Corporate Governance

How the Wall Street Reform Act Impacts Smaller Businesses: Shareholder Reporting ? Schedule 13D and Section 16(a)

By J Robert Brown Jr.

The Act amends § 13(d) and § 16 of the 1934. Section 13(d) imposes certain reporting requirements on persons who own more than 5 percent of the outstanding securities of a company registered under Section 12 of the 1934 Act. Section 16 imposes other reporting requirements on officers and directors of companies that have securities registered under the 1934 Act (as well as persons owning more than 10 percent of the outstanding securities of such companies) and also imposes potential liability for trading in those securities within a six month period.38 Currently the requirements for an initial filing (made under § 13(d) in a Schedule 13D and under § 16(a) on a Form 3) is ten days after the event that imposes the reporting requirement.39 Section 929R of the Act gives the SEC the discretion to reduce the ten days to a lesser number of days under both § 13(d) and § 16(a).?

Herrick K. Lidstone, Jr., Burns Figa & Will, PC

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38 See general discussion in Lidstone, Securities Law Deskbook (Bradford Publishing Co.) at §§ 16.18 and 17.7.
39 1934 Act, § 13(d)(1) and § 16(a)(2)(B).

Full post as published by The Race to the Bottom on July 29, 2010 (boomark / email).