Monday, December 05, 2005
SEC reform to ease US reporting obligations
Foreign companies with New York share listings are set to be offered an easier route to ending expensive financial reporting obligations in the US.
Under existing US rules, even if a foreign company terminates its Wall Street listing it may have to continue filing accounts with the Securities and Exchange Commission indefinitely.
But next week the SEC is expected to propose a reform of the rules as an important way to help the US secure fresh listings by companies.
Both the New York Stock Exchange and the Nasdaq stock market are facing growing competition from London and Hong Kong.
European industry groups have been pressing for reform because the cost of a company's reporting obligations with the SEC has been increased dramatically by the 2002 Sarbanes-Oxley law, which requires statements in annual reports about the quality of internal controls against fraud.
The SEC does not want companies considering listings in the US to think they could be saddled with reporting obligations to the regulator forever.
posted by Brian Moran @ 9:11 AM