SEC staff announces changes to processing of shareholder proposal no-action requests

The SEC’s Division of Corporation Finance recently announced changes to its process for responding to no-action requests that seek exclusion from proxy materials of shareholder proposals submitted under Exchange Act Rule 14a-8.

Starting with the 2019-2020 proxy season, the staff may respond orally, rather than in writing, to a no-action request. In an additional change to its past practice, the staff announced that it may decline in its response to state a view on the company’s arguments for exclusion, instead of indicating whether it agrees or disagrees with the arguments. The Division cautions that the company and the shareholder proponent should not interpret a staff decision declining to state a view as indicating that the company must include the proposal in its proxy materials. The company may exclude the proposal if it has a valid legal basis to do so.

The staff’s announcement is available here.

To learn more about the SEC's recent changes, please read here.


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