This article summarizes regulatory guidance recently issued under Section 306(a) and 306(b) of the Sarbanes-Oxley Act (the "Act") with respect to blackout periods under individual account retirement plans
Section 306(a) of the Act prohibits insiders from trading in their company’s equity securities acquired in connection with service as a director or executive officer during a retirement plan blackout period.
Section 306(a) also requires that, in any case where a director or executive officer is subject to trading restrictions in connection with a blackout period, the issuer must notify the directors, officers, and the SEC of such blackout period.
Section 306(b) of the Act also amended ERISA to add a new provision that requires administrators of "individual account plans" to provide notice to affected participants and beneficiaries in advance of the commencement of any blackout period.
