SEC Regulatory Priorities

SEC’s Spring 2022 Regulatory Flexibility Agenda

The SEC published its spring 2022 regulatory priorities for the next 12 months. Key items on the short-term agenda:

• Tailored Shareholder Reports (final rulemaking October 2022)
• Move to T+1 settlement cycle (final rulemaking October 2022)
• Fund fee disclosure and reform (new item with proposed rulemaking listed as October 2022)
• Corporate issuer disclosure proposals (e.g., Climate Change, Cyber and Human Capital Management)

Other Noteworthy Items:

• Form N-PX amendments (final rulemaking October 2022)
• Digital engagement practices for investment advisors (new item on short-term agenda with same proposal for broker-dealers moved from long-term agenda to short-term, proposed rulemaking October 2022)
• Broker-dealer electronic books and records (final rulemaking pushed back to October 2022)
• Rule 14a-8 amendments (amendments were proposed at July 13 open meeting)
• Regulation ATS modernization (new item)
• Consolidated Audit Trail (updated due date October 2022)
• Money Market reform (final rulemaking October 2022)
• Transfer agents rule amendments (moved from short-term to long-term agenda)
• Universal Proxy Rule (goes into effect for meeting held after August 31, 2022)

SEC short-term agenda of priority items for the next 12 months.

SEC long-term agenda (lower priority items, may still be addressed by the SEC).

SEC Rulemaking

SEC adopts amendments to proxy rules governing proxy voting advice

On July 13, the SEC modified the rules governing proxy advisers – they will no longer be required to provide (1) their voting recommendations to issuers at or before they are provided to clients and, (2) their clients with a mechanism to become aware of the issuers written response.

Read the press release, fact sheet and adopting release.

SEC proposes amendments to Shareholder Proposal Rule (Rule 14a-8)

On July 13, the SEC proposed amendments to the rule that governs the process for including shareholder proposals in a company’s proxy statement. The amendments would revise three of the substantive bases for exclusion of shareholder proposals under the rule: the substantial implementation exclusion; the duplication exclusion; and the resubmission exclusion.

Read the press release, fact sheet and proposing release.

SEC adopts rules to require electronic filing for investment advisers and institutional investment managers

On June 23, the SEC adopted amendments to require certain documents filed by investment advisers, institutional investment managers and certain other entities to be filed or submitted electronically.

Review the press release and adopting release.

SEC requests information and comment on Advisers Act regulatory status of index providers, model portfolio providers and pricing services

On June 15, the SEC announced it is requesting information and public comment on matters related to the activities of certain “information providers,” including whether, under particular facts and circumstances, information providers are acting as “investment advisers” under the Advisers Act.

Read the press release.

SEC Leadership Changes and Other Actions

New SEC Commissioners Jaime Lizárraga and Mark Uyeda

On June 16, the SEC issued a statement announcing the Senate Confirmation of Jaime Lizárraga and Mark Uyeda to serve as commissioners.

Read the SEC statement.

Read the press release announcing the swearing in of Jaime Lizárraga as a commissioner.

Read the press release announcing the swearing in of Mark T. Uyeda as a commissioner.

SEC charges firm and five brokers with violations of Regulation Best Interest (Reg BI)

On June 16, the SEC charged a registered broker-dealer and five of its registered representatives with violating Reg BI’s Obligation requirements.

Read the press release.

Department of Labor’s (DOL) Regulatory Priorities

DOL’s Spring 2022 Regulatory Flexibility Agenda

The DOL published its spring 2022 regulatory priorities for the next 12 months. Key items on the short-term agenda include:

• Updates to the DOL’s Fiduciary definition
• Prudence and loyalty in selecting plan investments and exercising shareholder rights
• Improving participant engagement and effectiveness of ERISA retirement plan disclosures

Review the DOL’s Spring 2022 Regulatory Flexibility Agenda.

FINRA

Regulation Best Interest and Form CRS: Two Years In

On June 28, FINRA posted a podcast to mark the second anniversary of the implementation of Regulation Best Interest and Form CRS.

Listen to the podcast.

FINRA requests comment on proposed trade reporting requirements for over-the-counter options transactions

FINRA is soliciting comment on a proposal to establish a new trade reporting requirement for transactions in over-the-counter options on securities with terms identical or substantially similar to listed options.

Read Regulatory Notice 22-14.

Exemption from trade reporting obligation for certain transactions on alternative trading systems (ATS)

FINRA has adopted amendments to Rule 6732 (Exemption from Trade Reporting Obligation for Certain Transactions on an Alternative Trading System) to expand the scope of the exemption to include eligible ATS transactions involving only one member (other than the ATS).

Read Regulatory Notice 22-13.