Effective Date Set for SEC Final Rule Implementing "Holding Foreign Companies Accountable Act" Requirements

An SEC final rule amending certain annual reporting and registration forms (Forms 20-F, 40-F, 10-K and/or N-CSR) to implement disclosure requirements under the Holding Foreign Companies Accountable Act ("HFCA") will go into effect on January 10, 2022. Amendments to Regulation S-T - Rule 232.405 ("Interactive Data File Submissions") will be effective from January 10, 2022, until July 1, 2023. The final rule was published in the Federal Register.

As previously covered, the final amendments update the forms to:

• reflect the disclosure requirements in Section 3 of the HFCA, which require SEC-registered foreign issuers to disclose, among other things:
  • the percentage of the issuer owned by governmental entities in the foreign jurisdiction of the issuer;
  • whether foreign governments in the jurisdiction of the relevant accounting firm have a controlling financial interest in the issuer;
  • the names of any Chinese Communist Party "officials" who are members of the board of directors, of the company, or of an operating entity with respect to the issuer; and
  • whether the issuer's articles of incorporation contain any Chinese Communist Party charter, including the text of any such charter; and
• require all SEC-registered issuers that are "not owned or controlled by a governmental entity in that foreign jurisdiction" to submit documentation on a supplemental basis establishing that they are not so owned or controlled.