NYSE Reissues Proposal to Require Foreign Private Issuers to Submit Semi-Annual Unaudited Financial Information on Form 6-K | Practical Law

NYSE Reissues Proposal to Require Foreign Private Issuers to Submit Semi-Annual Unaudited Financial Information on Form 6-K | Practical Law

The NYSE reissued a proposed rule change that would require foreign private issuers to submit semi-annual unaudited financial information to the SEC in a Form 6-K.

NYSE Reissues Proposal to Require Foreign Private Issuers to Submit Semi-Annual Unaudited Financial Information on Form 6-K

by Practical Law Corporate & Securities
Published on 28 Jan 2016 • USA (National/Federal)
The NYSE reissued a proposed rule change that would require foreign private issuers to submit semi-annual unaudited financial information to the SEC in a Form 6-K.
On January 25, 2016, the NYSE reissued a proposed rule change to add new Section 203.03 to its Listed Company Manual. Proposed Section 203.03 would require NYSE-listed foreign private issuers (FPIs) to submit semi-annual unaudited financial information to the SEC on Form 6-K, a requirement that already applies to NASDAQ-listed FPIs. The proposed rule change takes effect on filing with the SEC.
The NYSE had issued a substantially similar proposal in May 2015 that it later withdrew (see Legal Update, NYSE Proposal Would Require Foreign Private Issuers to Submit Semi-Annual Unaudited Financial Information on Form 6-K).
Currently, SEC rules do not require FPIs to submit interim financial information to the SEC, unlike domestic issuers which are required to do so quarterly in a Form 10-Q. Under proposed Section 203.03, a NYSE-listed FPI would be required, at a minimum, to submit to the SEC a Form 6-K that includes:
  • An interim balance sheet as of the end of its second fiscal quarter.
  • A semi-annual income statement that covers its first two fiscal quarters.
The proposal states that the purpose of proposed Section 203.03 is to establish a minimum interim reporting regime for FPIs, and that companies:
  • May provide more expansive or more frequent interim financial information if they wish.
  • Must still comply with any reporting obligations that may arise under the instructions to Form 6-K (which, depending on the circumstances, may effectively require an FPI to submit quarterly financial information on Form 6-K).
Under the proposal, an FPI would be required to submit its Form 6-K no later than six months following the end of its second fiscal quarter. The financial information included in the Form 6-K:
  • Would have to be presented in English.
  • Would not have to be reconciled to US GAAP.
The proposed rule change would also amend Section 802.01E of the Listed Company Manual to subject FPIs that have not timely filed the required Form 6-K to the same compliance procedures as are applied to listed companies that are late in filing their annual report or Form 10-Q. Under amended Section 802.01E, an FPI that was delayed in filing its Form 6-K would have an initial six-month compliance period within which to file the Form 6-K and any subsequently due Form 20-F or Form 6-K. If the FPI did not submit all required filings during that six-month period, the NYSE's staff would have the discretion to allow the FPI an additional six-month compliance period. An FPI that failed to become timely with its filing obligations within the compliance periods would be subject to delisting.
In addition, the proposed rule change would amend Section 103.00 of the Listed Company Manual to clarify that, despite the provision in that section that allows FPIs to follow home country practice in lieu of complying with the NYSE's interim reporting requirements applicable to domestic companies, all FPIs would be required to disclose interim financial information in a Form 6-K on a semi-annual basis in compliance with proposed Section 203.03.
Update: The proposal was filed with the SEC, and took effect on, February 19, 2016.
To learn more about filing a Form 6-K, see Practice Note, Preparing Form 6-K.