The SEC’s Proposed Changes to Beneficial Ownership Reporting: Implications for Market Participants

On February 10, 2022, the Securities and Exchange Commission (the “SEC”) issued for public comment proposed rules that will, if adopted, significantly affect how investors report their beneficial ownership on Schedules 13D and 13G.

The principal changes would:

• accelerate the filing deadlines for Schedules 13D and 13G beneficial ownership reports;
• clarify the circumstances under which two or more persons have formed a “group” that would be subject to beneficial ownership reporting obligations; and
• expand the definition of beneficial ownership to include certain cash-settled derivative securities.

In this memo, we summarize the proposed changes and the implications for issuers, activists, financial institutions, and other market participants.

Please click here to read the full alert memorandum.

This article was republished by The Columbia Law School Blue Sky Blog.