[Federal Register Volume 87, Number 114 (Tuesday, June 14, 2022)]
[Proposed Rules]
[Pages 35938-35939]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-12792]


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SECURITIES AND EXCHANGE COMMISSION

17 CFR Parts 229, 240, 249, and 274

[Release No. 33-11071; 34-95057; IC-34610; File No. S7-12-15]
RIN 3235-AK99


Reopening of Comment Period for Listing Standards for Recovery of 
Erroneously Awarded Compensation

AGENCY: Securities and Exchange Commission.

ACTION: Proposed rule; reopening of comment period.

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SUMMARY: The Securities and Exchange Commission (``Commission'') is 
reopening the comment period for its proposal for Listing Standards for 
Recovery of Erroneously Awarded Compensation, Exchange Act Release No. 
34-75342 (July 1, 2015) (the ``Proposing Release''). The proposed rules 
would direct the national securities exchanges and national securities 
associations to establish listing standards that would require each 
issuer to develop and implement a policy providing for the recovery, 
under certain circumstances, of incentive-based compensation based on 
financial information required to be reported under the securities laws 
that is received by current or former executive officers, and require 
disclosure of the policy. The Commission reopened the comment period 
for Proposing Release in the Reopening of Comment Period for Listing 
Standards for Recovery of Erroneously Awarded Compensation Release, 
Exchange Act Release No. Release No. 34-93311 (Oct. 14, 2021) (the 
``Reopening Release''). The Commission is re-opening the comment period 
to allow interested persons to analyze and comment on the additional 
analysis and data on compensation recovery policies and accounting 
restatements contained in a staff memorandum that was added to the 
public comment file on June 8, 2022.

DATES: The comment period for the proposed rule published July 14, 
2015, at 80 FR 41144, which was initially reopened on October 21, 2021, 
at 86 FR 58232, is again reopened. Comments should be received on or 
before July 14, 2022.

ADDRESSES: Comments may be submitted by any of the following methods:

Electronic Comments

     Use the Commission's internet comment form (https://www.sec.gov/rules/submitcomments.htm).

Paper Comments

     Send paper comments to Vanessa A. Countryman, Secretary, 
Securities and Exchange Commission, 100 F Street NE, Washington, DC 
20549-1090.

All submissions should refer to File Number S7-12-15. This file number 
should be included on the subject line if email is used. To help us 
process and review your comments more efficiently, please use only one 
method. The Commission will post all comments on the Commission's 
website (https://www.sec.gov/rules/proposed.shtml). Comments also are 
available for website viewing and printing in the Commission's Public 
Reference Room, 100 F Street NE, Washington, DC 20549-1090 on official 
business days between the hours of 10 a.m. and 3 p.m. Operating 
conditions may limit access to the Commission's public reference room. 
All comments received will be posted without change. Persons submitting 
comments are cautioned that we do not redact or edit personal 
identifying information from comment submissions. You should submit 
only information that you wish to make available publicly.
    Studies, memoranda, or other substantive items may be added by the 
Commission or staff to the comment file during this rulemaking. A 
notification of the inclusion in the comment file of any such materials 
will be made available on our website. To ensure direct electronic 
receipt of such notifications, sign up through the ``Stay Connected'' 
option at www.sec.gov to receive notifications by email.

FOR FURTHER INFORMATION CONTACT: Steven G. Hearne, Senior Special 
Counsel, in the Office of Rulemaking, at (202) 551-3430, Division of 
Corporation Finance, Securities and Exchange Commission, 100 F Street 
NE, Washington, DC 20549.

SUPPLEMENTARY INFORMATION: Section 954 of the Dodd-Frank Act added 
Section 10D to the Securities Exchange Act of 1934 \1\ (``Exchange 
Act''), which provides that the Commission require national securities 
exchanges and national securities associations to prohibit the listing 
of any security of an issuer that does not develop and implement a 
policy providing for the recovery of erroneously awarded compensation 
and for disclosure of that policy. As described more fully in the 
Proposing Release,\2\ under the proposed rules, an issuer would be 
subject to delisting if it does not adopt a compensation recovery 
policy that complies with the applicable listing standard, disclose the 
policy in accordance with Commission rules, and comply with the 
policy's recovery provisions. The Commission previously reopened the 
comment period for the Proposing Release to allow interested persons 
further opportunity to analyze and comment upon the proposed rules in 
light of developments since the publication of the Proposing Release 
and our further consideration of the Section 954 mandate.\3\ The 
Reopening Release put forth additional requests for comment on 
potential revisions to the proposal and sought additional comment on 
the proposal. The Reopening Release was published for comment in the 
Federal Register on October 21, 2021, and the comment period closed on 
November 22, 2021.
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    \1\ 15 U.S.C. 78a et seq.
    \2\ See Listing Standards for Recovery of Erroneously Awarded 
Compensation, Release No. 34-75342 (Jul. 1, 2015) [80 FR 41144 (Jul. 
14, 2015)].
    \3\ See Reopening of Comment Period for Listing Standards for 
Recovery of Erroneously Awarded Compensation, Release No. 34-93311 
(Oct. 14, 2021) [86 FR 58232 (Oct. 21, 2021] (``Re-opening 
Release'').
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    The staff of the Division of Economic and Risk Analysis has 
prepared a memorandum that provides additional analysis and data on 
compensation recovery policies and accounting restatements. 
Specifically, the staff memorandum (i) discusses the increase in 
voluntary adoption of compensation recovery policies by issuers; (ii) 
provides estimates of the number of additional restatements that would 
trigger a compensation recovery analysis if, as the Commission 
described in the Reopening Release, the rules were

[[Page 35939]]

extended to include all required restatements made to correct an error 
in previously issued financial statements; and (iii) briefly discusses 
some potential implications for the costs and benefits of the proposed 
rules.
    We believe that the information presented in the memorandum has the 
potential to be informative for evaluating the proposed rules. We are, 
therefore, reopening the comment period for an additional 30 days to 
permit interested parties to comment on the staff memorandum, which has 
been included in the comment file.

    By the Commission.

    Dated: June 8, 2022.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2022-12792 Filed 6-13-22; 8:45 am]
BILLING CODE 8011-01-P