Commenters Generally Support SEC’s Simplified Disclosure Proposals Under Regulation S-K

Eversheds Sutherland (US) LLP

On January 2, 2018, the comment period ended for proposed amendments (the Proposed Amendments) to certain provisions of Regulation S-K that the US Securities and Exchange Commission (SEC) published in October 2017. With a few exceptions, commenters generally supported the Proposed Amendments, which if adopted as proposed would:

  • Permit registrants to omit or redact non-material confidential information from public filings without prior SEC approval;
  • Reduce the comparison periods in the Management Discussion and Analysis of Financial Condition and Results of Operations (MD&A) section of public filings;
  • Limit the requirement to file certain material contracts for newly reporting companies;
  • Require registrants to include a legal entity identifier (if one has been obtained) for each of its subsidiaries;
  • Require registrants to include a description of their registered securities in their Annual Report on Form 10-K; 
  • Limit disclosure of a registrant’s properties;
  • Clarify the requirements for disclosure regarding a registrant’s directors, executive officers and significant employees; 
  • Eliminate the requirement to furnish a duplicate set of Section 16 reports to the registrant;
  • Streamline the information required on the cover of a prospectus;
  • Clarify the requirements in the Plan of Distribution section of a prospectus; and
  • Eliminate redundancies in rules governing incorporation by reference.

This Legal Alert provides a summary of the current law and how the Proposed Amendments could change the requirements of Regulation S-K. 

Exclusion or Redaction of Confidential Information in Exhibits
Item 601 under Regulation S-K requires registrants to file complete exhibits, including any material contracts to which the registrant is a party, with certain filings with the SEC (i.e., Form S-1 or Form S-3). However, Rule 406 under the Securities Act of 1933, as amended (the Securities Act), and Rule 24b-2 under the Securities Exchange Act of 1934, as amended (the Exchange Act), allows a registrant to request confidential treatment for certain exhibits (or portions of such exhibits) if they contain information that, if disclosed, would be harmful to the registrant’s business or financial condition and is not material to investors. Pursuant to current practice, the SEC allows a registrant to file documents that omit personally identifiable information from exhibits without a confidential treatment request. Under the Proposed Amendments, registrants would be permitted to omit or redact any confidential information that is not material and that would cause competitive harm to the registrant if publicly disclosed without having to submit the confidential treatment request. Registrants would be required to include certain language to clearly identify any exhibit (or portions of any exhibit) that has been omitted or redacted.  

The Proposed Amendments would also permit the registrant to exclude schedules and exhibits to material contracts (assuming they are not material and have not been publicly disclosed), as well as certain personally identifiable information (which would codify current practice), without the need for a confidential treatment request.  

Commenters have generally supported these Proposed Amendments. The SEC requested comments on whether comparable relief should be extended to investment companies given that there appears to be no reason that comparable relief should not be extended to investment companies, such as mutual funds, registered variable separate accounts, closed-end funds and business development companies.

Limit the Period-to-Period Comparison in the MD&A

Item 303(a) under Regulation S-K requires a registrant to discuss its financial condition, changes in financial condition, and results of operations. Instruction 1 to Item 303(a) states in part that the discussion shall cover the three-year period covered by the financial statements and either provide year-to-year comparisons or present any other format that would enhance a reader’s understanding. Under the Proposed Amendments, registrants would be permitted to eliminate the discussion of the earliest year covered by the financial statements included in the relevant filing. When financial statements included in a filing cover three years (which is typically the case), discussion about the earliest year would not be required if: (1) that discussion is not material to an understanding of the registrant’s financial condition, changes in financial condition, and results of operations; and (2) the registrant has filed its prior year Form 10-K containing the MD&A of the earliest of the three years included in the financial statements of the current filing. 

Additionally, for consistency, the SEC has proposed to change Form 20-F to conform to the Proposed Amendments with respect to all foreign private issuers (FPIs) except Canadian issuers. Commenters have supported the Proposed Amendments. However, in response to the SEC’s question on whether a registrant should be permitted to exclude the earliest year if there was a restatement in such year, one commenter responded that it did not support such an exception. Another commenter has suggested that prong (2) is too narrow because the earliest year may have been included in a filing other than a Form 10-K (e.g., Form S-1 or Form 10) and that the modified rule should permit exclusion so long as the excluded year is included in any prior public filing.

Limit the Two-Year Lookback on Material Contracts 

Item 601(b)(10)(i) under Regulation S-K requires registrants to file every material contract not made in the ordinary course of business, provided that one of two tests is met: (1) the contract must be performed in whole or in part at or after the relevant filing; or (2) the contract was entered into not more than two years before such filing. Under current law, the two-test inquiry is applicable to both new and current registrants subject to Item 601(b)(10); however, under the Proposed Amendments, the two-year lookback period prong would apply only to newly reporting registrants (i.e., registrants filing their first registration statement or annual report on Form 10-K). The Proposed Amendments seek to define “newly reporting companies” in a manner so as to ensure that investors receive access to agreements containing material information, including agreements entered into by newly reporting registrants up to two years before the commencement of their reporting obligations. On the flip side, the Proposed Amendments would require registrants to remove from their respective exhibit index any material contracts under which the registrant no longer has ongoing obligations. 

Amendments to Disclosure of Subsidiaries

Item 601(b)(21) under Regulation S-K requires a registrant to list as an exhibit all of its subsidiaries, the state or other jurisdiction of incorporation, and the names under which subsidiaries do business. Under the Proposed Amendments, a registrant would be required to include a legal entity identifier (LEI) for each subsidiary if an LEI has been obtained. An LEI is a 20-character, alpha-numeric code that allows for unique identification of entities engaged in financial transactions. The Proposed Amendments do not mandate the requirement of an LEI—only that it be provided if one has been obtained. The Proposed Amendments would similarly modify the requirements for FPIs, with the exception of Canadian issuers. 

Require a Description of Securities in Exchange Act Filings

Item 202 under Regulation S-K requires a registrant’s registration statement to provide a brief description of any securities registered or to be registered. A registrant is not currently required to provide this information in a periodic Exchange Act filing (i.e., Form 10-K, Form 20-F, etc.). Under the Proposed Amendments, a registrant would be required to include a description of any securities registered under Section 12 of the Exchange Act as an exhibit to its Form 10-K (or Form 20-F in the case of FPIs). Commenters have suggested that the Proposed Amendments would impose an undue burden on registrants since they may require making conforming edits to other sections of a filing, as well as combining disclosures from a base prospectus and a prospectus supplement into one narrative. Commenters have suggested that a similar result could be achieved by allowing the registrant to incorporate by reference and by including an active hyperlink to the relevant prior disclosure.

Limit the Disclosure of Property 

Item 102 of Regulation S-K requires a registrant to disclose the location and general character of its principal plants, mines and other materially important physical properties. Under the Proposed Amendments, this disclosure would be required only to the extent it is material to the registrant. The Proposed Amendments also clarify that the disclosure required under Item 102 should focus on physical properties that are material to the registrant and may be provided on a collective basis, if appropriate. Commenters have generally supported the Proposed Amendments. However, one commenter indicated that there is no reason for a registrant to disclose uncertainties about properties near designated areas where natural disasters occur (a specific item on which the SEC requested comments); these uncertainties would be described elsewhere in the disclosure, such as in the discussion of risk factors.

Clarifying Disclosure on Directors, Officers and Significant Employees 

Item 401 of Regulation S-K requires disclosure of background information about a registrant’s directors, executive officers and significant employees. Although Form 10-K requires Item 401 disclosure, it may be incorporated by reference from the registrant’s proxy statement. In the alternative, Instruction 3 to Item 401(b) allows disclosure of executive officers to be included in the Form 10-K and not duplicated in a subsequently filed proxy statement. However, because there are other parts of Item 401 that require disclosure about executive officers, the SEC believes the placement of Instruction 3 is confusing since it may be construed as applying only to Item 401(b). Therefore, the Proposed Amendments seek to eliminate confusion by moving Instruction 3 to the general instruction to Item 401.

Eliminating Requirement to Deliver Section 16 Reports

Section 16 of the Exchange Act requires officers, directors and certain stockholders to report their beneficial ownership of a registrant’s securities. Item 405 of Regulation S-K requires the registrant to disclose whether or not each reporting person timely filed its Section 16 report(s). As part of the process, reporting persons are required to furnish a duplicate copy of any Section 16 report to the registrant. The Proposed Amendments seek to eliminate the delivery requirement of duplicate reports, and to allow a registrant to review any Section 16 reports filed on EDGAR in determining whether all Section 16 reports have been timely filed and in making the disclosure required by Item 405.

Streamlining Information on Cover Page of Prospectus

Item 501 of Regulation S-K requires certain information to be presented on the outside front cover page of a prospectus, including a registrant’s name, information relating to offering price and underwriting discounts, the name of the “national securities exchange” on which the securities will be offered, and the “subject to completion” language on a preliminary prospectus. The Proposed Amendments would seek to:

  • Remove an instruction that indicates that a registrant may need to include information to eliminate confusion with other companies if the registrant’s name is “well known” or to possibly change its name if it’s not possible to avoid confusion;
  • Allow registrants to include a clear statement that the offering price or method will be fully disclosed in a later prospectus if it is impracticable to state the price or the method by which the price will be determined at the time of filing the prospectus; 
  • Broaden the markets that should be disclosed if the securities are not being listed on a “national securities exchange”; and
  • Eliminate the requirement that the “subject to completion” language in a preliminary prospectus includes a reference to state law for offerings that are not prohibited by state blue sky laws.

Clarifying Plan of Distribution Section

Item 508 requires the plan of distribution for an offering to include information about the underwriters including any discounts and commissions to be allowed or paid to dealers. If a dealer is paid any additional amounts for acting as a “sub-underwriter,” this information is required to be disclosed as well. Because “sub-underwriter” is not defined, the Proposed Amendments seek to define “sub-underwriter” in this context to avoid any confusion.

Eliminating Redundancies in Incorporating by Reference

Regulation S-K, generally, permits incorporation by reference to obviate the need for duplicative disclosure in public filings. The Proposed Amendments would streamline the process to incorporate by reference by eliminating the prohibition in Item 10(d) of Regulation S-K that precludes incorporation by reference of documents filed with the SEC more than five years ago.

[View source.]

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.

© Eversheds Sutherland (US) LLP | Attorney Advertising

Written by:

Eversheds Sutherland (US) LLP

Eversheds Sutherland (US) LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide

JD Supra Privacy Policy

Updated: May 25, 2018:

JD Supra is a legal publishing service that connects experts and their content with broader audiences of professionals, journalists and associations.

This Privacy Policy describes how JD Supra, LLC ("JD Supra" or "we," "us," or "our") collects, uses and shares personal data collected from visitors to our website (located at (our "Website") who view only publicly-available content as well as subscribers to our services (such as our email digests or author tools)(our "Services"). By using our Website and registering for one of our Services, you are agreeing to the terms of this Privacy Policy.

Please note that if you subscribe to one of our Services, you can make choices about how we collect, use and share your information through our Privacy Center under the "My Account" dashboard (available if you are logged into your JD Supra account).

Collection of Information

Registration Information. When you register with JD Supra for our Website and Services, either as an author or as a subscriber, you will be asked to provide identifying information to create your JD Supra account ("Registration Data"), such as your:

  • Email
  • First Name
  • Last Name
  • Company Name
  • Company Industry
  • Title
  • Country

Other Information: We also collect other information you may voluntarily provide. This may include content you provide for publication. We may also receive your communications with others through our Website and Services (such as contacting an author through our Website) or communications directly with us (such as through email, feedback or other forms or social media). If you are a subscribed user, we will also collect your user preferences, such as the types of articles you would like to read.

Information from third parties (such as, from your employer or LinkedIn): We may also receive information about you from third party sources. For example, your employer may provide your information to us, such as in connection with an article submitted by your employer for publication. If you choose to use LinkedIn to subscribe to our Website and Services, we also collect information related to your LinkedIn account and profile.

Your interactions with our Website and Services: As is true of most websites, we gather certain information automatically. This information includes IP addresses, browser type, Internet service provider (ISP), referring/exit pages, operating system, date/time stamp and clickstream data. We use this information to analyze trends, to administer the Website and our Services, to improve the content and performance of our Website and Services, and to track users' movements around the site. We may also link this automatically-collected data to personal information, for example, to inform authors about who has read their articles. Some of this data is collected through information sent by your web browser. We also use cookies and other tracking technologies to collect this information. To learn more about cookies and other tracking technologies that JD Supra may use on our Website and Services please see our "Cookies Guide" page.

How do we use this information?

We use the information and data we collect principally in order to provide our Website and Services. More specifically, we may use your personal information to:

  • Operate our Website and Services and publish content;
  • Distribute content to you in accordance with your preferences as well as to provide other notifications to you (for example, updates about our policies and terms);
  • Measure readership and usage of the Website and Services;
  • Communicate with you regarding your questions and requests;
  • Authenticate users and to provide for the safety and security of our Website and Services;
  • Conduct research and similar activities to improve our Website and Services; and
  • Comply with our legal and regulatory responsibilities and to enforce our rights.

How is your information shared?

  • Content and other public information (such as an author profile) is shared on our Website and Services, including via email digests and social media feeds, and is accessible to the general public.
  • If you choose to use our Website and Services to communicate directly with a company or individual, such communication may be shared accordingly.
  • Readership information is provided to publishing law firms and authors of content to give them insight into their readership and to help them to improve their content.
  • Our Website may offer you the opportunity to share information through our Website, such as through Facebook's "Like" or Twitter's "Tweet" button. We offer this functionality to help generate interest in our Website and content and to permit you to recommend content to your contacts. You should be aware that sharing through such functionality may result in information being collected by the applicable social media network and possibly being made publicly available (for example, through a search engine). Any such information collection would be subject to such third party social media network's privacy policy.
  • Your information may also be shared to parties who support our business, such as professional advisors as well as web-hosting providers, analytics providers and other information technology providers.
  • Any court, governmental authority, law enforcement agency or other third party where we believe disclosure is necessary to comply with a legal or regulatory obligation, or otherwise to protect our rights, the rights of any third party or individuals' personal safety, or to detect, prevent, or otherwise address fraud, security or safety issues.
  • To our affiliated entities and in connection with the sale, assignment or other transfer of our company or our business.

How We Protect Your Information

JD Supra takes reasonable and appropriate precautions to insure that user information is protected from loss, misuse and unauthorized access, disclosure, alteration and destruction. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. You should keep in mind that no Internet transmission is ever 100% secure or error-free. Where you use log-in credentials (usernames, passwords) on our Website, please remember that it is your responsibility to safeguard them. If you believe that your log-in credentials have been compromised, please contact us at

Children's Information

Our Website and Services are not directed at children under the age of 16 and we do not knowingly collect personal information from children under the age of 16 through our Website and/or Services. If you have reason to believe that a child under the age of 16 has provided personal information to us, please contact us, and we will endeavor to delete that information from our databases.

Links to Other Websites

Our Website and Services may contain links to other websites. The operators of such other websites may collect information about you, including through cookies or other technologies. If you are using our Website or Services and click a link to another site, you will leave our Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We are not responsible for the data collection and use practices of such other sites. This Policy applies solely to the information collected in connection with your use of our Website and Services and does not apply to any practices conducted offline or in connection with any other websites.

Information for EU and Swiss Residents

JD Supra's principal place of business is in the United States. By subscribing to our website, you expressly consent to your information being processed in the United States.

  • Our Legal Basis for Processing: Generally, we rely on our legitimate interests in order to process your personal information. For example, we rely on this legal ground if we use your personal information to manage your Registration Data and administer our relationship with you; to deliver our Website and Services; understand and improve our Website and Services; report reader analytics to our authors; to personalize your experience on our Website and Services; and where necessary to protect or defend our or another's rights or property, or to detect, prevent, or otherwise address fraud, security, safety or privacy issues. Please see Article 6(1)(f) of the E.U. General Data Protection Regulation ("GDPR") In addition, there may be other situations where other grounds for processing may exist, such as where processing is a result of legal requirements (GDPR Article 6(1)(c)) or for reasons of public interest (GDPR Article 6(1)(e)). Please see the "Your Rights" section of this Privacy Policy immediately below for more information about how you may request that we limit or refrain from processing your personal information.
  • Your Rights
    • Right of Access/Portability: You can ask to review details about the information we hold about you and how that information has been used and disclosed. Note that we may request to verify your identification before fulfilling your request. You can also request that your personal information is provided to you in a commonly used electronic format so that you can share it with other organizations.
    • Right to Correct Information: You may ask that we make corrections to any information we hold, if you believe such correction to be necessary.
    • Right to Restrict Our Processing or Erasure of Information: You also have the right in certain circumstances to ask us to restrict processing of your personal information or to erase your personal information. Where you have consented to our use of your personal information, you can withdraw your consent at any time.

You can make a request to exercise any of these rights by emailing us at or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

You can also manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard.

We will make all practical efforts to respect your wishes. There may be times, however, where we are not able to fulfill your request, for example, if applicable law prohibits our compliance. Please note that JD Supra does not use "automatic decision making" or "profiling" as those terms are defined in the GDPR.

  • Timeframe for retaining your personal information: We will retain your personal information in a form that identifies you only for as long as it serves the purpose(s) for which it was initially collected as stated in this Privacy Policy, or subsequently authorized. We may continue processing your personal information for longer periods, but only for the time and to the extent such processing reasonably serves the purposes of archiving in the public interest, journalism, literature and art, scientific or historical research and statistical analysis, and subject to the protection of this Privacy Policy. For example, if you are an author, your personal information may continue to be published in connection with your article indefinitely. When we have no ongoing legitimate business need to process your personal information, we will either delete or anonymize it, or, if this is not possible (for example, because your personal information has been stored in backup archives), then we will securely store your personal information and isolate it from any further processing until deletion is possible.
  • Onward Transfer to Third Parties: As noted in the "How We Share Your Data" Section above, JD Supra may share your information with third parties. When JD Supra discloses your personal information to third parties, we have ensured that such third parties have either certified under the EU-U.S. or Swiss Privacy Shield Framework and will process all personal data received from EU member states/Switzerland in reliance on the applicable Privacy Shield Framework or that they have been subjected to strict contractual provisions in their contract with us to guarantee an adequate level of data protection for your data.

California Privacy Rights

Pursuant to Section 1798.83 of the California Civil Code, our customers who are California residents have the right to request certain information regarding our disclosure of personal information to third parties for their direct marketing purposes.

You can make a request for this information by emailing us at or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

Some browsers have incorporated a Do Not Track (DNT) feature. These features, when turned on, send a signal that you prefer that the website you are visiting not collect and use data regarding your online searching and browsing activities. As there is not yet a common understanding on how to interpret the DNT signal, we currently do not respond to DNT signals on our site.

Access/Correct/Update/Delete Personal Information

For non-EU/Swiss residents, if you would like to know what personal information we have about you, you can send an e-mail to We will be in contact with you (by mail or otherwise) to verify your identity and provide you the information you request. We will respond within 30 days to your request for access to your personal information. In some cases, we may not be able to remove your personal information, in which case we will let you know if we are unable to do so and why. If you would like to correct or update your personal information, you can manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard. If you would like to delete your account or remove your information from our Website and Services, send an e-mail to

Changes in Our Privacy Policy

We reserve the right to change this Privacy Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our Privacy Policy will become effective upon posting of the revised policy on the Website. By continuing to use our Website and Services following such changes, you will be deemed to have agreed to such changes.

Contacting JD Supra

If you have any questions about this Privacy Policy, the practices of this site, your dealings with our Website or Services, or if you would like to change any of the information you have provided to us, please contact us at:

JD Supra Cookie Guide

As with many websites, JD Supra's website (located at (our "Website") and our services (such as our email article digests)(our "Services") use a standard technology called a "cookie" and other similar technologies (such as, pixels and web beacons), which are small data files that are transferred to your computer when you use our Website and Services. These technologies automatically identify your browser whenever you interact with our Website and Services.

How We Use Cookies and Other Tracking Technologies

We use cookies and other tracking technologies to:

  1. Improve the user experience on our Website and Services;
  2. Store the authorization token that users receive when they login to the private areas of our Website. This token is specific to a user's login session and requires a valid username and password to obtain. It is required to access the user's profile information, subscriptions, and analytics;
  3. Track anonymous site usage; and
  4. Permit connectivity with social media networks to permit content sharing.

There are different types of cookies and other technologies used our Website, notably:

  • "Session cookies" - These cookies only last as long as your online session, and disappear from your computer or device when you close your browser (like Internet Explorer, Google Chrome or Safari).
  • "Persistent cookies" - These cookies stay on your computer or device after your browser has been closed and last for a time specified in the cookie. We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.
  • "Web Beacons/Pixels" - Some of our web pages and emails may also contain small electronic images known as web beacons, clear GIFs or single-pixel GIFs. These images are placed on a web page or email and typically work in conjunction with cookies to collect data. We use these images to identify our users and user behavior, such as counting the number of users who have visited a web page or acted upon one of our email digests.

JD Supra Cookies. We place our own cookies on your computer to track certain information about you while you are using our Website and Services. For example, we place a session cookie on your computer each time you visit our Website. We use these cookies to allow you to log-in to your subscriber account. In addition, through these cookies we are able to collect information about how you use the Website, including what browser you may be using, your IP address, and the URL address you came from upon visiting our Website and the URL you next visit (even if those URLs are not on our Website). We also utilize email web beacons to monitor whether our emails are being delivered and read. We also use these tools to help deliver reader analytics to our authors to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

Analytics/Performance Cookies. JD Supra also uses the following analytic tools to help us analyze the performance of our Website and Services as well as how visitors use our Website and Services:

  • HubSpot - For more information about HubSpot cookies, please visit
  • New Relic - For more information on New Relic cookies, please visit
  • Google Analytics - For more information on Google Analytics cookies, visit To opt-out of being tracked by Google Analytics across all websites visit This will allow you to download and install a Google Analytics cookie-free web browser.

Facebook, Twitter and other Social Network Cookies. Our content pages allow you to share content appearing on our Website and Services to your social media accounts through the "Like," "Tweet," or similar buttons displayed on such pages. To accomplish this Service, we embed code that such third party social networks provide and that we do not control. These buttons know that you are logged in to your social network account and therefore such social networks could also know that you are viewing the JD Supra Website.

Controlling and Deleting Cookies

If you would like to change how a browser uses cookies, including blocking or deleting cookies from the JD Supra Website and Services you can do so by changing the settings in your web browser. To control cookies, most browsers allow you to either accept or reject all cookies, only accept certain types of cookies, or prompt you every time a site wishes to save a cookie. It's also easy to delete cookies that are already saved on your device by a browser.

The processes for controlling and deleting cookies vary depending on which browser you use. To find out how to do so with a particular browser, you can use your browser's "Help" function or alternatively, you can visit which explains, step-by-step, how to control and delete cookies in most browsers.

Updates to This Policy

We may update this cookie policy and our Privacy Policy from time-to-time, particularly as technology changes. You can always check this page for the latest version. We may also notify you of changes to our privacy policy by email.

Contacting JD Supra

If you have any questions about how we use cookies and other tracking technologies, please contact us at:

- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.