Capital Markets & Securities Law Watch

On June 4, the SEC published a concept release focusing on whether the current definition of “foreign private issuer” still makes sense in light of dramatic shifts in market structure and issuer profiles. The SEC seeks public comment on whether, and how, it should redefine “foreign private issuer” to better protect investors and promote capital formation.

On March 6, 2025, the Securities and Exchange Commission (SEC) released updated Compliance and Disclosure Interpretations (C&DIs) concerning lock-up agreements in the context of business combinations and introduced new C&DIs related to tender offers.

The U.S. Securities and Exchange Commission (the SEC or Commission) is implementing significant changes to its Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system, aimed at modernizing filer access and enhancing cybersecurity protections. On December 27, 2024, the SEC adopted a new rule, EDGAR Filer Access and Account Management (the Rule), to formalize these updates. Effective on March 24, 2025, as part of the SEC’s transition to EDGAR Next, key security enhancements will be implemented to access account management, which include requiring individual account credentials and multi-factor authentication (MFA).

On February 12, 2025, the staff of the Division of Corporation Finance of the Securities and Exchange Commission (SEC) issued Staff Legal Bulletin No. 14M, which provides updated information for public companies and shareholders regarding shareholder proposals pursuant to Rule 14a-8 under the Securities Exchange Act of 1934 and outlines a new approach towards excluding shareholder proposals from a company’s proxy statement. 

On December 11, 2024, in Alliance for Fair Board Recruitment v. SEC, the Fifth Circuit Court of Appeals (the Court) held that the Securities and Exchange Commission (the SEC) did not have the authority to approve The Nasdaq Stock Exchange’s (Nasdaq) board diversity rule (the Rule).

On October 7, 2024, the SEC approved a Nasdaq-proposed rule amendment which impacts Nasdaq’s minimum bid price and reverse stock splits on the exchange. These changes may impose further considerations for companies as they work through the broader impact of such actions on their overall compliance status. 

Effective August 1, 2024, the Delaware General Corporation Law (DGCL) is amended in part to allow corporations to enter into agreements with stockholders that delegate governance rights to stockholders regardless of whether such rights are provided for in the corporation’s certificate of incorporation. Such stockholder agreements were previously found to violate Section 141(a) of the DGCL in the controversial case West Palm Beach Firefighters’ Pension Fund v. Moelis & Co.

A wave of substantially similar stockholders’ complaints have recently been filed by plaintiffs’ firms in the Delaware Court of Chancery challenging certain advance notice bylaw provisions commonly included in public companies’ bylaws.

On May 3, 2023, the Securities and Exchange Commission adopted final rules amending the disclosure requirements for repurchases of equity securities by domestic U.S. issuers, foreign private issuers and registered closed-end management investment companies that are exchange-traded. The final rules require issuers to provide disclosures of daily repurchase activity on a quarterly basis for domestic U.S. issuers, and foreign private issuers and on a semi-annual basis for Listed Closed-End Funds. The rules also require new disclosures regarding officer and director purchases and sales of equity securities subject to the issuer’s share repurchase program, the rationale and objectives of the repurchases, policies and procedures relating to officer and director purchases and sales during a repurchase program, and adoption and termination of Rule 10b5-1 trading arrangements.

On March 22, 2023, the Securities and Exchange Commission (the SEC) proposed amendments that would require electronically submitting certain filings, including Securities and Exchange Act of 1934 (Exchange Act) forms, eliminating related paper-based filing requirements and compelling the use of XBRL or custom XML for certain submissions.  The affected filings are primarily associated with self-regulatory organizations (SROs), broker-dealers, security-based swap dealers (SBSDs) and major security-based swap participants (MSBSPs).  The SEC stated in its press release that the proposed amendments are designed to modernize the SEC’s information collection and analysis methods and are intended to build upon the success of electronic filing relief implemented during the COVID-19 pandemic.  

On December 15, 2022, the Public Company Accounting Oversight Board (the PCAOB or the Board) announced that it was able to secure complete access to inspect and investigate PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong for the first time and issued its 2022 HFCAA Determination Report (collectively, the 2022 Determinations)[i] under the Holding Foreign Companies Accountable Act of 2020 (the HFCAA or the Act).

On August 26, 2022, the U.S. Public Company Accounting Oversight Board (the PCAOB) announced a Statement of Protocol (the SOP) with the China Securities Regulatory Commission (the CSRC) and Ministry of Finance of China (MOF) in respect of cooperation on the oversight of PCAOB-registered public accounting firms based in mainland China and Hong Kong. This represents a first and meaningful move to address the decade-long audit oversight conflict between the PCAOB and regulators in the People’s Republic of China (the PRC).

On July 13, 2022, the SEC proposed amendments to Rule 14a‑8, the shareholder proposal rule, to modify three of the bases for excluding shareholder proposals from a company’s proxy materials.

On July 13, 2022, the SEC adopted amendments to the 2020 proxy rules governing proxy voting advice applicable to proxy advisory firms, or proxy voting advice businesses (“PVABs”). (You can find our blog post about the 2020 rules here).

On August 30, 2020, the California State Legislature took another unprecedented step in spearheading the promotion of greater diversity on public company boards by passing a new bill (Assembly Bill (AB) 979) requiring each publicly held corporation whose principal executive offices are located in California—regardless of state of incorporation—to have a minimum number of directors from “underrepresented communities” on its board of directors.

As the world continues to respond to the threat of COVID-19, financial markets and corporate constituencies are looking more closely at how environmental, social, and governance (ESG) considerations can help companies respond to the impact of COVID-19, both in the short term and long term, drive the re-imagination of global business models, and prevent crises in the future.

With the COVID-19 pandemic rapidly evolving and ever-changing, staying well-informed about corporate developments is vital for board effectiveness. The pandemic has caused the need for urgent yet thoughtful responses by corporations through their executive officers and boards of directors.