SEC Amends Regulatory Requirements for Timely Disclosure of Beneficial Ownership Information
The Securities and Exchange Commission has adopted rule amendments that update Regulation 13D-G beneficial ownership reporting requirements in order to provide investors with more timely information about positions held by market participants. These amendments will require investors to file Initial Schedule 13D filings within five business days as opposed to the current 10-day deadline, and amendments to Schedule 13D must now be filed within two business days rather than the previous 10. Additionally, investors, such as Qualified Institutional Investors and Passive Investors, who file Schedule 13G beneficial ownership reports must now do so in accordance with shortened filing deadlines (which vary depending on the type of investor). Also included are clarifications to Schedule 13D disclosure requirements regarding derivative securities, as well as the requirement for all Schedule 13D and 13G filings to use a structured, machine-readable data language. Finally, the release also provides guidance regarding the current legal standard governing when multiple persons can be considered a group, as well as how an investor’s use of cash-settled derivative securities may be treated in terms of beneficial ownership. The amendments will become effective 90 days after publication in the Federal Register, with complicated compliance plans set for September 30, 2024 and December 18, 2024, respectively.