The CTA and its implementing regulations have created a number of new risks and responsibilities. We understand the difficulty in sorting through these new requirements, let alone complying with them. This Alert provides guidance for public companies.
The SEC has adopted a number of substantive new rules that will require new disclosures as soon as December 18, 2023 for material cybersecurity incidents on Form 8-K.
On October 10, 2023, the SEC adopted final rules governing beneficial ownership reporting under Sections 13(d) and 13(g) of the Securities Exchange Act of 1934. These sections, along with Regulations 13D and 13G, require an investor who beneficially owns more than 5% of a covered class of equity securities to publicly file either a Schedule 13D (investors with control intent) or a Schedule 13G (investors without a control intent).
The rule, proposed in March 2022, includes requirements about current disclosure of material cybersecurity incidents, and periodic disclosures about a registrant’s processes to assess, identify, and manage material cybersecurity risks.
Given the expected increase in scrutiny of issuer buybacks, we recommend that companies consider taking some or all of the actions noted in this Alert before the fourth quarter of this year.
What should companies be doing now?
Set to go into effect on October 11, 2022, new Item 402(v) requires companies to make these disclosures in proxy statements and information statements for fiscal years ending on or after December 16, 2022, thus greatly impacting the 2023 proxy season.
Update regarding the SEC's proposed amendments.
