COVID-19: Impact on Reporting Obligations

As the situation concerning the COVID-19 pandemic continues to develop, publicly traded companies might be wondering how their reporting obligations are affected. The U.S. Securities & Exchange Commission (“SEC”) has announced conditional regulatory relief for certain filing obligations. Specifically, the SEC will provide companies with an additional 45 days to file disclosure reports required under the Securities Exchange Act of 1934, as amended, that would otherwise have been due between March 1 and April 30, 2020. In issuing this relief, the SEC recognized that COVID-19 may present challenges for companies required to provide information to trading markets, shareholders, and the SEC. The SEC’s order details the requirements for companies to avail themselves of this relief.
 
The SEC has also reminded companies to consider the operational and financial impact of COVID-19 and their plans to mitigate related exposure in light of disclosure obligations under the federal securities laws. Several companies have already made COVID-19-related disclosures. 
 
Public companies should consider where and how to make material COVID-19-related disclosures, including within periodic reports, upon the occurrence of a Form 8-K triggering event or to report a material change that requires prompt disclosure pursuant to the rules of an exchange. Among other disclosure requirements, issuers must address material risks in their periodic reports, including new risks which may have risen. Disclosure may also be appropriate as part of an issuer’s cautionary note regarding forward-looking statements, within the business description and in one or more areas of Management’s Discussion and Analysis of Financial Condition and Results of Operation. To best dispatch reporting requirements and manage securities litigation risks, issuers should avoid selective disclosure, refresh prior disclosures as necessary (particularly as the situation continues to rapidly evolve), and avoid characterizing risks, uncertainties, trends, and other relevant disclosures as hypothetical where currently realized.
 
The above described SEC order can be found here: https://www.sec.gov/news/press-release/2020-53. Additional SEC guidance related to COVID-19 is available here:  https://www.sec.gov/sec-coronavirus-covid-19-response.

Ice Miller attorneys are ready to assist with questions you may have regarding reporting obligations or other inquiries related to COVID-19, including with respect to litigation, shareholder meetings, selective disclosure, insider trading compliance, and capital markets transactions. See our COVID-19 Resource Center here.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.