Section 13F

WAIS Document RetrievalFrom the U.S. Code Online via GPO Access

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[Laws in effect as of January 24, 2002]

[Document not affected by Public Laws enacted between

January 24, 2002 and December 19, 2002]

[CITE: 15USC78m]

TITLE 15--COMMERCE AND TRADE

CHAPTER 2B--SECURITIES EXCHANGES

Sec. 78m. Periodical and other reports

(a) Reports by issuer of security; contents

Every issuer of a security registered pursuant to section 78l of

this title shall file with the Commission, in accordance with such rules

and regulations as the Commission may prescribe as necessary or

appropriate for the proper protection of investors and to insure fair

dealing in the security--

(1) such information and documents (and such copies thereof) as

the Commission shall require to keep reasonably current the

information and documents required to be included in or filed with

an application or registration statement filed pursuant to section

78l of this title, except that the Commission may not require the

filing of any material contract wholly executed before July 1, 1962.

(2) such annual reports (and such copies thereof), certified if

required by the rules and regulations of the Commission by

independent public accountants, and such quarterly reports (and such

copies thereof), as the Commission may prescribe.

Every issuer of a security registered on a national securities exchange

shall also file a duplicate original of such information, documents, and

reports with the exchange.

(b) Form of report; books, records, and internal accounting; directives

(1) The Commission may prescribe, in regard to reports made pursuant

to this chapter, the form or forms in which the required information

shall be set forth, the items or details to be shown in the balance

sheet and the earning statement, and the methods to be followed in the

preparation of reports, in the appraisal or valuation of assets and

liabilities, in the determination of depreciation and depletion, in the

differentiation of recurring and nonrecurring income, in the

differentiation of investment and operating income, and in the

preparation, where the Commission deems it necessary or desirable, of

separate and/or consolidated balance sheets or income accounts of any

person directly or indirectly controlling or controlled by the issuer,

or any person under direct or indirect common control with the issuer;

but in the case of the reports of any person whose methods of accounting

are prescribed under the provisions of any law of the United States, or

any rule or regulation thereunder, the rules and regulations of the

Commission with respect to reports shall not be inconsistent with the

requirements imposed by such law or rule or regulation in respect of the

same subject matter (except that such rules and regulations of the

Commission may be inconsistent with such requirements to the extent that

the Commission determines that the public interest or the protection of

investors so requires).

(2) Every issuer which has a class of securities registered pursuant

to section 78l of this title and every issuer which is required to file

reports pursuant to section 78o(d) of this title shall--

(A) make and keep books, records, and accounts, which, in

reasonable detail, accurately and fairly reflect the transactions

and dispositions of the assets of the issuer;

(B) devise and maintain a system of internal accounting controls

sufficient to provide reasonable assurances that--

(i) transactions are executed in accordance with

management's general or specific authorization;

(ii) transactions are recorded as necessary (I) to permit

preparation of financial statements in conformity with generally

accepted accounting principles or any other criteria applicable

to such statements, and (II) to maintain accountability for

assets;

(iii) access to assets is permitted only in accordance with

management's general or specific authorization; and

(iv) the recorded accountability for assets is compared with

the existing assets at reasonable intervals and appropriate

action is taken with respect to any differences; and

(C) notwithstanding any other provision of law, pay the

allocable share of such issuer of a reasonable annual accounting

support fee or fees, determined in accordance with section 7219 of

this title.

(3)(A) With respect to matters concerning the national security of

the United States, no duty or liability under paragraph (2) of this

subsection shall be imposed upon any person acting in cooperation with

the head of any Federal department or agency responsible for such

matters if such act in cooperation with such head of a department or

agency was done upon the specific, written directive of the head of such

department or agency pursuant to Presidential authority to issue such

directives. Each directive issued under this paragraph shall set forth

the specific facts and circumstances with respect to which the

provisions of this paragraph are to be invoked. Each such directive

shall, unless renewed in writing, expire one year after the date of

issuance.

(B) Each head of a Federal department or agency of the United States

who issues a directive pursuant to this paragraph shall maintain a

complete file of all such directives and shall, on October 1 of each

year, transmit a summary of matters covered by such directives in force

at any time during the previous year to the Permanent Select Committee

on Intelligence of the House of Representatives and the Select Committee

on Intelligence of the Senate.

(4) No criminal liability shall be imposed for failing to comply

with the requirements of paragraph (2) of this subsection except as

provided in paragraph (5) of this subsection.

(5) No person shall knowingly circumvent or knowingly fail to

implement a system of internal accounting controls or knowingly falsify

any book, record, or account described in paragraph (2).

(6) Where an issuer which has a class of securities registered

pursuant to section 78l of this title or an issuer which is required to

file reports pursuant to section 78o(d) of this title holds 50 per

centum or less of the voting power with respect to a domestic or foreign

firm, the provisions of paragraph (2) require only that the issuer

proceed in good faith to use its influence, to the extent reasonable

under the issuer's circumstances, to cause such domestic or foreign firm

to devise and maintain a system of internal accounting controls

consistent with paragraph (2). Such circumstances include the relative

degree of the issuer's ownership of the domestic or foreign firm and the

laws and practices governing the business operations of the country in

which such firm is located. An issuer which demonstrates good faith

efforts to use such influence shall be conclusively presumed to have

complied with the requirements of paragraph (2).

(7) For the purpose of paragraph (2) of this subsection, the terms

``reasonable assurances'' and ``reasonable detail'' mean such level of

detail and degree of assurance as would satisfy prudent officials in the

conduct of their own affairs.

(c) Alternative reports

If in the judgment of the Commission any report required under

subsection (a) of this section is inapplicable to any specified class or

classes of issuers, the Commission shall require in lieu thereof the

submission of such reports of comparable character as it may deem

applicable to such class or classes of issuers.

(d) Reports by persons acquiring more than five per centum of certain

classes of securities

(1) Any person who, after acquiring directly or indirectly the

beneficial ownership of any equity security of a class which is

registered pursuant to section 78l of this title, or any equity security

of an insurance company which would have been required to be so

registered except for the exemption contained in section 78l(g)(2)(G) of

this title, or any equity security issued by a closed-end investment

company registered under the Investment Company Act of 1940 [15 U.S.C.

80a-1 et seq.] or any equity security issued by a Native Corporation

pursuant to section 1629c(d)(6) of title 43, is directly or indirectly

the beneficial owner of more than 5 per centum of such class shall,

within ten days after such acquisition, send to the issuer of the

security at its principal executive office, by registered or certified

mail, send to each exchange where the security is traded, and file with

the Commission, a statement containing such of the following

information, and such additional information, as the Commission may by

rules and regulations, prescribe as necessary or appropriate in the

public interest or for the protection of investors--

(A) the background, and identity, residence, and citizenship of,

and the nature of such beneficial ownership by, such person and all

other persons by whom or on whose behalf the purchases have been or

are to be effected;

(B) the source and amount of the funds or other consideration

used or to be used in making the purchases, and if any part of the

purchase price is represented or is to be represented by funds or

other consideration borrowed or otherwise obtained for the purpose

of acquiring, holding, or trading such security, a description of

the transaction and the names of the parties thereto, except that

where a source of funds is a loan made in the ordinary course of

business by a bank, as defined in section 78c(a)(6) of this title,

if the person filing such statement so requests, the name of the

bank shall not be made available to the public;

(C) if the purpose of the purchases or prospective purchases is

to acquire control of the business of the issuer of the securities,

any plans or proposals which such persons may have to liquidate such

issuer, to sell its assets to or merge it with any other persons, or

to make any other major change in its business or corporate

structure;

(D) the number of shares of such security which are beneficially

owned, and the number of shares concerning which there is a right to

acquire, directly or indirectly, by (i) such person, and (ii) by

each associate of such person, giving the background, identity,

residence, and citizenship of each such associate; and

(E) information as to any contracts, arrangements, or

understandings with any person with respect to any securities of the

issuer, including but not limited to transfer of any of the

securities, joint ventures, loan or option arrangements, puts or

calls, guaranties of loans, guaranties against loss or guaranties of

profits, division of losses or profits, or the giving or withholding

of proxies, naming the persons with whom such contracts,

arrangements, or understandings have been entered into, and giving

the details thereof.

(2) If any material change occurs in the facts set forth in the

statements to the issuer and the exchange, and in the statement filed

with the Commission, an amendment shall be transmitted to the issuer and

the exchange and shall be filed with the Commission, in accordance with

such rules and regulations as the Commission may prescribe as necessary

or appropriate in the public interest or for the protection of

investors.

(3) When two or more persons act as a partnership, limited

partnership, syndicate, or other group for the purpose of acquiring,

holding, or disposing of securities of an issuer, such syndicate or

group shall be deemed a ``person'' for the purposes of this subsection.

(4) In determining, for purposes of this subsection, any percentage

of a class of any security, such class shall be deemed to consist of the

amount of the outstanding securities of such class, exclusive of any

securities of such class held by or for the account of the issuer or a

subsidiary of the issuer.

(5) The Commission, by rule or regulation or by order, may permit

any person to file in lieu of the statement required by paragraph (1) of

this subsection or the rules and regulations thereunder, a notice

stating the name of such person, the number of shares of any equity

securities subject to paragraph (1) which are owned by him, the date of

their acquisition and such other information as the Commission may

specify, if it appears to the Commission that such securities were

acquired by such person in the ordinary course of his business and were

not acquired for the purpose of and do not have the effect of changing

or influencing the control of the issuer nor in connection with or as a

participant in any transaction having such purpose or effect.

(6) The provisions of this subsection shall not apply to--

(A) any acquisition or offer to acquire securities made or

proposed to be made by means of a registration statement under the

Securities Act of 1933 [15 U.S.C. 77a et seq.];

(B) any acquisition of the beneficial ownership of a security

which, together with all other acquisitions by the same person of

securities of the same class during the preceding twelve months,

does not exceed 2 per centum of that class;

(C) any acquisition of an equity security by the issuer of such

security;

(D) any acquisition or proposed acquisition of a security which

the Commission, by rules or regulations or by order, shall exempt

from the provisions of this subsection as not entered into for the

purpose of, and not having the effect of, changing or influencing

the control of the issuer or otherwise as not comprehended within

the purposes of this subsection.

(e) Purchase of securities by issuer

(1) It shall be unlawful for an issuer which has a class of equity

securities registered pursuant to section 78l of this title, or which is

a closed-end investment company registered under the Investment Company

Act of 1940 [15 U.S.C. 80a-1 et seq.], to purchase any equity security

issued by it if such purchase is in contravention of such rules and

regulations as the Commission, in the public interest or for the

protection of investors, may adopt (A) to define acts and practices

which are fraudulent, deceptive, or manipulative, and (B) to prescribe

means reasonably designed to prevent such acts and practices. Such rules

and regulations may require such issuer to provide holders of equity

securities of such class with such information relating to the reasons

for such purchase, the source of funds, the number of shares to be

purchased, the price to be paid for such securities, the method of

purchase, and such additional information, as the Commission deems

necessary or appropriate in the public interest or for the protection of

investors, or which the Commission deems to be material to a

determination whether such security should be sold.

(2) For the purpose of this subsection, a purchase by or for the

issuer or any person controlling, controlled by, or under common control

with the issuer, or a purchase subject to control of the issuer or any

such person, shall be deemed to be a purchase by the issuer. The

Commission shall have power to make rules and regulations implementing

this paragraph in the public interest and for the protection of

investors, including exemptive rules and regulations covering situations

in which the Commission deems it unnecessary or inappropriate that a

purchase of the type described in this paragraph shall be deemed to be a

purchase by the issuer for purposes of some or all of the provisions of

paragraph (1) of this subsection.

(3) At the time of filing such statement as the Commission may

require by rule pursuant to paragraph (1) of this subsection, the person

making the filing shall pay to the Commission a fee at a rate that,

subject to paragraphs (5) and (6), is equal to $92 per $1,000,000 of the

value of securities proposed to be purchased. The fee shall be reduced

with respect to securities in an amount equal to any fee paid with

respect to any securities issued in connection with the proposed

transaction under section 6(b) of the Securities Act of 1933 [15 U.S.C.

77f(b)], or the fee paid under that section shall be reduced in an

amount equal to the fee paid to the Commission in connection with such

transaction under this paragraph.

(4) Offsetting collections.--Fees collected pursuant to this

subsection for any fiscal year shall be deposited and credited as

offsetting collections to the account providing appropriations to the

Commission, and, except as provided in paragraph (9), shall not be

collected for any fiscal year except to the extent provided in advance

in appropriation Acts. No fees collected pursuant to this subsection for

fiscal year 2002 or any succeeding fiscal year shall be deposited and

credited as general revenue of the Treasury.

(5) Annual adjustment.--For each of the fiscal years 2003 through

2011, the Commission shall by order adjust the rate required by

paragraph (3) for such fiscal year to a rate that is equal to the rate

(expressed in dollars per million) that is applicable under section 6(b)

of the Securities Act of 1933 [15 U.S.C. 77f(b)] for such fiscal year.

(6) Final rate adjustment.--For fiscal year 2012 and all of the

succeeding fiscal years, the Commission shall by order adjust the rate

required by paragraph (3) for all of such fiscal years to a rate that is

equal to the rate (expressed in dollars per million) that is applicable

under section 6(b) of the Securities Act of 1933 [15 U.S.C. 77f(b)] for

all of such fiscal years.

(7) Pro rata application.--The rates per $1,000,000 required by this

subsection shall be applied pro rata to amounts and balances of less

than $1,000,000.

(8) Review and effective date.--In exercising its authority under

this subsection, the Commission shall not be required to comply with the

provisions of section 553 of title 5. An adjusted rate prescribed under

paragraph (5) or (6) and published under paragraph (10) shall not be

subject to judicial review. Subject to paragraphs (4) and (9)--

(A) an adjusted rate prescribed under paragraph (5) shall take

effect on the later of--

(i) the first day of the fiscal year to which such rate

applies; or

(ii) five days after the date on which a regular

appropriation to the Commission for such fiscal year is enacted;

and

(B) an adjusted rate prescribed under paragraph (6) shall take

effect on the later of--

(i) the first day of fiscal year 2012; or

(ii) five days after the date on which a regular

appropriation to the Commission for fiscal year 2012 is enacted.

(9) Lapse of appropriation.--If on the first day of a fiscal year a

regular appropriation to the Commission has not been enacted, the

Commission shall continue to collect fees (as offsetting collections)

under this subsection at the rate in effect during the preceding fiscal

year, until 5 days after the date such a regular appropriation is

enacted.

(10) Publication.--The rate applicable under this subsection for

each fiscal year is published pursuant to section 6(b)(10) of the

Securities Act of 1933 [15 U.S.C. 77f(b)(10)].

(f) Reports by institutional investment managers

(1) Every institutional investment manager which uses the mails, or

any means or instrumentality of interstate commerce in the course of its

business as an institutional investment manager and which exercises

investment discretion with respect to accounts holding equity securities

of a class described in subsection (d)(1) of this section having an

aggregate fair market value on the last trading day in any of the

preceding twelve months of at least $100,000,000 or such lesser amount

(but in no case less than $10,000,000) as the Commission, by rule, may

determine, shall file reports with the Commission in such form, for such

periods, and at such times after the end of such periods as the

Commission, by rule, may prescribe, but in no event shall such reports

be filed for periods longer than one year or shorter than one quarter.

Such reports shall include for each such equity security held on the

last day of the reporting period by accounts (in aggregate or by type as

the Commission, by rule, may prescribe) with respect to which the

institutional investment manager exercises investment discretion (other

than securities held in amounts which the Commission, by rule,

determines to be insignificant for purposes of this subsection), the

name of the issuer and the title, class, CUSIP number, number of shares

or principal amount, and aggregate fair market value of each such

security. Such reports may also include for accounts (in aggregate or by

type) with respect to which the institutional investment manager

exercises investment discretion such of the following information as the

Commission, by rule, prescribes--

(A) the name of the issuer and the title, class, CUSIP number,

number of shares or principal amount, and aggregate fair market

value or cost or amortized cost of each other security (other than

an exempted security) held on the last day of the reporting period

by such accounts;

(B) the aggregate fair market value or cost or amortized cost of

exempted securities (in aggregate or by class) held on the last day

of the reporting period by such accounts;

(C) the number of shares of each equity security of a class

described in subsection (d)(1) of this section held on the last day

of the reporting period by such accounts with respect to which the

institutional investment manager possesses sole or shared authority

to exercise the voting rights evidenced by such securities;

(D) the aggregate purchases and aggregate sales during the

reporting period of each security (other than an exempted security)

effected by or for such accounts; and

(E) with respect to any transaction or series of transactions

having a market value of at least $500,000 or such other amount as

the Commission, by rule, may determine, effected during the

reporting period by or for such accounts in any equity security of a

class described in subsection (d)(1) of this section--

(i) the name of the issuer and the title, class, and CUSIP

number of the security;

(ii) the number of shares or principal amount of the

security involved in the transaction;

(iii) whether the transaction was a purchase or sale;

(iv) the per share price or prices at which the transaction

was effected;

(v) the date or dates of the transaction;

(vi) the date or dates of the settlement of the transaction;

(vii) the broker or dealer through whom the transaction was

effected;

(viii) the market or markets in which the transaction was

effected; and

(ix) such other related information as the Commission, by

rule, may prescribe.

(2) The Commission, by rule, or order, may exempt, conditionally or

unconditionally, any institutional investment manager or security or any

class of institutional investment managers or securities from any or all

of the provisions of this subsection or the rules thereunder.

(3) The Commission shall make available to the public for a

reasonable fee a list of all equity securities of a class described in

subsection (d)(1) of this section, updated no less frequently than

reports are required to be filed pursuant to paragraph (1) of this

subsection. The Commission shall tabulate the information contained in

any report filed pursuant to this subsection in a manner which will, in

the view of the Commission, maximize the usefulness of the information

to other Federal and State authorities and the public. Promptly after

the filing of any such report, the Commission shall make the information

contained therein conveniently available to the public for a reasonable

fee in such form as the Commission, by rule, may prescribe, except that

the Commission, as it determines to be necessary or appropriate in the

public interest or for the protection of investors, may delay or prevent

public disclosure of any such information in accordance with section 552

of title 5. Notwithstanding the preceding sentence, any such information

identifying the securities held by the account of a natural person or an

estate or trust (other than a business trust or investment company)

shall not be disclosed to the public.

(4) In exercising its authority under this subsection, the

Commission shall determine (and so state) that its action is necessary

or appropriate in the public interest and for the protection of

investors or to maintain fair and orderly markets or, in granting an

exemption, that its action is consistent with the protection of

investors and the purposes of this subsection. In exercising such

authority the Commission shall take such steps as are within its power,

including consulting with the Comptroller General of the United States,

the Director of the Office of Management and Budget, the appropriate

regulatory agencies, Federal and State authorities which, directly or

indirectly, require reports from institutional investment managers of

information substantially similar to that called for by this subsection,

national securities exchanges, and registered securities associations,

(A) to achieve uniform, centralized reporting of information concerning

the securities holdings of and transactions by or for accounts with

respect to which institutional investment managers exercise investment

discretion, and (B) consistently with the objective set forth in the

preceding subparagraph, to avoid unnecessarily duplicative reporting by,

and minimize the compliance burden on, institutional investment

managers. Federal authorities which, directly or indirectly, require

reports from institutional investment managers of information

substantially similar to that called for by this subsection shall

cooperate with the Commission in the performance of its responsibilities

under the preceding sentence. An institutional investment manager which

is a bank, the deposits of which are insured in accordance with the

Federal Deposit Insurance Act [12 U.S.C. 1811 et seq.], shall file with

the appropriate regulatory agency a copy of every report filed with the

Commission pursuant to this subsection.

(5)(A) For purposes of this subsection the term ``institutional

investment manager'' includes any person, other than a natural person,

investing in or buying and selling securities for its own account, and

any person exercising investment discretion with respect to the account

of any other person.

(B) The Commission shall adopt such rules as it deems necessary or

appropriate to prevent duplicative reporting pursuant to this subsection

by two or more institutional investment managers exercising investment

discretion with respect to the same amount.\1\

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\1\ So in original. Probably should be ``account.''

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(g) Statement of equity security ownership

(1) Any person who is directly or indirectly the beneficial owner of

more than 5 per centum of any security of a class described in

subsection (d)(1) of this section shall send to the issuer of the

security and shall file with the Commission a statement setting forth,

in such form and at such time as the Commission may, by rule,

prescribe--

(A) such person's identity, residence, and citizenship; and

(B) the number and description of the shares in which such

person has an interest and the nature of such interest.

(2) If any material change occurs in the facts set forth in the

statement sent to the issuer and filed with the Commission, an amendment

shall be transmitted to the issuer and shall be filed with the

Commission, in accordance with such rules and regulations as the

Commission may prescribe as necessary or appropriate in the public

interest or for the protection of investors.

(3) When two or more persons act as a partnership, limited

partnership, syndicate, or other group for the purpose of acquiring,

holding, or disposing of securities of an issuer, such syndicate or

group shall be deemed a ``person'' for the purposes of this subsection.

(4) In determining, for purposes of this subsection, any percentage

of a class of any security, such class shall be deemed to consist of the

amount of the outstanding securities of such class, exclusive of any

securities of such class held by or for the account of the issuer or a

subsidiary of the issuer.

(5) In exercising its authority under this subsection, the

Commission shall take such steps as it deems necessary or appropriate in

the public interest or for the protection of investors (A) to achieve

centralized reporting of information regarding ownership, (B) to avoid

unnecessarily duplicative reporting by and minimize the compliance

burden on persons required to report, and (C) to tabulate and promptly

make available the information contained in any report filed pursuant to

this subsection in a manner which will, in the view of the Commission,

maximize the usefulness of the information to other Federal and State

agencies and the public.

(6) The Commission may, by rule or order, exempt, in whole or in

part, any person or class of persons from any or all of the reporting

requirements of this subsection as it deems necessary or appropriate in

the public interest or for the protection of investors.

(h) Large trader reporting

(1) Identification requirements for large traders

For the purpose of monitoring the impact on the securities

markets of securities transactions involving a substantial volume or

a large fair market value or exercise value and for the purpose of

otherwise assisting the Commission in the enforcement of this

chapter, each large trader shall--

(A) provide such information to the Commission as the

Commission may by rule or regulation prescribe as necessary or

appropriate, identifying such large trader and all accounts in

or through which such large trader effects such transactions;

and

(B) identify, in accordance with such rules or regulations

as the Commission may prescribe as necessary or appropriate, to

any registered broker or dealer by or through whom such large

trader directly or indirectly effects securities transactions,

such large trader and all accounts directly or indirectly

maintained with such broker or dealer by such large trader in or

through which such transactions are effected.

(2) Recordkeeping and reporting requirements for brokers and

dealers

Every registered broker or dealer shall make and keep for

prescribed periods such records as the Commission by rule or

regulation prescribes as necessary or appropriate in the public

interest, for the protection of investors, or otherwise in

furtherance of the purposes of this chapter, with respect to

securities transactions that equal or exceed the reporting activity

level effected directly or indirectly by or through such registered

broker or dealer of or for any person that such broker or dealer

knows is a large trader, or any person that such broker or dealer

has reason to know is a large trader on the basis of transactions in

securities effected by or through such broker or dealer. Such

records shall be available for reporting to the Commission, or any

self-regulatory organization that the Commission shall designate to

receive such reports, on the morning of the day following the day

the transactions were effected, and shall be reported to the

Commission or a self-regulatory organization designated by the

Commission immediately upon request by the Commission or such a

self-regulatory organization. Such records and reports shall be in a

format and transmitted in a manner prescribed by the Commission

(including, but not limited to, machine readable form).

(3) Aggregation rules

The Commission may prescribe rules or regulations governing the

manner in which transactions and accounts shall be aggregated for

the purpose of this subsection, including aggregation on the basis

of common ownership or control.

(4) Examination of broker and dealer records

All records required to be made and kept by registered brokers

and dealers pursuant to this subsection with respect to transactions

effected by large traders are subject at any time, or from time to

time, to such reasonable periodic, special, or other examinations by

representatives of the Commission as the Commission deems necessary

or appropriate in the public interest, for the protection of

investors, or otherwise in furtherance of the purposes of this

chapter.

(5) Factors to be considered in Commission actions

In exercising its authority under this subsection, the

Commission shall take into account--

(A) existing reporting systems;

(B) the costs associated with maintaining information with

respect to transactions effected by large traders and reporting

such information to the Commission or self-regulatory

organizations; and

(C) the relationship between the United States and

international securities markets.

(6) Exemptions

The Commission, by rule, regulation, or order, consistent with

the purposes of this chapter, may exempt any person or class of

persons or any transaction or class of transactions, either

conditionally or upon specified terms and conditions or for stated

periods, from the operation of this subsection, and the rules and

regulations thereunder.

(7) Authority of Commission to limit disclosure of

information

Notwithstanding any other provision of law, the Commission shall

not be compelled to disclose any information required to be kept or

reported under this subsection. Nothing in this subsection shall

authorize the Commission to withhold information from Congress, or

prevent the Commission from complying with a request for information

from any other Federal department or agency requesting information

for purposes within the scope of its jurisdiction, or complying with

an order of a court of the United States in an action brought by the

United States or the Commission. For purposes of section 552 of

title 5, this subsection shall be considered a statute described in

subsection (b)(3)(B) of such section 552.

(8) Definitions

For purposes of this subsection--

(A) the term ``large trader'' means every person who, for

his own account or an account for which he exercises investment

discretion, effects transactions for the purchase or sale of any

publicly traded security or securities by use of any means or

instrumentality of interstate commerce or of the mails, or of

any facility of a national securities exchange, directly or

indirectly by or through a registered broker or dealer in an

aggregate amount equal to or in excess of the identifying

activity level;

(B) the term ``publicly traded security'' means any equity

security (including an option on individual equity securities,

and an option on a group or index of such securities) listed, or

admitted to unlisted trading privileges, on a national

securities exchange, or quoted in an automated interdealer

quotation system;

(C) the term ``identifying activity level'' means

transactions in publicly traded securities at or above a level

of volume, fair market value, or exercise value as shall be

fixed from time to time by the Commission by rule or regulation,

specifying the time interval during which such transactions

shall be aggregated;

(D) the term ``reporting activity level'' means transactions

in publicly traded securities at or above a level of volume,

fair market value, or exercise value as shall be fixed from time

to time by the Commission by rule, regulation, or order,

specifying the time interval during which such transactions

shall be aggregated; and

(E) the term ``person'' has the meaning given in section

78c(a)(9) of this title and also includes two or more persons

acting as a partnership, limited partnership, syndicate, or

other group, but does not include a foreign central bank.

(i) Accuracy of financial reports

Each financial report that contains financial statements, and that

is required to be prepared in accordance with (or reconciled to)

generally accepted accounting principles under this chapter and filed

with the Commission shall reflect all material correcting adjustments

that have been identified by a registered public accounting firm in

accordance with generally accepted accounting principles and the rules

and regulations of the Commission.

(j) Off-balance sheet transactions

Not later than 180 days after July 30, 2002, the Commission shall

issue final rules providing that each annual and quarterly financial

report required to be filed with the Commission shall disclose all

material off-balance sheet transactions, arrangements, obligations

(including contingent obligations), and other relationships of the

issuer with unconsolidated entities or other persons, that may have a

material current or future effect on financial condition, changes in

financial condition, results of operations, liquidity, capital

expenditures, capital resources, or significant components of revenues

or expenses.

(k) Prohibition on personal loans to executives

(1) In general

It shall be unlawful for any issuer (as defined in section 7201

of this title), directly or indirectly, including through any

subsidiary, to extend or maintain credit, to arrange for the

extension of credit, or to renew an extension of credit, in the form

of a personal loan to or for any director or executive officer (or

equivalent thereof) of that issuer. An extension of credit

maintained by the issuer on July 30, 2002, shall not be subject to

the provisions of this subsection, provided that there is no

material modification to any term of any such extension of credit or

any renewal of any such extension of credit on or after July 30,

2002.

(2) Limitation

Paragraph (1) does not preclude any home improvement and

manufactured home loans (as that term is defined in section 1464 of

title 12), consumer credit (as defined in section 1602 of this

title), or any extension of credit under an open end credit plan (as

defined in section 1602 of this title), or a charge card (as defined

in section 1637(c)(4)(e) of this title), or any extension of credit

by a broker or dealer registered under section 78o of this title to

an employee of that broker or dealer to buy, trade, or carry

securities, that is permitted under rules or regulations of the

Board of Governors of the Federal Reserve System pursuant to section

78g of this title (other than an extension of credit that would be

used to purchase the stock of that issuer), that is--

(A) made or provided in the ordinary course of the consumer

credit business of such issuer;

(B) of a type that is generally made available by such

issuer to the public; and

(C) made by such issuer on market terms, or terms that are

no more favorable than those offered by the issuer to the

general public for such extensions of credit.

(3) Rule of construction for certain loans

Paragraph (1) does not apply to any loan made or maintained by

an insured depository institution (as defined in section 3 of the

Federal Deposit Insurance Act (12 U.S.C. 1813)), if the loan is

subject to the insider lending restrictions of section 375b of title

12.

(l) Real time issuer disclosures

Each issuer reporting under subsec. (a) of this section or section

78o(d) of this title shall disclose to the public on a rapid and current

basis such additional information concerning material changes in the

financial condition or operations of the issuer, in plain English, which

may include trend and qualitative information and graphic presentations,

as the Commission determines, by rule, is necessary or useful for the

protection of investors and in the public interest.

(June 6, 1934, ch. 404, title I, Sec. 13, 48 Stat. 894; Pub. L. 88-467,

Sec. 4, Aug. 20, 1964, 78 Stat. 569; Pub. L. 90-439, Sec. 2, July 29,

1968, 82 Stat. 454; Pub. L. 91-567, Secs. 1, 2, Dec. 22, 1970, 84 Stat.

1497; Pub. L. 94-29, Sec. 10, June 4, 1975, 89 Stat. 119; Pub. L. 94-

210, title III, Sec. 308(b), Feb. 5, 1976, 90 Stat. 57; Pub. L. 95-213,

title I, Sec. 102, title II, Secs. 202, 203, Dec. 19, 1977, 91 Stat.

1494, 1498, 1499; Pub. L. 98-38, Sec. 2(a), June 6, 1983, 97 Stat. 205;

Pub. L. 100-181, title III, Secs. 315, 316, Dec. 4, 1987, 101 Stat.

1256; Pub. L. 100-241, Sec. 12(d), Feb. 3, 1988, 101 Stat. 1810; Pub. L.

100-418, title V, Sec. 5002, Aug. 23, 1988, 102 Stat. 1415; Pub. L. 101-

432, Sec. 3, Oct. 16, 1990, 104 Stat. 964; Pub. L. 107-123, Sec. 5, Jan.

16, 2002, 115 Stat. 2395; Pub. L. 107-204, title I, Sec. 109(h), title

IV, Secs. 401(a), 402(a), 409, July 30, 2002, 116 Stat. 771, 785, 787,

791.)

References in Text

This chapter, referred to in subsecs. (b)(1), (h)(1), (2), (4), (6),

and (i), was in the original ``this title''. See References in Text note

set out under section 78a of this title.

The Investment Company Act of 1940, referred to in subsecs. (d)(1)

and (e)(1), is title I of act Aug. 22, 1940, ch. 686, 54 Stat. 789, as

amended, which is classified generally to subchapter I (Sec. 80a-1 et

seq.) of chapter 2D of this title. For complete classification of this

Act to the Code, see section 80a-51 of this title and Tables.

The Securities Act of 1933, referred to in subsec. (d)(6)(A), is act

May 27, 1933, ch. 38, title I, 48 Stat. 74, as amended, which is

classified generally to subchapter I (Sec. 77a et seq.) of chapter 2A of

this title. For complete classification of this Act to the Code, see

section 77a of this title and Tables.

The Federal Deposit Insurance Act, referred to in subsec. (f)(4), is

act Sept. 21, 1950, ch. 967, Sec. 2, 64 Stat. 873, as amended, which is

classified generally to chapter 16 (Sec. 1811 et seq.) of Title 12,

Banks and Banking. For complete classification of this Act to the Code,

see Short Title note set out under section 1811 of Title 12 and Tables.

Section 7201 of this title, referred to in subsec. (k)(1), was in

the original ``section 2 of the Sarbanes-Oxley Act of 2002'', Pub. L.

107-204, which enacted section 7201 of this title and amended section

78c of this title.

Amendments

2002--Subsec. (b)(2)(C). Pub. L. 107-204, Sec. 109(h), added subpar.

(C).

Subsec. (e)(3). Pub. L. 107-123, Sec. 5(1), substituted ``a fee at a

rate that, subject to paragraphs (5) and (6), is equal to $92 per

$1,000,000 of the value of securities proposed to be purchased'' for ``a

fee of \1/50\ of 1 per centum of the value of securities proposed to be

purchased''.

Subsec. (e)(4) to (10). Pub. L. 107-123, Sec. 5(2), added pars. (4)

to (10).

Subsecs. (i), (j). Pub. L. 107-204, Sec. 401(a), added subsecs. (i)

and (j).

Subsec. (k). Pub. L. 107-204, Sec. 402(a), added subsec. (k).

Subsec. (l). Pub. L. 107-204, Sec. 409, added subsec. (l).

1990--Subsec. (h). Pub. L. 101-432 added subsec. (h).

1988--Subsec. (b)(4) to (7). Pub. L. 100-418 added pars. (4) to (7).

Subsec. (d)(1). Pub. L. 100-241 inserted ``or any equity security

issued by a Native Corporation pursuant to section 1629c(d)(6) of title

43''.

1987--Subsec. (c). Pub. L. 100-181, Sec. 315, struck out ``of''

after ``thereof''.

Subsec. (h). Pub. L. 100-181, Sec. 316, struck out subsec. (h) which

required Commission to report to Congress within thirty months of Dec.

19, 1977, with respect to effectiveness of ownership reporting

requirements contained in this chapter and desirability and feasibility

of reducing or otherwise modifying the 5 per centum threshold used in

subsecs. (d)(1) and (g)(1) of this section.

1983--Subsec. (e)(3). Pub. L. 98-38 added par. (3).

1977--Subsec. (b). Pub. L. 95-213, Sec. 102, designated existing

provisions as par. (1) and added pars. (2) and (3).

Subsec. (d)(1). Pub. L. 95-213, Sec. 202, inserted references to

residence and citizenship of persons and to nature of beneficial

ownership of persons in subpar. (A), and inserted references to

background, identity, residence, and citizenship of associates of

persons in subpar. (D).

Subsecs. (g), (h). Pub. L. 95-213, Sec. 203, added subsecs. (g) and

(h).

1976--Subsec. (b). Pub. L. 94-210 substituted provisions relating to

exceptions for inconsistent rules and regulations, for provisions

relating to reporting requirements for carriers subject to the

provisions of section 20 of title 49, or other carriers required to make

reports of the same general character as those required under section 20

of title 49.

1975--Subsec. (f). Pub. L. 94-29 added subsec. (f).

1970--Subsec. (d)(1). Pub. L. 91-567, Sec. 1(a), included equity

securities of insurance companies which would have been required to be

registered except for the exemption contained in section 78l(g)(2)(G) of

this title, and substituted ``5 per centum'' for ``10 per centum''.

Subsec. (d)(5), (6). Pub. L. 91-567, Sec. 1(b), added par. (5) and

redesignated former par. (5) as (6).

Subsec. (e)(2). Pub. L. 91-567, Sec. 2, inserted provisions

empowering the Commission to make rules and regulations implementing the

paragraph in the public interest and for the protection of investors.

1968--Subsecs. (d), (e). Pub. L. 90-439 added subsecs. (d) and (e).

1964--Subsec. (a). Pub. L. 88-467 substituted provisions which

require the issuer of a security registered pursuant to section 78l of

this title to file reports with the Commission rather than with the

exchange and to furnish the exchange with duplicate originals and

prohibit the Commission from requiring the filing of any material

contract wholly executed before July 1, 1962 for former provisions which

required the issuer of a security registered on a national securities

exchange to file certain reports with the exchange and to file

duplicates with the Commission.

Effective Date of 2002 Amendment

Amendment by Pub. L. 107-123 effective Oct. 1, 2001, except that

authorities provided by subsec. (e)(9) of this section to not apply

until Oct. 1, 2002, see section 11 of Pub. L. 107-123, set out as a note

under section 78ee of this title.

Effective Date of 1976 Amendment

Amendment by Pub. L. 94-210 not applicable to any report by any

person with respect to a fiscal year of such person which began before

Feb. 5, 1976, see section 308(d)(2) of Pub. L. 94-210, set out as a note

under section 80a-3 of this title.

Effective Date of 1975 Amendment

Amendment by Pub. L. 94-29 effective June 4, 1975, see section 31(a)

of Pub. L. 94-29, set out as a note under section 78b of this title.

Effective Date of 1964 Amendment

Amendment by Pub. L. 88-467 effective Aug. 20, 1964, see section 13

of Pub. L. 88-467, set out as a note under section 78c of this title.

Transfer of Functions

For transfer of functions of Securities and Exchange Commission,

with certain exceptions, to Chairman of such Commission, see Reorg. Plan

No. 10 of 1950, Secs. 1, 2, eff. May 24, 1950, 15 F.R. 3175, 64 Stat.

1265, set out under section 78d of this title.

Consultation

Pub. L. 106-102, title II, Sec. 241, Nov. 12, 1999, 113 Stat. 1407,

provided that:

``(a) In General.--The Securities and Exchange Commission shall

consult and coordinate comments with the appropriate Federal banking

agency before taking any action or rendering any opinion with respect to

the manner in which any insured depository institution or depository

institution holding company reports loan loss reserves in its financial

statement, including the amount of any such loan loss reserve.

``(b) Definitions.--For purposes of subsection (a), the terms

`insured depository institution', `depository institution holding

company', and `appropriate Federal banking agency' have the same meaning

as given in section 3 of the Federal Deposit Insurance Act [12 U.S.C.

1813].''

Section Referred to in Other Sections

This section is referred to in sections 77f, 77r, 77s, 77z-2, 77nnn,

78c, 78j-1, 78l, 78n, 78o, 78u-5, 78w, 78hh, 80a-8, 80a-29, 80a-54, 80a-

63, 773, 7201, 7241, 7261, 7262, 7264, 7265, 7266 of this title; title 7

section 12a; title 11 section 1145; title 12 section 1817; title 16

section 824c; title 18 section 1350; title 22 section 2197; title 26

sections 162, 952, 964; title 29 section 1343; title 43 section 1629c.