Overview


On December 18, the SEC adopted a final rule requiring companies to disclose in proxy or information statements for the election of directors any practices or policies regarding the ability of employees or directors to engage in certain hedging transactions with respect to company equity securities. This long-awaited rule implements the mandate imposed by Section 955 of the Dodd-Frank Act to provide investors with information on whether directors and employees are permitted to hedge any decrease in market value of their own company’s stock. Most companies must include this disclosure with respect to fiscal years beginning on or after July 1, 2019.

In Depth


On December 18, the US Securities and Exchange Commission (SEC) approved a final rule requiring companies to disclose in proxy or information statements for the election of directors any practices or policies regarding the ability of employees or directors to engage in certain hedging transactions with respect to company equity securities. This rule implements Section 14(j) of the Securities Exchange Act of 1934, which was enacted by Section 955 of the Dodd-Frank Wall Street Reform and Consumer Protection Act in April 2015.

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