[Federal Register Volume 85, Number 128 (Thursday, July 2, 2020)]
[Notices]
[Pages 39960-39961]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-14246]
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SECURITIES EXCHANGE ACT OF 1934
[Release No. 34-89170]
Order Under Section 17a and Section 36 of The Securities Exchange
Act of 1934 Extending Temporary Exemptions From Specified Provisions of
The Exchange Act and Certain Rules Thereunder
June 26, 2020.
On March 20, 2020, the Securities and Exchange Commission
(``Commission'') issued an order pursuant to its authority under
Sections 36 and 17A(c)(1) of the Exchange Act that granted transfer
agents (and other persons with regard to Exchange Act section 17(f)(2)
and Rule 17f-2 thereunder) the following temporary exemptions: (1)
Transfer agents from the requirements of Sections 17A and 17(f)(1) of
the Exchange Act, as well as Rules 17Ad-1 through 17Ad-11, 17Ad-13
through 17Ad-20, and 17f-1 thereunder; and (2) transfer agents and
other persons subject to such requirements, from the requirements of
Section 17(f)(2) of the Exchange Act and Rule 17f-2 thereunder
(collectively, the ``Exemptions'').\1\ The Exemptions were granted in
light of the challenges that may be presented by COVID-19 and
originally were scheduled to expire on May 30, 2020. On May 27, 2020,
the Commission issued an order extending the Exemptions until June 30,
2020.\2\
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\1\ See Securities Exchange Act Release No. 34-88488 (March 20,
2020), 85 FR 17122 (March 26, 2020) (``Order'').
\2\ See Securities Exchange Act Release No. 34-88960 (May 27,
2020), 85 FR 33234 (June 1, 2020) (``First Extension Order'').
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The Commission understands that COVID-19 may continue to present
challenges for transfer agents and other persons in timely meeting
certain of their obligations under the federal securities laws. For
this reason and the reasons stated in the Order originally granting the
Exemptions, the Commission finds that extending the Exemptions pursuant
to its authority under Sections 36 and 17A(c)(1) of the Exchange Act,
is appropriate in the public interest and consistent with the
protection of investors.
Accordingly, it is ordered, pursuant to Sections 17A and 36 of the
Exchange Act, that the time period for the Exemptions specified in the
Order is hereby extended to the date to be specified in a public notice
from Commission staff specifying the date on which the Exemptions will
terminate. Such date shall be at least two weeks from the date of the
Commission staff public notice. Transfer agents and other persons
seeking to avail themselves of this relief must satisfy the conditions
below.
Conditions
(a) A registrant or other person relying on the Order must provide
written notification to the Commission within two weeks of relying on
the Order of the following: \3\
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\3\ A registrant or other person who is relying on the Order or
the First Extension Order and has already provided a written
notification to the Commission may rely on this extension without
submitting another written notification solely with respect to the
Exempted Provisions described in such prior written notification.
(1) The registrant or other person is relying on the Order;
(2) A description of the specific Exempted Provisions, as
defined in the Order, the registrant or other person is unable to
comply with and a statement of the reasons why, in good faith, the
registrant or other person is unable to comply with such Exempted
Provisions; and
(3) If a transfer agent knows or believes that it has been
unable to maintain the books and records it is required to maintain
pursuant to Section 17A and the rules thereunder, a complete and
accurate description of the type of books and records that were not
maintained, the names of the issuers for whom such books and records
were not maintained, the extent of the failure to maintain such
books and records, and the steps taken to ameliorate any such
failure to maintain such books and records.
(b) As noted in the Order, the Exempted Provisions do not include,
and neither the Order, the First Extension order, nor this extension of
the Order provides relief from, Rule 17Ad-12 under the Exchange Act.
Transfer agents affected by COVID-19 that have custody or possession of
any security holder or issuer funds or securities shall continue to
comply with the requirements of Rule 17Ad-12 under the Exchange Act. If
a transfer agent's operations, facilities, or systems are significantly
affected as a result of COVID-19 such that the transfer agent believes
its compliance with Rule 17Ad-12 could be negatively affected, to the
extent possible, all security holder or issuer funds that remain in the
custody of the transfer agent should be maintained in a separate bank
account held for the exclusive benefit of security holders until such
funds are properly processed, transferred, or remitted.
The notification required under (a) above shall be emailed to:
[email protected].
The Commission encourages registered transfer agents and the
issuers for whom they act to inform affected security holders whom they
should contact concerning their accounts, their access to funds or
securities, and other
[[Page 39961]]
shareholder concerns. If feasible, issuers and their transfer agents
should place a notice on their websites or provide toll free numbers to
respond to inquiries.
The Commission is closely monitoring the impact of COVID-19 on
investors, the securities markets, and market participants and may
modify the relief provided by the Order, with any additional conditions
the Commission deems appropriate, if the need for such modification
arises. Transfer agents and other persons who are unable to meet a
deadline as extended by this relief, or in need of additional
assistance, should contact the Division of Trading and Markets at (202)
551-5777 or [email protected].
By the Commission.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2020-14246 Filed 7-1-20; 8:45 am]
BILLING CODE 8011-01-P