In May, the SEC adopted a proposal intended to modernize and improve disclosure regarding company stock repurchases.  One fortunate aspect of the final rules—for domestic companies, that is—was that the new rule did away with the proposed new Form SR for reporting of daily repurchase data by domestic companies and, instead, moved to quarterly reporting of detailed quantitative information on daily repurchase activity, to be filed as exhibits to companies’ periodic reports.  But that was not the case for foreign private issuers. The final rules require FPIs that report on FPI forms to disclose daily quantitative repurchase data at the end of every quarter on new Form F-SR, due 45 days after the end of the FPI’s fiscal quarter.  Some commenters on the proposal had suggested exempting FPIs that already make repurchase disclosure under home-country rules, but the SEC elected not to do so in light of its view that the detailed disclosure would be beneficial for all investors in companies that conduct repurchases. The SEC noted, however, that, if an FPI’s home country disclosures furnished on Form 6-K satisfy the Form F-SR requirements, it can incorporate those disclosures by reference into its Form F-SR. (See this PubCo post.) 

Now, Corp Fin has issued three new CDIs, summarized below, related to new Form F-SR addressing reporting in the absence of repurchases and reporting for the final fiscal quarter.

Form F-SR

Question 113.01 In this CDI, the staff advises that Form F-SR is not required to be filed if, during the covered fiscal quarter, neither the FPI nor any affiliated purchaser repurchased any of its equity securities registered under Exchange Act Section 12. However, the staff points out that “there is no de minimis exception to the Form F-SR filing requirement; even the repurchase of a very small number of equity securities would trigger a Form F-SR filing.”

Question 113.02 So long as the FPI or affiliated purchaser did not conduct any repurchases that would trigger the requirement to file a Form F-SR, no Form F-SR is required to be filed “solely to check the box under ‘Registrant Purchases of Equity Securities’ section of Form F-SR for the covered purchases or sales of securities by a director or member of senior management who would be identified pursuant to Item 1 of Form 20-F.”

Question 113.03 Unlike domestic issuers that may report repurchase activity on exhibits attached to periodic reports, FPIs are “not permitted to wait to report repurchases during the final quarter of the fiscal year in the Form 20-F for that fiscal year.” Rather, if the FPI or affiliated purchaser engaged in repurchases during the final quarter of the fiscal year, “then a Form F-SR would be required for that final quarter and must be filed within 45 days after the end of the quarter.”

Posted by Cydney Posner