Securities

February 26, 2021

https://video.wixstatic.com/video/4dc8bf_e852c5ebbc0f4393b352ff6d5be76b03/1080p/mp4/file.mp4 Lack of access to financial capital is a barrier for many entrepreneurs who seek to grow their business ventures. Congress and the Obama Administration enacted the Jumpstart Our Business Startups Act (JOBS) Act to help solve this lack of access to financial capital by democratizing the entrepreneurial ecosystem through investment crowdfunding. The JOBS Act established crowdfunding provisions that allow early-stage businesses to offer and sell securities up to a certain dollar limit, adjusted for…

FCPA Professor

A Further Reminder That The FCPA Has Always Been A Law Much Broader Than Its Name Suggests

By Mike Koehler

February 26, 2021

http-fcpaprofessor-com-wp-content-uploads-2018-01-bdo2-jpg

The Foreign Corrupt Practices Act has always been a law much broader than its name suggests. Sure, the FCPA contains anti-bribery provisions which concern foreign bribery. Sure, the FCPA’s books and records and internal controls provisions can be implicated in foreign bribery schemes. However, the fact remains that most FCPA enforcement actions (that is enforcement actions that charge or find violations of the FCPA’s books and records and internal controls provisions) have nothing to do…

SEC Actions

SEC Acting Chair Directs Study of Climate Change

By Thomas Gorman

February 25, 2021

Acting Chair Allison Herren Lee directed the staff of the Division of Corporation Finance to “enhance its focus on climate-related disclosure in public company filings.” Presumably this directive is to focus on updating the Commission’s only existing disclosure requirements regarding climate change. Those were, as the Acting Chair stated, passed in 2010 (here). The directive is an important step. As a leading setter of disclosure standards, it is critical that the SEC update…

Free Writings + Perspectives

Investor Status and Accredited Investor and QIB Resources

By Anna T. Pinedo & Brian Hirshberg

February 25, 2021

Recently, the US Securities and Exchange Commission (“SEC”) adopted amendments to the definition of accredited investor (“AI”) and amendments to the definition of Qualified Institutional Buyer (“QIB”). Our updated investor status chart now reflects these definitions. In addition, below you will find links to an accredited investor and QIB questionnaire, which may be useful in connection with exempt offerings and to accompany subscription agreements, as well as to the amended AI definition for reference. Accredited …

Free Writings + Perspectives

SEC Acting Chair Directs Staff to Enhance Focus on Climate-Related Disclosure

By Christina M. Thomas, Andrew Olmem, J. Paul Forrester & Anna T. Pinedo

February 25, 2021

On February 24, 2021, Acting Chair of the US Securities and Exchange Commission (“SEC”), Allison Herren Lee, announced that the agency will be focusing on public companies’ climate change disclosures as part of an effort to both assess current compliance with federal securities laws and develop new disclosure requirements for climate change. Specifically, she stated that she has directed the SEC’s Division of Corporation Finance “to enhance its focus on climate-related disclosure in public company…

Free Writings + Perspectives

Nasdaq Amends its Direct Listing Proposal

By Brian Hirshberg

February 25, 2021

On February 22, 2021, Nasdaq amended the rule changes it initially proposed in September 2020 that would permit an issuer to conduct a concurrent primary offering of its securities and a direct listing on Nasdaq. In December 2020, the US Securities and Exchange Commission approved amendments to the New York Stock Exchange (“NYSE”) rules allowing a direct listing on the NYSE with a primary offering component, subject to compliance with certain conditions. Nasdaq’s amended proposal…

FCPA Professor

FCPA Scrutiny Of Philips Grows

By Mike Koehler

February 24, 2021

As highlighted in this prior post, in 2013 Philips (a Netherlands-based company with shares listed on the NYSE) resolved a $4.5 million Foreign Corrupt Practices Act enforcement action concerning conduct in Poland. As highlighted in this prior post, in 2019 the company again became the subject of the FCPA scrutiny – this time concerning conduct in Brazil and China. As highlighted below, Philips recently disclosed that its conduct in another country is also…

SEC Actions

Nasdaq Rebuked by GOP Senators for Board Diversity Requirements

By Thomas Gorman

February 24, 2021

Nasdaq filed a proposal with the Securities and Exchange Commission on December 1, 2020 to modify its listing standards to embrace diversity (here). Specifically, the exchange proposed to require companies listed on Nasdaq Global Select Market and Nasdaq Global Market to have two diverse directors within four years of the time the Commission approves the proposed rule. Firms listed on Nasdaq Capital Market would be expected to have two diverse directors within five…

FCPA Professor

The World’s Most Ethical FCPA Violators

By Mike Koehler

February 23, 2021

In the minds of some, companies that have resolved Foreign Corrupt Practices Act enforcement actions are bad or unethical companies. It is a tempting position to take. After all, the FCPA is about bribery and corruption. However, it is a wrong position to take in many (but certainly not all) instances. It surprises most people to learn that a company with pre-existing FCPA compliance policies and procedures – and a company otherwise making good faith efforts to comply…

SEC Actions

Climate Change, A Key Issue For World Regulators

By Thomas Gorman

February 23, 2021

Climate change is an often talked about issue. Some firmly believe in it; others do not. Regardless of your view, there is a significant quantum of information available on the subject. There is also no doubt that climate has an impact on business enterprises and the ability to deliver services or product. Viewed in this context, many investors may want to know how executives making critical decisions about the use of investor capital consider the…