SEC Approves New FINRA Rule 6490 Relating to the Processing of and Fees for Company-Related Actions for Non-Exchange-Listed Securities
Regulatory Notice 10-38
Effective Date: September 27, 2010
Executive Summary
Effective September 27, 2010, new FINRA Rule 6490 (Processing of Company-Related Actions) codifies the requirements in SEA Rule 10b-17 for issuers of a class of publicly trading securities to provide timely notice to FINRA of certain corporate actions (e.g., dividend or other distribution of cash or securities, stock split or reverse split, rights or subscription offering). Issuers must also provide timely notification to FINRA of certain other specified corporate actions. The rule clarifies the scope of FINRA’s regulatory authority and discretionary power when processing documents related to announcements for company-related actions for non-exchange listed equity and debt securities, and implements fees for these services. Issuers must complete the necessary forms and pay the applicable fees within the required time periods or they will be subject to late fees and delayed processing of documents to announce corporate actions.
Please review the information at these links:
http://www.finra.org/web/groups/industry/@ip/...121988.pdf
http://www.finra.org/web/groups/industry/@ip/...122176.pdf
> > And based on the below info from the same link, I see why the corp docs had to be filed to have an effective date.
Submitting Notice of Company-Related Actions An issuer or other duly authorized representative that is obligated to notify FINRA of a Company-Related Action must:
1. Complete, sign and submit the Company-Related Action Notification Form to
FINRA Operations at least ten (10) days prior to the record date or effective date
(as applicable) involved for the Company-Related Action. The form is available on
FINRA’s website at www.finra.org/upc/forms.2. Ensure that the issuer’s duly authorized transfer agent signs and submits a
completed Transfer Agent Verification Form to FINRA Operations simultaneously.3. Attach supporting documentation (e.g., copy of board resolutions authorizing the
Company-Related Action, amendment to the charter of incorporation) as required
by the Company-Related Action Notification Form.4. Pay all applicable fees, including late fees, in the manner prescribed on the
Company-Related Action Notification Form.5. Submit the above package either electronically or via overnight mail to FINRA
Operations at the addresses specified on the applicable Form
Based on this little exerpt from one of the links they sent, the R/S could actually take quite some time.
FINRA Operations Determination
Once an issuer or its duly authorized representative submits a Company-Related Action
Notification Form, FINRA Operations will review the submission and may request
additional information or documentation as may be necessary to verify the accuracy of
the information. If the party that submits the form does not sufficiently respond within
90 calendar days of the date FINRA Operations requests additional information or
documentation, the request will be deemed “lapsed” and will be closed.During the course of the review, if FINRA Operations believes that one of five explicitly
enumerated factors outlined in Rule 6490 may be triggered, it generally will conduct an
in-depth review of the Company-Related Action and may seek additional information
or documentation from the issuer or duly authorized representative as outlined above.
Where a Company-Related Action is deemed deficient, FINRA Operations may
determine that it is necessary for the protection of investors, the public interest and to
maintain fair and orderly markets, that documentation related to a Company-Related
Action will not be processed. Factors that may be considered by the FINRA Operations
in finding a request to process documentation related to a Company-Related Action
deficient are explicitly limited to the following:1. FINRA staff reasonably believes the forms and all supporting documentation, in
whole or in part, may not be complete, accurate or with proper authority;2. the issuer is not current in its reporting obligations, if applicable, to the SEC or
other regulatory authority;3. FINRA has actual knowledge that parties related to the Company-Related Action
are the subject of pending, adjudicated or settled regulatory action or investigation
by a regulatory body, or civil or criminal action related to fraud or securities laws
violations4;4. a government authority or regulator has provided information to FINRA, or FINRA
has actual knowledge, indicating that persons related to the Company-Related
Action may be potentially involved in fraudulent activities related to the securities
market and/or pose a threat to public investors; and/or5. there is significant uncertainty in the settlement and clearance process for the
security.6 Regulatory
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>> Example of FINRA's RESPONSE towards commenting on corp actions
EMAIL REPLY
from: Experts experts@finra.org / date: Thu, Mar 22, 2012 at 9:00 AM / subject: RE: Reverse Splits
FINRA does not comment on pending corporate actions . In handling these matters, the company must follow the procedures set in Rule 6490. Please see a summary below and follow the links below for details and instructions as to how the company must file.
(posts by hvnsangel67 gathered by Me into one post ;-P)
