By Cydney Posner
It is a fairly common practice to include language in CTRs requesting that the company be notified if a person asks for disclosure of the CTR or the protected sections of the underlying document. To address concerns raised by the staff that this request makes the CTR impermissibly conditional, it is commonplace to add a statement to the effect that "the company emphasizes, however, that the above requests regarding the provision of notice and information to the company by the Commission should not be interpreted as conditions to its unconditional consent to the actual disclosure of the confidential information to governmental agencies, offices or bodies and to Congress." Sporadically, notwithstanding the express disclaimer, the staff has continued to reject the requesting language on the same basis.
In conversations with the Staff, we have been advised that requests for notification of further disclosure will no longer be permitted, nor will requests that any other governmental agency to which the information is disclosed afford confidential treatment similar to that granted by the Commission. This change apparently reflects a new staff policy focused on "cleaning up" CTR letters and making them "more concise." We were advised that the Staff intend to issue comments to this effect uniformly in the future.