Rule12g3-2SupportingStatement.2021

SUPPORTING STATEMENT
FOR THE PAPERWORK REDUCTION ACT INFORMATION COLLECTION
SUBMISSION FOR RULE 12g3-2
A.

JUSTIFICATION
1.

Circumstances Making the Collection of Information Necessary

The Securities Exchange Act of 1934 (“Exchange Act”) is intended to ensure that
secondary markets for publicly traded securities are fair and honest. The principal means
by which the Exchange Act carries out this purpose include regulation of broker-dealers,
registration of exchanged-traded and other securities, remedial provisions for fraud in
securities transactions and manipulation of regulated securities markets, and limits on the
extension of credit for securities purposes. In addition, they include issuer registration and
periodic reporting requirements prescribed by the Securities and Exchange Commission
(“Commission”) pursuant to its authority in Sections 12(b), 12(g), 13(a) and 15(d) of the
Exchange Act.
Exchange Act Section 12(g)(3) provides that the Commission may exempt from the
registration requirements of Section 12(g)(1) any security of a foreign issuer if the
Commission finds that such exemption is in the public interest and is consistent with the
protection of investors. The Commission has exercised its authority under Section 12(g)(3)
by providing an exemption from such requirements to a foreign private issuer that provides
certain information to the Commission that is publicly available in accordance with the laws
of the foreign jurisdiction in which the foreign private issuer is domiciled, incorporated or
organized, or the rules of the foreign stock exchange on which its securities are traded, or
that has been distributed or is required to be distributed to its security holders (together the
issuer’s “non-U.S. disclosure documents”), and that otherwise satisfies other conditions as
currently specified in Exchange Act Rule 12g3-2.
In 1992, the Commission received approval to use Forms 12-F and 12-FA to collect
the information required by Rule 12g3-2. Those forms were never adopted, however.
Therefore, the information required by Rule 12g3-2 currently is not submitted to the
Commission on a prescribed form.
2.

Purpose and Use of the Information Collection

The principal function of the Commission's forms, schedules and rules under the
securities laws' disclosure provisions is to make information available to investors. The
information required to be filed with and submitted to the Commission permits verification of
compliance with securities law requirements and assures the public availability and
dissemination of such information. Private contractors reproduce much of the submitted
information and provide it to private parties. Many other persons obtain information directly
from the Commission's files located in the Public Reference Room. Security holders,
investors, broker-dealers, investment banking firms, professional securities analysts and

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others can use this information to evaluate securities and make investment decisions with
respect to such securities.
3.

Consideration Given to Information Technology

The information required by Rule 12g3-2 is filed electronically using the Electronic
Data Gathering, Analysis and Retrieval (“EDGAR”) System.
4.

Duplication of Information

The information required by Rule 12g3-2 is designed to provide investors in foreign
securities with information concerning such securities and the foreign issuer. This
information is not otherwise readily available in the United States.
5.

Reducing the Burden on Small Entities

There are no qualifications for use of Rule 12g3-2 based on size of the applying
foreign private issuer. Thus, the rules do not discriminate against small issuers.
6.

Consequences of Not Conducting Collection

Persons in the United States considering investment in securities issued by foreign
companies would find it more difficult and expensive to obtain the necessary information if
not required by the Commission.
7.

Special Circumstances
There are no special circumstances.

8.

Consultations with Persons Outside the Agency

No comments were received on this request during the 60-day comment period prior
to OMB’s review.
9.

Payments or Gift to Respondents
No payment or gift has been provided to any respondents.

10.

Confidentiality
Information submitted pursuant to Rule 12g3-2 is public.

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11.

Sensitive Questions

No information of a sensitive nature, including social security numbers, will be
required under this collection of information. The information collection does not collect
personally identifiable information (PII). The agency has determined that a system of
records notice (SORN) and privacy impact assessment (PIA) are not required in connection
with the collection of information.
12.

Estimate of Respondent Reporting Burden
Estimated Reporting Burden
Information
Collection
Title
Rule 12g-3

OMB Control
Number

Number of
Responses

Burden
Hours

3235-0119

16,632

37,206

For purposes of the Paperwork Reduction Act (“PRA”), we estimate that
approximately 1,386 respondents claim the exemption. Each respondent publishes an
estimated 12 submissions pursuant to Rule 12g3-2 per year for a total of 16,632 responses.
We derived our burden hour estimates by estimating the average number of hours it would
take a foreign private issuer to compile the necessary information and data, prepare and
review disclosure, file documents and retain records. In connection with rule amendments
to the form, we occasionally receive PRA estimates from public commenters about
incremental burdens that are used in our burden estimates. We believe that the actual
burdens will likely vary among individual foreign private issuers based on the nature of their
operations. We further estimate that 25% of the collection of information burden is carried
by the foreign private issuer internally and that75% of the burden of preparation is carried
by outside professionals retained by the company. Based on our estimates, we calculate the
number of burden hours incurred by foreign private issuers to produce the Rule 12g3-2(b)
publications to total 37,206, or approximately 2.237 burden hours per response (2.237 hours
per responses x 16,632 responses. For administrative convenience, the presentation of the
total related to the paperwork burden hours has been rounded to the nearest whole number.
The estimated burden hours are made solely for the purpose of the Paperwork Reduction
Act.

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13.

Estimate of Total Annualized Cost Burden
Estimated Cost Burden
Information
Collection
Title
Rule 12g-3

OMB Control
Number

Number of
Responses

Burden
Hours

3235-0119

16,632

$5,860,050

We estimate that the total annual cost burden for outside firms to perform services
necessary to prepare a response is $5,860,050 ($352.33586 cost per response x 16,632
responses). This estimate is based on our consultations with registrants and professional
firms who regularly assist registrants in preparing and filing disclosure documents with the
Commission. Our estimates reflect average burdens, and therefore, some companies may
experience costs in excess of our estimates and some companies may experience costs that
are lower than our estimates. For administrative convenience, the presentation of the total
cost has been rounded to the nearest dollar. The cost estimate is made solely for the
purpose of the Paperwork Reduction Act.
14.

Costs to Federal Government

The annual cost of reviewing and processing disclosure documents, including
registration statements, post-effective amendments, proxy statements, annual reports and
other filings of operating companies amounted to approximately $103,479,690 in fiscal year
2019, based on the Commission’s computation of the value of staff time devoted to this
activity and related overhead.
15.

Reason for Changes in Burden
There is no change in burden.

16.

Information Collection Planned for Statistical Purposes
The information collection is not planned for statistical purposes.

17.

Approval to Omit OMB Expiration Date
The Commission is not seeking approval to omit the expiration date.

18.

Exceptions to Certification for Paperwork Reduction Act Submissions
There are no exceptions to certification for Paperwork Reduction Act submissions.

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B.

STATISTICAL METHODS
The information collection does not employ statistical methods.