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SEC Provides COVID-19 Guidance

Monday, March 30, 2020  
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The Securities and Exchange Commission recently issued two notifications providing guidance regarding securities law obligations as a result of the COVID-19 outbreak and related business disruptions.

On March 20, 2020, the SEC announced an exemption from some provisions of the Securities Exchange Act of 1934. Recognizing the challenges of complying with Sections 17A and 17(f) of the Exchange Act, and related rules, the order temporarily exempts transfer agents and other subject to these regulations from March 16, 2020, to May 30, 2020, under certain conditions. See the full notice for details.

On March 25, 2020, the SEC’s Division of Corporation Finance provided guidance regarding disclosure and other securities law obligations in light of COVID-19 related disruptions.

“Companies should consider the need for COVID-19-related disclosures within the context of the federal securities laws and our principles-based disclosure system,” the guidance says. “The cornerstone of this system is disclosure of material information that is widely disseminated. It is only with this type of disclosure that all investors can make informed decisions.”

The notification includes a list of questions to consider when evaluating disclosure requirements, along with clarification regarding insider trading and earning estimates with respect to COVID-19 issues. See the complete guidance.