SEC Provides Relief for Bank Holding Companies to Facilitate JOBS Act


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The JOBS Act increased the threshold of registration under Section 12(g) of the Exchange Act from 300 to 1,200 persons.  The JOBS Act does not on its face provide relief from Exchange Act reporting requirements under Section 15(d), which applies if the issuer files or updates a registration statement in the current fiscal year.

However, the SEC issued the following FAQ in connection with the JOBS Act:


On or after April 5, 2012, how can a bank holding company suspend its reporting obligations under Section 15(d)?


In general, the Section 15(d) reporting obligation is suspended if, and for so long as, the issuer has a class of security registered under Section 12. When an issuer terminates Section 12 registration, it must address any Section 15(d) obligation that would apply once the Section 15(d) suspension is lifted.

For the current fiscal year, a bank holding company can suspend its obligation to file reports under Section 15(d) with respect to a class of security that was sold pursuant to a Securities Act registration statement and that was held of record by less than 1,200 persons as of the first day of the current fiscal year. Such suspension would be deemed to have occurred as of the beginning of the fiscal year in accordance with Section 15(d) (as amended by the JOBS Act). If, during the current fiscal year, a bank holding company has a registration statement that becomes effective or is updated pursuant to Securities Act Section 10(a)(3), then it will have a Section 15(d) reporting obligation for the current fiscal year.

If a bank holding company with a class of security held of record by less than 1,200 persons as of the first day of the current fiscal year has a registration statement that is updated during the current fiscal year pursuant to Securities Act Section 10(a)(3), but under which no sales have been made during the current fiscal year, the bank holding company may be eligible to seek no-action relief to suspend its Section 15(d) reporting obligation. Such issuers should contact the Division’s Office of Chief Counsel for further information.

Bank holding companies have begun to ask the SEC staff for no-action relief under the foregoing FAQ, and the SEC staff have responded favorably.  You can find examples here, here and here.

Check frequently for updated information on the JOBS Act, the Dodd-Frank Act and other important securities law matters.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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