Today, the SEC staff issued a revised Statement regarding the extension, for an indeterminate period, of temporary relief related to authentication document retention requirements under Rule 302(b) of Reg S-T in light of light of public health and safety concerns regarding COVID-19. This staff Statement is temporary and remains in effect until the staff provides public notice that it no longer will be in effect; that notice will be published at least two weeks before the announced termination date. Nothing new there.  But what is new is that the Statement indicates that the staff will not recommend enforcement action if filers take advantage of the new electronic signature rules even before the effective date of those rules.

In March, the staff of various SEC divisions, including Corp Fin, issued a Statement Regarding Rule 302(b) of Regulation S-T in Light of COVID-19 Concerns.  The statement offered temporary relief in connection with “the authentication document retention requirements under Rule 302(b) [of Reg S-T] in light of health, transportation, and other logistical issues raised by the spread of coronavirus disease 2019 (COVID-19).” Rule 302(b) requires each person who signs a document that is filed electronically with the SEC to manually sign a signature page (or other document), before or at the time the electronic filing is made.  To facilitate authentication of the signature, the rule requires the company or other electronic filer to retain the signed documents for five years and to furnish copies to the SEC upon request. In light of difficulties that filers and signatories experienced in satisfying those requirements as a result of COVID-19, the relief allowed the signatory to retain the signed document and provide it to the filer as promptly as practicable so long as specified steps were taken.   In June, the staff extended that relief for an indeterminate period. (See this PubCo post and this PubCo post for a description of the requirements.)

Now the staff appears to have reissued the Statement, the key difference being the addition of a paragraph regarding electronic signatures. Just this week, in recognition of the widespread use of electronic signatures, the SEC adopted rules and amendments to permit the use of electronic signatures in signature “authentication documents” required under Reg S-T in connection with electronic SEC filings, provided that the signatures satisfy requirements specified in the EDGAR Filer Manual and the signatory follows certain procedures. (See this PubCo post.) While the amendments will not be effective until the adopting release is published in the Federal Register, “the staff will not recommend the Commission take enforcement action with respect to the requirements of Rule 302(b) in advance of such time provided that a signatory complies with all of the requirements of amended Rule 302(b).”

Posted by Cydney Posner