Alert
for the REIT Industry
August 21, 2017

Revised NYSE Dividend Notification Requirements

Summary

The New York Stock Exchange has amended its Listed Company Manual to require listed companies to notify the NYSE at least 10 minutes before the company announces any dividend or stock distribution or the fixing of a record date for any dividend or stock distribution, even if the announcement is made outside of market hours. The NYSE adopted these amendments on August 14, 2017. 

The New York Stock Exchange is seeking to delay the implementation of its recently-adopted dividend notification requirements until no later than February 1, 2018. For additional information, see our alert “NYSE Seeks to Delay Dividend Notification Change.

On August 14, 2017, the NYSE amended Sections 204.12 and 204.21 of its Listed Company Manual. These amendments require listed companies to provide notification to the NYSE at least 10 minutes before any public announcement of any action relating to a dividend or stock distribution on a listed stock, including the fixing of a record date for such a dividend or stock distribution. Previously, the NYSE had required notification no later than the time of the public announcement. These notification requirements are separate from the requirement of Section 202.06 of the NYSE Listed Company Manual, which requires listed companies to provide notification at least 10 minutes in advance of any announcement of material news that is released between 7:00 AM ET and 4:00 PM ET. To this end, the NYSE has also amended Section 202.06 to clarify that listed companies must continue to comply with the procedures in Section 202.06 for all public announcements that relate to a dividend or stock distribution that are released between 7:00 AM ET and 4:00 PM ET.

The NYSE amended these notice requirements to enable it to ensure that a listed company’s proposed dividend schedule complies with applicable NYSE requirements before a listed company makes any public announcement with respect to a dividend or distribution on a listed stock, including the requirement to provide 10 days advance notice of a record date. The NYSE has indicated that it will have staff available at all times to review dividend notifications immediately upon receipt, regardless of what time or day of the week the company provides this notification, and the NYSE will contact a listed company immediately if it identifies a problem with the notification.

The NYSE previously sent an email advising listed companies of the upcoming change on August 4, 2017, and will notify listed companies of the effectiveness of the notification requirements. The NYSE email indicates that, in contrast to the requirement that listed companies obtain NYSE approval before issuance of an announcement related to a dividend or stock distribution or a related record date during market hours, listed companies are not required to wait for NYSE approval before issuing such announcements outside of market hours as long as the company provides the required notice to the NYSE at least 10 minutes before public dissemination.

The NYSE proposal is available on the NYSE website, and the SEC notice of the proposed rule change (and the text of the proposed rule change) and the SEC order approving the rule change are available on the SEC website.

What Should Listed Companies Do?

NYSE-listed companies should review and revise their procedures for announcements of dividends and stock distributions to ensure that they comply with these new advanced notice requirements.