Proxy access still too hot to handle

By: Cydney Posner

In October, the SEC had announced that it would consider a number of important issues at its December open meeting: recommendations regarding proposed guidance to management on SOX 404, deregistration of foreign private issuers, internet availability of proxy materials and Rule 14a-8 shareholder proposals regarding proxy access. Apparently, some of those issues are still unresolved and will not be considered at the meeting as planned. In particular, the SEC agenda posted at the last minute yesterday (last minute to comply with Sunshine Act requirements) does not include any mention of proxy access, a controversial topic that has already been postponed once from a planned October meeting. Also postponed is the plan to adopt a rule to ease deregistration for foreign private issuers. Instead, the SEC has decided to repropose the rule with significant changes. Apparently, as originally proposed, the rule used thresholds based primarily on the percentage of U.S. holders and on trading volume, but would have permitted few foreign private issuers to terminate registration; the new rule proposal will include deregistration thresholds based solely on trading volume.

Added to the December agenda are proposals for a new antifraud rule under Section 206 of the Investment Advisers Act of 1940, aimed at hedge funds, as well as a proposed new rule to revise the criteria (i.e., raise the bar) for natural persons to be considered accredited investors for purposes of investing in certain privately offered investment vehicles.

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