Alert December 12, 2017

SEC Approves Revised NYSE Rule Delaying Material News Releases After Closing

Summary

The Securities and Exchange Commission has approved a revised version of the previously proposed New York Stock Exchange rule that will prohibit listed companies from issuing material news after the close of trading (generally 4:00 p.m. Eastern Time) until the earlier of the publication of the company’s official NYSE closing price or five minutes after the close of trading. The revised version, which was effective immediately, provides an exception that permits listed companies to publicly disclose material information following a non-intentional disclosure in order to comply with Regulation FD.

As described in our previous client alert, on August 17, 2017, the NYSE filed a proposal to amend Section 202.06 of the Listed Company Manual to prohibit listed companies from issuing material news after the official closing time for the NYSE’s trading session until the earlier of the publication of the company’s official closing price on the NYSE or five minutes after the official NYSE closing time. On December 4, 2017, the SEC approved a revised version of the NYSE proposal  that provides an exception for public disclosure of material information following a non-intentional disclosure in order for the company to comply with Regulation FD. On December 7, 2017, the NYSE circulated an email to listed companies advising that the change in Section 202.06 was effective immediately. Section 202.06 as amended will continue to include advisory text adopted by the NYSE in 2015 amendments that requested companies avoid issuing material news until the earlier of the publication of the official NYSE closing price or 15 minutes after the NYSE’s official closing time.

Companies should remember that during trading hours (generally between 7:00 p.m. ET and 4:00 p.m. ET) Section 202.06 of the NYSE Listed Company Manual will continue to require listed companies to provide notification at least 10 minutes in advance of any announcement of material news in order to determine whether trading in the company’s securities should be temporarily halted.