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SEC Relaxing Private Tech Disclosure Rules

September 21, 2017

Fenwick securities enforcement co-chair Michael Dicke spoke with The Information about the U.S. Securities and Exchange Commission’s move to begin relaxing financial disclosure requirements for private companies.

An SEC advisory committee—chaired by Fenwick corporate partner and life sciences practice co-chair Stephen Graham—recommended scaling back the rules that require private companies to share information about their financial performance with employees if they grant their employees more than $5 million in stock awards, The Information reported.

Last summer, the SEC enforcement division increased scrutiny of major private companies and their adherence to these rules. However, enforcement actions under Rule 701 seem less likely now that the rules may be relaxed, Dicke told The Information. He said he expects to see the SEC enforcement division bringing fewer actions alleging mere “foot faults” and technical violations.

The full article is available through The Information website (subscription required).

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