April 13, 2022
SEC Buybacks Proposal: Notable Comment Letters
The comment period for the SEC’s proposal to modernize repurchase disclosure also officially expired on April 1st – and just under 100 letters have rolled in so far. A number of prominent law firms & corporations have weighed in, as well as:
– The Society for Corporate Governance – raising concerns about the proposal’s requirements for daily disclosure and operational information about buyback programs and about the impact on investor returns, liquidity & capital formation
– Senators Marco Rubio (R-FL) & Tammy Baldwin (D-WI) – supporting the proposal & encouraging additional enhanced disclosures about alternative uses of capital and whether repurchases are financed by additional debt
– Oxfam – 8 pages on the supposed harms of share repurchases
– NYSE – supporting the proposal in principle, including enhanced periodic disclosure and XBRL data, but expressing concern over unduly burdensome disclosure requirements that would also erode information quality
– Business Roundtable – opposing the proposal due to adverse impacts on efficient capital allocation and undue costs & consequences for issuers, investors and the capital markets overall
– Better Markets – supporting the proposal, advocating for even more disclosure about financing of and motivations for repurchases, and suggesting that Form SR be “filed” rather than “furnished”
– US Chamber of Commerce & others – urging the SEC to reconsider the assumptions underpinning the proposal until it has conducted further economic analysis of the proposal’s potential impact, including in relation to the Rule 10b5-1 proposal (also see this 30-page addendum)
– Liz Dunshee