SEC Amends Foreign Private Issuer Exemption

The US Securities and Exchange Commission (the "SEC") has amended Rule 12g3-2(b) under the Securities Exchange Act of 1934, as amended (the "Exchange Act").¹ This rule provides an exemption to a foreign private issuer² from registering a class of equity securities under Section 12(g) of the Exchange Act.³ The Rule 12g3-2(b) exemption also enables a qualified foreign private issuer to have a class of its equity securities traded on a limited basis in the over-the-counter ("OTC") market in the United States (often in the form of American Depository Receipts), while avoiding the Exchange Act's periodic reporting requirements and provisions of the Sarbanes-Oxley Act of 2002. Foreign private issuers must continue to register a class of equity security under the Exchange Act if that class is listed on a national securities exchange or traded on the OTC Bulletin Board.⁴