SEC amends disclosure rules for acquisitions and disposals

By Ken Tysiac

The SEC voted to adopt amendments to its rules and forms for disclosing financial information about acquired or disposed businesses.

The changes are intended to improve information for investors, facilitate more timely access to capital, and reduce the complexity and costs of preparing the disclosure.

The new rules and forms are designed to help registrants make more meaningful determinations of whether a subsidiary or an acquired or disposed business is significant and to improve the financial disclosure requirements applicable to acquisitions and disposals of businesses, including real estate operations and investment companies.

The amendments take effect on Jan. 1, 2021, but voluntary compliance is permitted before the rules take effect.

This is the first comprehensive rules change in this area in more than 30 years, according to the SEC.

“This action, which is designed to enhance the quality of information that investors receive while eliminating unnecessary costs and burdens, will benefit investors, registrants, and the market more generally,” SEC Chairman Jay Clayton said in a news release.

Ken Tysiac ( is the JofA’s editorial director.

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