymitragynine in schedule I on a
temporary basis is necessary to avoid an
imminent hazard to public safety.
To find that placing a substance
temporarily into schedule I of the CSA
is necessary to avoid an imminent
hazard to the public safety, the
Administrator is required to consider
three of the eight factors set forth in
section 201(c) of the CSA, 21 U.S.C.
1 As discussed in a memorandum of
understanding entered into by the Food and Drug
Administration (FDA) and the National Institute on
Drug Abuse (NIDA), the FDA acts as the lead agency
within the Department of Health and Human
Services (HHS) in carrying out the Secretary’s
scheduling responsibilities under the CSA, with the
concurrence of NIDA. 50 FR 9518, Mar. 8, 1985.
The Secretary of the HHS has delegated to the
Assistant Secretary for Health of the HHS the
authority to make domestic drug scheduling
recommendations. 58 FR 35460, July 1, 1993.
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Agencies
[Federal Register Volume 81, Number 169 (Wednesday, August 31, 2016)]
[Proposed Rules]
[Pages 59927-59929]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-20906]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
17 CFR Part 229
[Release No. 33-10198; 34-78687; File No. S7-18-16]
Request for Comment on Subpart 400 of Regulation S-K Disclosure
Requirements Relating to Management, Certain Security Holders and
Corporate Governance Matters
AGENCY: Securities and Exchange Commission.
ACTION: Request for comment.
-----------------------------------------------------------------------
SUMMARY: The Commission is requesting public comment on certain
disclosure requirements in Regulation S-K relating to management,
certain security holders, and corporate governance matters contained in
Subpart 400. This request is part of an initiative by the Division of
Corporation Finance to review the disclosure requirements in Regulation
S-K to consider ways to improve them for the benefit of investors and
registrants. Comments received in response to this request for comment
will also inform the Commission's study on Regulation S-K, which is
required by Section 72003 of the Fixing America's Surface
Transportation Act (``FAST Act'').
DATES: Comments should be received on or before October 31, 2016.
ADDRESSES: Comments may be submitted by any of the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/other.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number S7-18-16 in the subject line; or
Use the Federal eRulemaking Portal (https://www.regulations.gov). Follow the instructions for submitting comments.
Paper Comments
Send paper comments to Brent J. Fields, Secretary,
Securities and Exchange Commission, 100 F Street NE., Washington, DC
20549-1090.
All submissions should refer to File Number S7-18-16. This file number
should be included in the subject line if email is used. To help the
Commission process and review your comments more efficiently, please
use only one method. The Commission will post all comments on the
Commission's Web site (https://www.sec.gov/rules/other.shtml). Comments
also are available for Web site viewing and printing in the
Commission's Public Reference Room, 100 F Street NE., Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. All comments received will be posted without change; we do
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly.
FOR FURTHER INFORMATION CONTACT: Eduardo A. Aleman, Special Counsel,
Office of Rulemaking, Division of Corporation Finance, at (202) 551-
3430, 100 F Street NE., Washington, DC 20549.
SUPPLEMENTARY INFORMATION:
Background and Discussion
Over the years, the Commission has evaluated its disclosure regime
and engaged periodically in rulemakings designed to enhance its
disclosure and registration requirements.\1\ Most recently, the
Commission published a concept release to seek public comment on
modernizing certain business and financial disclosure requirements in
Regulation S-K.\2\ The purpose of the Regulation S-K Concept Release is
to assess whether the business and financial disclosure requirements in
Regulation S-K continue to provide the information that investors need
to make informed investment and voting decisions. The Regulation S-K
Concept Release focuses on the business and financial disclosures that
registrants provide in their periodic reports, which are a subset of
the disclosure requirements in Regulation S-K, because many of them
have changed little since they were first adopted and are often the
foundation of the disclosures investors look to when making investment
decisions. These requirements have also been revisited by the
Commission or the staff less
[[Page 59928]]
frequently in the recent past than other disclosure requirements in
Regulation S-K, such as executive compensation and governance contained
in Subpart 400 of Regulation S-K.\3\ Last year, the Commission also
published a request for comment to seek public input about the
financial disclosure requirements in Regulation S-X for certain
entities other than a registrant.\4\
---------------------------------------------------------------------------
\1\ For a summary of the relevant history and background of
Regulation S-K, see Business and Financial Disclosure Required by
Regulation S-K, Release No. 33-10064 (Apr. 13, 2016) [81 FR 23916
(Apr. 22, 2016)] (``Regulation S-K Concept Release'').
\2\ See id.
\3\ See, e.g., Executive Compensation and Related Person
Disclosure, Release No. 33-8732A (Aug. 29, 2006) [71 FR 53157 (Sept.
8, 2006)]; Proxy Disclosure Enhancements, Release No. 33-9089 (Dec.
16, 2009) [74 FR 68333 (Dec. 23, 2009)]; Staff Observations in the
Review of Executive Compensation Disclosure, Division of Corporation
Finance (Oct. 9, 2007), available at https://www.sec.gov/divisions/corpfin/guidance/execcompdisclosure.htm. As the Commission noted in
the Regulation S-K Concept Release, the scope of that release does
not include certain disclosure requirements for information other
than business and financial disclosures, such as Subpart 400, which
requires disclosure about management and certain security holders as
well as corporate governance matters. See Regulation S-K Concept
Release, supra note 1, at Section I, n. 4. This request for comment
directly covers those subjects.
\4\ See Request for Comment on the Effectiveness of Financial
Disclosures about Entities Other Than the Registrant, Release No.
33-9929 (Sept. 25, 2015) [80 FR 59083 (Oct. 1, 2015)].
---------------------------------------------------------------------------
These efforts, in addition to this request for comment, are part of
a comprehensive evaluation of the Commission's disclosure requirements
recommended in the staff's Report on Review of Disclosure Requirements
in Regulation S-K (``S-K Study''), which was mandated by Section 108 of
the Jumpstart Our Business Startups Act (``JOBS Act'').\5\ As noted in
the Regulation S-K Concept Release, based on the S-K Study's
recommendation and at the request of the Chair, Commission staff
initiated a comprehensive evaluation of the type of information our
rules require registrants to disclose, how this information is
presented, where and how this information is disclosed, and how the
Commission can leverage technology as part of these efforts
(collectively, ``Disclosure Effectiveness Initiative''). Section
72003(a) of the FAST Act \6\ also requires the Commission to carry out
a study of the requirements contained in Regulation S-K.\7\
Specifically, Section 72003(a) requires that the study of Regulation S-
K:
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\5\ Public Law 112-106, Sec. 108, 126 Stat. 306 (2012). Section
108 of the JOBS Act requires the Commission to conduct a review of
Regulation S-K to determine how such requirements can be updated to
modernize and simplify the registration process for emerging growth
companies. The S-K Study is available at https://www.sec.gov/news/studies/2013/reg-sk-disclosure-requirements-review.pdf. For a
further discussion of the S-K Study, see the Regulation S-K Concept
Release, supra note 1, at Section II.C.
\6\ Public Law 114-94, Sec. 72003, 129 Stat. 1312 (2015).
\7\ In conducting this study, the Commission is required to
consult with the Investor Advisory Committee and the Advisory
Committee on Small and Emerging Companies.
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Determine how best to modernize and simplify such
requirements in a manner that reduces the costs and burdens on issuers
while still providing all material information;
Emphasize a company-by-company approach that allows
relevant and material information to be disseminated to investors
without boilerplate language or static requirements while preserving
completeness and comparability of information across registrants; and
Evaluate methods of information delivery and presentation
and explore methods for discouraging repetition and the disclosure of
immaterial information.\8\
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\8\ Public Law 114-94, Sec. 72003, 129 Stat. 1312 (2015).
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Request for Comment
The initiative to review the disclosure requirements in Regulation
S-K is intended to result in recommendations and proposals that will
improve our disclosure system for the benefit of investors and
registrants. The purpose of this request for comment is to solicit
public input on Subpart 400 of Regulation S-K, which requires certain
disclosures about a registrant's management, certain security holders,
and corporate governance matters.\9\ The input can include comments on
existing requirements in these rules as well as on potential disclosure
issues that commenters believe the rules should address.\10\ The
comments received in response to this request for comment, as well as
comments received in response to the Regulation S-K Concept Release,
will inform the Commission in carrying out the study of Regulation S-K
required by Section 72003(a) of the FAST Act.\11\
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\9\ 17 CFR 229.401 et seq.
\10\ For example, as noted in the Regulation S-K Concept
Release, supra note 1, this could include industry-specific
disclosure requirements, information about sustainability and
governance matters, and additional instances in which scaled
disclosure could be implemented.
\11\ Comment letters received in response to this request for
comment will be considered in connection with any future rulemaking
related to the disclosure requirements in Subpart 400 of Regulation
S-K. If the Commission proposes changes to these disclosure
requirements the proposed changes will be subject to public notice
and comment.
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Item 401 of Regulation S-K generally requires certain
disclosures about a registrant's directors, executive officers,
promoters and control persons.\12\
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\12\ 17 CFR 229.401.
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Item 402 of Regulation S-K generally requires disclosure
of all plan and non-plan compensation awarded to, earned by, or paid to
a registrant's named executive officers and directors.\13\
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\13\ 17 CFR 229.402. Item 402 also describes the disclosure
requirements for certain categories of registrants such as foreign
private issuers and smaller reporting companies. The Commission has
a number of outstanding proposals related to executive compensation
disclosure and listing requirements. See Disclosure of Hedging by
Employees, Officers and Directors, Release No. 33-9723 (Feb. 9,
2015) [80 FR 8485 (Feb. 17, 2015)]; Pay Versus Performance, Release
34-74835 (Apr. 29, 2015) [80 FR 26329 (May 7, 2015)]; Listing
Standards for Recovery of Erroneously Awarded Compensation, Release
No. 33-9861 (July 1, 2015) [80 FR 41143 (July 14, 2015)]. This
release requests comment on the disclosure requirements in Item 402
generally and is not intended to solicit specific comment on those
proposals.
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Item 403 of Regulation S-K generally requires a
description of the security ownership of certain beneficial owners and
management.\14\
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\14\ 17 CFR 229.403.
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Item 404 of Regulation S-K generally requires a
description of certain transactions with related persons, promoters and
certain control persons.\15\
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\15\ 17 CFR 229.404.
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Item 405 of Regulation S-K generally requires a registrant
to identify certain persons who failed to file on a timely basis, as
disclosed in certain forms, reports required by Section 16(a) of the
Securities Exchange Act \16\ during the most recent fiscal year or
prior fiscal years.\17\
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\16\ 15 U.S.C. 78p.
\17\ 17 CFR 229.405.
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Item 406 of Regulation S-K generally requires disclosures
about whether the registrant has adopted a code of ethics that applies
to certain of the registrant's executive officers, or persons
performing similar functions, and, if it has not adopted such a code of
ethics, an explanation why it has not done so.\18\
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\18\ 17 CFR 229.406.
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Item 407 of Regulation S-K generally requires certain
corporate governance disclosure about director independence, board
meetings, various board committees (e.g., nominating, audit and
compensation committees) and any process for shareholder
communications.\19\
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\19\ 17 CFR 229.407.
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In connection with the staff's continuing Disclosure Effectiveness
Initiative and corresponding work on the FAST Act mandate, the
Commission welcomes public comments on the issues that the staff should
consider in conducting its review of Subpart 400 of Regulation S-K,
including, among other things, how best to modernize and
[[Page 59929]]
simplify these disclosure items in view of the objectives of the
Regulation S-K study set forth in Section 72003 of the FAST Act and
whether additional disclosures in these areas are necessary or
appropriate to facilitate investor protection, to maintain fair,
orderly, and efficient markets, and/or to facilitate capital formation.
In addition to the substance of the disclosure requirements, the
Commission welcomes comments on how information can be presented to
improve its readability, navigability and comparability and how
technology and structured data can facilitate data aggregation and
analysis. All interested parties are invited to submit their views and
any data, in writing, on any matter relating to Subpart 400 of
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Regulation S-K.
By the Commission.
Dated: August 25, 2016.
Brent J. Fields,
Secretary.
[FR Doc. 2016-20906 Filed 8-30-16; 8:45 am]
BILLING CODE 8011-01-P