Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 8443 

1 15 U.S.C. 78a et seq. 

limit presentation times or impose 

further restrictions, as necessary. 

Alberta E. Mills, 

Secretary, Consumer Product Safety 

Commission. 

[FR Doc. 2022–03166 Filed 2–14–22; 8:45 am] 

BILLING CODE 6355–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

17 CFR Parts 229, 232, 240, 249, and 

274 

[Release Nos. 34–93783; IC–34440; File No. 

S7–21–21] 

RIN 3235–AM94 

Share Repurchase Disclosure 

Modernization 

AGENCY: Securities and Exchange 

Commission. 

ACTION: Proposed rule. 

SUMMARY: The Securities and Exchange 

Commission is proposing amendments 

to modernize and improve disclosure 

about repurchases of an issuer’s equity 

securities that are registered under the 

Securities Exchange Act of 1934. 

Specifically, the proposed amendments 

would require an issuer to provide more 

timely disclosure on a new Form SR 

regarding purchases of its equity 

securities for each day that it, or an 

affiliated purchaser, makes a share 

repurchase. The proposed amendments 

would also enhance the existing 

periodic disclosure requirements about 

these purchases. 

DATES: Comments should be received on 

or before April 1, 2022. 

ADDRESSES: Comments may be 

submitted by any of the following 

methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

regulatory-actions/how-to-submitcomments); or 

Paper Comments 

• Send paper comments to Secretary, 

Securities and Exchange Commission, 

100 F Street NE, Washington, DC 

20549–1090. 

All submissions should refer to File 

Number S7–21–21. This file number 

should be included on the subject line 

if email is used. To help us process and 

review your comments more efficiently, 

please use only one method of 

submission. The Commission will post 

all comments on the Commission’s 

website (http://www.sec.gov/rules/ 

proposed.shtml). Comments also are 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549–1090, on official 

business days between the hours of 10 

a.m. and 3 p.m. Operating conditions 

may limit access to the Commission’s 

public reference room. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. 

Studies, memoranda, or other 

substantive items may be added by the 

Commission or staff to the comment file 

during this rulemaking. A notification of 

the inclusion in the comment file of any 

such materials will be made available 

on our website. To ensure direct 

electronic receipt of such notifications, 

sign up through the ‘‘Stay Connected’’ 

option at www.sec.gov to receive 

notifications by email. 

FOR FURTHER INFORMATION CONTACT: 

Steven G. Hearne, Senior Special 

Counsel, Office of Rulemaking, at (202) 

551–3460, Division of Corporation 

Finance; and, with respect to the 

application of the proposal to 

investment companies, Bradley Gude, 

Special Counsel, at (202) 551–6792, 

Investment Company Regulation Office, 

Division of Investment Management; 

U.S. Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549. 

SUPPLEMENTARY INFORMATION: We are 

proposing to amend or add the 

following rules and forms: 

Commission reference CFR citation 

(17 CFR) 

Regulation S–K .................................................. Item 10 through 1305 ...................................... §§ 229.10 through 229.1305. 

Item 601 ........................................................... § 229.601. 

Item 703 ........................................................... § 229.703. 

Regulation S–T ................................................... Rule 10 through 903 ........................................ §§ 232.10 through 232.903. 

Rule 405 ........................................................... § 232.405. 

Securities Exchange Act of 1934 (Exchange 

Act) 1.

Proposed Rule 13a–21 .................................... § 240.13a–21. 

Proposed Form SR 

Form 20–F ....................................................... § 249.220f. 

Form N–CSR ................................................... §§ 249.331 and 274.128. 

Table of Contents 

I. Introduction 

II. Discussion of Proposed Amendments 

A. Proposed Form SR 

B. Proposed Revisions to Item 703, Form 

20–F, and Form N–CSR 

1. Additional Disclosure 

2. Clarifying Amendments 

C. Structured Data Requirement 

III. General Request for Comment 

IV. Economic Analysis 

A. Baseline and Affected Parties 

1. Affected Parties 

2. Baseline 

B. Benefits 

C. Costs 

D. Reasonable Alternatives 

V. Paperwork Reduction Act 

VI. Small Business Regulatory Enforcement 

Fairness Act 

VII. Initial Regulatory Flexibility Analysis 

Statutory Authority 


lotter on DSK11XQN23PROD with PROPOSALS1
8444 Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 

2For purposes of this release, the term ‘‘issuer’’ 

includes affiliated purchasers and any person acting 

on behalf of the issuer or an affiliated purchaser. 

The term ‘‘affiliated purchaser’’ as used in Item 703 

is defined in 17 CFR 10b–18(a)(3). References 

throughout this release to ‘‘issuer repurchases’’ 

include purchases by affiliates of the issuer and 

purchases by any person acting on behalf of the 

issuer or an affiliated purchaser. 

3See Business and Financial Disclosure Required 

by Regulation S–K, Release No. 33–10064 (Apr. 13, 

2016) [81 FR 23915 (Apr. 22, 2016)] (‘‘Concept 

Release’’). The release requested comment on, 

among other things, whether Item 703 disclosure is 

important to investors, whether the Commission 

should require more granular or more frequent 

repurchase disclosure, and whether there should be 

a de minimis monetary threshold for disclosure. We 

received approximately 30 comment letters that 

addressed Item 703 and we discuss these comments 

throughout this release, where relevant. 

4See Purchases of Certain Equity Securities by 

the Issuer and Others, Release No. 33–8335 (Nov. 

10, 2003) [68 FR 64952 (Nov. 17, 2003)] (‘‘Adopting 

Release’’). 

5 Id. at 64963. 

6 Id. 

7Certain information regarding share repurchases 

is also required to be disclosed in an issuer’s 

financial statements, including in the statements of 

cash flows indicating the amount of cash paid for 

repurchased securities and the statements of 

changes in shareholders’ equity indicating any 

reduction in securities outstanding and additional 

paid-in capital for the securities repurchased. If 

securities are repurchased for purposes other than 

retirement, or if ultimate disposition has not yet 

been decided, the amount and cost of the 

repurchased securities may be shown separately on 

the balance sheets and statements of changes in 

shareholders’ equity as a deduction from the total 

of securities, additional paid-in capital, and 

retained earnings. 

8See Adopting Release at 64963. 

9See Adopting Release at 64962. 

10See Section IV.A.2, infra and note 60 and 

accompanying text. 

11See Section IV.A., infra for a more detailed 

discussion of the various studies. 

12See Section IV.A.2, infra. 

I. Introduction 

We are proposing changes to the 

requirements for disclosure of purchases 

of equity securities made by or on behalf 

of an issuer or any affiliated purchaser.2

Issuers may repurchase their shares 

through, among other means, open 

market purchases, tender offers, private 

negotiated transactions, and accelerated 

share repurchases. Issuers typically 

disclose repurchase plans or programs 

at the time that the share repurchases 

are authorized by the board of directors. 

Most share repurchases are executed 

over time through open market 

purchases through such share 

repurchase plans or programs. Issuers 

are not required to, and typically do not, 

disclose the specific dates on which 

they will execute trades pursuant to an 

announced repurchase plan or program. 

Investors and other market participants 

normally do not become aware of an 

issuer’s actual share repurchase-related 

trading activity until they are reported 

in an issuer’s periodic reports, long after 

the trades have been executed. 

The proposed amendments are 

intended to improve the quality, 

relevance, and timeliness of information 

related to issuer share repurchases. This 

proposal results from an ongoing, 

comprehensive evaluation of our 

disclosure requirements. As part of this 

evaluation, in April 2016, the 

Commission issued a Concept Release 

on the business and financial disclosure 

required by Regulation S–K, including 

disclosure pursuant to Item 703.3

The Commission adopted Item 703 in 

2003 to require disclosure on a quarterly 

basis of any purchase made by or on 

behalf of the issuer or any affiliated 

purchaser of shares or other units of any 

class of the issuer’s equity securities 

registered under Section 12 of the 

Exchange Act.4 The disclosure 

requirement applies to both open 

market and private transactions. When 

it adopted Item 703, the Commission 

noted that an issuer’s stock price often 

increases following an issuer’s public 

announcement of a repurchase plan or 

program and that some issuers publicly 

announce repurchase programs, but do 

not actually purchase any securities or 

purchase only a small portion of the 

announced amount.5 The Commission 

concluded that disclosure of an issuer’s 

actual purchases would inform 

investors whether, and to what extent, 

the issuer had followed through on its 

original plan.6

Currently, Item 703 share repurchase 

disclosure is required in Form 10–Q (17 

CFR 249.308a) for the issuer’s first three 

fiscal quarters and in Form 10–K (17 

CFR 249.310) for the issuer’s fourth 

quarter.7 The same disclosure is 

required in Form 20–F on an annual 

basis for foreign private issuers and in 

Form N–CSR on a semi-annual basis for 

certain closed-end funds. In particular, 

Item 9 of Form N–CSR implements the 

requirements of Item 703 for certain 

registered closed-end investment 

management companies (‘‘registered 

closed-end funds’’), varying from Item 

703 only to account for the different 

reporting period covered by Form N– 

CSR.8 Similarly, Item 16E of Form 20– 

F applies the Item 703 requirements to 

foreign private issuers.9 Accordingly, 

unless the context otherwise requires, 

references in this release to ‘‘Item 703’’ 

should be read to include these parallel 

provisions of Form N–CSR and Form 

20–F. 

More specifically, Item 703 currently 

requires an issuer to disclose in tabular 

format: 

• The total number of shares (or 

units) purchased, regardless of amount 

and regardless of whether made 

pursuant to a publicly announced plan 

or program, by the issuer or any 

affiliated purchaser during the relevant 

period, reported on a monthly basis and 

by class, including footnote disclosure 

regarding the number of shares 

purchased other than through a publicly 

announced plan or program and the 

nature of the transaction; 

• The average price paid per share (or 

unit); 

• The total number of shares (or 

units) purchased as part of a publicly 

announced repurchase plan or program; 

and 

• The maximum number (or 

approximate dollar value) of shares (or 

units) that may yet be purchased under 

the plans or programs. 

Item 703 also requires footnote 

disclosure in the aggregate of the 

principal terms of all publicly 

announced repurchase plans or 

programs, including: 

• The date each plan or program was 

announced; 

• The dollar amount (or share or unit 

amount) approved; 

• The expiration date (if any) of each 

plan or program; 

• Each plan or program that has 

expired during the period covered by 

the table; and 

• Each plan or program the issuer has 

determined to terminate prior to 

expiration, or under which the issuer 

does not intend to make further 

purchases. 

We recognize that there are a number 

of reasons that issuers conduct share 

repurchases and that share repurchases 

can have a positive or negative impact 

on the market for an issuer’s securities. 

The high dollar volume, nearly $700 

billion in 2020, of recent share 

repurchase activity has been 

accompanied by public interest in 

corporate payouts in the form of share 

repurchases.10 Various studies address 

motivations behind corporate payouts 

and the choice of the form of payout 

(repurchases or dividends).11

Some studies have found that issuers 

often use repurchases in a manner 

aligned with shareholder value 

maximization, such as to offset share 

dilution after new stock is issued, to 

facilitate stock- and stock option-based 

employee compensation programs, to 

help signal the issuer’s view that its 

stock is undervalued, or because the 

issuer’s board has otherwise determined 

that a repurchase program is a prudent 

use of the issuer’s excess cash.12

Other observers, however, have 

expressed concerns about issuers’ uses 

of share repurchases. Some research has 


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Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 8445 

13For evidence on the use of repurchases as a 

method of real earnings management, see infra note 

79. See also Rulemaking Petition 4–746 (June 25, 

2019), Rulemaking Petition Requesting Repeal and 

Reform of Rule 10b–18 to Address Manipulative 

Repurchase Programs that Harm Workers, available 

at https://www.sec.gov/rules/petitions/2019/petn4- 

746.pdf, at 4 (expressing concern that repurchases 

can be used to inflate share price and EPS-linked 

executive compensation) (‘‘Rulemaking Petition 4– 

746’’). 

14See, e.g., Chan, K., Ikenberry, D., Lee, I., & 

Wang. Y., Share Repurchases as a Potential Tool to 

Mislead Investors, 16 Corp. Fin. 137 (2010) (‘‘Chan 

et al. (2010)’’) (finding in 1980–2000 data that a 

limited number of managers may have used 

repurchases in a misleading way as ‘‘cheap talk’’). 

For a discussion of the use of repurchases to 

influence compensation tied to per-share measures, 

see infra note 81. 

15See infra note 82; Jackson, Jr., R.J., Stock 

Buybacks and Corporate Cashouts, Speech by 

Commissioner Jackson Before the Center for 

American Progress (June 11, 2018), available at 

https://www.sec.gov/news/speech/speech-jackson061118 (‘‘Jackson Speech’’); https://www.cnbc.com/ 

2021/03/02/elizabeth-warren-rips-stock-buybacksas-nothing-but-paper-manipulation.html (‘‘Warren 

article’’) (expressing Senator Warren’s view that 

share repurchases increase the price of an issuers 

shares through the issuer’s purchase of its securities 

on the market rather than investing in the issuer’s 

business); Palladino, L., Do Corporate Insiders Use 

Stock Buybacks for Personal Gain?, 34(2) Int’l Rev 

of Applied Econ. 152–174 (2020) (‘‘Palladino 

(2020)’’) (finding increased insider selling in 

quarters where buybacks are occurring); and 

Palladino, L. & Lazonick, W., Regulation Stock 

Buybacks: The $6.3 Trillion Question, Roosevelt 

Institute Working Paper (May 2021), available at 

https://rooseveltinstitute.org/publications/ 

regulating-stock-buybacks-the-6-3-trillion-question/ 

(‘‘Regulation Stock Buybacks Article’’). See also 

Fried, J.M., Testimony of Jesse M. Fried on Stock 

Buybacks before the U.S. House of Representatives 

Subcommittee on Investor Protection, 

Entrepreneurship, and Capital Markets (Oct, 17, 

2019) available at SSRN: https://ssrn.com/abstract=

3474175 (‘‘Fried Testimony’’). 

16See, e.g., Warren Article; and Lazonick, W., 

Clinton’s Proposals on Stock Buybacks Don’t Go Far 

Enough, Harvard Business Review (Aug. 11, 2015) 

available at https://hbr.org/2015/08/clintonsproposals-on-stock-buybacks-dontgo-far-enough. 

17See, e.g., Jackson Speech; Regulation Stock 

Buybacks Article; and Fried Testimony. Fried 

asserted that executives may use repurchases to 

enrich themselves at the expense of public investors 

by: Conducting a share repurchase when the 

issuer’s stock price is lower than the ‘‘stock’s actual 

stock value,’’ resulting in a value transfer from 

selling shareholders to non-selling shareholders pro 

rata; the manipulation of the stock price and 

earnings metrics in compensation arrangements; or 

repurchase announcements made solely to boost the 

stock price before sales by executives. 

18See, e.g., letters in response to the Concept 

Release from SEC Investor Advisory Committee 

(Jun. 15, 2016); Council of Institutional Investors 

(Jul. 8, 2016) (‘‘CII’’); W. Klein and T. Amy (Jul. 19, 

2016) (‘‘Klein & Amy’’); Domini Social Investments 

(Jul. 21, 2016) (‘‘Domini’’); California State 

Teachers’ Retirement System (Jul. 21, 2016) 

(‘‘CalSTRS’’); American Federation of State, County 

and Municipal Employees (Jul. 21, 2019) 

(‘‘AFSCME’’); AFL–CIO (Jul. 21, 2016) (‘‘AFL– 

CIO’’); California Public Employees’ Retirement 

System (‘‘CalPERS’’) (Jul. 19, 2016); Better Markets, 

Inc. (Jul. 21, 2016) (‘‘Better Markets’’); and 

Americans for Financial Reform (Aug. 10, 2016) 

(‘‘AFR’’). Other commenters, however, opposed 

expanding the disclosure required by Item 703. See, 

e.g., letters in response to the Concept Release from 

U.S. Chamber of Commerce (Jul. 20, 2016) 

(‘‘Chamber’’); FedEx Corporation (Jul. 21, 2016) 

(‘‘FedEx’’); Business Roundtable (Jul. 21, 2016); 

Securities Industry and Financial Markets 

Association (Jul. 21, 2016) (‘‘SIFMA’’); Fenwick 

West LLP (Aug. 1, 2016) (‘‘Fenwick’’); General 

Motors Company (Sept. 30, 2016) (‘‘GM’’); and 

Financial Executives International (Oct.3, 2016) 

(‘‘FEI’’). 

19See, e.g., letters in response to the Concept 

Release from Klein & Amy; and AFR. See also letter 

in response to the Concept Release from CalPERS 

supporting disclosure on Form 8–K of significant 

equity repurchases. Other commenters, however, 

supported maintaining the current frequency of 

reporting share repurchases on a quarterly basis. 

See, e.g., letters in response to the Concept Release 

from Chamber; SIFMA; and Fenwick. 

20See Rulemaking Petition 4–772 (Apr. 21, 2021), 

Request to Amend Regulation S–K (17 CFR 

229.402(d), instruction (7)), available at https://

www.sec.gov/rules/petitions/2021/petn4-772.pdf 

(recommending revisions to 17 CFR 229.402(d), 

instruction 7). We believe that the additional 

information relating to share repurchases that we 

are proposing would help meet the goals of the 

rulemaking petition by better enabling investors to 

determine whether issuer repurchases trigger higher 

payments to senior executives under performancebased compensation plans, such as by altering 

earnings per share calculations. 

21 In a separate release, we are proposing several 

rules and form amendments to address potentially 

abusive practices associated with 17 CFR 240.10b5– 

1 (‘‘Rule 10b5–1’’) trading arrangements, grants of 

options and other equity instruments with similar 

features and the gifting of securities. See Release 

No. 33–11013 Rule 10b5–1 and Insider Trading 

(Jan. 13, 2022) (‘‘Rule 10b5–1 Proposing Release’’). 

shown that repurchases can serve as a 

form of real earnings management 

(through decreasing the denominator of 

earnings-per-share (‘‘EPS’’)) and thus be 

subject to short-term earnings 

management objectives of an executive 

seeking to meet or beat consensus 

forecasts.13 In addition, because 

announcements of repurchases and 

actual repurchase trades can also effect 

short-term upward price pressure, share 

price- or EPS-tied compensation 

arrangements could incentivize 

executives to undertake repurchases in 

an attempt to maximize their 

compensation.14 Several commentators 

have highlighted what they viewed to be 

the opportunistic and harmful use of 

issuer share repurchases by issuer 

insiders.15 Some of these commentators 

view issuer share repurchases as a tool 

to raise the price of an issuer’s stock in 

a way that allows insiders and senior 

executives to extract value from the 

issuer instead of using the funds to 

invest in the issuer and its employees.16

A further concern raised by some 

commentators is the potential for share 

repurchases to be used by issuers as a 

mechanism to inflate the compensation 

of their executives in a manner that is 

not transparent to investors or the 

market.17 In addition, a number of 

commenters recommended expanding 

the disclosure required by Item 703 in 

response to the Commission’s request 

for comments regarding Item 703 in the 

Concept Release.18 Some commenters 

also supported increasing the frequency 

of reporting share repurchases.19

We also received a rulemaking 

petition expressing general support for 

the current regulatory regime for issuer 

share repurchases, but recommending 

revisions to the Commission’s executive 

compensation disclosure requirements 

to require disclosure of whether issuer 

share repurchases have affected the 

calculation of the repricing of any 

options, stock appreciation rights, or 

option-like instruments.20

In light of the growth of issuer share 

repurchase plans in recent years and the 

concerns expressed by commentators, 

we believe investors could benefit from 

improving the quality, relevance, and 

timeliness of information related to 

issuer share repurchases. In particular, 

we are concerned that, because issuers 

are repurchasing their own securities, 

asymmetries may exist between issuers 

and affiliated purchasers and investors 

with regard to information about the 

issuer and its future prospects. This, in 

turn, could exacerbate some of the 

potential harms associated with issuer 

repurchases. To help address these 

information asymmetries, we are 

proposing a new disclosure form and 

additional disclosure requirements 

about issuer repurchases.21

The proposed amendments would 

require more detailed and more frequent 

disclosure about issuer share 

repurchases, and require issuers to 

present the disclosure using a structured 

data language, which could allow 

investors to: 

• Better understand the extent of an 

issuer’s activity in the market, including 

potential impacts on the issuer’s share 

price; 

• Better understand an issuer’s 

motivation for its share repurchases, 

and how it is executing its purchase 

plan; and 

• Gain potential insight into any 

relationship between share repurchases 

and executive compensation and stock 

sales. 

The proposed amendments could also 

improve the ability of investors to 

identify repurchases that are more likely 

to be driven by managerial self-interest 

(e.g., increasing the share price prior to 

an insider’s sale, meeting a threshold in 

an executive compensation 

arrangement, or meeting consensus 

earnings forecast) and thereby promote 

investor protection. 

II. Discussion of Proposed Amendments 

We are proposing to modernize and 

improve the disclosure required about 


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8446 Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 

22 15 U.S.C. 781. Registered investment 

companies other than registered closed-end funds 

are not required to provide the repurchase 

disclosure under Item 703 (as implemented in Form 

N–CSR). Accordingly, proposed Form SR also 

would not be filed by registered investment 

companies other than registered closed-end funds. 

See proposed rule 13a–21(b). Business development 

companies (‘‘BDCs’’), which are not registered 

investment companies, provide the repurchase 

disclosure of Item 703 on Forms 10–K and 10–Q 

rather than Form N–CSR. 

23 ‘‘Execution’’ has a commonly understood 

meaning consistent with the Commission’s 

explanation in Interpretation of Section 206(3) of 

the Investment Advisers Act of 1940, Release No. 

IA–1732, (July 17, 1998) [63 FR 39505 (July 23, 

1998)] that the ‘‘ending point of a transaction is 

when the actual exchange of securities and payment 

occurs, which is known as ‘settlement.’ The date of 

execution (i.e., the trade date) marks an earlier point 

of a securities transaction at which the parties have 

agreed to its terms and are contractually obligated 

to settle the transaction.’’ Release No. IA–1732 at 

notes 13–14 and accompanying text (citing 

Radiation Dynamics, Inc. v. Goldmuntz, 464 F.2d 

876, 891 (2d Cir. 1972) with the explanation that 

the ‘‘court held that, for purposes of insider trading 

liability under Rule 10b–5 under the Exchange Act, 

the time of a ‘purchase or sale’ of securities is 

determined by reference to when the parties are 

obligated to perform the terms of the transaction, 

not when final performance occurs.’’). Similarly, in 

the security-based swaps context, 17 CFR 240.15Fi– 

1(f) defines ‘‘execution’’ as ‘‘the point at which the 

counterparties become irrevocably bound to a 

transaction under applicable law.’’ 

24The Commission adopted Rule 10b5–1 in 2000 

to clarify the meaning of ‘‘manipulative or 

deceptive device[s] or contrivance[s]’’ prohibited by 

Exchange Act Section 10(b) and Rule 10b–5 with 

respect to trading on the basis of material nonpublic 

information. See Selective Disclosure and Insider 

Trading, Release No. 33–7881 (Aug. 15, 2000) [65 

FR 51716 (Aug. 24, 2000)]. Rule 10b5–1(c) 

established an affirmative defense to Rule 10b–5 

liability for insider trading in circumstances where 

it is clear that the trading was not based on material 

nonpublic information and the trade was pursuant 

to a binding contract, an instruction to another 

person to execute the trade for the instructing 

person’s account, or a written plan. 

25See Adopting Release at 64962. 

26 Id. 

27See, e.g., Bonaime ́, A., Mandatory Disclosure 

and Firm Behavior: Evidence from Share 

Repurchases, 90 Acct. Rev. 1333 (2015) (‘‘Bonaime ́

(2015)’’) (stating that ‘‘[a]nalysts and investors alike 

are concerned with properly estimating repurchases 

since actual repurchase activity is linked to future 

operating and stock price performance’’). 

28One commentator emphasized the need to 

regulate consistently economically equivalent 

practices. See Grullon, G. & Ikenberry, D., What Do 

We Know About Stock Repurchases, J. App. Corp. 

Fin. 13 (2000) at 48 (referring to the requirement 

that a Form 4 Statement of Changes of Beneficial 

Ownership of Securities (17 CFR 249.104) be filed 

before the end of the second business day following 

the day on which a transaction resulting in a change 

in beneficial ownership has been executed). See 

also Fried Testimony (proposing a two-day 

disclosure rule, but suggesting that even more 

frequent disclosure would be preferable). 

29See supra notes 16 and 17. 

30 Id. See also notes 80, 81, and 83, infra. 

31The total number of shares purchased, class of 

securities, and the average price paid per share (or 

unit) correspond to information that is currently 

disclosed pursuant to Item 703. 

repurchases of an issuer’s equity 

securities by: 

• Requiring daily repurchase 

disclosure on a new Form SR, which 

would be furnished to the Commission 

one business day after execution of an 

issuer’s share repurchase order; 

• Amending Item 703 to require 

additional detail regarding the structure 

of an issuer’s repurchase program and 

its share repurchases; and 

• Requiring information disclosed 

pursuant to Item 703 of Regulation S– 

K and pursuant to Form SR to be 

reported using a structured data 

language (specifically, Inline eXtensible 

Business Reporting Language or ‘‘Inline 

XBRL’’). 

A. Proposed Form SR 

We are proposing new Exchange Act 

Rule 13a–21 and Form SR that would 

require an issuer, including a foreign 

private issuer and certain registered 

closed-end funds, to report any 

purchase made by or on behalf of the 

issuer or any affiliated purchaser of 

shares or other units of any class of the 

issuer’s equity securities that is 

registered by the issuer pursuant to 

Exchange Act Section 12.22 The issuer 

would have to furnish a new Form SR 

before the end of the first business day 

following the day on which the issuer 

executes a share repurchase.23 The 

Form SR would require the following 

disclosure in tabular format, by date, for 

each class or series of securities: 

(1) Identification of the class of 

securities purchased; 

(2) The total number of shares (or 

units) purchased, including all issuer 

repurchases whether or not made 

pursuant to publicly announced plans 

or programs; 

(3) The average price paid per share 

(or unit); 

(4) The aggregate total number of 

shares (or units) purchased on the open 

market; 

(5) The aggregate total number of 

shares (or units) purchased in reliance 

on the safe harbor in 17 CFR 240.10b– 

18 (‘‘Rule 10b–18’’); and 

(6) The aggregate total number of 

shares (or units) purchased pursuant to 

a plan that is intended to satisfy the 

affirmative defense conditions of Rule 

10b5–1(c).24

When adopting the Item 703 

disclosure requirements, the 

Commission stated its belief that 

information about the equity securities 

an issuer has repurchased is important 

to investors.25 The Commission also 

stated its belief that Item 703 would 

provide investors and the marketplace 

with information regarding an issuer’s 

repurchase activity that would allow 

them to assess the impact of an issuer’s 

share repurchases on the issuer’s stock 

price, similar to periodic disclosure of 

issuer earnings and dividend payouts.26

While we continue to believe that the 

existing Item 703 requirements provide 

useful information,27 we believe that 

proposed Form SR could enhance 

transparency and enable more timely 

investor review of issuer share 

repurchases. Proposed Form SR would 

require issuer share repurchases to be 

reported on a daily basis before the end 

of the first business day following the 

day on which the repurchase 

transaction has been executed. Investors 

could use this more detailed and timely 

disclosure to monitor and evaluate 

issuer share repurchases, and their 

effects on the market for the issuer’s 

securities. 

The data currently required to be 

disclosed under Item 703 does not 

provide daily detail about such 

repurchases. Information asymmetries 

may exist between issuers and affiliated 

purchasers and investors, particularly 

due to the timing of the current Item 703 

disclosures.28 Because issuers are 

repurchasing their own securities, 

issuers and affiliated purchasers will 

typically have significantly more, and 

more detailed, information about the 

issuer and its future prospects. Proposed 

Form SR could provide investors with 

additional insight into the details of a 

share repurchase closer in time to the 

repurchase, which may diminish any 

informational asymmetry due to the 

timing of current Item 703 disclosure. 

Generally, there are legitimate 

business reasons for issuers to 

repurchase securities; nevertheless, 

incentives also exist for issuers to 

engage in opportunistic share 

repurchases. For example, as noted 

above, some commentators have 

asserted that issuer repurchases could 

potentially be used to increase share 

prices in order to enhance executive 

compensation and insider stock value.29

The share price increase that often 

occurs in connection with an issuer 

share repurchase plan may raise certain 

financial ratios, such as EPS, that are 

often used as executive compensation 

targets.30 Proposed Form SR, when 

combined with other information 

available about the issuer, could provide 

investors with additional insight into 

such possible behavior. 

We are therefore proposing that Form 

SR include daily disclosure of the total 

number of shares purchased, class of 

securities, and the average price paid 

per share (or unit) 31 as well as the 

aggregate total number of shares 


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32The proposed disclosure would not provide a 

defense to manipulative conduct for purchases that 

are not in fact eligible to rely on the safe harbor. 

33Rule 10b–18, which was adopted in 1982 and 

amended in 2003, provides a voluntary, nonexclusive ‘‘safe harbor’’ from liability for 

manipulation under Sections 9(a)(2) and 10(b) of 

the Exchange Act, and Rule 10b–5, when an issuer 

or its affiliated purchaser bids for or purchases 

shares of the issuer’s common stock in accordance 

with the Rule 10b–18’s manner, timing, price, and 

volume conditions. See Adopting Release. See also 

Purchases of Certain Equity Securities by the Issuer 

and Others; Adoption of Safe Harbor, Release No. 

34–19244 (Nov. 17, 1982), [47 FR 53333 (Nov. 26, 

1982)]. 

34See note 80 infra and accompanying 

discussion. 

35See note 79 infra and accompanying 

discussion. In this regard, we note that share priceor earnings per share-tied compensation 

arrangements could incentivize executives to 

undertake repurchases, in an attempt to maximize 

their compensation. 

36For domestic issuers, this disclosure is required 

quarterly. However, for registered closed-end funds 

the disclosure is made semi-annually and for 

foreign private issuers is included in their annual 

reports. See supra note 8 and accompanying text. 37See discussion in Section I. 38See, e.g., letters in response to the Concept 

Release from Klein & Amy (recommending Form 8– 

K disclosure); CalPERS (recommending Form 8–K 

disclosure of significant repurchases in line with 

other significant corporate events); and AFR 

(recommending disclosure at the time the 

repurchase occurs because that is the time that any 

price manipulation would be occurring). But see, 

e.g., letters in response to the Concept Release from 

Chamber; FedEx; SIFMA; Fenwick; GM; FEI 

(supporting the current frequency of share 

repurchases). 

39See, e.g., Australian Securities Exchange 

Listing Rule 3.8A requiring listed issuers to file a 

notification disclosing acquisitions before the 

commencement of trading on the business day after 

any day on which shares are bought back; and 

Financial Conduct Authority (United Kingdom) 

Listing Rule 12.4.6R requiring certain issuers to file 

a notification disclosing acquisitions no later than 

7:30 a.m. on the business day following the day that 

the purchase occurred. See also Ontario Securities 

Commission (Canada) National Instrument 55–104 

requiring certain issuers to file an insider trading 

report disclosing acquisition within 10 days of the 

end of the month. 

40See 17 CFR 240.10b–10. 

41See supra note 23. 

42 In addition, by requiring the Form SR to be 

furnished, a late submission of the form would not 

affect eligibility to use Form S–3 or to file a shortform registration statement under General 

Instruction A.2 of Form N–2. General Instruction 

I.A.3(b) to Form S–3 requires that all reports 

required to be filed with the Commission during the 

preceding 12 months have been filed; the same 

requirements apply under General Instruction A.2 

of Form N–2. 

purchased on the open market, the 

aggregate total number of shares 

purchased in reliance on the safe harbor 

in Rule 10b–18,32 and the aggregate total 

number of shares purchased pursuant to 

a plan that is intended to satisfy the 

affirmative defense conditions of Rule 

10b5–1(c), to enhance the repurchase 

information that would be available to 

investors. Requiring disclosure of the 

number of shares purchased on the open 

market would provide a clearer 

indication of the scale of the issuer’s 

activity in the market for each day that 

repurchases are made. Requiring 

disclosure of the number of shares 

purchased in reliance on the nonexclusive safe harbor in Rule 10b–18 33

and pursuant to a plan that is intended 

to satisfy the affirmative defense 

conditions of Rule 10b5–1(c) could also 

enable investors to better understand 

how an issuer has structured its 

repurchase activity. 

We are proposing to require issuers to 

furnish Form SR no later than one 

business day after execution of the 

issuer’s share repurchase transaction 

order. The proposed daily detail would 

provide more granular information to 

investors that could enable them to 

better evaluate the market for the 

issuer’s securities and the actions of the 

issuer’s insiders. For example, when 

combined with existing executive 

compensation, Section 16 (15 U.S.C. 

78p), and financial statement 

disclosures, the proposed Form SR 

disclosures may improve the ability of 

investors to identify issuer repurchases 

potentially driven by managerial selfinterest, such as seeking to increase the 

share price prior to an insider sale 34 or 

to change the value of an option or other 

form of executive compensation.35

The proposed requirement to furnish 

the daily detail in Form SR on the 

Commission’s Electronic Data 

Gathering, Analysis, and Retrieval 

(‘‘EDGAR’’) system no later than one 

business day after execution of the share 

repurchase order could help alleviate 

information asymmetries and promote 

more informed investment decisions. 

Under the current rules, Item 703 

disclosure about share repurchases is 

required in an issuer’s periodic 

reports.36 As noted above, some have 

expressed concern about the timeliness 

of this disclosure and the asymmetry of 

information available to the market 

while issuers are conducting share 

repurchase programs.37 While existing 

Item 703 disclosure provides investors 

and market participants with a general 

understanding of issuer share 

repurchases over time, the disclosure 

relates to repurchases made several 

weeks or months earlier, resulting in a 

delay in such information being relayed 

to investors and absorbed by the market. 

This delay could contribute to an 

information asymmetry between the 

issuer and investors. 

Several commenters on the Concept 

Release asked the Commission to 

require disclosure closer in time to 

share repurchases.38 We additionally 

note that the disclosure deadlines for 

share repurchases in several foreign 

jurisdictions are shorter than in the U.S. 

For example, the Financial Conduct 

Authority in the United Kingdom and 

the Australian Securities Exchange 

provide listing standards requiring 

certain issuers to disclose share 

repurchases on the next business day.39

In addition, to the extent a foreign 

private issuer files public reports 

pursuant to its home country 

requirements with respect to share 

repurchases, some of these issuers file 

those reports on 17 CFR 249.306 (‘‘Form 

6–K’’) where the issuer deems those 

reports material to investors. 

While we are proposing that issuers 

provide this new daily detail disclosure 

one business day after execution of a 

share repurchase order, we recognize 

that the repurchases may not finally 

settle until two business days after the 

transaction.40 However, we believe that 

issuers generally have access to details 

regarding their purchase orders that 

have been executed and that these 

executed orders typically are confirmed 

and accurately cleared and settled.41

The proposed amendments would 

require an issuer to disclose material 

errors or changes to information 

previously reported on an amended 

Form SR. We believe that this provision 

would allow for timely and accurate 

disclosure the day after execution of the 

share repurchase order, with the ability 

to make corrections, if needed, in 

amended filings. 

We are proposing to require issuers to 

furnish, rather than file, Form SR. As a 

result, issuers would not be subject to 

liability under Section 18 of the 

Exchange Act for the disclosure in the 

form, and the information would not be 

deemed incorporated by reference into 

filings under the Securities Act and thus 

would not be subject to liability under 

Section 11 of the Securities Act, unless 

the issuer expressly incorporated such 

information.42 We believe that deeming 

the information provided on Form SR to 

be furnished rather than filed would 

alleviate some of the concerns about 

requiring this disclosure within a 

shorter timeframe without undermining 

the transparency objectives of the 

proposed disclosures. 

Request for Comment 

1. Should we adopt new Form SR to 

require daily repurchase disclosure, as 

proposed? Would less frequent 

disclosure of daily share repurchases 

(e.g., weekly, monthly, or quarterly 

disclosure) provide sufficiently timely 

information about issuer repurchases? 

Would less detailed disclosure (e.g., 

aggregated disclosure of repurchases on 

a weekly or monthly basis, rather than 


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8448 Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 

daily), that is furnished more frequently 

than under current Item 703, provide 

sufficiently useful disclosure? Instead of 

adopting Form SR, should we amend 

Form 8–K or another existing form to 

require daily repurchase disclosure? 

2. Should we instead require an issuer 

to disclose its share repurchase program 

and continue to report actual share 

repurchases on a periodic basis? If so, 

should we require the issuer to disclose 

its planned share repurchases at least 30 

days prior to the first repurchase 

transaction? Would a different 

disclosure deadline be more 

appropriate? Should the disclosure 

specify the amount of securities that 

may be purchased or any additional 

information? How would the burden of 

complying with such requirements 

compare with the burdens of complying 

with proposed Form SR? In reporting 

actual share repurchases under this 

approach, should we require the 

periodic disclosure to be broken out on 

a monthly basis, as currently required 

under Item 703 of Regulation S–K, Item 

16E of Form 20–F, and Item 9 of Form 

N–CSR, or should we expand the 

disclosure to require a breakout of 

repurchase activity on a more frequent 

basis? 

3. Should we amend issuers’ exhibit 

filing requirements to require issuers to 

provide daily, weekly, or biweekly 

repurchase disclosure in an exhibit to 

the issuer’s periodic reports? If so, 

should such an exhibit requirement be 

in lieu of or in addition to reporting on 

Form SR? 

4. Should we require disclosure of 

executed share repurchase orders on 

Form SR, as proposed? Are there 

concerns that executed orders may fail 

to settle and that issuers would not be 

able to accurately disclose the shares 

purchased on the next business day? 

How frequently do executed orders fail 

to clear and settle? Should we base the 

requirement on something other than 

order execution? For example, should 

we require issuers to furnish Form SR 

within one business day after the order 

clears and settles and the issuer receives 

trade confirmation? 

5. Should we require an issuer to 

furnish disclosure on Form SR within 

one business day of execution of a share 

repurchase order, as proposed? Would 

issuers have sufficient time to prepare 

and furnish such disclosure? If not, how 

long should an issuer have to furnish 

Form SR? How would a longer time 

period to furnish Form SR impact the 

costs associated with preparing the 

disclosures and the benefits to investors 

of more timely disclosure? Would a 

longer period compared to the proposal 

(e.g., two days, five days, ten days or 

more) still provide timely information 

about issuer repurchases? Would the 

proposed deadline for furnishing Form 

SR negatively impact issuers’ ability to 

effectively conduct share repurchases, 

such as by increasing the price issuers 

may have to pay to repurchase their 

securities? 

6. As discussed above, proposed Form 

SR would require daily reporting of the 

total number of shares repurchased, the 

average price paid per share, issuer 

share repurchases on the open market, 

shares purchased in reliance on the safe 

harbor in Rule 10b–18, and shares 

purchased pursuant to a plan that is 

intended to satisfy the affirmative 

defense conditions of Rule 10b5–1(c). 

Should we adopt these Form SR 

disclosure requirements, as proposed? 

Should we eliminate or modify any of 

these requirements? Should we add any 

disclosure requirements to Form SR, 

such as disclosure of the highest and 

lowest price paid per share for open 

market purchases or any other 

information? 

7. Should we require issuers to 

furnish an amended Form SR to correct 

material changes to transactions 

previously reported on Form SR, as 

proposed? Alternatively, should we 

require all corrections to be made on an 

amended Form SR, regardless of 

materiality? 

8. We have proposed that foreign 

private issuers would have the same 

Form SR filing obligations as domestic 

issuers. Should we exempt all foreign 

private issuers from the requirement to 

file a Form SR or provide different 

requirements? We note that some 

foreign private issuers are required to 

provide daily detailed disclosure in 

their home jurisdictions. To the extent 

these issuers file public reports 

pursuant to their home country 

requirements with respect to share 

repurchases, some also file those reports 

under Form 6–K where the issuer deems 

those reports material to investors. 

Should we exempt these foreign private 

issuers from the Form SR requirement? 

9. Should we exempt or provide 

different requirements for registered 

closed-end funds from the Form SR 

requirements? Those funds already 

provide share repurchase disclosure less 

frequently than most other issuers 

subject to the disclosure requirement in 

that they disclose the information semiannually rather than quarterly. Would 

less frequent disclosure continue to be 

appropriate for these issuers or, 

conversely, would investors benefit 

from the more frequent disclosure on 

Form SR? Alternatively, because the 

proposal would only apply to issuers 

with securities registered pursuant to 

Section 12 of the Exchange Act, it 

would only apply to those registered 

closed-end funds with securities that 

trade on an exchange. Should we 

expand the scope of covered registered 

closed-end funds to more closely match 

the scope of corporate issuers subject to 

repurchase disclosure requirements by 

applying the requirements to registered 

closed-end funds that would be subject 

to Section 12(g) of the Exchange Act but 

for Section 12(g)(2)(B) (15 U.S.C. 

78l(g)(2)(B)), which exempts them from 

the requirement to register their 

securities under that section unless they 

are listed on an exchange? 

10. We have observed that smaller 

issuers generally conduct fewer issuer 

share repurchases, but that smaller 

issuers tend to trade in less liquid 

markets where share repurchases may 

have more pronounced impacts. Should 

we consider an exemption from the 

proposed Form SR reporting 

requirement for non-accelerated filers, 

smaller reporting companies, or 

emerging growth companies? 

11. Should we provide a de minimis 

exception to the Form SR reporting 

requirement for share repurchases that 

are below a certain level? Should any 

such threshold be based on a dollar 

threshold, share number, a percentage of 

public float, or another metric? If so, 

what level would be appropriate and 

why? 

12. Should we require that Form SR 

be furnished, as proposed? 

Alternatively, should we require the 

form to be filed? Should a late or 

missing Form SR filing affect an issuer’s 

Form S–3 eligibility or eligibility to file 

a short-form registration statement on 

Form N–2? Alternatively, would 

extending the timeframe for providing 

Form SR (e.g., to one day after 

settlement, or two or more business 

days after order execution) alleviate 

concerns such that we should require 

the Form SR to be filed rather than 

furnished? As proposed, Form SR 

would be furnished to the Commission, 

but the Item 703 disclosure would be 

filed as part of the periodic report. 

Should repurchase information in the 

Form SR be subject to different liability 

than disclosure in issuer periodic 

reports? 

B. Proposed Revisions to Item 703, Form 

20–F, and Form N–CSR 

We are proposing to revise and 

expand the disclosure requirements in 

Item 703, Form 20–F, and Form N–CSR 

to work in conjunction with proposed 

Form SR to provide investors with more 

detailed and timely information they 

can use to evaluate issuer share 

repurchases. 


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43See, e.g., letters in response to the Concept 

Release from CII; Domini; CalSTRS; AFSCME; AFL– 

CIO; CalPERS; and Better Markets. Other 

commenters, however, opposed expanding the 

disclosure required by Item 703. See, e.g., letters in 

response to the Concept Release from Chamber; 

FedEx; Business Roundtable (Jul. 21, 2016); SIFMA; 

Fenwick; GM; and FEI. 

44See, e.g., letters in response to the Concept 

Release from Klein & Amy; Domini; CalSTRS; AFL– 

CIO; CalPERS (indicating that more detailed 

disclosure of the issuer’s share repurchase plan 

would enable analysis in light of the short and longterm ramifications of the repurchase). 

45See discussion in Section I. 

1. Additional Disclosure 

We are proposing to revise Item 703, 

with corresponding changes to Form 

20–F and Form N–CSR, to require 

additional disclosure about an issuer’s 

share repurchases. Specifically, we 

propose to require an issuer to disclose: 

• The objective or rationale for its 

share repurchases and process or 

criteria used to determine the amount of 

repurchases; 

• Any policies and procedures 

relating to purchases and sales of the 

issuer’s securities by its officers and 

directors during a repurchase program, 

including any restriction on such 

transactions; 

• Whether it made its repurchases 

pursuant to a plan that is intended to 

satisfy the affirmative defense 

conditions of Rule 10b5–1(c), and if so, 

the date that the plan was adopted or 

terminated; and 

• Whether purchases were made in 

reliance on the Rule 10b-18 nonexclusive safe harbor. We are 

additionally proposing to require that 

issuers disclose if any of their officers or 

directors subject to the reporting 

requirements under Section 16(a) of the 

Exchange Act (15 U.S.C. 78p(a)) 

purchased or sold shares or other units 

of the class of the issuer’s equity 

securities that is the subject of an issuer 

share repurchase plan or program 

within 10 business days before or after 

the announcement of an issuer purchase 

plan or program by checking a box 

before the tabular disclosure of issuer 

purchases of equity securities. 

In response to the Commission’s 

request for comments regarding Item 

703 in the Concept Release, many 

commenters recommended expanding 

the disclosure required by Item 703.43

Some of these commenters specifically 

supported requiring disclosure of the 

objective or rationale for repurchases.44

As noted above, other commentators 

have expressed concern that issuer 

share repurchases may be used to inflate 

executive compensation and cash out 

executives’ securities.45

Based on these comments and 

concerns, we are proposing additional 

disclosure requirements intended to 

improve investor access to information 

regarding the rationale and objectives of 

any issuer repurchase plan. In addition, 

the proposed disclosure regarding 

whether the plan is expected to be in 

reliance on the Rule 10b–18 safe harbor 

or pursuant to a Rule 10b5–1 plan, as 

well as disclosures regarding any 

policies and procedures (including any 

restrictions) relating to purchases and 

sales imposed on officers and directors 

during a repurchase plan, should allow 

investors to better understand how an 

issuer has structured its repurchase plan 

and whether it has taken steps to 

prevent officers and directors from 

potentially benefiting from issuer 

repurchases in a manner that is not 

available to regular investors. Similarly, 

the proposed checkbox will obviate the 

need for investors to review Section 

16(a) filings close in time to any 

announcement of an issuer purchase 

plan or program to see if any officer or 

director reporting pursuant to Section 

16(a) of the Exchange Act has purchased 

or sold shares or other units of the class 

of the issuer’s equity securities that is 

the subject of an issuer share repurchase 

plan or program close in time to the 

announcement. Together with the 

additional daily level detail that we are 

proposing to require on Form SR, we 

believe this additional information 

would help investors to assess whether 

the issuer or its insiders are potentially 

engaged in self-interested or otherwise 

inefficient repurchases and thereby help 

mitigate some of the potential harms 

associated with issuer repurchases. 

Request for Comment 

13. Many issuers voluntarily choose 

to announce their share repurchase 

plans or programs publicly. Item 703 

currently requires disclosure of the date 

each plan or program was announced if 

the issuer did publicly announce it. 

Should we clarify what constitutes an 

announcement for purposes of the 

disclosure requirement? For example, 

should the announcement have to have 

been made in a Form 8–K, another 

existing form, or press release? Should 

we require all open market share 

repurchase plans to be publicly 

announced? 

14. We have proposed requiring 

issuers to indicate via the proposed 

checkbox if any officer or director 

reporting pursuant to Section 16(a) of 

the Exchange Act purchased or sold the 

issuer’s equity securities that are the 

subject of an issuer share repurchase 

plan or program within 10 business 

days before or after any announcement 

of an issuer purchase plan or program. 

How would investors use this 

information? Would the proposed 

requirement discourage issuers from 

publicly announcing plans or programs? 

Is there other information in 

combination with, or instead of, this 

disclosure that could notify investors 

and help them process information 

regarding officer and director 

transactions made close in time to the 

issuer’s share repurchase plan 

announcement? If an issuer doesn’t 

publicly announce its repurchase plan, 

should the issuer be required to check 

the box if there are officer or director 

transactions within a certain time from 

the initiation of the repurchase plan or 

program (for example, within 10 

business days of initiation)? 

15. Is a 10-business-day period before 

or after the announcement an 

appropriate window for the proposed 

indication about officer and director 

transactions? Would a shorter or longer 

period provide more appropriate notice 

to investors and cover a sufficient time 

period where an insider may be most 

likely to trade in relation to the issuer’s 

announcement of a share repurchase 

plan? Should we add a proposed 

checkbox to Form SR, in lieu of or in 

addition to Item 703, Form 20–F, and 

Form N–CSR? 

16. Issuers would need to rely on 

representations from, or Section 16 

reports filed by, their officers and 

directors to indicate whether any officer 

or director has purchased or sold the 

issuer’s securities in the relevant time 

period. Should we provide guidance 

about the issuer’s scope of inquiry and 

explain what an issuer may rely on for 

purposes of complying with the 

checkbox requirement? 

17. Should we require issuers to 

describe the objective or rationale for 

their share repurchases and process or 

criteria used to determine the amount of 

repurchases, as proposed? How would 

investors use this information? Should 

we also require information regarding 

how share repurchases are financed or 

their anticipated or actual impact on 

leverage ratios or the cost of capital? 

Should we ask issuers to disclose if they 

specifically considered other uses for 

the funds being used for the share 

repurchase? Is there additional 

disclosure regarding the reasons for, or 

expected effects of a share repurchase 

plan that should be required? Would 

this proposed requirement result in 

boilerplate disclosure? 

18. Proposed Item 703 and proposed 

Form SR would require issuers to 

disclose whether repurchases were 

made pursuant to a plan that is intended 

to satisfy the affirmative defense 

conditions of Rule 10b5–1(c). Does the 

proposal require an appropriate level of 


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46 In Form N–CSR only we would continue to 

refer to ‘‘registrants’’ rather than ‘‘issuer’’ or 

‘‘company’’ for consistency with other provisions in 

Form N–CSR. 

47This tagging requirement would be 

implemented by including cross-references to Rule 

405 of Regulation S–T in each of the repurchase 

disclosure provisions, and by revising Rule 405(b) 

of Regulation S–T to include the proposed 

repurchase disclosures. Pursuant to Rule 301 of 

Regulation S–T the EDGAR Filer Manual is 

incorporated by reference into the Commission’s 

rules. In conjunction with the EDGAR Filer Manual, 

Regulation S–T governs the electronic submission 

of documents filed with the Commission. Rule 405 

of Regulation S–T specifically governs the scope 

and manner of disclosure tagging requirements for 

operating companies and investment companies, 

including the requirement in Rule 405(a)(3) to use 

Inline XBRL as the specific structured data language 

to use for tagging the disclosures. 

48 Interactive Data to Improve Financial 

Reporting, Release No. 33–9002 (Jan. 30, 2009) [74 

FR 6776 (Feb. 10, 2009)] (‘‘2009 Financial 

Statement Information Adopting Release’’) 

detail regarding Rule 10b5–1 plans? 

Should this disclosure additionally 

contemplate repurchases made pursuant 

to ‘‘other pre-arranged trading plans’’ 

that issuers may seek to rely on in lieu 

of Rule 10b5–1 plans? How should we 

define ‘‘other pre-arranged trading 

plans’’ in this circumstance? How 

would investors use information 

regarding these plans? 

19. Proposed Item 703, and proposed 

Form SR would require disclosure of 

whether shares were purchased in 

reliance on the safe harbor in Rule 10b– 

18. How would investors use this 

information? Is the use of the term 

‘‘purchased in reliance on the safe 

harbor’’ sufficiently clear? 

20. How would investors use the 

proposed disclosure regarding any 

policies and procedures relating to 

purchases and sales of the issuer’s 

securities by its officers and directors 

during a repurchase program, including 

any restriction on such transactions? 

Should we require disclosure of broader 

policies and procedures related to a 

repurchase program, for example, how 

material nonpublic information is 

controlled for or potential impacts, if 

any, on executive compensation 

metrics? Is there additional information 

about repurchase plans and trading by 

insiders that we should require to be 

disclosed? 

21. In this release, we are proposing 

amendments to require an issuer to 

disclose whether it repurchased its 

securities pursuant to a Rule 10b5–1 

plan, and if so, the date that such a plan 

was adopted or terminated. We also are 

proposing amendments to Item 703 to 

require disclosure of any policies and 

procedures the issuer has established 

relating to purchases and sales of its 

securities by its officers and directors, 

including any restriction on such 

transactions. In a separate release 

described in note 21 above, we are 

proposing new Item 408 under 

Regulation S–K and corresponding 

amendments to Forms 10–Q and 10–K 

to require: (1) Quarterly disclosure of 

the use of Rule 10b5–1 and other trading 

arrangements by a registrant, and its 

directors and officers, for the trading of 

the issuer’s securities; and (2) annual 

disclosure of an issuer’s insider trading 

policies and procedures. If the 

Commission adopts both the proposed 

Item 703 and Item 408 amendments, are 

there opportunities to streamline or 

simplify overlapping disclosure 

requirements that may apply to an 

issuer’s repurchase plan? If so, which 

provisions should we eliminate or how 

should we modify the proposed 

disclosure requirements? 

22. As proposed, disclosure of issuer 

share repurchases would be required on 

a daily basis on Form SR. In addition, 

Item 703 would continue to require 

monthly summary disclosure of share 

repurchases that would be similar to, 

but not the same as, Form SR tabular 

disclosure. What are the costs and 

benefits of providing this disclosure as 

proposed? Do these different sets of 

share repurchase disclosures provide 

distinctly valuable information for 

investors and market participants? 

Should there instead be more alignment 

between Item 703 and Form SR tabular 

data? Alternatively, should we adopt a 

subset of the proposed disclosures, such 

as: 

• Only Form SR; 

• Form SR and Item 703 and Forms 

20–F and N–CSR, amended as proposed, 

but without monthly data; 

• No Form SR, but Item 703 and 

Forms 20–F and N–CSR, amended as 

proposed and including daily, weekly, 

or bi-weekly repurchase disclosure; or 

• No Form SR, but Item 703 and 

Forms 20–F and N–CSR, amended as 

proposed, with an exhibit providing 

daily detail about share repurchases 

made during the period covered by the 

report? 

23. We have not proposed exemptions 

or different requirements from the 

proposed revisions to Item 703, Form 

20–F, and Form N–CSR for foreign 

private issuers, registered closed-end 

funds, non-accelerated filers, smaller 

reporting companies, or emerging 

growth companies. Should we exempt 

or provide different requirements from 

some or all of the proposed amendments 

for these or other classes of issuers? 

2. Clarifying Amendments 

In addition to the proposed 

amendments described above, we are 

proposing clarifying amendments to 

Item 703, Form 20–F, and Form N–CSR 

to simplify application of the rules and 

remove unnecessary instructions. 

Specifically, we are proposing: 

• To relocate guidance in the 

Instruction 1 to paragraph (b)(1) about 

information to appear in the table and 

disclosure to appear in a footnote to the 

table to paragraph (b)(1) to a new 

paragraph (c); 

• To consistently refer to ‘‘issuer’’ 

instead of ‘‘company’’; 46

• To remove Instruction 1 and 2 in 

the Instructions to paragraphs (b)(3) and 

(b)(4) and effectuate those instruction by 

adding ‘‘aggregate’’ to total number of 

shares for all plans or programs publicly 

announced in paragraph (b)(3) in lieu of 

Instruction 1 and adding proposed 

paragraph (c) to replace Instruction 2; 

• To delete the Instruction to the 

affected requirements as they are clear 

that all purchases, including those that 

do not satisfy the conditions of Rule 

10b–18, are included. 

Request for Comment 

24. Do the changes we are proposing 

simplify and clarify Item 703 and the 

corresponding provisions in Forms 20– 

F and N–CSR? Are there other changes 

we should consider to clarify the share 

repurchase disclosure requirements? 

C. Structured Data Requirement 

We are proposing to require issuers to 

tag information disclosed pursuant to 

Item 703 of Regulation S–K, Item 16E of 

Form 20–F, Item 9 of Form N–CSR, and 

Form SR in a structured, machinereadable data language. Specifically, we 

are proposing to require issuers to tag 

the disclosures in Inline XBRL in 

accordance with Rule 405 of Regulation 

S–T and the EDGAR Filer Manual.47

The proposed requirements would 

include detail tagging of quantitative 

amounts disclosed within the tabular 

disclosures in each of the 

aforementioned forms, as well as block 

text tagging and detail tagging of 

narrative and quantitative information 

disclosed in the footnotes to the tables 

required by Item 703 of Regulation S– 

K, Item 16E of Form 20–F, and Item 9 

of Form N–CSR. 

In 2009, the Commission adopted 

rules requiring operating companies to 

submit the information from the 

financial statements (including 

footnotes and schedules thereto) 

included in certain registration 

statements and periodic and current 

reports in a structured, machinereadable data language using eXtensible 

Business Reporting Language 

(‘‘XBRL’’).48 In 2018, the Commission 


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(requiring submission of an Interactive Data File to 

the Commission in exhibits to such reports); see 

also Release No. 33–9002A (Apr. 1, 2009) [74 FR 

15666 (Apr. 7, 2009)]. 

49 Inline XBRL Filing of Tagged Data, Release No. 

33–10514 (June 28, 2018) [83 FR 40846, 40847 

(Aug. 16, 2018)]. Inline XBRL allows filers to embed 

XBRL data directly into an HTML document, 

eliminating the need to tag a copy of the 

information in a separate XBRL exhibit. Id. at 

40851. 

50Securities Offering Reform for Closed-End 

Investment Companies, Release No. 33–10771 (Apr. 

8, 2020) [85 FR 33290 (Jun. 1, 2020) at 33318]. 

51See supra notes 50 and 51. Inline XBRL 

requirements for registered closed-end funds and 

business development companies will take effect 

beginning August 1, 2022 (for seasoned issuers) and 

February 1, 2023 (for all other issuers). See id. If 

the proposed Inline XBRL requirements are adopted 

in the interim, they will not apply to registered 

closed-end funds and business development 

companies prior to the aforementioned 

effectiveness dates. 

52 15 U.S.C. 78c(f). 

53 15 U.S.C. 80a–2(c). 54 15 U.S.C. 78w(a)(2). 

adopted modifications to these 

requirements by requiring issuers to use 

Inline XBRL, which is both machinereadable and human-readable, to reduce 

the time and effort associated with 

preparing XBRL filings and improve the 

quality and usability of XBRL data for 

investors.49 In 2020, the Commission 

adopted Inline XBRL requirements for 

registered closed-end funds and 

business development companies that 

will be effective no later than February 

2023.50

Requiring Inline XBRL tagging of the 

repurchase disclosures would benefit 

investors by making the disclosures 

more readily available and easily 

accessible to investors, market 

participants, and others for aggregation, 

comparison, filtering, and other 

analysis, as compared to requiring a 

non-machine readable data language 

such as ASCII or HTML. This would 

enable automated extraction and 

analysis of granular data on actual 

repurchases, allowing investors and 

other market participants to more 

efficiently perform large-scale analysis 

and comparison of repurchases across 

issuers and time periods, including 

comparing repurchases to information 

on executive’s compensation. At the 

same time, we do not expect the 

incremental compliance burden 

associated with tagging the additional 

information to be unduly burdensome, 

because issuers subject to the proposed 

tagging requirements are or in the near 

future will be subject to similar Inline 

XBRL requirements in other 

Commission filings.51

Request for Comment 

25. Should we require issuers to 

include block text tagging of narrative 

disclosures, as well as detail tagging of 

quantitative amounts disclosed within 

the narrative and tabular disclosure 

required by Item 703 of Regulation S– 

K, Item 16E of Form 20–F, Item 9 of 

Form N–CSR, and Form SR in Inline 

XBRL, as proposed? Are there any 

changes we should make to promote 

accurate and consistent tagging? If so, 

what changes should we make? 

26. Should we modify the scope of the 

repurchase disclosures required to be 

tagged? For example, should we only 

require tagging of the quantitative 

repurchase disclosures? 

27. Should we require issuers to use 

a different structured data language to 

tag repurchase disclosures? If so, what 

structured data language should we 

require? Should we leave the structured 

data language undefined? 

28. We have not proposed exemptions 

or different requirements from the 

proposed structured data requirement 

for foreign private issuers, registered 

closed-end funds, non-accelerated filers, 

smaller reporting companies, or 

emerging growth companies. Should we 

exempt or provide different 

requirements from some or all of the 

proposed amendments for these or other 

classes of issuers? 

III. General Request for Comment 

The Commission requests comment 

on the rule and form amendments 

proposed in this release, whether any 

changes to our rules or forms are 

necessary or appropriate to implement 

the objectives of our proposed rule and 

form amendments, and other matters 

that might affect the proposals 

contained in this release. 

IV. Economic Analysis 

We are mindful of the costs imposed 

by, and the benefits obtained from, our 

rules. Section 3(f) of the Exchange Act 52

and Section 2(c) of the Investment 

Company Act of 1940 (‘‘Investment 

Company Act’’) 53 require us, when 

engaging in rulemaking, to consider or 

determine whether an action is 

necessary or appropriate in (or, with 

respect to the Investment Company Act, 

consistent with) the public interest, and 

to consider, in addition to the protection 

of investors, whether the action will 

promote efficiency, competition, and 

capital formation. In addition, Section 

23(a)(2) of the Exchange Act requires the 

Commission to consider the effects on 

competition of any rules the 

Commission adopts under the Exchange 

Act and prohibits the Commission from 

adopting any rule that would impose a 

burden on competition not necessary or 

appropriate in furtherance of the 

purposes of the Exchange Act.54

We have considered the economic 

effects of the proposed amendments, 

including their effects on competition, 

efficiency, and capital formation. Many 

of the effects discussed below cannot be 

quantified. Consequently, while we 

have, wherever possible, attempted to 

quantify the economic effects expected 

from this proposal, much of the 

discussion remains qualitative in 

nature. Where we are unable to quantify 

the economic effects of the proposed 

amendments, we provide a qualitative 

assessment of the potential effects and 

encourage commenters to provide data 

and information that would help 

quantify the benefits, costs, and the 

potential impacts of the proposed 

amendments on efficiency, competition, 

and capital formation. 

As discussed in greater detail in 

Section II above, the Commission is 

proposing to require disclosure of 

repurchases, on a daily basis, on a new 

form. The proposed daily disclosure, 

which would be required to be 

structured using Inline XBRL, would 

include the number of shares 

repurchased by an issuer, the average 

price per share paid, the number of 

shares repurchased on the open market, 

the number of shares repurchased in 

reliance on the Rule 10b–18 nonexclusive safe harbor, and the number of 

shares repurchased pursuant to a Rule 

10b5–1 plan. 

The Commission is also proposing to 

require, on Forms 10–Q, 10–K, 20–F, 

and N–CSR, additional disclosure about 

the issuer’s repurchase program and 

practices, including the objective or 

rationale for the share repurchases, the 

structure of an issuer’s repurchase 

program, and whether purchases were 

made pursuant to a plan that is intended 

to satisfy the affirmative defense 

conditions of Rule 10b5–1(c), or in 

reliance on the Rule 10b–18 nonexclusive safe harbor. Further, the 

Commission is proposing to require 

disclosure of any policies and 

procedures relating to purchases and 

sales of the issuer’s securities by its 

officers and directors during a 

repurchase program, including any 

restrictions on such transactions. The 

Commission is also proposing to require 

an issuer to indicate whether any officer 

or director reporting pursuant to Section 

16(a) of the Exchange Act purchased or 

sold shares or other units of the class of 

the issuer’s equity securities that is the 

subject of an issuer share repurchase 

plan or program within 10 business 

days before or after the issuer’s 


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55Filers with no repurchases today could be 

affected by the proposed amendments to the extent 

they were planning future repurchases and such 

plans were affected by the costs of the additional 

disclosure requirements. 

56As a caveat, a complete estimate of the number 

of affected filers is limited by data coverage. A 

source of data commonly used in existing studies, 

Standard & Poor’s Compustat, has limited coverage 

of small and unlisted registrants and Form 20–F 

filers. Therefore, we supplement data from 

Compustat with structured data from financial 

statement disclosures in EDGAR filings (with the 

caveat that variation in filer use of tags to 

characterize their repurchases may result in some 

data noise). 

57Based upon a staff review, we expect 

approximately 20% of registered closed-end funds 

to be affected by the proposal engage in share 

repurchases, as compared to approximately half of 

operating companies. 

58For a more detailed discussion of the data and 

research on repurchases and other payouts, see SEC 

Staff Response to Congress: Negative Net Equity 

Issuance, December 2020, available at https://

www.sec.gov/files/negative-net-equity-issuance-dec2020.pdf (‘‘2020 Staff Study’’); and Farre-Mensa, J., 

Michaely, R., & Schmalz, M. Payout Policy, 6 Ann. 

Rev. of Fin. Econ. 75 (2014) (‘‘Farre-Mensa et al. 

(2014)’’). Staff reports, statistics, and other staff 

documents (including those cited herein) represent 

the views of Commission staff and are not a rule, 

regulation, or statement of the Commission. The 

Commission has neither approved nor disapproved 

the content of these documents and, like all staff 

statements, they have no legal force or effect, do not 

alter or amend applicable law, and create no new 

or additional obligations for any person. The 

Commission has expressed no view regarding the 

analysis, findings, or conclusions contained therein. 

The focus of the 2020 Staff Study was determined 

by the directive of Congress in its Joint Explanatory 

Statement accompanying the Financial Services and 

General Government Appropriations Act, which 

directed the staff to study the recent growth of 

negative net equity issuances with respect to nonfinancial issuers, including the history and effects 

of those issuers repurchasing their own securities, 

and the effects of those repurchases on investment, 

corporate leverage, and economic growth. The 

study provided data and statistics on share 

repurchases across different types of companies and 

time periods, as well as an extensive discussion of 

related evidence in existing research, which offers 

insight into the existing market baseline. For 

example, the study discusses the evidence on the 

favorable market reaction to repurchase 

announcements. Among its findings, the study 

notes that ‘‘[r]epurchases are an increasingly 

common way firms distribute cash to shareholders. 

There are several possible reasons firms conduct 

repurchases; some support efficient investment and 

for some the connection is less clear. The analysis 

below suggests that firms are more likely to conduct 

repurchases when they have excess cash and when 

they would benefit from increased reliance on debt 

financing.’’ The study further notes that ‘‘the data 

is consistent with firms using repurchases to 

maintain optimal levels of cash holdings and to 

minimize their cost of capital’’ and that ‘‘reasons for 

repurchases where the connection to efficient 

investment is less clear are unlikely to motivate the 

majority of repurchases since stock prices typically 

increase in response to repurchase announcements, 

suggesting that, at least on average, repurchases are 

viewed as having a positive effect on firm value.’’ 

In discussing one of the criticisms of share 

repurchases, the study notes ‘‘that insider sales may 

be timed to coincide with repurchase 

announcements. If insiders time sales to coincide 

with repurchase announcements and any resulting 

increase in stock price, executives may be 

incentivized to recommend repurchase programs to 

further their own gain.’’ However, the study notes, 

it is ‘‘difficult to ascertain the motivations 

underlying insider sales.’’ As a caveat, existing 

studies referenced in this release, including the 

2020 Staff Study, are necessarily constrained by 

existing disclosure limitations. The low frequency 

and the unstructured nature of existing Item 703 

data on repurchase activity limit the ability of 

existing studies to gauge the extent of information 

asymmetry between issuers and investors 

associated with the execution of repurchase 

programs and its economic effects. Existing 

disclosure has also limited the ability of existing 

studies to draw a causal connection between 

managerial incentives and day-to-day execution of 

repurchase programs as well as quantify its 

economic effects. Further, while public attention 

has focused on the aggregate trends in repurchases, 

the attribution of aggregate trends to specific drivers 

of repurchases is complicated due to the presence 

of confounding factors that cannot be readily 

isolated in existing data. The discussed data 

limitations should be considered in evaluating 

existing studies of the motivations of repurchases. 

Additional caveats, where applicable, are 

referenced in the discussion of individual strands 

of research and evidence on repurchases below. 

59Based on staff analysis of Standard & Poor’s 

Compustat data related to share repurchases 

conducted during fiscal year 2020 by issuers listed 

on U.S. exchanges. This represented a significant 

decline from approximately $1 trillion in share 

repurchases during fiscal year 2019, in line with the 

effects of the COVID–19 crisis. The sample for this 

estimate is defined more broadly than in the 2020 

Staff Study (adding financial and U.S.-listed foreign 

issuers with Compustat data), resulting in larger 

aggregate totals. 

announcement of such repurchase plan 

or program. 

We request comment on this 

economic analysis from all interested 

parties. With regard to any comments, 

we note that such comments are of 

greatest assistance to our rulemaking 

initiative if accompanied by supporting 

data and analysis of the issues 

addressed in those comments. 

A. Baseline and Affected Parties 

1. Affected Parties 

Repurchase disclosures are currently 

required by Item 703 of Regulation S– 

K (on Forms 10–Q and 10–K), Item 16E 

of Form 20–F, and Item 9 of Form N– 

CSR (for registered closed-end funds). 

The disclosure is required with respect 

to any purchase made by or on behalf 

of the issuer or any ‘‘affiliated 

purchaser’’ of shares or other units of 

any class of the issuer’s equity securities 

that is registered by the issuer pursuant 

to Section 12 of the Exchange Act. 

Based on staff analysis of EDGAR filings 

for 2020, the proposed amendments 

would affect the same categories of 

filers, including approximately 5,900 

filers of Forms 10–Q and 10–K and 

approximately 700 filers of Form 20–F 

with a class of securities registered 

under Section 12. In addition, based on 

staff analysis of Morningstar Direct data 

for 2020, approximately 500 registered 

closed-end funds are expected to be 

affected by the proposed amendments to 

Form N–CSR. We lack the data to 

estimate the number of affected 

‘‘affiliated purchasers.’’ 

Among the filers described above, 

filers that conduct repurchases today are 

most likely to be affected by the 

proposed amendments.55 Based on data 

from Compustat and EDGAR filings for 

fiscal year 2020, we estimate that 

approximately 3,300 operating 

companies that conducted repurchases 

during fiscal year 2020 would be 

affected by the amendments (among 

them, approximately 250 Form 20–F 

filers).56 In addition, based on staff 

analysis of Form N–CEN filings for 

2020, approximately 100 registered 

closed-end funds conducted 

repurchases.57 Based on these estimates, 

most of the affected issuers are 

operating companies that file periodic 

reports on domestic forms. 

Shareholders and prospective 

investors would also be affected by the 

proposed amendments to the extent that 

they receive additional and more timely 

insight into an issuer’s repurchase 

activity. Financial intermediaries that 

execute repurchases at the issuer’s 

instruction would also be affected by 

the proposed amendments to the extent 

that they have to prepare the 

information necessary for an issuer’s 

responsive disclosure, and indirectly, to 

the extent that the amendments affect 

the incidence of repurchases and thus 

demand for financial intermediaries’ 

services in connection with executing 

repurchases. To the extent that the 

proposed requirement to disclose any 

policies and procedures relating to 

purchases and sales of the issuer’s 

securities by its officers and directors 

during a repurchase program, including 

any restriction on such transactions, 

results in more issuers establishing such 

policies and procedures or imposing 

such restrictions, officers and directors 

would also be affected by the proposed 

amendments. We lack data to assess 

how many of these parties will be 

affected. 

2. Baseline 

Corporate payout decisions have been 

extensively studied for decades.58 In 

recent years the high dollar volume of 

repurchase activity has renewed interest 

in corporate payouts in the form of 

share repurchases. During 2020, share 

repurchases accounted for 

approximately $670 billion.59 Aggregate 

repurchases have grown significantly 

over the past four decades, but the 

increase relative to aggregate market 

capitalization has been significantly 

more modest due to the accompanying 

growth in aggregate market 


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60See, e.g., Campello M., Graham J., & Harvey, C., 

The Real Effects of Financial Constraints: Evidence 

from a Financial Crisis, 97 J. Fin. Econ. 470 (2010); 

Dittmar, A. & Dittmar, R., The Timing of Financing 

Decisions: An Examination of the Correlation in 

Financing Waves, 90 J. Fin. Econ. 59 (2008) 

(‘‘Dittmar and Dittmar (2008)’’); Floyd, E., Li, N., & 

Skinner, D., Payout Policy through the Financial 

Crisis: The Growth of Repurchases and the 

Resilience of Dividends, 118 J. Fin. Econ 299 (2015). 

See also 2020 Staff Study (observing that growth in 

aggregate repurchases has fluctuated over the past 

several decades, as demonstrated by a large decline 

and rebound following the financial crisis, and also 

observing that share repurchases net of equity 

issuances as a percentage of aggregate market 

capitalization of public companies have remained 

relatively stable over the past decade, within the 

longer trend of modest percentage growth over the 

last forty years). 

61See, e.g., Brealey, R., Myers, S., & Allen, F., 

Principles of Corporate Finance (12th ed. 2017). 

Issuers generally announce dividend policies, and 

markets react strongly to increases and reductions 

in dividends. See, e.g., Healy, P. & Palepu, K., 

Earnings Information Conveyed by Dividend 

Initiations and Omissions, 21 J. Fin. Econ. 149 

(1988). Market reactions to initiations and 

omissions are even more pronounced. See 

Michaely, R., Thaler, R., & Womack, K., Price 

Reactions to Dividend Initiations and Omissions: 

Overreaction or Drift?, 50 J. Fin. 573 (1995); Lee, 

B.S. & Mauck, N., Dividend Initiations, Increases 

and Idiosyncratic Volatility, 40 J. Corp. Fin. 47 

(2016). These studies indicate that decreases in 

buybacks do not elicit the same negative market 

reaction as dividend decreases. 

62For example, one survey of 384 CFOs and 

executives suggests that the ability to avoid 

reducing dividends was the top consideration of 

managers when determining dividend policy. See 

Brav, A., Graham, J., Harvey, C., & Michaely, R., 

Payout Policy in the 21st Century, 77 J. Fin. Econ. 

483 (2005) (‘‘Brav et al. (2005)’’). 

63See 2020 Staff Study. The partial substitution 

between dividends and repurchases has also been 

documented in academic studies. See, e.g., Skinner, 

D., The Evolving Relation between Earnings, 

Dividends and Stock Repurchases, 87 J. Fin. Econ. 

582 (2008); Grullon, G. & Michaely, R., Dividends, 

Share Repurchases, and the Substitution 

Hypothesis, 57 J. Fin. 1649 (2002). 

64See Farre-Mensa et al. (2014). 

65For analysis of signaling with repurchases, see, 

e.g., Vermaelen, T., Common Stock Repurchases 

and Market Signaling: An Empirical Study, 9(2) J. 

Fin. Econ. 139 (1981); Vermaelen, T., Repurchase 

Tender Offers, Signaling, and Managerial 

Incentives, 19 J. Fin. & Quantitative Analysis 163 

(1984); Constantinides, G. & Grundy, B., Optimal 

Investment with Stock Repurchase and Financing 

as Signals, 2 Rev. Fin. Stud. 445 (1989); Hausch, D. 

& Seward, J., Signaling with Dividends and Share 

Repurchases: A Choice Between Deterministic and 

Stochastic Cash Disbursement, 6 Rev. Fin. Stud. 

121 (1993); McNally, W., Open Market Stock 

Repurchase Signaling, 28(2) Fin. Mgmt. 55 (1999). 

In some studies, authors find that repurchases send 

a stronger signal than dividends. See, e.g., Ofer, A. 

& Thakor, A., A Theory of Stock Price Responses 

to Alternative Corporate Cash Disbursement 

Methods: Stock Repurchases and Dividends, 42 J. 

Fin. 365 (1987); Persons, J., Heterogeneous 

Shareholders and Signaling with Share 

Repurchases, 3(3) J. Corp. Fin. 221–249 (1997). 

66See, e.g., Dittmar, A. & Field, L. C., Can 

managers time the market? Evidence using 

repurchase price data, 115(2) J. Fin. Econ. 261–282 

(2015) (‘‘Dittmar and Field (2015)’’); Ben-Rephael, 

A., Oded, J., & Wohl, A., Do Firms Buy Their Stock 

at Bargain Prices? Evidence From Actual Stock 

Repurchase Disclosures, 18 Rev. Fin. 1299 (2014) 

(‘‘Ben-Rephael et al. (2014)’’); Chan, K., Ikenberry, 

D., & Lee, I., Do Managers Time the Market? 

Evidence from Open-Market Share Repurchases, 

31(9) J. of Banking & Fin. 2673–2694 (2007); Cook, 

D., Krigman, L., & Leach, J.C., On the Timing and 

Execution of Open Market Repurchases, 17(2) Rev. 

of Fin. Studies, 463–498 (2004) (‘‘Cook et al. 

(2004)’’) (finding that larger firms in the sample 

perform better than smaller firms in timing the 

price at which repurchases are executed). However, 

other studies do not find evidence that repurchases 

are driven by market timing. See, e.g., Obernberger, 

S., The Timing of Actual Share Repurchases, 

Working paper (2014) (concluding that contrarian 

trading rather than market timing ability explains 

the observed relation between returns and actual 

share repurchases); Dittmar and Dittmar (2008); 

Bonaime ́, A., Hankins, K., & Jordan, B., The Cost of 

Financial Flexibility: Evidence From Share 

Repurchases, 38 J. Corp. Fin., 345–362 (2016) 

(finding that ‘‘actual repurchase investments 

underperform hypothetical investments that 

mechanically smooth repurchase dollars through 

time by approximately two percentage points per 

year on average’’). The differences in the 

conclusions may be due to differences in empirical 

methodology and sample period. Because these 

studies utilize presently available, monthly data, 

their conclusions may be noisy and may not map 

fully to the effects associated with daily repurchase 

activity. As a general caveat, any working papers 

cited here have generally not undergone peer 

review and may be subject to revision. Studies 

focused on returns following share repurchase 

announcements also find positive returns. See, e.g., 

Evgeniou, T., Junque ́ de Fortuny, E., Nassuphis, N., 

& Vermaelen, T., Volatility and the Buyback 

Anomaly, 49 J. Corp. Fin., 32–53 (2018); Bargeron, 

L., Kulchania, M., & Thomas, S., The Timing and 

Source of Long-Run Returns Following 

Repurchases, 52 J. Fin. & Quantitative Analysis 491 

(2017); Peyer, U., & Vermaelen, T., The Nature And 

Persistence of Buyback Anomalies, 22 Rev. Fin. 

Stud. 1693 (2009). But see Fu, F. & Huang, S., The 

Persistence of Long-Run Abnormal Returns 

Following Stock Repurchases and Offerings, 62 

Mgmt. Science 964 (2016) (documenting 

disappearance of long-run, post-repurchase 

abnormal returns during 2003–2012). 

67See, e.g., Liu, H. & Swanson, E., Is Price 

Support a Motive for Increasing Share 

Repurchases?, 38 J. Corp. Fin. 77 (2016) (‘‘Liu and 

Swanson (2016)’’). 

68The price effects of actual repurchases 

discussed above are additional to any price effects 

of repurchase announcements. Because repurchase 

announcements precede actual repurchases, the 

announcement effect is already incorporated into 

the baseline share price, against which the price 

effects of actual repurchases are analyzed. 

capitalization; in addition, aggregate 

repurchases, both in absolute terms and 

relative to aggregate market 

capitalization, have exhibited 

considerable cyclical fluctuations 

(increasing during economic booms and 

declining during recessions).60

Dividends fluctuate less than 

repurchases, consistent with dividends 

being viewed by the market as a 

commitment to regularly return cash to 

shareholders.61 As a result, managers 

may endeavor to keep dividend 

payments stable, mainly avoiding 

dividend cuts, justifying the market’s 

interpretation.62 Firms that exclusively 

pay dividends are increasingly rare 

whereas the proportion of firms that 

regularly conduct repurchases has 

increased over time, consistent with 

repurchases being a partial substitute for 

dividends.63

Information about recent repurchases 

is expected to be valuable to investors. 

Various studies argue that an issuer 

conducts repurchases when it believes 

its securities to be undervalued.64

Corporate insiders likely have a superior 

understanding of their business and 

industry. Academic research has 

suggested managers can use increases in 

distributions, such as new repurchase 

programs, to signal their view that the 

stock is undervalued and is expected to 

increase in the future.65 Several 

empirical studies show that on average 

share prices increase after actual share 

repurchases, suggesting that information 

about recent repurchases could be 

useful in predicting the trend of future 

share prices, above and beyond other 

market factors (while some other studies 

do not find this result).66 A related 

explanation for repurchases is that they 

are an effort to provide price support by 

supplying liquidity when selling 

pressure is high; thus, share prices 

would be lower during an issuer’s 

repurchases and higher afterwards.67 In 

all of these scenarios, actual repurchases 

would precede a rise in the share price. 

Timely disclosure about recent actual 

repurchases can thus contain valuable 

information about the future movement 

of the share price that is not revealed to 

the market otherwise, and a lack of 

timely disclosure could contribute to 

information asymmetries between 

investors and issuers/insiders. The 

benefit of the information contained in 

a disclosure of recent repurchase 

activity would be lower to the extent 

that large issuer repurchases already 

have a price impact, resulting in price 

discovery and indirect revelation of 

information to the market, even in the 

absence of daily disclosure. 

Nevertheless, to the extent that an 

issuer’s purchases incorporate insiders’ 

future outlook on the firm, they could 

be informative to investors 

(complementing the information in 

Form 4 filings). The value of 

information on recent repurchases is not 

subsumed by the information content of 

announcements of repurchase programs. 

In the data, this is supported by the 

evidence of share price trends after 

actual repurchases.68 Importantly, after 

a repurchase announcement—which is 

voluntary for an issuer to make—an 

issuer retains considerable discretion on 

when to implement any repurchases 

and how much to repurchase at any 

point in time. Because, similar to 

information on individual insider 

trades, such information is likely to 

have a short-term component, its timely 

disclosure is expected to be relevant for 


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69Under existing requirements, while the delay in 

reporting can be relatively short, for example, when 

a repurchase is conducted at the end of a first, 

second, or third fiscal quarter, by a domestic large 

accelerated filer, in all cases disclosure will lag 

actual repurchases by weeks or months and is 

aggregated on a monthly basis. 

70For a more detailed summary of the related 

studies, see 2020 Staff Study and Farre-Mensa et al. 

(2014). 

71See Jensen, M., Agency Costs of Free Cash 

Flow, Corporate Finance, and Takeovers, 76 Am. 

Econ. Rev. 323 (1986). 

72See Brav et. al. (2005). 

73See Grullon, G. & Michaely, R., The 

Information Content of Share Repurchase 

Programs, 59 J. Fin. 651–680 (2004). 

74See, e.g., Guay, W. & Harford, J., The Cash-Flow 

Permanence and Information Content of Dividend 

Increases versus Repurchases, 57(3) J. Fin. Econ. 

385–415 (2000); Jagannathan, M., Stephens, C., & 

Weisbach, M., Financial Flexibility and the Choice 

between Dividends and Stock Repurchases, 57(3) J. 

Fin. Econ. 355–384 (2000). See also supra notes 62– 

63 and accompanying text. 

75See Hoberg, G. & Prabhala, N., Disappearing 

Dividends, Catering, and Risk, 22 Rev. Fin. Stud. 79 

(2009) (showing that riskier firms are less likely to 

pay dividends). 

76See, e.g., Feng, L., Pukthuanthong, K., 

Thiengtham, D., Turtle, H. J., & Walker, T. J., The 

Effects of Cash, Debt, and Insiders on Open Market 

Share Repurchases, 25(1) J. App. Corp. Fin. 55–63 

(2013). The tax advantage of repurchases has been 

attenuated but not eliminated after the 2003 

dividend tax cut. Outside of tax-exempt/taxdeferred accounts, all shareholders are subject to 

taxes on dividends for the year the dividend was 

paid. In the case of repurchases, only selling 

shareholders are subject to taxes on capital gains 

(the remaining shareholders do not pay taxes until 

they sell their shares). 

77See, generally, Baker, M. & Wurgler, J., Market 

Timing and Capital Structure, 57 J. Fin. 1 (2002). 

Some other evidence suggests that firms tend to 

repurchase stock and issue debt when the cost of 

debt falls relative to the cost of equity. See Ma, Y., 

Nonfinancial Firms as Cross-Market Arbitrageurs, 

74 J. Fin. 3041 (2019). See also Hovakimian, A., 

Role of Target Leverage in Security Issues and 

Repurchases, 77(4) J. Bus. 1041–1072 (2004) 

(finding that ‘‘equity issues and repurchases do not 

offset the accumulated deviation from the target and 

they are timed to market conditions’’). 

78For evidence on the use of repurchases as a 

method of real earnings management, see, e.g., 

Burnett, B., Cripe, B., Martin, G., & McAllister, B., 

Audit Quality and the Trade-Off Between Accretive 

Stock Repurchases and Accrual-Based Earnings 

Management, 87 Acct. Rev. 1861 (2012). CFO 

survey responses indicate that increasing EPS is an 

important factor affecting share repurchase 

decisions according to Brav et. al. (2005). Investors 

may take this into account when evaluating EPS. 

For example, Hribar, P., Jenkins, N., & Johnson, W. 

B., Stock Repurchases as an Earnings Management 

Device, 41 J. Acct. & Econ. 3 (2006), find that the 

market discounts EPS announcements in situations 

in which EPS would have been shy of analyst 

expectations but for share repurchases (and where 

repurchases are disclosed along with quarterly 

earnings). Kurt (2018) studies the use of accelerated 

share repurchases (ASRs) for real earnings 

management and concludes investors ‘‘are not 

fooled’’ by managers’ use of ASRs as an earnings 

management device. See Kurt, Ahmet C., Managing 

EPS and Signaling Undervaluation as a Motivation 

for Repurchases: The Case of Accelerated Share 

Repurchases, 17(4) Rev. Acct. & Fin. 453–481. 

Nevertheless, earnings management-motivated 

repurchases can have negative real effects on the 

issuer and its shareholders. For example, one recent 

study finds that repurchases used to push EPS 

above analyst expectations are accompanied by a 

10% decrease in capital expenditures and a 3% 

decrease in research and development. See, e.g., 

Almeida, H., Fos, V., & Kronlund, M., The Real 

Effects of Share Repurchases, 119(1) J. Fin. Econ., 

168–185 (2016) (‘‘Almeida et al. (2016)’’). Note that 

these findings do not necessarily generalize to 

repurchases at issuers outside the range of EPS 

approaching the earnings target, or to repurchases 

unrelated to EPS manipulation. A 2016 McKinsey 

& Co. report states that share repurchases do not 

improve shareholder returns simply by increasing 

EPS because, under certain conditions, there may 

have been more preferable uses for those funds such 

as debt reduction and reinvestment in the firm. See 

also, e.g., Ezekoye, O., Koller, T., & Mittal, A., How 

Share Repurchases Boost Earnings without 

Improving Returns, McKinsey, April 29, 2016, 

available at https://www.mckinsey.com/businessfunctions/strategy-and-corporate-finance/ourinsights/how-share-repurchases-boost-earningswithout-improving-returns. 

79With respect to actual share repurchases, a 

recent study shows that price support provided by 

actual share repurchases improves price efficiency, 

even when manipulation concerns might be 

highest, such as those that occur prior to insider 

sales. Busch, B. & Obernberger, S., Actual Share 

Repurchases, Price Efficiency, and The Information 

Content Of Stock Prices, 30 Rev. Fin. Stud. 324 

(2017) (‘‘Busch and Obernberger (2017)’’). With 

respect to share repurchase announcements, some 

have suggested that managers may take advantage 

of positive stock price reactions to non-binding 

repurchase announcements and use disingenuous 

repurchase announcements to manipulate share 

prices. See Chan et. al. (2010) (finding in 1980–2000 

data that a limited number of managers may have 

used repurchases in a misleading way as ‘‘cheap 

talk’’). Such ‘‘cheap talk’’ may result in lower 

announcement returns. See, e.g., Alice Bonaime ́, 

Repurchases, Reputation, and Returns, 47 J. Fin. & 

Quantitative Analysis 469 (2012) (‘‘Bonaime ́

(2012)’’); Bonaime ́ (2015). Some studies argue that 

‘‘cheap-talk’’ repurchase announcements may 

correct mispricing by attracting additional market 

scrutiny. See Almazan, A., Banerji, S., & De Motta, 

A., Attracting Attention: Cheap Managerial Talk 

and Costly Market Monitoring, 63 J. Fin. 1399 

(2008); Bhattacharya, U. & Jacobsen, S., The Share 

Repurchase Announcement Puzzle: Theory and 

Evidence, 20 Rev. Fin. 725 (2016). 

80As an important caveat, the incentives would 

be weaker to the extent executive compensation 

plans and board committees that address executive 

compensation account for how repurchases would 

affect compensation targets and the value of 

incentive-based compensation. For evidence on the 

use of repurchases to influence compensation tied 

to per-share measures, see, e.g., Cheng, Y., Harford, 

J., & Zhang, T., Bonus-Driven Repurchases, 50 J. 

Fin. & Quantitative Analysis 447 (2015) (‘‘Cheng et 

al. (2015)’’) (finding that ‘‘when a CEO’s bonus is 

directly tied to earnings per share (EPS), his 

company is more likely to conduct a buyback,’’ 

with the effect being ‘‘especially pronounced when 

a company’s EPS is right below the threshold for 

a bonus award,’’ that ‘‘[s]hare repurchasing 

investors. Existing disclosures provide a 

significantly delayed, aggregated insight 

into the execution of announced 

repurchases. Thus, a large part of the 

information content of the day-to-day 

timing of issuer repurchases with regard 

to short-term share price movements 

may become obsolete and potentially 

obscured by aggregation by the time the 

disclosure is made under existing 

requirements.69

Various studies address motivations 

behind corporate payouts and the 

choice of the form of payout 

(repurchases or dividends).70 In a 

number of instances, the use of 

repurchases can be efficient and aligned 

with shareholder value maximization. 

Sometimes issuers that have excess cash 

do not have profitable investment 

opportunities. In such instances, 

distributing the cash through dividends 

or repurchases can alleviate concerns 

that managers will spend the cash in 

sub-optimal ways, such as empirebuilding acquisitions.71 Survey 

evidence supports this theory, with the 

second most cited reason for conducting 

a repurchase being the ‘‘lack of good 

investment opportunities.’’ 72 By 

returning excess cash to shareholders, 

repurchases free up that capital to be 

reinvested into businesses that lack the 

capital to pursue value-creating 

investment opportunities. Stock price 

reactions to announcements of new 

repurchase programs are higher for 

cash-rich issuers, which may be 

consistent with the creation of value 

when managers remove their discretion 

over how to invest excess cash and 

provide that cash to investors to 

redeploy as they see fit.73 Issuers may 

choose repurchases if the excess free 

cash flow stems from a one-time 

windfall, or if they value financial 

flexibility and wish to avoid a costly, 

long-term commitment to higher 

dividends.74 For instance, firms that 

favor repurchases tend to have more 

volatile cash flows than dividendpaying firms.75 Issuers with excess free 

cash flow may also choose repurchases 

over dividends as the method of payout 

because repurchases are more taxefficient for shareholders.76 Finally, 

repurchases may also be used to adjust 

an issuer’s leverage upward, as part of 

adjustment towards the target capital 

structure, or as part of a market timing 

approach to capital structure.77

Some commentators and studies have 

noted that opportunistic insider 

behavior and agency conflicts, rather 

than firm value maximization, can 

motivate repurchases. In particular, 

repurchases can serve as a form of real 

earnings management (through 

decreasing the denominator of EPS) and 

thus be subject to short-term earnings 

management objectives of an executive 

seeking to meet or beat consensus 

forecasts.78 Announcements of 

repurchases and actual repurchase 

trades can also affect short-term upward 

price pressure.79 Share price- or EPStied compensation arrangements can 

thus incentivize executives to undertake 

repurchases, in an attempt to maximize 

their compensation,80 even if such 


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increases the probability the CEO receives a bonus 

and the magnitude of that bonus, but only when 

bonus pay is EPS based,’’ and further finding that 

‘‘[b]onus-driven repurchasing firms do not exhibit 

positive long-run abnormal returns’’); Kim, S. & Ng, 

J., Executive Bonus Contract Characteristics and 

Share Repurchases, 93 Acct. Rev. 289 (2018) 

(finding that ‘‘managers are more (less) likely to 

repurchase shares and spend more (less) on 

repurchases when as-if EPS just misses (exceeds) 

the bonus threshold (maximum) EPS level,’’ and 

that ‘‘[m]anagers making bonus-motivated 

repurchases do so at a higher cost’’). A different 

study documented a link between EPS targets and 

repurchases but did not find evidence of a negative 

effects on shareholders: Young, S. & Yang, J., Stock 

Repurchases and Executive Compensation Contract 

Design: The Role of Earnings Per Share 

Performance Conditions, 86 Acct. Rev. 703–733 

(2011) (finding ‘‘a strong positive association 

between repurchases and EPS-contingent 

compensation arrangements’’ but also finding ‘‘net 

benefits to shareholders from this association’’ 

(including ‘‘larger increases in total payouts’’, a 

more pronounced ‘‘positive association between 

repurchases and cash performance’’ in the presence 

of surplus cash; greater likelihood of undervalued 

firms ‘‘signal[ing] mispricing through a 

repurchase,’’ and ‘‘lower abnormal accruals’’) and 

‘‘no evidence that EPS-driven repurchases impose 

costs on share-holders in the form of investment 

myopia’’) Further, a different study examined the 

real cost of EPS-motivated repurchases outside the 

context of compensation. See Almeida et al. (2016) 

(finding that ‘‘[t]he probability of share repurchases 

that increase earnings per share (EPS) is sharply 

higher for firms that would have just missed the 

EPS forecast in the absence of the repurchase, when 

compared with firms that ‘just beat’ the EPS 

forecast’’ and that ‘‘EPS-motivated repurchases are 

associated with reductions in employment and 

investment, and a decrease in cash holdings’’ and 

concluding that ‘‘managers are willing to trade off 

investments and employment for stock repurchases 

that allow them to meet analyst EPS forecasts’’). See 

also Rulemaking Petition 4–746. But see 2020 Staff 

Study (finding that, based on a review of 

compensation disclosures in proxy statements for a 

sample of 50 firms that repurchased the most stock 

in 2018 and 2019, ‘‘82% of the firms reviewed 

either did not have EPS-linked compensation 

targets or had EPS targets but their board 

considered the impact of repurchases when 

determining whether performance targets were met 

or in setting the targets’’); Fields, R., Buybacks and 

the Board: Director Perspectives on the Share 

Repurchase Revolution, Sept. 20, 2016, available at 

https://corpgov.law.harvard.edu/2016/09/20/ 

buybacks-and-the-board-director-perspectives-onthe-share-repurchase-revolution/ (concluding, 

based on interviews of ‘‘44 directors serving on the 

boards of 95 publicly traded US companies with an 

aggregate market capitalization of $2.7 trillion’’ that 

‘‘most directors said that their companies are aware 

of the relationship between buyback programs and 

compensation and that they make deliberate, 

informed choices to ensure that they reward 

executives for desired behavior rather than for 

financial manipulation of share prices. Anticipated 

buyback effects on EPS are usually factored into 

EPS targets, they say, and unanticipated effects can 

be adjusted out.’’). 

81See, e.g., Chan et. al. (2010). See also Bonaime ́, 

A. A. & Ryngaert, M. D., Insider Trading and Share 

Repurchases: Do Insiders and Firms Trade in the 

Same Direction?, 22 J. Corp. Fin. 35–53 (2013) 

(‘‘Bonaime ́ and Ryngaert (2013)’’) (finding that 

repurchases that coincide with net insider selling 

may be related to price support and/or reasons 

related to option exercises); Cziraki, P., Lyandres, 

E., & Michaely, R., What Do Insiders Know? 

Evidence from Insider Trading Around Share 

Repurchases and SEOs, 66 J. Corp. Fin. 101544 

(2021) (‘‘Cziraki et al. (2021)’’) (finding that 

‘‘[h]igher insider net buying is associated with 

better post-event operating performance, a 

reduction in undervaluation, and, for repurchases, 

lower post-event cost of capital. Insider trading also 

predicts announcement returns and long-term 

abnormal returns following events.’’ They conclude 

their results suggest ‘‘insider trades before corporate 

events [repurchases and SEOs] contain information 

about changes both in fundamentals and in investor 

sentiment’’); Palladino (2020) (finding increased 

insider selling in quarters where buybacks are 

occurring); Ahmed, W., Insider Trading Around 

Open Market Share Repurchase Announcements, 

Working paper, University of Warwick (2017) 

(finding that ‘‘insiders take advantage of higher 

post-[repurchase] announcement price and sell 

more heavily’’, and that such selling is predictive 

of lower long-term returns). See also Rulemaking 

Petition 4–746, at 5 and note 17 (expressing concern 

and citing evidence of repurchases used to increase 

share prices at the time when insiders sell shares). 

See also, generally, Edmans, A., Goncalves-Pinto, 

L., Groen-Xu, M., & Wang, Y., Strategic News 

Releases in Equity Vesting Months, 31(11) Rev. Fin. 

Stud., 4099–4141 (2018) (finding that ‘‘CEOs release 

20% more discretionary news items in months in 

which they are expected to sell equity, predicted 

using scheduled vesting months’’ and that ‘‘[t]he 

increase arises for positive news, but not neutral or 

negative news, nor nondiscretionary news’’ and 

concluding that ‘‘[n]ews in vesting months 

generates a temporary increase in stock prices and 

market liquidity, which the CEO exploits by 

cashing out shortly afterwards’’; as an important 

caveat, while the study includes buybacks among 

announcements, and based on other evidence, they 

are generally viewed as positive announcements, 

the study does not provide specific results for 

buybacks); Edmans, A., Fang, V., & Huang, A., The 

Long-Term Consequences of Short-Term Incentives, 

J. Acct. Res., forthcoming (2021) (finding that 

‘‘[v]esting equity is positively associated with the 

probability of a firm repurchasing shares’’ but that 

‘‘it is also associated with more negative long-term 

returns over the 2–3 years following repurchases’’ 

and that ‘‘CEOs sell their own stock shortly after 

using company money to buy the firm’s stock, also 

inconsistent with repurchases being motivated by 

undervaluation’’). But see, e.g., Liu and Swanson 

(2016) (finding that ‘‘[c]orporate insiders do not sell 

from personal stock holdings during the price 

support quarter.’’); see also Busch and Obernberger 

(2017) (concluding, with respect to actual share 

repurchases, that price support provided by 

repurchases improves price efficiency, even when 

manipulation concerns might be highest, such as 

those that occur prior to insider sales). In the case 

of repurchase announcements, where such 

announcements coincide with earnings 

announcements, because issuers generally prohibit 

insiders from trading in the period leading up to 

earnings announcements as part of blackout 

periods, insider sales activity after the repurchase 

announcement may be the result of pent-up 

liquidity demand. 

82Announcement returns are positively related to 

past insider purchases, especially for firms that are 

priced less efficiently. See, e.g., Dittmar & Field 

(2015) (finding that ‘‘repurchasing firms with 

relatively high net insider buying have significantly 

lower relative repurchase prices’’ and concluding 

that firms with more net insider buying repurchase 

undervalued stock); Babenko, I., Tserlukevich, Y., & 

Vedrashko, A., The Credibility of Open Market 

Share Repurchase Signaling, J. Fin. & Quantitative 

Analysis 1059–1088 (2012).; Bonaime ́ and Ryngaert 

(2013) (finding that net insider buying reinforces 

the undervaluation signal conveyed by repurchases 

while net insider selling weakens it); Cziraki et al. 

(2021) (showing that ‘‘pre-event insider trading 

contains information regarding future changes in 

the cost of capital for repurchasing firms’’). Setting 

aside the signaling theory, purchases by insiders 

during an issuer’s repurchases if such insiders are 

in possession of material nonpublic information 

may represent unlawful insider trading that may 

harm other market participants. Similar to insiders, 

issuers that purchase their securities while in 

possession of material nonpublic information may 

be subject to Rule 10b–5 liability. 

83Brav et. al. (2005). 

84See, e.g., Dittmar and Field (2015); Ben-Rephael 

et al. (2014). See also infra note 67. 

85See, e.g., Busch and Obernberger (2017); Cook 

et al. (2004); Hillert, A., Maug, E., & Obernberger, 

S., Stock Repurchases and Liquidity, 119(1) J. Fin. 

Econ. 186–209 (2016). 

repurchases are not optimal from the 

shareholder value maximization 

perspective. Another instance of 

potentially inefficient repurchase 

behavior, which could have a negative 

effect on investors, involves insider 

incentives to raise the share price prior 

to insider sales.81 Conversely, some 

studies note that insider purchases of 

stock in conjunction with a repurchase 

announcement may strengthen the 

credibility of the repurchase signal.82

CFOs report considering the price of the 

stock when deciding whether to 

repurchase stock.83 Further, academic 

studies have found that firms conduct 

repurchases when stock prices are 

low.84 This trading, however, does not 

appear to degrade market quality, with 

several studies finding improved 

liquidity during repurchase programs.85

Presently, information about 

repurchases, aggregated at the monthly 

level, is provided in periodic reports 

(quarterly for most filers). While issuers 

may voluntarily announce future 

repurchase plans (typically on Form 8– 

K), they are not required to do so, nor 

are they required to provide timely 

updates to investors about incremental 

progress under the previously 

announced repurchase program. 

Generally, a lack of transparency, 

comprehensive disclosure, and timely 

information about repurchases may 

contribute to information asymmetries 

and thus make it harder for investors to 

value an issuer’s securities and make 

informed investment decisions. 

Although some issuers announce 

details of their repurchase programs on 

a voluntary basis, issuers are not 

required to do so, or to disclose reasons 

for their repurchases. Further, issuers 

are not required to disclose whether 

they allow insiders to trade during 

repurchases. Thus, it can be difficult for 

investors to determine whether the 

undertaken repurchases were efficient 

and aligned with shareholder value 

maximization, or were at least in part 

driven by self-interested behavior of 

corporate insiders rather than 

shareholder interest. The last significant 

change to repurchase reporting was 

adopted in 2003, when the Commission 

required domestic filers to present 


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86See Bonaime ́ (2015). 

87 Id. 

88 Id. 

89See Ginglinger, E. & Hamon, J., Actual Share 

Repurchases, Timing, and Liquidity, 31 J. Banking 

& Fin. 915–938 (2007), for a study of France; and 

Brockman, P. & Chung, D., Managerial Timing and 

Corporate Liquidity: Evidence from Actual Share 

Repurchases, 61 J. Fin. Econ. 417–448 (2001), for 

a study of Hong Kong. While the authors do not 

examine empirically the effects of different 

reporting frequencies, they compare their findings 

with those from a foreign regime with a different 

reporting frequency and extrapolate that ‘‘[t]he 

similarity of our results to the results for the Hong 

Kong market indicates that the choice of whether 

to require firms to disclose repurchases one day 

versus one month after execution does not affect the 

impact of share repurchases on liquidity’’; while the 

study further concludes that this suggests ‘‘that 

there are limited benefits from requiring greater 

post-trade transparency of share repurchases,’’ the 

conclusion that greater disclosure of repurchases 

would have limited benefits, in our view, does not 

follow from the similarity of the effects of 

repurchases on liquidity in the two countries 

referenced in the study. As a further caveat, there 

are potentially significant comparability issues in 

evaluating data from different jurisdictions, which 

have varying legal and market conditions for 

repurchases. 

90See Zhang, H., Share Price Performance 

Following Actual Share Repurchases, 29 J. Banking 

& Fin. 1887–1901 (2005), for a study of Hong Kong, 

and Drousia, A., Episcopos, A., & Leledakis, G., 74 

Q. Rev. Econ. and Fin. 267–277 (2019), for a study 

of Greece. See also Bratli, D. & Rehman, O., The 

Price Impact and Timing of Actual Share 

Repurchases in Norway, Thesis (2016) (examining 

Norwegian data on daily repurchases and finding a 

small but positive price impact of such 

repurchases). 

91See supra notes 66–68 and preceding, 

accompanying, and following text. 92Timelier disclosure of repurchases was 

supported by several commenters on the 2016 

concept release. See, e.g., letters in response to the 

Concept Release from Klein & Amy (supporting 

reporting of all repurchases on Form 8–K with no 

de minimis threshold); CalPERS (recommending 

reporting of significant repurchases on Form 8–K); 

AFR (recommending that share repurchases should 

be disclosed at the time that the repurchase occurs). 

But see letters in response to the Concept Release 

from SIFMA (arguing that more frequent reporting 

would not provide any material information to 

justify the increased cost to registrants and might 

prejudice a registrant’s execution of share 

repurchases). See also Letters from Chamber; 

FedEx; Fenwick; GM; and FEI (generally supporting 

the existing, quarterly frequency of repurchase 

reporting required in Item 703). 

93See supra note 67. 

94See supra note 78. 

monthly data on actual repurchases on 

a quarterly basis in Form 10–Q or 10– 

K (registered closed-end funds, on a 

semi-annual basis in Form N–CSR, and 

Form 20–F filers, on an annual basis in 

Form 20–F). One study examined the 

consequences of this change and found 

that ‘‘[f]irms announce significantly 

fewer and slightly smaller open market 

repurchase plans in the enhanced 

disclosure environment,’’ however, 

‘‘completion rates (the amount of stock 

repurchased as a percentage of the 

announced amount) significantly 

increase.’’ 86 The study further states 

that ‘‘[m]ore conservative 

announcement strategies and more 

aggressive completion rates are 

consistent with a decline in false 

signaling . . . open market repurchase 

announcements are viewed as more 

credible, on average, in the enhanced 

disclosure environment.’’ 87 However, as 

the study notes, ‘‘[a]s with any analysis 

based on a regulatory change affecting 

all firms simultaneously, other 

unobservable, macroeconomic trends 

could have affected repurchase 

behavior.’’ 88

A number of foreign jurisdictions 

require repurchase disclosure of greater 

frequency and timeliness, relative to 

current U.S. requirements. Studies have 

examined the resulting higher-frequency 

data on repurchase program and how 

repurchase trades affect investors and 

markets. Studies based on data from 

France and Hong Kong, which require 

repurchase disclosures at the beginning 

of the following month and following 

day, respectively, found that 

repurchases reduced market liquidity in 

periods in which repurchases took place 

but not in response to the disclosures.89

These findings are consistent with 

potential adverse selection when a large 

informed trader (the repurchasing 

issuer) is in the market but do not 

suggest a negative impact from 

increased disclosure frequency. Other 

studies of disclosures required in 

Greece, which requires repurchase 

disclosures within seven days, and 

Hong Kong document that cumulative 

abnormal returns following disclosures 

of actual share repurchases are greatest 

for smaller firms as well as firms with 

higher book-to-market ratios. These are 

consistent with the studies finding that 

repurchase announcements may correct 

market undervaluation and do so 

especially for smaller firms, which may 

be subject to greater information 

asymmetry.90

While we could not find studies 

analyzing empirically how the 

introduction of more frequent disclosure 

affected buybacks in foreign countries, 

we also were not able to find evidence 

that such disclosure requirements 

adversely affected shareholder value or 

market participants. The broad 

application of a disclosure requirement 

to issuers in a given jurisdiction makes 

it hard to formulate an empirical setting, 

such as a quasi-natural experiment, that 

effectively addresses the question of 

how the introduction of the disclosure 

affected buybacks and issuers that 

undertake them. Moreover, there are 

potentially significant differences 

between jurisdictions with respect to 

other repurchase regulations, market 

structure, taxation, composition of the 

subset of issuers that undertake 

repurchases, and the subset of investors 

in such issuers, complicating crosscountry comparisons or extrapolation 

from international studies to the U.S. 

setting. 

In Sections IV.B and IV.C below we 

evaluate the anticipated costs and 

benefits of the final rule and the 

anticipated effects of the final rule on 

efficiency, competition, and capital 

formation. 

B. Benefits 

The proposed disclosure could benefit 

investors (including existing 

shareholders contemplating a sale or 

purchasing more securities) by enabling 

them to value the issuer’s securities 

more accurately, resulting in better 

informed investment decisions.91

Specifically, the proposed daily 

disclosure of repurchases (compared to 

the existing Form 10–Q and 10–K 

quarterly disclosure of monthly 

repurchase activity, the semi-annual 

disclosure on Form N–CSR, and the 

annual disclosure on Form 20–F) could 

reveal time-sensitive information about 

the issuer’s evolving outlook on its 

future share price to investors in a much 

timelier manner.92 To the extent issuers’ 

repurchase decisions tend to predict 

future price changes,93 information 

about the timing of recent repurchases 

could be valuable to investors’ decisions 

to buy and sell the issuer’s securities. 

These benefits would be more modest to 

the extent that many issuers already 

make public announcements of 

repurchase plans, which alleviate some 

information asymmetries, and there is 

evidence that investors on aggregate 

draw accurate inferences about the 

likely program completion rate 94

(although they cannot gauge the timing 

of specific repurchase trades). The 

benefits would further be more modest 

to the extent that large issuer 

repurchases already have price impact 

in the absence of a daily disclosure. The 

disclosure could be of greater benefit to 

market participants that do not have the 

sophistication to uncover large 

repurchases from other trading data. 

Further, the benefits of repurchase 

disclosure may be lower if issuers 

restructure their repurchases in a 

manner intended to minimize the 

information content and associated 

front-running costs of the daily 

disclosure (see Section IV.C below) in 

response to the proposed disclosure 

requirement. 

In addition, the proposed periodic 

disclosure of the reasons for, and the 

structure of, the issuer’s repurchase 


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95See, e.g., Bonaime ́ (2012) (tabulating, in Table 

3, evidence on the stated motive of the announced 

repurchase program and program completion rates). 

The paper finds that ‘‘[f]ew stated motives for 

repurchases affect completion rates. Firms that 

mention undervaluation or general corporate 

purposes in their announcements have significantly 

lower completion rates, while firms that mention 

extending a prior plan or having a strong cash 

position have significantly higher completion rates 

on average. With the above exceptions, completion 

rates depend more on what issuers are doing 

(implied motives) than on what they are saying 

(stated motives).’’ As a caveat, data obtained from 

a voluntary regime may not fully generalize to the 

mandatory disclosure of the rationale for 

repurchases under the proposed amendments. 

96 In other contexts, see, e.g., Cazier, R., 

McMullin, J., & Treu, J., Are Lengthy and 

Boilerplate Risk Factor Disclosures Inadequate? An 

Examination of Judicial and Regulatory 

Assessments of Risk Factor Language, 96(4) Acct. 

Rev. 131–155 (2021) (finding that risk factor 

disclosures often remain ‘‘excessively long and 

boilerplate’’, ‘‘lengthier and more boilerplate risk 

factor disclosures are less likely to be considered 

inadequate under judicial and regulatory review,’’ 

and ‘‘when risk factor language is assessed as 

adequate in judicial review, industry peers borrow 

that language more frequently, and that judicial 

assessments of risk factor disclosures prompt 

industry peers to lengthen their risk factor 

disclosures.’’). But see Nelson, K. & Pritchard, A. C., 

Carrot or Stick? The Shift from Voluntary to 

Mandatory Disclosure of Risk Factors, 13(2) J. 

Empirical Legal Stud. 266–297 (2016) (finding that 

‘‘[f]irms subject to greater litigation risk disclose 

more risk factors, update the language more from 

year to year, and use more readable language than 

firms with lower litigation risk,’’ and while ‘‘[t]hese 

differences in the quality of disclosure are 

pronounced in the voluntary disclosure regime, 

[they] converge following the SEC mandate as lowrisk firms improved the quality of their risk factor 

disclosures.’’); Campbell, J., Chen, H., Dhaliwal, D., 

Lu, H., & Steele, L. B., The Information Content of 

Mandatory Risk Factor Disclosures in Corporate 

Filings, 19 Rev. Acct. Stud. 396–455 (2014) (finding 

that ‘‘firms facing greater risk disclose more risk 

factors . . . managers provide risk factor 

disclosures that meaningfully reflect the risks they 

face . . . [and that] the information conveyed by 

risk factor disclosures is reflected in systematic risk, 

idiosyncratic risk, information asymmetry, and firm 

value’’). 

97See supra note 80. 

98For example, one recent study shows that price 

support provided by actual share repurchases 

contributes to improved price efficiency, even when 

manipulation concerns might be highest, such as 

those that occur prior to insider sales. See Busch 

and Obernberger (2017). 

program could improve the ability of 

investors to assess the optimality of the 

issuer’s repurchase policy. The benefits 

of the information about the rationale 

for repurchases could be limited in 

cases where issuers already provide 

such disclosures in voluntary 

repurchase program announcements, or 

if investors are able to infer the purpose 

of repurchases from other public 

information.95 The benefits of the 

information about the rationale for 

repurchases could be limited if such 

disclosure is boilerplate and provides 

relatively little specificity to investors.96

In some cases, incentives for valuedestroying or opportunistic repurchases 

may exist, as discussed in detail in 

Section IV.A.2 above. To the extent that 

some repurchases are inefficient, the 

additional transparency about 

repurchases under the proposed 

amendments could reduce such 

opportunistic uses of buybacks. The 

daily disclosure of repurchases, 

combined with other existing 

disclosures (e.g., dates and terms of 

compensation awards, dates of insider 

trades, dates and details of earnings 

announcements and earnings forecasts), 

could improve the ability of investors to 

identify those instances of repurchases 

that may be driven by managerial selfinterest (e.g., increasing the share price 

prior to an insider’s sale, meeting a 

threshold in the compensation 

arrangement, or meeting/beating the 

consensus earnings forecast). Such 

market scrutiny could mitigate agency 

conflicts associated with repurchases 

and thereby enhance firm value, 

benefiting shareholders. Further, the 

proposed additional disclosure could 

make it easier for investors to timely 

identify repurchase announcements 

potentially motivated by short-term 

attempts to boost the share price 

(including cases where issuers 

announce repurchase programs but do 

not follow through), to the extent that 

daily information provides a more 

complete and timely picture than the 

monthly information presently reported 

on a quarterly (or for some filers, less 

frequent) basis. 

The use of a structured data language 

(specifically, Inline XBRL) for the 

repurchase disclosures under the 

proposed amendments would enable 

automated extraction of granular data on 

issuers’ repurchase programs and actual 

repurchases, which could allow 

investors, information intermediaries, 

and other market participants to 

efficiently perform large-scale analyses 

and comparisons of repurchases across 

issuers and time periods. Structured 

data on repurchases could also be 

efficiently combined with other 

information available in a structured 

data language in corporate filings (e.g., 

information on insider sales and 

purchases of securities) and with market 

data contained in external machinereadable databases (e.g., information on 

daily share prices and trading volume). 

The use of a structured data language 

could also enable considerably faster 

analysis of the disclosed data by 

investors and other market participants. 

The use of a new form for the daily 

disclosure of repurchase information 

could on the margin benefit investors 

manually reviewing repurchase filings 

of an individual issuer or a handful of 

issuers, relative to the reporting of such 

daily disclosure on an existing form 

(such as Form 8–K), by making the 

repurchase information relatively more 

salient and easier to find among an 

issuer’s filings. However, in cases where 

investors extract structured data 

underlying the disclosure, the use of a 

new form versus adding structured data 

to an existing form is unlikely to have 

a meaningful effect. 

The proposed requirements to 

disclose any policies and procedures 

relating to purchases and sales of the 

issuer’s securities by its officers and 

directors during a repurchase program, 

including any restriction on such 

transactions, as well as the proposed 

disclosure of whether any officer or 

director reporting pursuant to Section 

16(a) of the Exchange Act purchased or 

sold shares or other units of the class of 

the issuer’s securities that is the subject 

of an issuer share repurchase plan or 

program within 10 business days before 

or after the issuer’s announcement of an 

issuer purchase plan or program, could 

also benefit investors. This information 

could help investors better interpret 

repurchase program announcements 

and disclosures of actual repurchase 

activity in formulating projections of an 

issuer’s future share price. As one 

example, a lack of restrictions on insider 

selling during repurchases, alongside 

historical disclosures of insider selling, 

could help investors gauge whether a 

future repurchase announcement, or 

actual repurchases, may be motivated by 

price support for insiders’ sales of their 

securities, rather than conveying a true 

signal of undervaluation or efficiently 

disbursing excess cash.97 The 

magnitude of these benefits may be 

more limited to the extent that past 

insider selling activity, disclosed on 

beneficial ownership filings, around 

past repurchases, could be sufficiently 

representative of future insider selling 

behavior in such circumstances, even in 

the absence of a disclosure of 

restrictions. The magnitude of these 

benefits of reduced information 

asymmetry may further be limited to the 

extent that the existing repurchase and 

disclosure practices already sufficiently 

provide for price efficiency.98 Besides 

providing information to investors, and 

thus enabling better informed 

investment decisions, the proposed 

disclosure requirements might also 

significantly affect the underlying 

behavior of insiders and issuers by 

drawing scrutiny of investors and 

market participants to insider selling 

during repurchases, potentially 

disincentivizing announcements of 

repurchases and actual repurchases 


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99Studies have found evidence that changes in 

mandatory disclosure affect behavior. See, e.g., 

Chuk, E. C., Economic Consequences of Mandated 

Accounting Disclosures: Evidence from Pension 

Accounting Standards, 88(2) Acct. Rev. 395–427 

(2013); Bonaime ́ (2015). 

100See, e.g., Easley, E. & O’Hara, M., Information 

and the Cost of Capital, 59(4) J. Fin. 1553–1583 

(2005); Botosan, C., Disclosure and the Cost of 

Capital: What Do We Know?, 36 Acct. & Bus. 

Research 31–40 (2006) (stating that ‘‘[t]he 

overriding conclusion of existing theoretical and 

empirical research is that greater disclosure reduces 

cost of capital’’); Lambert, R., Leuz, C., & 

Verrecchia, R., Accounting Information, Disclosure, 

and the Cost of Capital, 45(2) J. Acct. Research 385– 

420 (2007) (showing, in a conceptual framework, 

that ‘‘increasing the quality of mandated disclosures 

should in general move the cost of capital closer to 

the risk-free rate’’ and ‘‘generally reduce the cost of 

capital for each firm in the economy’’ and further 

noting that ‘‘the benefits of mandatory disclosures 

are likely to differ across firms.’’); Accelerated Filer 

and Large Accelerated Filer Definitions, Rel. No. 

34–88365 (Mar. 12, 2020) [85 FR 17178 (Mar. 26, 

2020)], at 17215, note 477. 

101See Section V for a detailed description of the 

estimated burden of the proposed disclosure 

requirements for purposes of the Paperwork 

Reduction Act. 

102See, e.g., Pay Ratio Disclosure, Rel. No. 33– 

9877 (Aug. 5, 2015) [80 FR 50103 (Aug. 18, 2015)], 

at 50177; Interactive Data to Improve Financial 

Reporting, Rel. No. 33–9002 (Jan. 30, 2009) [74 FR 

6775 (Feb. 10, 2009], at 6794; and Selective 

Disclosure and Insider Trading, Rel. No. 33–7881 

(Aug. 15, 2000) [65 FR 51715 (Aug. 24, 2020)], at 

51723. 

103See supra note 51 and accompanying text. 

104This cost could be more pronounced for 

repurchases under a Rule 10b5–1(c) plan to the 

extent that such repurchases exhibit a greater 

degree of periodicity and occur over a period of 

time, enabling market participants to predict future 

repurchases to a greater extent based on historical 

daily data. To the extent that more timely 

disclosure enables some other investors to purchase 

securities before the issuer completes the 

motivated by price support for insider 

selling, to the extent such activity exists, 

instead of shareholder value 

maximization.99 The benefits of the 

disclosure of whether any officer or 

director has purchased or sold securities 

of the issuer around the repurchase 

announcement may be small to the 

extent the investors can obtain the same 

information from existing Section 16 

beneficial ownership disclosures and 

public announcements of repurchases. 

We expect the proposed amendments 

to have positive effects on efficiency 

and capital formation. In particular, any 

decrease in the information asymmetry 

between issuers and investors about the 

value of an issuer’s securities as a result 

of the disclosure could lead to more 

informationally efficient prices, and 

more efficient capital allocation in 

investor portfolios. Decreased 

information asymmetries between 

investors and issuers as a result of the 

enhanced disclosure under the 

proposed amendments could also 

incrementally facilitate capital 

formation and reduce the cost of 

capital.100 It is difficult to determine the 

incremental contribution of the 

proposed amendments and thus the 

magnitude of this potential benefit. 

C. Costs 

The proposed disclosure would 

impose costs on issuers (and therefore 

existing shareholders). Such costs 

would include direct (compliancerelated) costs to compile and report 

daily repurchase data, as well as to 

provide additional disclosure, such as a 

description of the rationale and 

structure of the repurchase program 

(including reliance on Rule 10b–18 and 

pursuant to a plan that is intended to 

satisfy the affirmative defense 

conditions of Rule 10b5–1(c)).101 The 

aggregate direct costs of compliance 

would be potentially significant and 

would be largest for issuers that 

repurchase more frequently and thus 

have to provide more disclosures. The 

direct costs of compliance with the 

daily disclosure requirement on Form 

SR could be partly alleviated by the 

provision that such disclosure would be 

furnished, rather than filed, which 

could result in an incrementally smaller 

legal cost of the new disclosure.102 It is 

difficult to quantify how significantly 

the proposed timing of the daily 

disclosure requirement with respect to 

the timing of trade settlement (i.e., daily 

disclosure within one day of trade 

execution, which would be prior to the 

settlement of the trade, as opposed to 

after trade settlement) would affect 

direct compliance costs. As proposed, 

issuers would have one business day 

from the trade execution to report 

repurchases. Thus, issuers would likely 

have fairly complete data based on 

trades that have been executed, 

although the disclosure would be 

required in most cases before trades 

have settled (since settlement typically 

occurs two business days after the trade 

execution). Where material changes 

occur after settlement, issuers would 

incur a cost to file an amended Form 

SR. In addition, issuers that do not 

presently gather and aggregate 

repurchase information on a daily basis, 

outside of the financial reporting cycle, 

would incur costs to implement such 

systems and processes. 

The proposed requirement to report 

the additional quantitative repurchase 

disclosure on a new form will impose 

costs. Issuers will likely incur an initial 

upfront cost to train counsel or retain an 

outside service provider to assist with 

the preparation of the new form. On an 

ongoing basis, holding the scope of the 

disclosure and affected filers 

unchanged, we expect the direct costs of 

filing the data on a new form to be very 

similar to the direct costs of filing the 

data on an existing form (such as Form 

8–K). 

The proposed requirement to use a 

structured data language for reporting 

the repurchase disclosure will impose 

incremental compliance costs on 

issuers. Such costs are expected to be 

modest as issuers affected by the 

amendments (including small and 

foreign filers) already are required to, or 

would be required to (in the case of 

certain closed-end funds—no later than 

February 2023 103), use Inline XBRL to 

comply with other disclosure 

obligations. Moreover, the scope of the 

disclosure proposed to be reported 

using a structured data language is 

limited and would thus likely require a 

relatively simple taxonomy of 

additional tags, minimizing initial and 

ongoing costs of complying with the 

proposed tagging requirement. 

The proposed qualitative disclosure 

requirements would also result in 

compliance costs for issuers. While 

issuers are likely to have most of the 

additional information readily available, 

these disclosures would require 

additional time of counsel and/or 

management to characterize the 

rationale for the repurchase program, 

and the program’s structure, in the 

periodic report. The proposed 

requirement to disclose whether any 

Section 16 officer or director purchased 

or sold securities in the 10 business day 

before or after a repurchase 

announcement would involve costs 

associated with collecting information 

from Section 16 reporting officers and 

directors, in reliance on their Section 16 

filings and/or representations about 

their trading activity. 

The proposed requirements would 

also impose indirect costs. A key 

indirect cost of daily disclosure 

(proposed to be required one business 

day after the repurchase trade is 

executed) is that it may cause the stock 

price to rise more than it would absent 

such disclosure, making additional 

purchases more costly. These costs 

would be borne by the issuer and 

therefore its shareholders, but would be 

mitigated for shareholders selling part of 

their position. The reason that 

disclosure might have this effect is it 

could reveal the issuer’s plans to 

repurchase additional stock to outside 

investors (to the extent repurchases are 

taking place over multiple days), as well 

as the issuer’s positive outlook on the 

stock price (to the extent that 

participants infer this is a motivation for 

the repurchase).104 This cost to issuers 


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repurchase program, thus potentially at a lower 

price than they would have otherwise, those other 

investors may benefit from being able to front-run 

the issuer’s trades. 

105See, e.g., Amihud, Y. & Mendelson, H., 

Liquidity and Stock Returns, 42(3) Fin. Analysts J. 

43–48 (1986) (noting that ‘‘[t]he stocks of small 

firms suffer from market ‘thinness,’ which impairs 

their liquidity’’.); Duarte, H., and Young, L., Why is 

PIN priced?, 91(2) J. Fin. Econ. 119–138 (2009) (in 

Table 6, showing that larger firm size is correlated 

with higher liquidity based on different measures); 

Collver, C., A Characterization of Market Quality 

for Small Capitalization US Equities, September 

2014, available at https://www.sec.gov/files/ 

marketstructure/research/small_cap_liquidity.pdf 

(2014) (finding that ‘‘[s]mall cap stocks had larger 

quoted and effective spreads and traded much 

lower volumes than mid cap stocks’’ and that 

‘‘[l]iquidity improved with market capitalization’’). 

would be a wealth transfer to other 

market participants, which would have 

otherwise been less informed about the 

issuer’s outlook on its future share 

price. The magnitude of such costs 

would vary across issuers and could 

evolve if issuers restructure their 

repurchase programs in an effort to 

minimize the price impact associated 

with the proposed disclosure 

requirement. For example, issuers that 

conduct open market repurchases over 

multiple days on a highly predictable 

periodic schedule (such as under a Rule 

10b5–1 or a similar trading plan, or that 

conduct recurring trades outside of a 

trading plan) may face a higher cost of 

this type. Conversely, issuers that 

conduct open market repurchases over a 

period of only a couple of days, or over 

a longer period of time but at highly 

irregular intervals, or in irregular 

amounts (e.g., a series of smaller 

repurchases followed by a large 

repurchase day), may see lower costs of 

this type from the proposed disclosure 

requirement. However, issuers that 

bunch large repurchases into a 

compressed time period would likely 

experience greater price impact from 

large trades, and issuers that rely on the 

Rule 10b–18 safe harbor would also be 

limited by the safe harbor’s provisions 

in the volume of daily repurchase 

activity. Further, issuers that conduct 

one-time repurchases outside the open 

market (such as in a privately negotiated 

transaction, as an accelerated share 

repurchase, or as a tender offer) may be 

less subject to these costs because the 

trade would be required to be reported 

after it is executed, and it would 

typically be executed at once. To the 

extent that repurchases convey 

information even in the absence of 

disclosure, if issuers were to limit 

repurchases due to cost, price efficiency 

may be reduced. To the extent that 

repurchases add liquidity in the absence 

of disclosure, limiting repurchases 

might also reduce liquidity. 

Another potential indirect cost of the 

proposed disclosure is the risk of 

sharing sensitive information with 

competitors. It is unlikely that the 

rationale behind repurchases would 

reveal such proprietary information, 

above and beyond other disclosures 

about the business and financial 

condition of the issuer. Thus, we expect 

such costs to be relatively modest. 

A further indirect cost of the proposed 

disclosure is the possibility of the 

proposed disclosure requirements 

leading issuers to deviate from an 

optimal payout policy (resulting in a 

negative effect on efficiency). For 

example, the described costs of the 

proposed disclosure might discourage 

some issuers from repurchases that 

would otherwise be optimal for 

shareholder value (e.g., as a more 

flexible and tax-efficient method of 

payout compared to dividends). Issuers 

might instead overweigh dividends or 

reduce overall corporate payouts and 

inefficiently retain excess cash within 

the firm. Further, if the costs of the 

proposed disclosure requirements cause 

issuers to decrease overall payouts, even 

if issuers lack positive-net present value 

investment opportunities, it would limit 

the ability of investors to efficiently 

reallocate cash to other, higher-net 

present value investment opportunities, 

potentially resulting in inefficiencies in 

the aggregate allocation of capital across 

issuers. 

The described direct and indirect 

costs of the proposed disclosure for the 

affected issuers would decrease 

shareholder value and would thus be 

passed on to the issuer’s existing 

shareholders (that do not sell securities 

during the repurchase). 

The proposed disclosure requirements 

could also affect financial 

intermediaries involved in executing 

repurchases on behalf of issuers. Such 

intermediaries are likely to incur 

additional costs of consolidating 

information about repurchase trades on 

a daily basis for the issuer. Such 

information should be relatively readily 

available, thus direct costs could be 

incremental. Financial intermediaries 

may also incur indirect costs of the 

proposed requirements. Specifically, to 

the extent the proposed disclosure 

requirements lead to a decrease in 

repurchases, financial intermediaries 

may see a decrease in orders, resulting 

in lower revenue. 

Some of the proposed disclosure 

requirements may also impose costs on 

corporate insiders. In particular, the 

requirement that issuers publicly 

disclose whether they have policies and 

procedures related to purchases and 

sales by officers and directors during 

repurchases, as well as the proposed 

disclosure of whether any officer or 

director reporting pursuant to Section 

16(a) of the Exchange Act purchased or 

sold shares or other units of the class of 

the issuer’s equity securities that is the 

subject of an issuer share repurchase 

plan or program within 10 business 

days before or after the issuer’s 

announcement of such repurchase plan 

or program, could cause issuers to 

increasingly adopt such restrictions in 

anticipation of the market scrutiny 

following such disclosure. The 

incremental costs of the requirement to 

disclose whether any officer or director 

reporting pursuant to Section 16(a) of 

the Exchange Act purchased or sold 

securities around the repurchase 

announcement may be small to the 

extent the investors can already obtain 

the same information from beneficial 

ownership disclosures and public 

announcements of repurchases. Any 

restrictions an issuer imposes on officer 

and director trading could limit the 

ability of corporate insiders to purchase 

or sell securities at issuers that conduct 

repurchases periodically over an 

extended period of times (such as open 

market repurchases under a multiquarter program, or a Rule 10b5–1 plan). 

To the extent any new such restrictions 

limit insider sales, they could 

significantly decrease the liquidity of 

insiders’ holdings of an issuer’s 

securities, including securities obtained 

from equity-based executive 

compensation (which may in turn 

potentially lead insiders to attempt to 

reduce their equity exposure and 

negotiate more cash compensation, or 

negotiate larger compensation to 

compensate for the decreased liquidity). 

To the extent that the proposed 

requirement to disclose whether any 

officer or director has purchased or sold 

securities around the repurchase 

announcements leads some companies 

whose officers or directors trade 

securities within the specified period to 

forgo making a repurchase 

announcement to limit market scrutiny, 

the amount of information available to 

investors about companies’ forwardlooking repurchase plans could 

decrease. 

To the extent that the proposed 

requirements affect small filers to a 

greater extent than large filers, they 

could result in adverse effects on 

competition. The fixed component of 

the legal costs of preparing the 

disclosure could be one contributing 

factor. The lower liquidity of smaller 

issuers’ securities,105 which could 

exacerbate the price impact of the 

proposed disclosure, could be another 


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106See, e.g., Dittmar, A., Why Do Firms 

Repurchase Stock, 73(3) J. Business 331–355 (2000) 

(finding that ‘‘large firms are the dominant 

repurchasers’’); Cheng et al. (2015) (showing in 

Table 2 that repurchasing firms are significantly 

larger than nonrepurchasing firms); Jiang, Z., Kim, 

K. A., Lie, E., and Yang, S., Share Repurchases, 

Catering, and Dividend Substitution, 21 J. Corp. 

Fin., 36–50 (2013) (showing in Table 5 that firm 

size is positively related to the fraction of 

outstanding share purchase by firms on a monthly 

basis). 107See Rule 10b5–1 Proposing Release. 

108See supra note 107 and accompanying text. 

109See supra note 35. 

factor contributing to the 

disproportionate effects of the 

disclosure on smaller filers. The latter 

effect could be mitigated by the lower 

incidence, and the lower average level 

(relative to issuer size), of repurchases 

among small issuers.106

D. Reasonable Alternatives 

We could propose to increase the 

frequency of repurchase disclosure 

compared to existing Item 703, but 

implement a lower frequency compared 

to the proposal (e.g., monthly or weekly 

disclosure), instead of requiring daily 

disclosure. Compared to the proposal, 

requiring less frequent reporting would 

provide investors with less timely 

information about daily issuer 

purchases. Compared to the baseline, 

such an alternative would still benefit 

investors by enabling them to perform 

more timely and in-depth retrospective 

evaluation of an issuer’s repurchase 

activity, independently or in 

conjunction with other disclosures (e.g., 

financial condition, risk factors, other 

corporate events, executive 

compensation, governance, and insider 

ownership disclosures) and gauge the 

extent to which recent repurchases, 

conducted at the specific point in time, 

were likely to be aligned with 

shareholder value maximization (as 

opposed to potential insider self-interest 

or other reasons), potentially informing 

future investment decisions. However, 

such benefits would be smaller than the 

benefits of the daily disclosure under 

the proposal, to the extent that 

information about actual repurchase is 

of a time-sensitive nature. In turn, while 

weekly or monthly reporting would 

increase issuer costs compared to the 

baseline, the additional cost is likely to 

be less significant than the cost of the 

daily disclosure under the proposal 

(particularly, with respect to the 

indirect costs considered in Section 

IV.C above). 

We could also propose a different 

timing requirement for the reporting of 

daily repurchases (e.g., more or fewer 

days after the repurchase). We are 

proposing that issuers report a daily 

summary of repurchase transactions 

within one business day following the 

trade. As two alternatives, we could 

require reporting within one business 

day after settlement (which typically 

occurs within two days following the 

trade), or allow issuers up to four 

business days to report on daily 

repurchases (consistent with the typical 

requirement for a Form 8–K). Generally, 

a longer time lag for filing the 

repurchase form would provide 

investors with less timely information 

about issuer purchases. In turn, it would 

also decrease costs for issuers described 

above compared to the proposal. In 

particular, the alternative of requiring 

daily reporting within one business day 

of the settlement could provide 

relatively timely information to 

investors, but it could also decrease 

costs for issuers and financial 

intermediaries that may lack final 

repurchase information until after 

settlement (to the extent that such costs 

are not already alleviated by the 

furnished, rather than filed, nature of 

the daily disclosure). 

We could modify the scope of the 

proposed disclosure, for instance, 

omitting information about the use of 

Rule 10b–18 and/or Rule 10b5–1 in the 

proposed quantitative disclosure, or 

about any policies and procedures 

relating to purchases and sales of the 

issuer’s securities by officers and 

directors during repurchases, including 

any restrictions on such transactions. 

Compared to the proposal, narrowing 

the scope of the required disclosure 

would reduce the costs to issuers that 

use these provisions to execute 

repurchases. However, this alternative 

would also provide less information to 

investors and result in greater 

information asymmetry, compared to 

the proposal. The effects of the 

alternative of omitting Rule 10b5–1 

repurchase disclosures compared to the 

proposal could be partly mitigated if the 

Commission adopts additional 

disclosure requirements for insider and 

issuer Rule 10b5–1 plans under new 

Item 408 of Regulation S–K, which the 

Commission is proposing in a separate 

release.107

As another alternative, we could 

preserve the existing frequency of 

repurchase disclosure but require 

greater granularity of the disclosure 

(e.g., including daily detail in Forms 

10–Q, 10–K, 20–F, and N–CSR). This 

would allow the investors to 

retrospectively evaluate the optimality 

of repurchases at a granular level. 

However, compared to the proposal, less 

frequent reporting would provide 

investors with significantly less timely 

information about issuer purchases and 

thus the outlook on its future share 

price, resulting in less information 

asymmetry resolution. In turn, less 

frequent disclosure would also decrease 

the costs for issuers compared to the 

proposal. 

We could provide exemptions from 

all, or some of the proposed disclosure 

requirements for smaller filers. As 

another alternative, we could provide a 

de minimis exemption to issuers whose 

repurchases are below a certain 

threshold. These alternatives could 

reduce the aggregate costs of the rule but 

also reduce the information available to 

investors, compared to the proposal. 

The economic effects of the alternative 

of excluding small filers are uncertain to 

the extent that the effects of the 

proposed disclosure on small filers are 

somewhat ambiguous. On the one hand, 

smaller issuers are more likely to be 

affected by the costs of additional 

disclosure, all else equal (holding 

constant the disclosure burden). On the 

other hand, smaller issuers are less 

likely to have repurchases,108 which 

would limit the incremental burden of 

additional reporting under the proposed 

amendments for each small filer. 

Further, to the extent that small filers 

have relatively high information 

asymmetries because of lower analyst 

and institutional coverage, disclosure 

about their repurchases may be 

relatively more informative to investors. 

As another alternative, we could 

provide exemptions or different 

requirements for foreign private issuers 

and/or registered closed-end funds. 

These alternatives would eliminate or 

reduce the costs for the affected issuers 

but also reduce the information benefits 

for investors in these issuers, compared 

to the proposal. For example, registered 

closed-end funds, in general, repurchase 

their shares less frequently than 

corporate issuers,109 and not all of the 

motivations for corporate issuer share 

repurchases will apply to registered 

closed-end funds because of differences 

in the business model and 

organizational structure of a fund as 

compared to an operating company. 

Abuses can nevertheless occur when a 

registered closed-end fund engages in 

repurchases of its shares, including 

attempts to create an appearance that 

the value of the shares was steady or 

rising in an effort to influence the 

market to aid in the distribution of new 

shares or to manipulate the market 

value of securities involved in 

exchanges. A lack of disclosure would 

make it more difficult for investors to 

determine the extent to which the share 

price was being driven by such actions 


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110See, e.g., Investment Trusts and Investment 

Companies, pt. 3, H.R. Doc. No. 279, 76th Cong., 1st 

Sess. (1939) and Division of Investment 

Management, Protecting Investors: A Half Century 

of Investment Company Regulation (1992), 

available at https://www.sec.gov/divisions/ 

investment/guidance/icreg50-92.pdf. 

111See 17 CFR 232.405(b) (setting forth structured 

disclosure requirements for, inter alia, operating 

companies and closed-end management investment 

companies). 

of the fund’s management.110 Thus, we 

believe that investors would benefit 

from receiving timely details about a 

fund’s repurchase activity so they can 

make an informed decision as to 

whether they believe the fund’s share 

price has been influenced by this 

repurchase activity, which is difficult to 

do using the semi-annual reports on 

Form N–CSR. Exempting or providing 

different requirements for foreign 

private issuers may place them at a 

relative competitive advantage to 

domestic issuers. Further, it would 

reduce the amount of information 

available to investors, potentially 

reducing their ability to make informed 

investment decisions, compared to the 

proposal. The aggregate effects of these 

alternatives may be incremental as such 

issuers engage in relatively few 

repurchases as seen in Section IV.A.1 

above. 

We could modify some of the 

elements of implementation of the 

proposed disclosure requirements. For 

example, we could propose an 

additional requirement that a summary 

of daily disclosures be filed as an 

exhibit to the periodic report. This 

alternative could slightly decrease 

investor costs of retrieving and 

consolidating daily information from 

Form SR, compared to the proposal 

(because the consolidation of daily 

disclosures into a time series for the 

periodic report could require small, but 

not zero effort, particularly for investors 

that are not performing large-scale 

automated extraction of data on 

multiple issuers but are reviewing 

repurchase disclosure for one or a 

handful of issuers). This alternative also 

would impose incremental costs on 

filers, compared to the proposal 

(because the aggregation of such 

information from prior daily filings for 

an exhibit to a periodic report is likely 

to have a small, but not zero cost). As 

an alternative, we could require the 

daily disclosure to be reported on Form 

8–K (and subject issuers that do not 

typically report on this form, such as 

registered closed-end funds, to this 

requirement) or another existing form 

rather than on the new form, as 

proposed. This alternative could 

incrementally lower the initial 

transition cost for filers, compared to 

the proposal. At the same time, this 

alternative could make it incrementally 

harder for investors to parse out the 

daily repurchase disclosure from other 

current events, compared to the 

proposed use of a dedicated form. For 

filers that would be subject to the daily 

disclosure requirement under this 

alternative, this alternative is unlikely to 

impact ongoing disclosure costs, or 

benefits for investors, relative to the 

proposal. We are retaining the existing 

requirement to provide monthly 

breakdowns of repurchase activity in 

periodic reports. As an alternative, we 

could remove this requirement, and let 

it be superseded by the new daily 

disclosures. The costs and benefits of 

this alternative compared to the 

proposal are likely to be fairly 

incremental because aggregation of daily 

disclosures into a monthly breakdown is 

likely to be low-cost for filers, and of 

relatively little incremental importance 

to investors. Removing this information 

under this alternative could on the 

margin increase information costs for 

the subset of investors that only seek 

monthly information about repurchases 

and would in that case have to newly 

aggregate daily information from Form 

SR to reproduce the monthly figures. 

As another alternative, we could scale 

the structured disclosure requirements 

compared to the proposal, for instance, 

by not requiring that the footnote 

disclosure in periodic reports, or the 

narrative disclosure of buybacks, be 

structured. These alternatives could 

incrementally increase the cost of the 

extraction and analysis of additional 

information about the structure and 

purpose of repurchase programs, 

compared to the proposal. At the same 

time, the incremental cost savings for 

issuers, compared to the proposal, 

would likely be modest since affected 

filers already tag various other 

disclosures in their filings with the 

Commission.111

Request for Comment 

29. Do investors currently have 

sufficient information about issuers’ 

repurchases to make an informed 

assessment of such repurchases and 

their effects on the future share price? 

In what areas, if any, is existing 

disclosure lacking such that it is 

limiting investor ability to make 

informed investment decisions? Would 

the proposed disclosure decrease any 

such information gaps? 

30. Is existing disclosure about 

repurchases sufficient to enable 

investors to assess whether the issuer or 

its insiders are engaged in selfinterested or otherwise inefficient 

repurchases? Is such inefficient 

repurchase behavior common today? 

Would the proposed amendments 

sufficiently address any disclosure 

gaps? Would the proposed amendments 

decrease the likelihood of inefficient 

repurchase decisions? 

31. How would investors benefit from 

the proposed new disclosure of daily 

repurchases? Would investors benefit 

from the proposed requirement to 

disclose additional detail about the 

number of shares repurchased on the 

open market, the number of shares 

repurchased in reliance on the safe 

harbor in Rule 10b–18, and the number 

of shares repurchased pursuant to a plan 

intended to satisfy the affirmative 

defense conditions of Rule 10b5–1(c)? 

Would investors benefit from a more 

streamlined disclosure, including some 

but not all of the proposed columns, or 

including only the total number of 

shares repurchased on a daily basis? 

32. How would the proposed 

requirement to disclose daily 

repurchases affect issuers? What costs 

could issuers incur as a result of the 

proposed daily disclosures? Are issuers 

likely to incur front-running costs? How 

would the proposed timing of the new 

daily disclosures (one business day after 

the trade) affect issuers? In what ways 

could the proposed disclosure 

requirements be modified to mitigate 

costs to issuers? 

33. Would investors benefit from 

alternative disclosure and reporting 

frequencies? For example, would the 

disclosure remain beneficial to investors 

if the daily repurchase filing were 

allowed to be made with a longer time 

lag, such as one or more business days 

after settlement? Alternatively, would 

reporting a summary of daily repurchase 

activity on a weekly, monthly, or 

quarterly basis provide valuable 

information to investors? Further, 

would reporting repurchase activity on 

a weekly or monthly basis still be 

beneficial to investors? Would the 

described alternatives result in a smaller 

increase in disclosure costs for issuers? 

Which alternative reporting frequency 

would be most beneficial in the case of 

foreign private issuers that presently 

report repurchases on an annual basis 

on Form 20–F and registered closed-end 

funds that presently report repurchases 

on a semi-annual basis on Form N–CSR? 

34. How would investors benefit from 

the proposed qualitative disclosure 

requirements, including the rationale 

for, and the structure of, an issuer’s 

repurchase program? Would investors 

benefit from the proposed new 

disclosure of any policies and 

procedures relating to purchases or sales 


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112See 44 U.S.C. 3501 et seq. 113 44 U.S.C. 3507(d) and 5 CFR 1320.11. 114See supra notes 56–57 and surrounding text. 

of an issuer’s securities by officers and 

directors during the pendency of a share 

repurchase plan or program? How 

would investors benefit from the 

proposed new checkbox disclosure of 

whether any officer or director reporting 

pursuant to Section 16(a) of the 

Exchange Act has purchased or sold 

shares or other units of the class of the 

issuer’s equity securities that is the 

subject of an issuer share repurchase 

plan or program within 10 business 

days before or after the issuer’s 

announcement of such repurchase plan 

or program? What are the anticipated 

costs of those requirements for issuers? 

In what ways could those requirements 

be streamlined to decrease costs to 

issuers, while still providing valuable 

information to investors? Would 

shareholders be disadvantaged by the 

disclosures, as proposed, and attendant 

costs? 

35. Would investors benefit from 

different qualitative disclosure 

requirements? If so, which ones? What 

would be the costs of such alternatives 

for issuers? 

36. Would investors benefit from the 

proposed requirement to use a 

structured data language for the 

repurchase disclosures? What would be 

the costs of the proposed requirement to 

issuers? Should we consider alternative 

structured disclosure requirements for 

repurchase disclosure, and what would 

be their benefits and costs? 

37. Would investors benefit from an 

additional requirement to compile the 

daily repurchase information in an 

exhibit to periodic reports, in addition 

to reporting this information on new 

Form SR? What would be the costs of 

such an alternative to issuers? 

38. Would investors benefit from 

keeping the existing monthly disclosure 

in the body of the periodic report, in 

addition to the reporting of daily data 

on a new form? Would issuers realize 

cost savings if we eliminated the current 

Item 703 requirement to provide a 

monthly breakdown of repurchase 

activity? 

39. What are the costs and benefits of 

requiring the reporting of daily data on 

new Form SR, as opposed to on Form 

8–K or another existing form? 

40. Would the proposed disclosure 

requirements have disproportionate 

effects on certain categories of issuers? 

How could such effects be mitigated? 

Should we exempt some issuers–for 

example, smaller reporting companies, 

issuers with few repurchases, registered 

closed-end funds, foreign private 

issuers–from all or some of the proposed 

requirements? What would be the 

effects of such exemptions on investors’ 

ability to make informed investment 

decisions? 

V. Paperwork Reduction Act 

A. Summary of the Collection of 

Information 

Certain provisions of our rules and 

forms that would be affected by the 

proposed amendments contain 

‘‘collection of information’’ 

requirements within the meaning of the 

Paperwork Reduction Act of 1995 

(‘‘PRA’’).112 The Commission is 

submitting the proposed amendments to 

the Office of Management and Budget 

(‘‘OMB’’) for review in accordance with 

the PRA.113 The hours and costs 

associated with preparing and filing the 

forms constitute reporting and cost 

burdens imposed by each collection of 

information. An agency may not 

conduct or sponsor, and a person is not 

required to comply with, a collection of 

information unless it displays a 

currently valid OMB control number. 

Compliance with the information 

collections is mandatory. Responses to 

the information collections are not kept 

confidential and there is no mandatory 

retention period for the information 

disclosed. The titles for the affected 

collections of information are: 

• ‘‘Form 10–K’’ (OMB Control No. 

3235–0063); 

• ‘‘Form 10–Q’’ (OMB Control No. 

3235–0070); 

• ‘‘Form 20–F’’ (OMB Control No. 

3235–0288); 

• ‘‘Form N–CSR’’ (OMB Control No. 

3235–0570); and 

• ‘‘Form SR’’ (a proposed new 

collection of information). 

We adopted the existing forms 

pursuant to the Exchange Act and 

Investment Company Act and are 

proposing the new form pursuant to the 

Exchange Act. The forms set forth the 

disclosure requirements for periodic 

reports filed by issuers to help investors 

make informed investment and voting 

decisions. A description of the proposed 

amendments, including the need for the 

information and its proposed use, as 

well as a description of the likely 

respondents, can be found in Section II 

above, and a discussion of the economic 

effects of the proposed amendments can 

be found in Section IV above. 

B. Summary of the Estimated Burdens of 

the Proposed Amendments on the 

Collections of Information 

1. Estimated Paperwork Burden for 

Proposed Form SR 

The following table summarizes the 

estimated paperwork burden associated 

with proposed new Form SR that 

affected issuers of equity securities 

registered under Section 12 of the 

Exchange Act would use to disclose a 

repurchase of their equity shares. 

PRA TABLE 1—ESTIMATED PAPERWORK BURDEN OF PROPOSED FORM

Affected form Estimated burden Brief explanation of estimated burden 

New Form SR .............. A new burden of 1.5 hours for each Form SR This burden is the estimated effect of compiling the data elements, 

tagging the data using Inline XBRL, and preparing and submitting 

the Form SR. 

We estimate a burden of 

approximately 1.5 hours for each Form 

SR. The burden includes the effect of 

compiling the six required data 

elements for each date that the form is 

required, tagging the data using Inline 

XBRL, and preparing and submitting the 

Form SR. Our proposed 1.5 hour 

estimate is for the average burden over 

the first three years of reporting. We 

acknowledge that preparation of Form 

SR may initially entail a higher burden 

as issuers get accustomed to collecting 

data for, and preparing the new form, 

but we believe that the burden would be 

reduced with subsequent filings. 

Based on data from Compustat and 

EDGAR filings for fiscal year 2020,114

we estimate that approximately 3,400 

issuers that conducted share 

repurchases during fiscal year 2020 

would be affected by the proposed new 

Form SR requirement (among them, 

approximately 250 foreign private 

issuers who reported share repurchases 

on Form 20–F and 100 registered 

closed-end funds who reported share 

repurchases on Form N–CSR). We 

additionally note that most issuers that 

conduct share repurchases do so over a 


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115The OMB PRA filing inventories represent a 

three-year average. Averages may not align with the 

actual number of filings in any given year. 

116We recognize that the costs of retaining 

outside professionals may vary depending on the 

nature of the professional services, but for purposes 

of this PRA analysis, we estimate that such costs 

would be an average of $400 per hour. This estimate 

is based on consultations with several issuers, law 

firms, and other persons who regularly assist 

issuers in preparing and filing reports with the 

Commission. 

period of time, rather than by making a 

single purchase or a few isolated 

purchases during the year. We 

conservatively estimate that issuers 

conducting share repurchases would 

purchase shares one day a week for the 

entire year, resulting in 52 Form SR 

filings per year. Based on the staff’s 

findings relating to the number of 

issuers conducting share repurchases 

and the estimate of the frequency of 

repurchases, we estimate 176,800 Form 

SR filings per year. 

2. Estimated Paperwork Burdens of the 

Proposed Amendments to Periodic 

Reports 

The following table summarizes the 

estimated paperwork burdens associated 

with the proposed amendments to the 

affected forms filed by issuers of equity 

securities registered under Section 12 of 

the Exchange Act. 

PRA TABLE 2—ESTIMATED PAPERWORK BURDEN OF PROPOSED AMENDMENTS TO PERIODIC REPORTS

Amendments to Reg. S–K Item 703, Form 20–F and Form N–CSR, 

Reg. S–T Rule 405 and Proposed New 

Exchange Act Rule 13a–21 

Estimated burden increase Brief explanation of 

estimated burden increase 

• Require additional disclosure regarding the structure of an issuer’s 

repurchase program and its share repurchases;.

• Require new checkbox to indicate if any of the issuer’s officers or 

directors subject to the reporting requirements under Section 16(a) 

of the Exchange Act purchased or sold shares or other units of the 

class of the issuer’s equity securities that is the subject of an issuer 

share repurchase plan or program within 10 business days before 

or after the announcement of an issuer purchase plan or program; 

and.

• Require information to be reported using a structured data language 

An increase of 3 burden hours for 

each of the affected forms: 

Form 10–K, Form 10–Q, Form 

20–F and Form N–CSR.

This increase is the estimated effect on the affected forms by the 

proposed amendments to include additional share repurchase disclosures, clarify the 

rules, and require the use of 

structured data for this information. 

Considering the various revisions 

outlined in Sections II.B, II.C. and II.D. 

above, we estimate that proposed new 

Rule 13a–21, Item 703 of Regulation S– 

K, Item 16E of Form 20–F, Item 9 of 

Form N–CSR, and Rule 405 of 

Regulation S–T (interactive data file 

submission requirements) would 

increase the paperwork burden for 

filings on the affected forms that include 

share repurchase disclosure. However, 

not all filings on the affected forms 

include these disclosures because they 

are provided only when an issuer 

conducts share repurchases that trigger 

the disclosure requirement. Therefore, 

to estimate the increase in overall 

paperwork burden from the proposed 

amendments, we first estimated the 

number of filings that include share 

repurchase information. As indicated in 

paragraph B.1 of this section, we 

estimate that approximately 3,300 

operating companies (among them, 

approximately 250 foreign private 

issuers filing on Form 20–F) and 

approximately 100 registered closed-end 

funds during fiscal year 2020 would be 

affected by the amendments. Based on 

the staff’s findings, the table below sets 

forth our estimates of the number of 

filings on these forms that included 

share repurchase disclosure. We used 

this data to extrapolate the effect of 

these changes on the paperwork burden 

for the listed periodic reports.115

PRA TABLE 3—ESTIMATED NUMBER

OF AFFECTED FILINGS

Form 

Current annual 

responses in 

PRA inventory 

Number of 

filings that 

include share 

repurchase 

disclosure 

10–K ................ 8,292 3,050 

10–Q ................ 22,925 9,150 

20–F ................ 729 250 

N–CSR ............ 6,898 200 

C. Incremental and Aggregate Burden 

and Cost Estimates 

Below we estimate the incremental 

and aggregate changes in paperwork 

burden as a result of the proposed 

amendments. These estimates represent 

the average burden for all issuers, both 

large and small. In deriving our 

estimates, we recognize that the burdens 

will likely vary among individual 

issuers. The proposed amendments 

would create a new required collection 

of information and change the burden 

per response of existing collections of 

information, if adopted. 

We calculated the burden estimates 

by adding the estimated additional 

burden to the existing estimated 

responses and multiplying the estimated 

number of responses by the estimated 

average amount of time it would take an 

issuer to prepare and review disclosure 

required under the proposed 

amendments. For purposes of the PRA, 

the burden is to be allocated between 

internal burden hours and outside 

professional costs. PRA Table 4 below 

sets forth the percentage estimates we 

typically use for the burden allocation 

for each collection of information and 

the estimated burden allocation for the 

proposed new collection of information. 

We also estimate that the average cost of 

retaining outside professionals is $400 

per hour.116

PRA TABLE 4—ESTIMATED BURDEN

ALLOCATION FOR THE AFFECTED

COLLECTIONS OF INFORMATION

Collection of 

information 

Internal 

(%) 

Outside 

professionals 

(%) 

Forms 10–K, 10–Q, N– 

CSR, SR .................. 75 25 

Form 20–F ................... 25 75 

PRA Table 5 below illustrates the 

incremental change to the total annual 

compliance burden of affected forms, in 

hours and in costs, as a result of the 

proposed amendments’ estimated effect 

on the paperwork burden per response. 


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8464 Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 

117For purposes of the PRA, the requested change 

in burden hours (column H) is rounded to the 

nearest whole number. 

PRA TABLE 5—CALCULATION OF THE INCREMENTAL CHANGE IN BURDEN ESTIMATES OF CURRENT RESPONSES

RESULTING FROM THE PROPOSED AMENDMENTS

Collection of Information 

Number of 

estimated 

affected 

responses 

Burden hour 

increase per 

response 

Change in 

burden hours 

Change in 

company hours 

Change in 

professional 

hours 

Change in 

professional 

costs 

(A) a (B) (C) = (A) × (B) (D) = (C) × 0.75 or 0.25 (E) = (C) × 0.25 or 0.75 (F) = (E) × $400 

10–K ........................................................ 3,050 3 9,150 6862.5 2,287.5 $915,000 

10–Q ........................................................ 9,150 3 27,450 20,587.5 6,862.5 2,745,000 

20–F ........................................................ 250 3 750 187.5 562.5 225,000 

N–CSR .................................................... 200 3 600 450 150 60,000 

The following tables summarize the 

requested paperwork burden, including 

the estimated total reporting burdens 

and costs, under the proposed 

amendments. 

PRA TABLE 6—REQUESTED PAPERWORK BURDEN UNDER THE PROPOSED AMENDMENTS 117

Form 

Current 

burden 

Program change Requested change in burden 

Current 

annual 

responses 

Current 

burden 

hours 

Current cost 

burden 

Number of 

affected 

responses 

Change in 

company 

hours 

Change in 

professional 

costs 

Annual 

responses 

Burden 

hours 

Cost 

burden 

(A) (B) (C) (D) (E) (F) (G) (H) = (B) + (E) (I) = (C) + (F) 

Form 10–K .............. 8,292 14,188,040 $1,893,793,119 3,050 6,862.5 $915,000 8,292 14,194,903 $1,894,708,119 

Form 10–Q .............. 22,925 3,182,333 421,490,754 9,150 29,587.5 2,745,000 22,925 3,211,921 424,235,754 

Form 20–F ............... 729 479,261 576,824,025 250 187.5 225,000 729 479,449 577,049,025 

Form N–CSR ........... 6,898 181,167 5,199,584 200 450 60,000 6,898 181,617 5,259,584 

PRA Table 7 summarizes the 

requested paperwork burden for the 

new Form SR collection of information, 

including the estimated total reporting 

burdens and costs, under the proposed 

amendments as described in Section 

II.A. For purposes of the PRA, we 

estimate that new Form SR will entail 

a 1.5 hour compliance burden per 

response with 176,800 annual 

responses. 

PRA TABLE 7—REQUESTED PAPERWORK BURDEN FOR THE NEW COLLECTION OF INFORMATION

Collection of information 

Requested paperwork burden 

Annual 

responses Burden hours Cost burden 

(A) (A) × 1.5 × (0.75) (A) × 1.5 × (0.25) × $400 

Form SR .................................................................................................... 176,800 189,900 $26,520,000 

Request for Comment 

Pursuant to 44 U.S.C. 3506(c)(2)(B), 

we request comment in order to: 

• Evaluate whether the proposed 

collections of information are necessary 

for the proper performance of the 

functions of the Commission, including 

whether the information will have 

practical utility; 

• Evaluate the accuracy of our 

assumptions and estimates of the 

frequency with which issuers conduct 

issuer share repurchases and of the 

initial and ongoing burden of the 

proposed collection of information; 

• Determine whether there are ways 

to enhance the quality, utility, and 

clarity of the information to be 

collected; 

• Evaluate whether there are ways to 

minimize the burden of the collection of 

information on those who respond, 

including through the use of automated 

collection techniques or other forms of 

information technology; and 

• Evaluate whether the proposed 

amendments would have any effects on 

any other collection of information not 

previously identified in this section. 

Any member of the public may direct 

to us any comments concerning the 

accuracy of these burden estimates and 

any suggestions for reducing these 

burdens. Persons submitting comments 

on the collection of information 

requirements should direct their 

comments to the Office of Management 

and Budget, Attention: Desk Officer for 

the U.S. Securities and Exchange 

Commission, Office of Information and 

Regulatory Affairs, Washington, DC 

20503, and send a copy to Vanessa A. 

Countryman, Secretary, U.S. Securities 

and Exchange Commission, 100 F Street 

NE, Washington, DC 20549, with 

reference to File No. S7–21–21. 

Requests for materials submitted to 

OMB by the Commission with regard to 

the collection of information 

requirements should be in writing, refer 

to File No. S7–21–21 and be submitted 

to the U.S. Securities and Exchange 

Commission, Office of FOIA Services, 


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118 138 Public Law 104–121, Title II, 110 Stat. 857 

(1996). 

119 5 U.S.C. 601 et seq. 

120 5 U.S.C. 603(a). 

121 5 U.S.C. 601(6). 

122This estimate is based on staff analysis of 

issuers, excluding co-registrants, subsidiaries, or 

asset-backed securities, with EDGAR filings of Form 

10–K and 20–F, or amendments thereto, filed 

during the calendar year of January 1, 2020, to 

December 31, 2020 or filed by September 1, 2021 

that, if timely filed by the applicable deadline, 

would have been filed between January 1 and 

December 31, 2020. Analysis is based on data from 

XBRL filings, Compustat, Ives Group Audit 

Analytics, and manual review of filings submitted 

to the Commission. 

123See 17 CFR 270.0–10(a). 

124This estimate is derived from an analysis of 

data obtained from Morningstar Direct as well as 

data reported to the Commission for the period 

ending June 2021. 

125See supra Section IV.D. In addition, in Section 

IV.C. above we further note that to the extent that 

the proposed requirements affect small filers to a 

greater extent than large filers, they could result in 

adverse effects on competition. 

126We also discuss the estimated compliance 

burden associated with the proposed amendments 

for purposes of the PRA in Section V above. 

100 F Street NE, Washington, DC 20549. 

OMB is required to make a decision 

concerning the collection of information 

requirements between 30 and 60 days 

after publication of the proposed 

amendments. Consequently, a comment 

to OMB is best assured of having its full 

effect if the OMB receives it within 30 

days of publication. 

VI. Small Business Regulatory 

Enforcement Fairness Act 

For purposes of the Small Business 

Regulatory Enforcement Fairness Act of 

1996 (‘‘SBREFA’’),118 the Commission 

must advise OMB as to whether the 

proposed amendments constitute a 

‘‘major’’ rule. Under SBREFA, a rule is 

considered ‘‘major’’ where, if adopted, it 

results, or is likely to result, in: 

• An annual effect on the economy of 

$100 million or more (either in the form 

of an increase or a decrease); 

• A major increase in costs or prices 

for consumers or individual industries; 

or 

• Significant adverse effects on 

competition, investment or innovation. 

We request comment on whether the 

proposed amendments would be a 

‘‘major rule’’ for purposes of SBREFA. 

We solicit comment and empirical data 

on: (a) The potential effect on the U.S. 

economy on an annual basis; (b) any 

potential increase in costs or prices for 

consumers or individual industries; and 

(c) any potential effect on competition, 

investment or innovation. Commenters 

are requested to provide empirical data 

and other factual support for their views 

to the extent possible. 

VII. Initial Regulatory Flexibility 

Analysis 

When an agency issues a rulemaking 

proposal, the Regulatory Flexibility Act 

(‘‘RFA’’) 119 requires the agency to 

prepare and make available for public 

comment an Initial Regulatory 

Flexibility Analysis (‘‘IRFA’’) that will 

describe the impact of the proposed rule 

on small entities.120 This IRFA has been 

prepared in accordance with the 

Regulatory Flexibility Act. It relates to 

proposed amendments or additions to 

the rules and forms described in Section 

II above. 

A. Reasons for, and Objectives of, the 

Proposed Action 

The proposed amendments are 

intended to modernize and improve 

disclosure about repurchases of an 

issuer’s equity securities that are 

registered under Section 12 of the 

Exchange Act. Specifically, the 

proposed amendments would require an 

issuer to (i) provide more timely 

disclosure on a new Form SR regarding 

purchases of its Section 12 registered 

equity securities for each day that it, or 

an affiliated purchaser, makes a share 

repurchase; (ii) provide additional 

periodic disclosures about these 

purchases; and (iii) tag the required 

information using Inline XBRL. The 

reasons for, and objectives of, the 

proposed amendments are discussed in 

more detail in Section II above. 

B. Legal Basis 

The amendments contained in this 

release are being proposed under the 

authority set forth in the Exchange Act, 

particularly, Sections 12, 13, 15, and 

23(a) thereof; and the Investment 

Company Act, particularly Sections 8, 

23, 24(a), 30, 31, and 38. 

C. Small Entities Subject to the 

Proposed Rules 

The proposed amendments would 

affect some issuers that are small 

entities. The RFA defines ‘‘small entity’’ 

to mean ‘‘small business,’’ ‘‘small 

organization,’’ or ‘‘small governmental 

jurisdiction.’’ 121For purposes of the 

RFA, under 17 CFR 230.157 and 17 CFR 

240.0–10(a), an issuer, other than an 

investment company, is a ‘‘small 

business’’ or ‘‘small organization’’ if it 

had total assets of $5 million or less on 

the last day of its most recent fiscal year 

and is engaged or proposing to engage 

in an offering of securities not exceeding 

$5 million. We estimate that there are 

approximately 717 issuers with a class 

of securities registered under Section 12 

of the Exchange Act that file with the 

Commission, other than investment 

companies, that may be considered 

small entities and are potentially subject 

to the proposed amendments.122 For 

purposes of Commission rulemaking in 

connection with the RFA, an investment 

company (including a BDC) is a small 

entity if, together with other investment 

companies in the same group of related 

investment companies, it has net assets 

of $50 million or less as of the end of 

its most recent fiscal year.123

Commission staff estimates that 

approximately 23 registered closed-end 

funds and 9 BDCs are small entities.124

D. Projected Reporting, Recordkeeping 

and Other Compliance Requirements 

If adopted, the proposed amendments 

would require the filing of a new form 

along with enhanced disclosures and 

the use of Inline XBRL, which would 

increase the compliance costs for issuers 

conducting share repurchases. Further, 

the proposed amendments would 

expand the information provided on 

existing forms regarding an issuer’s 

share repurchases. In addition, 

compliance with the proposed 

amendments may require the use of 

professional skills. 

The proposed amendments would 

apply to small entities to the same 

extent as other entities, irrespective of 

size. As noted in Section IV.D. above, 

while we acknowledge that smaller 

issuers are more likely to be affected by 

the costs of additional disclosure, 

smaller issuers are also less likely to 

have share repurchases, which would 

limit the incremental burden of 

additional reporting under the proposed 

amendments.125 In addition, while we 

would expect larger registered closedend funds and BDCs (‘‘funds’’), or funds 

that are part of a large fund complex, to 

incur higher costs related to this 

requirement in absolute terms relative to 

a smaller fund or a fund that is part of 

a smaller fund complex, we would 

expect a smaller fund to find it more 

costly, per dollar managed, to comply 

with the proposed requirement because 

it would not be able to benefit from a 

larger fund complex’s economies of 

scale. Nonetheless, we expect that the 

nature of any benefits and costs 

associated with the proposed 

amendments to be generally similar for 

large and small entities. Accordingly, 

we refer to the discussion of the 

proposed amendments’ economic effects 

on all affected parties, including small 

entities, in Section IV above.126

Consistent with that discussion, we 

anticipate that the economic benefits 

and costs likely could vary widely 

among small entities, primarily based 


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127The proposed checkbox to indicate if any 

officer or director reporting pursuant to Section 

16(a) of the Exchange Act purchased or sold shares 

or other units of the class of the issuer’s equity 

securities that is the subject of an issuer share 

repurchase plan or program within 10 business 

days before or after the issuer’s announcement of 

such repurchase plan or program would require 

issuers to make this information more easily 

available to investors by working in conjunction 

with existing Section 16(a) disclosure to inform 

investors in periodic reports about an officer or 

directors trading activity. 

128See supra Section IV.D. 129See supra note 107 and accompanying text. 

on whether those small entities conduct 

share repurchases and how frequently 

they do so. 

E. Duplicative, Overlapping, or 

Conflicting Federal Rules 

We do not believe the proposed 

amendments would duplicate, 

overlap,127 or conflict with other 

existing federal rules. As proposed, 

Form SR would require daily disclosure 

of issuer share repurchases. Issuer 

periodic reports would also continue to 

provide monthly breakdowns of such 

repurchase activity. We additionally 

note that in the Rule 10b5–1 Proposing 

Release, we are separately proposing 

certain disclosure requirements for 

issuers regarding trading plans. In 

connection with the potential adoption 

of these rules, we would plan to 

coordinate the two releases to avoid any 

duplication, overlap or conflict between 

the rules. 

F. Significant Alternatives 

The RFA directs us to consider 

alternatives that would accomplish our 

stated objectives, while minimizing any 

significant adverse impact on small 

entities. In connection with the 

proposed amendments, we considered 

the following alternatives: 

• Establishing different compliance or 

reporting requirements or timetables 

that take into account the resources 

available to small entities; 

• Clarifying, consolidating, or 

simplifying compliance and reporting 

requirements under the rules for small 

entities; 

• Using performance rather than 

design standards; and 

• Exempting small entities from all or 

part of the requirements.128

The proposed amendments are 

intended to improve disclosure about 

repurchases of an issuer’s equity 

securities for investors to evaluate those 

activities and decrease any information 

asymmetry between issuers and 

investors. The additional disclosure, 

which would be provided in a machinereadable format, should permit investors 

to more quickly and efficiently evaluate 

information relating to issuer share 

repurchases, on a more timely basis. 

While we acknowledge that small 

entities are more likely to be affected by 

the costs of additional disclosure, all 

else equal (holding constant the 

disclosure burden), small entities are 

less likely to have share repurchases,129

which would limit the incremental 

burden of additional reporting under the 

proposed amendments for each small 

entity. Also, to the extent that small 

filers have relatively high information 

asymmetries because of lower analyst 

and institutional coverage, the proposed 

additional disclosure about their 

repurchases may be relatively more 

informative to investors. Because small 

entities are less likely to conduct share 

repurchases and in the event that they 

do, are more likely to have relatively 

high information asymmetries, we do 

not believe it would be appropriate to 

provide simplified or consolidated 

reporting requirements, a delayed 

compliance timetable, or an exemption 

for small entities from all or part of 

these requirements. 

We have used design rather than 

performance standards in connection 

with the proposed rules because we are 

seeking specific information relating to 

an issuer’s repurchase activity with the 

goal of enabling investors to better 

analyze share repurchase activity. Thus, 

the objectives of the proposed rules are 

unlikely to be met using a performance 

standard. 

G. Request for Comment 

We encourage the submission of 

comments with respect to any aspect of 

this IRFA. In particular, we request 

comments regarding: 

• The number of small entities that 

may be affected by the proposed 

amendments; 

• The existence or nature of the 

potential impact of the proposed 

amendments on small entities discussed 

in the analysis; 

• How the proposed amendments 

could further lower the burden on small 

entities; and 

• How to quantify the impact of the 

proposed amendments. 

Commenters are asked to describe the 

nature of any impact and provide 

empirical data supporting the extent of 

the impact. Comments will be 

considered in the preparation of the 

Final Regulatory Flexibility Analysis, if 

the proposed amendments are adopted, 

and will be placed in the same public 

file as comments on the proposed 

amendments themselves. 

Statutory Authority 

The amendments contained in this 

release are being proposed under the 

authority set forth in Sections 12, 13, 15, 

and 23(a) of the Exchange Act, and 

Sections 8, 23, 24(a), 30, 31, and 38 of 

the Investment Company Act. 

List of Subjects in 17 CFR Parts 229, 

232, 240, 249, and 274 

Reporting and record keeping 

requirements, Securities. 

For the reasons set forth in the 

preamble, the Commission is proposing 

to amend title 17, chapter II of the Code 

of Federal Regulations as follows: 

PART 229—STANDARD 

INSTRUCTIONS FOR FILING FORMS 

UNDER SECURITIES ACT OF 1933, 

SECURITIES EXCHANGE ACT OF 1934 

AND ENERGY POLICY AND 

CONSERVATION ACT OF 1975— 

REGULATION S–K 

■ 1. The authority citation for part 229 

continues to read as follows: 

Authority: 15 U.S.C. 77e, 77f, 77g, 77h, 77j, 

77k, 77s, 77z–2, 77z–3, 77aa(25), 77aa(26), 

77ddd, 77eee, 77ggg, 77hhh, 77iii, 77jjj, 

77nnn, 77sss, 78c, 78i, 78j, 78j–3, 78l, 78m, 

78n, 78n–1, 78o, 78u–5, 78w, 78ll, 78 mm, 

80a–8, 80a–9, 80a–20, 80a–29, 80a–30, 80a– 

31(c), 80a–37, 80a–38(a), 80a–39, 80b–11 and 

7201 et seq.; 18 U.S.C. 1350; sec. 953(b), Pub. 

L. 111–203, 124 Stat. 1904 (2010); and sec. 

102(c), Pub. L. 112–106, 126 Stat. 310 (2012). 

■ 2. Revise § 229.703 to read as follows: 

§ 229.703 (Item 703) Purchases of equity 

securities by the issuer and affiliated 

purchasers. 

(a) Provide the specified information 

in the following tabular format, and 

narratively with respect to any purchase 

made by or on behalf of the issuer or 

any ‘‘affiliated purchaser,’’ as defined in 

§ 240.10b–18(a)(3) of this chapter, of 

shares or other units of any class of the 

issuer’s equity securities that is 

registered by the issuer pursuant to 

section 12 of the Exchange Act (15 

U.S.C. 78l). 


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TABLE 1 TO PARAGRAPH (a)—ISSUER PURCHASES OF EQUITY SECURITIES

[Use the checkbox to indicate if any officer or director reporting pursuant to Section 16(a) of the Exchange Act (15 U.S.C. 78p(a)) purchased or 

sold shares or other units of the class of the issuer’s equity securities that is the subject of an issuer share repurchase plan or program within ten (10) business days before or after the issuer’s announcement of such repurchase plan or program. b] 

(a) (b) (c) (d) 

Period Total number 

of shares 

(or units) 

purchased 

Average 

price paid 

per share 

(or unit) 

Total number of shares (or 

units) purchased as part of 

publicly announced plans or 

programs 

Maximum number (or approximate dollar 

value) of shares (or units) that may yet be 

purchased under the plans or programs 

Month #1 (identify beginning 

and ending dates). 

Month #2 (identify beginning 

and ending dates). 

Month #3 (identify beginning 

and ending dates). 

Total.

(b) The table shall include the 

following information for each class or 

series of securities for each month 

included in the period covered by the 

report: 

(1) The total number of shares (or 

units) purchased (column (a)), including 

all issuer repurchases whether or not 

made pursuant to publicly announced 

plans or programs; 

(2) The average price paid per share 

(or unit) (column (b)); 

(3) The aggregate total number of 

shares (or units) purchased as part of 

publicly announced repurchase plans or 

programs (column (c)); and 

(4) The aggregate maximum number 

(or approximate dollar value) of shares 

(or units) that may yet be purchased 

under the plans or programs (column 

(d)). 

(c) Disclose, by footnote to the table 

or narrative accompanying the table: 

(1) The objective or rationale for each 

repurchase plan or program and the 

process or criteria used to determine the 

amount of repurchases; 

(2) The number of shares purchased: 

(i) Other than through a publicly 

announced plan or program, and if so, 

the nature of the transaction (e.g., 

whether the purchases were made in 

open-market transactions, tender offers, 

in satisfaction of the issuer’s obligations 

upon exercise of outstanding put 

options issued by the issuer, or other 

transactions); 

(ii) In reliance on the safe harbor in 

§ 240.10b–18 of this chapter; and 

(iii) Pursuant to a plan that is 

intended to satisfy the affirmative 

defense conditions of § 240.10b5–1(c) of 

this chapter, and if so, the date(s) the 

plan was adopted or terminated. 

(3) For publicly announced 

repurchase plans or programs: 

(i) The date each plan or program was 

announced; 

(ii) The dollar amount (or share or 

unit amount) approved; 

(iii) The expiration date (if any) of 

each plan or program; 

(iv) Each plan or program that has 

expired during the period covered by 

the table; and 

(v) Each plan or program the issuer 

has determined to terminate prior to 

expiration, or under which the issuer 

does not intend to make further 

purchases. 

(4) Any policies and procedures 

relating to purchases and sales of the 

issuer’s securities by its officers and 

directors during a repurchase program, 

including any restrictions on such 

transactions. 

(d) Provide the disclosure required by 

this section in an Interactive Data File 

as required by § 232.405 of this chapter 

(Rule 405 of Regulation S–T) in 

accordance with the EDGAR Filer 

Manual. 

PART 232—REGULATION S–T— 

GENERAL RULES AND REGULATIONS 

FOR ELECTRONIC FILINGS 

■ 3. The general authority citation for 

part 232 continues to read as follows: 

Authority: 15 U.S.C. 77c, 77f, 77g, 77h, 77j, 

77s(a), 77z–3, 77sss(a), 78c(b), 78l, 78m, 78n, 

78o(d), 78w(a), 78ll, 80a–6(c), 80a–8, 80a–29, 

80a–30, 80a–37, 7201 et seq.; and 18 U.S.C. 

1350, unless otherwise noted. 

* * * * * 

■ 4. Amend § 232.405 by: 

■ a. Revising the introductory text and 

paragraphs (a)(2) and (4); 

■ b. Removing the word ‘‘and’’ at the 

end of paragraph (b)(1)(i); 

■ c. Removing the period at the end of 

paragraph (b)(1)(ii) and adding ‘‘; and’’ 

in its place. 

■ d. Adding paragraph (b)(1)(iii); 

■ e. Removing the word ‘‘and’’ at the 

end of paragraph (b)(3)(ii); 

■ f. Removing the period at the end of 

paragraph (b)(3)(iii) and adding ‘‘; and’’ 

in its place. 

■ g. Adding paragraphs (b)(3)(iv) and 

(b)(4); and 

■ h. Revising Note 1 to § 232.405. 

The revisions and additions read as 

follows: 

§ 232.405 Interactive Data File 

submissions. 

This section applies to electronic 

filers that submit Interactive Data Files. 

Section 229.601(b)(101) of this chapter 

(Item 601(b)(101) of Regulation S–K), 

paragraph (101) of Part II—Information 

Not Required to be Delivered to Offerees 

or Purchasers of Form F–10 (§ 239.40 of 

this chapter), § 240.13a–21 of this 

chapter (Rule 13a–21 of the Exchange 

Act Rules), paragraph 101 of the 

Instructions as to Exhibits of Form 20– 

F (§ 249.220f of this chapter), paragraph 

B.(15) of the General Instructions to 

Form 40–F (§ 249.240f of this chapter), 

paragraph C.(6) of the General 

Instructions to Form 6–K (§ 249.306 of 

this chapter), General Instruction I of 

Form SR (§ 249.333 of this chapter), 

General Instruction C.3.(g) of Form N– 

1A (§§ 239.15A and 274.11A of this 

chapter), General Instruction I of Form 

N–2 (§§ 239.14 and 274.11a–1 of this 

chapter), General Instruction C.3.(h) of 

Form N–3 (§§ 239.17a and 274.11b of 

this chapter), General Instruction C.3.(h) 

of Form N–4 (§§ 239.17b and 274.11c of 

this chapter), General Instruction C.3.(h) 

of Form N–6 (§§ 239.17c and 274.11d of 

this chapter), and General Instruction 

C.4 of Form N–CSR (§§ 249.331 and 

274.128 of this chapter) specify when 

electronic filers are required or 

permitted to submit an Interactive Data 

File (§ 232.11), as further described in 

note 1 to this section. This section 

imposes content, format, and 

submission requirements for an 

Interactive Data File, but does not 

change the substantive content 

requirements for the financial and other 


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disclosures in the Related Official Filing 

(§ 232.11). 

(a) * * * 

(2) Be submitted only by an electronic 

filer either required or permitted to 

submit an Interactive Data File as 

specified by § 229.601(b)(101) of this 

chapter (Item 601(b)(101) of Regulation 

S–K), paragraph (101) of Part II— 

Information Not Required to be 

Delivered to Offerees or Purchasers of 

Form F–10 (§ 239.40 of this chapter), 

Rule 13a–21 of the Exchange Act Rules 

(§ 240.13a–21 of this chapter), paragraph 

101 of the Instructions as to Exhibits of 

Form 20–F (§ 249.220f of this chapter), 

paragraph B.(15) of the General 

Instructions to Form 40–F (§ 249.240f of 

this chapter), paragraph C.(6) of the 

General Instructions to Form 6–K 

(§ 249.306 of this chapter), General 

Instruction I to Form SR (§ 249.333 of 

this chapter), General Instruction C.3.(g) 

of Form N–1A (§§ 239.15A and 274.11A 

of this chapter), General Instruction I of 

Form N–2 (§§ 239.14 and 274.11a–1 of 

this chapter), General Instruction C.3.(h) 

of Form N–3 (§§ 239.17a and 274.11b of 

this chapter), General Instruction C.3.(h) 

of Form N–4 (§§ 239.17b and 274.11c of 

this chapter), General Instruction C.3.(h) 

of Form N–6 (§§ 239.17c and 274.11d of 

this chapter), or General Instruction C.4 

of Form N–CSR (§§ 249.331 and 274.128 

of this chapter), as applicable; 

* * * * * 

(4) Be submitted in accordance with 

the EDGAR Filer Manual and, as 

applicable, Item 601(b)(101) of 

Regulation S–K (§ 229.601(b)(101) of 

this chapter), paragraph (101) of Part 

II—Information Not Required to be 

Delivered to Offerees or Purchasers of 

Form F–10 (§ 239.40 of this chapter), 

Rule 13a–21 of the Exchange Act Rules 

(§ 240.13a–21 of this chapter), paragraph 

101 of the Instructions as to Exhibits of 

Form 20–F (§ 249.220f of this chapter), 

paragraph B.(15) of the General 

Instructions to Form 40–F (§ 249.240f of 

this chapter), paragraph C.(6) of the 

General Instructions to Form 6–K 

(§ 249.306 of this chapter), General 

Instruction I to Form SR (§ 249.333 of 

this chapter), General Instruction C.3.(g) 

of Form N–1A (§§ 239.15A and 274.11A 

of this chapter), General Instruction I of 

Form N–2 (§§ 239.14 and 274.11a–1 of 

this chapter), General Instruction C.3.(h) 

of Form N–3 (§§ 239.17a and 274.11b of 

this chapter), General Instruction C.3.(h) 

of Form N–4 (§§ 239.17b and 274.11c of 

this chapter), General Instruction C.3.(h) 

of Form N–6 (§§ 239.17c and 274.11d of 

this chapter); or General Instruction C.4 

of Form N–CSR (§§ 249.331 and 274.128 

of this chapter). 

(b) * * * 

(1) * * * 

(iii) As applicable, the disclosure set 

forth in paragraph (b)(4) of this section. 

* * * * * 

(3) * * * 

(iv) As applicable, the disclosure set 

forth in paragraph (b)(4) of this section. 

(4) An Interactive Data File must 

consist of the disclosure provided under 

17 CFR part 229 (Regulation S–K) and 

related provisions that is required to be 

tagged, including, as applicable, the 

repurchase information required by: 

(i) Section 229.703 of this chapter 

(Item 703 of Regulation S–K); 

(ii) Item 16E of Form 20–F (§ 249.220f 

of this chapter); 

(iii) Item 9 of Form N–CSR 

(§§ 249.331 and 274.128 of this chapter); 

and 

(iv) General Instruction I to Form SR 

(§ 249.333 of this chapter). 

* * * * * 

Note 1 to § 232.405: Section 

229.601(b)(101) of this chapter (Item 

601(b)(101) of Regulation S–K) specifies the 

circumstances under which an Interactive 

Data File must be submitted and the 

circumstances under which it is permitted to 

be submitted, with respect to § 239.11 of this 

chapter (Form S–1), § 239.13 of this chapter 

(Form S–3), § 239.25 of this chapter (Form S– 

4), § 239.18 of this chapter (Form S–11), 

§ 239.31 of this chapter (Form F–1), § 239.33 

of this chapter (Form F–3), § 239.34 of this 

chapter (Form F–4), § 249.310 of this chapter 

(Form 10–K), § 249.308a of this chapter 

(Form 10–Q), and § 249.308 of this chapter 

(Form 8–K). Paragraph (101) of Part II— 

Information not Required to be Delivered to 

Offerees or Purchasers of § 239.40 of this 

chapter (Form F–10) specifies the 

circumstances under which an Interactive 

Data File must be submitted and the 

circumstances under which it is permitted to 

be submitted, with respect to Form F–10. 

Paragraph 101 of the Instructions as to 

Exhibits of § 249.220f of this chapter (Form 

20–F) specifies the circumstances under 

which an Interactive Data File must be 

submitted and the circumstances under 

which it is permitted to be submitted, with 

respect to Form 20–F. Paragraph B.(15) of the 

General Instructions to § 249.240f of this 

chapter (Form 40–F) and Paragraph C.(6) of 

the General Instructions to § 249.306 of this 

chapter (Form 6–K) specify the 

circumstances under which an Interactive 

Data File must be submitted and the 

circumstances under which it is permitted to 

be submitted, with respect to § 249.240f of 

this chapter (Form 40–F) and § 249.306 of 

this chapter (Form 6–K). Section 240.13a–21 

of this chapter (Rule 13a–21 of the Exchange 

Act Rules) and General Instruction I to 

§ 249.333 of this chapter (Form SR) specifies 

the circumstances under which an Interactive 

Data File must be submitted, with respect to 

Form SR. Section 229.601(b)(101) (Item 

601(b)(101) of Regulation S–K), paragraph 

(101) of Part II—Information not Required to 

be Delivered to Offerees or Purchasers of 

Form F–10, paragraph 101 of the Instructions 

as to Exhibits of Form 20–F, paragraph B.(15) 

of the General Instructions to Form 40–F, and 

paragraph C.(6) of the General Instructions to 

Form 6–K all prohibit submission of an 

Interactive Data File by an issuer that 

prepares its financial statements in 

accordance with 17 CFR 210.6–01 through 

210.6–10 (Article 6 of Regulation S–X). For 

an issuer that is a management investment 

company or separate account registered 

under the Investment Company Act of 1940 

(15 U.S.C. 80a et seq.) or a business 

development company as defined in Section 

2(a)(48) of the Investment Company Act of 

1940 (15 U.S.C. 80a–2(a)(48)), General 

Instruction C.3.(g) of Form N–1A (§§ 239.15A 

and 274.11A of this chapter), General 

Instruction I of Form N–2 (§§ 239.14 and 

274.11a–1 of this chapter), General 

Instruction C.3.(h) of Form N–3 (§§ 239.17a 

and 274.11b of this chapter), General 

Instruction C.3.(h) of Form N–4 (§§ 239.17b 

and 274.11c of this chapter), General 

Instruction C.3.(h) of Form N–6 (§§ 239.17c 

and 274.11d of this chapter), and General 

Instruction C.4 of Form N–CSR (§§ 249.331 

and 274.128 of this chapter), as applicable, 

specifies the circumstances under which an 

Interactive Data File must be submitted. 

PART 240—GENERAL RULES AND 

REGULATIONS, SECURITIES 

EXCHANGE ACT OF 1934 

■ 5. The general authority citation for 

part 240 continues to read as follows: 

Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 

77s, 77z–2, 77z–3, 77eee, 77ggg, 77nnn, 

77sss, 77ttt, 78c, 78c–3, 78c–5, 78d, 78e, 78f, 

78g, 78i, 78j, 78j–1, 78k, 78k–1, 78l, 78m, 

78n, 78n–1, 78o, 78o–4, 78o–10, 78p, 78q, 

78q–1, 78s, 78u–5, 78w, 78x, 78dd, 78ll, 

78mm, 80a–20, 80a–23, 80a–29, 80a–37, 80b– 

3, 80b–4, 80b–11, and 7201 et seq., and 8302; 

7 U.S.C. 2(c)(2)(E); 12 U.S.C. 5221(e)(3); 18 

U.S.C. 1350; Pub. L. 111–203, 939A, 124 Stat. 

1376 (2010); and Pub. L. 112–106, sec. 503 

and 602, 126 Stat. 326 (2012), unless 

otherwise noted. 

* * * * * 

■ 6. Add § 240.13a–21 to read as 

follows: 

§ 240.13a–21 Purchases of equity 

securities by the issuer and affiliated 

purchasers. 

(a) Every issuer that has a class of 

equity securities registered pursuant to 

section 12 of the Act (15 U.S.C. 78l) 

must furnish a Form SR (§ 249.333 of 

this chapter) to report, as specified by 

the form, any purchase made by or on 

behalf of the issuer or any ‘‘affiliated 

purchaser,’’ as defined in § 240.10b– 

18(a)(3), of shares or other units of any 

class of the issuer’s equity securities 

that is registered by the issuer pursuant 

to section 12 of the Act, within the time 

period specified in General Instruction 

I to Form SR. Provide the information 

required by the form in an Interactive 

Data File as required by § 232.405 of this 

chapter (Rule 405 of Regulation S–T) in 


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accordance with the EDGAR Filer 

Manual. 

(b) This section shall not apply to an 

investment company registered under 

the Investment Company Act of 1940 

(15 U.S.C. 80a–1 et. seq.), other than a 

registered closed-end investment 

company. 

PART 249—FORMS, SECURITIES 

EXCHANGE ACT OF 1934 

■ 7. The general authority citation for 

part 249 continues to read as follows: 

Authority: 15 U.S.C. 78a et seq. and 7201 

et seq.; 12 U.S.C. 5461 et seq.; 18 U.S.C. 1350; 

Sec. 953(b) Pub. L. 111–203, 124 Stat. 1904; 

Sec. 102(a)(3) Pub. L. 112–106, 126 Stat. 309 

(2012), Sec. 107 Pub. L. 112–106, 126 Stat. 

313 (2012), Sec. 72001 Pub. L. 114–94, 129 

Stat. 1312 (2015), and secs. 2 and 3 Pub. L. 

116–222, 134 Stat. 1063 (2020), unless 

otherwise noted. 

* * * * * 

■ 8. Amend Form 20–F, by revising Part 

II, Item 16E (referenced in § 249.220f) to 

read as follows: 

Note: The text of Form 20–F does not, and 

this amendment will not, appear in the Code 

of Federal Regulations. 

UNITED STATES 

SECURITIES AND EXCHANGE 

COMMISSION 

WASHINGTON, DC 20549 

Form 20–F 

* * * * * 

Part II 

* * * * * 

Item 16E Purchases of Equity 

Securities by the Issuer and Affiliated 

Purchasers. 

(a) Provide the specified information 

in the following tabular format, and 

narratively, with respect to any 

purchase made by or on behalf of the 

issuer or any ‘‘affiliated purchaser,’’ as 

defined in § 240.10b–18(a)(3) of this 

chapter, of shares or other units of any 

class of the issuer’s equity securities 

that is registered by the issuer pursuant 

to section 12 of the Exchange Act (15 

U.S.C. 78l). 

ISSUER PURCHASES OF EQUITY 

SECURITIES 

Use the checkbox to indicate if any 

officer or director reporting pursuant to 

Section 16(a) of the Exchange Act (15 

U.S.C. 78p(a)) purchased or sold shares 

or other units of the class of the issuer’s 

equity securities that is the subject of an 

issuer share repurchase plan or program 

within ten (10) business days before or 

after the issuer’s announcement of such 

repurchase plan or program. b 

(a) (b (c) (d) 

Period Total number 

of shares 

(or units) 

purchased 

Average 

price paid 

per share 

(or unit) 

Total number of shares (or 

units) purchased as part of 

publicly announced plans or 

programs 

Maximum number (or approximate dollar 

value) of shares (or units) that may yet be 

purchased under the plans or programs 

Month #1 (identify beginning 

and ending dates). 

Month #2 (identify beginning 

and ending dates). 

Month #3 (identify beginning 

and ending dates). 

Month #4 (identify beginning 

and ending dates). 

Month #5 (identify beginning 

and ending dates). 

Month #6 (identify beginning 

and ending dates). 

Month #7 (identify beginning 

and ending dates). 

Month #8 (identify beginning 

and ending dates). 

Month #9 (identify beginning 

and ending dates). 

Month #10 (identify beginning 

and ending dates). 

Month #11 (identify beginning 

and ending dates). 

Month #12 (identify beginning 

and ending dates). 

Total.

(b) The table shall include the 

following information for each class or 

series of securities for each month 

included in the period covered by the 

report: 

(1) The total number of shares (or 

units) purchased (column (a)), including 

all issuer repurchases whether or not 

made pursuant to publicly announced 

plans or programs; 

(2) The average price paid per share 

(or unit) (column (b)); 

(3) The aggregate total number of 

shares (or units) purchased as part of 

publicly announced repurchase plans or 

programs (column (c)); and 

(4) The aggregate maximum number 

(or approximate dollar value) of shares 

(or units) that may yet be purchased 

under the plans or programs (column 

(d)). 

(c) Disclose, by footnote to the table 

or narrative accompanying the table: 

(1) The objective or rationale for each 

repurchase plan or program and the 

process or criteria used to determine the 

amount of repurchases; 

(2) The number of shares purchased: 

(i) Other than through a publicly 

announced plan or program, and if so, 

the nature of the transaction (e.g., 

whether the purchases were made in 

open-market transactions, tender offers, 

in satisfaction of the company’s 

obligations upon exercise of outstanding 

put options issued by the company, or 

other transactions); 

(ii) In reliance on the safe harbor in 

17 CFR 240.10b–18; and 

(iii) Pursuant to a plan that is 

intended to satisfy the affirmative 

defense conditions of 17 CFR 240.10b5– 


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8470 Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 

1(c), and if so, the date(s) the plan was 

adopted or terminated. 

(3) For publicly announced 

repurchase plans or programs: 

(i) The date each plan or program was 

announced; 

(ii) The dollar amount (or share or 

unit amount) approved; 

(iii) The expiration date (if any) of 

each plan or program; 

(iv) Each plan or program that has 

expired during the period covered by 

the table; and 

(v) Each plan or program the issuer 

has determined to terminate prior to 

expiration, or under which the issuer 

does not intend to make further 

purchases. 

(4) Any policies and procedures 

relating to purchases and sales of the 

issuer’s securities by its officers and 

directors during a repurchase program, 

including any restrictions on such 

transactions. 

(d) Provide the disclosure required by 

this Item in an Interactive Data File as 

required by Rule 405 of Regulation S– 

T (17 CFR 232.405) in accordance with 

the EDGAR Filer Manual. 

■ 9. Add § 249.333 to read as follows: 

§ 249.333 Form SR. 

This form shall be used for reporting 

of purchases by or on behalf of the 

issuer or an affiliated purchaser of 

equity securities registered by the issuer 

pursuant to section 12 of the Act (15 

U.S.C. 781). 

PART 274—FORMS PRESCRIBED 

UNDER THE INVESTMENT COMPANY 

ACT OF 1940 

■ 10. The general authority citation for 

part 274 continues to read as follows: 

Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 

78c(b), 78l, 78m, 78n, 78o(d), 80a–8, 80a–24, 

80a–26, 80a–29, and 80a–37, unless 

otherwise noted. 

* * * * * 

■ 11. Amend Form N–CSR (referenced 

in §§ 249.331 and 274.128) by revising 

Item 9 to read as follows: 

Note: The text of Form N–CSR does not, 

and these amendments will not, appear in 

the Code of Federal Regulations. 

UNITED STATES 

SECURITIES AND EXCHANGE 

COMMISSION 

Washington, DC 20549 

Form N–CSR 

* * * * * 

Item 9. Purchases of Equity Securities 

by Closed-End Management Investment 

Company and Affiliated Purchasers. 

(a) If the registrant is a closed-end 

management investment company, 

provide the specified information in the 

following tabular format, and 

narratively with respect to any purchase 

made by or on behalf of the registrant 

or any ‘‘affiliated purchaser,’’ as defined 

in 17 CFR 240.10b–18(a)(3), of shares or 

other units of any class of the 

registrant’s equity securities that is 

registered by the registrant pursuant to 

section 12 of the Exchange Act (15 

U.S.C. 781). 

REGISTRANT PURCHASES OF 

EQUITY SECURITIES 

Use the checkbox to indicate if any 

officer or director reporting pursuant to 

Section 16(a) of the Exchange Act (15 

U.S.C. 78p(a)) purchased or sold shares 

or other units of the class of the 

registrant’s equity securities that is the 

subject of a registrant share repurchase 

plan or program within ten (10) 

business days before or after the 

registrant’s announcement of such 

repurchase plan or program. 

(a) (b) (c) (d) 

Period Total 

numberof 

shares 

(or units) 

purchased 

Average 

price paid 

per share 

(or unit) 

Total number of shares (or 

units) purchased as part of 

publicly announced plans or 

programs 

Maximum number (or approximate dollar 

value) of shares (or units) that may yet be 

purchased under the plans or programs 

Month #1 (identify beginning 

and ending dates). 

Month #2 (identify beginning 

and ending dates). 

Month #3 (identify beginning 

and ending dates). 

Month #4 (identify beginning 

and ending dates). 

Month #5 (identify beginning 

and ending dates). 

Month #6 (identify beginning 

and ending dates). 

Total.

(b) The table shall include the 

following information for each class or 

series of securities for each month 

included in the period covered by the 

report: 

(1) The total number of shares (or 

units) purchased (column (a)), including 

all registrant repurchases whether or not 

made pursuant to publicly announced 

plans or programs; 

(2) The average price paid per share 

(or unit) (column (b)); 

(3) The aggregate total number of 

shares (or units) purchased as part of 

publicly announced repurchase plans or 

programs (column (c)); and 

(4) The aggregate maximum number 

(or approximate dollar value) of shares 

(or units) that may yet be purchased 

under the plans or programs (column 

(d)). 

(c) Disclose, by footnote to the table 

or narrative accompanying the table: 

(1) The objective or rationale for each 

repurchase plan or program and the 

process or criteria used to determine the 

amount of repurchases; 

(2) The number of shares purchased: 

(i) Other than through a publicly 

announced plan or program, and if so, 

the nature of the transaction (e.g., 

whether the purchases were made in 

open-market transactions, tender offers, 

in satisfaction of the registrant’s 

obligations upon exercise of outstanding 

put options issued by the registrant, or 

other transactions); 


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Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 8471 

(ii) In reliance on the safe harbor in 

17 CFR 240.10b–18; and 

(iii) Pursuant to a plan that is 

intended to satisfy the affirmative 

defense conditions of 17 CFR 240.10b5– 

1(c), and if so, the date(s) the plan was 

adopted or terminated. 

(3) For publicly announced 

repurchase plans or programs: 

(i) The date each plan or program was 

announced; 

(ii) The dollar amount (or share or 

unit amount) approved; 

(iii) The expiration date (if any) of 

each plan or program; 

(iv) Each plan or program that has 

expired during the period covered by 

the table; and 

(v) Each plan or program the 

registrant has determined to terminate 

prior to expiration, or under which the 

registrant does not intend to make 

further purchases. 

(4) Any policies and procedures 

relating to purchases and sales of the 

registrant’s securities by its officers and 

directors during a repurchase program, 

including any restrictions on such 

transactions. 

(d) Provide the disclosure required by 

this Item in an Interactive Data File as 

required by Rule 405 of Regulation S– 

T (17 CFR 232.405) in accordance with 

the EDGAR Filer Manual. 

By the Commission. 

Dated: December 15, 2021. 

Vanessa A. Countryman, 

Secretary. 

Note: The following appendix will not 

appear in the Code of Federal Regulations. 

UNITED STATES 

SECURITIES AND EXCHANGE 

COMMISSION 

Washington, DC 20549 

FORM SR 

ISSUER SHARE REPURCHASE 

REPORT 

lllllllllllllllllll

(Exact name of registrant as specified in 

its charter) 

lllllllllllllllllll

(CIK number of registrant) 

lllllllllllllllllll

(Address of Principal Executive Offices) 

lllllllllllllllllll

(IRS Employer Identification No.) 

Securities registered pursuant to 

Section 12(b) of the Act: 

Title of each class Trading 

symbol(s) Name of each exchange on which registered 

Securities registered pursuant to 

section 12(g) of the Act: 

lllllllllllllllllll

(Title of class) 

lllllllllllllllllll

(Title of class) 

GENERAL INSTRUCTIONS 

I. Repurchases to be Reported and Time 

for Filing of Report 

If purchases are made by or on behalf 

of the registrant or any ‘‘affiliated 

purchaser,’’ as defined in § 240.10b– 

18(a)(3) of this chapter, of shares or 

other units of any class of the issuer’s 

equity securities that is registered 

pursuant to section 12 of the Securities 

Exchange Act of 1934 (15 U.S.C. 781), 

furnish to the Commission in 

accordance with the requirements of 

§ 240.13a–21 the information set forth 

below in an Interactive Data File as 

required by Rule 405 of Regulation S– 

T (17 CFR 232.405) in the manner 

provided by the EDGAR Filer Manual 

before the end of the first business day 

following the day on which the share 

repurchase order has been executed. If 

there are material errors in, or material 

changes to, the information, furnish an 

amended Form SR. 

II. Requirements for Use of Form SR 

(a) The class of shares (column (a)) 

should clearly identify the class, even if 

the issuer has only one class of 

securities outstanding. 

(b) The total number of shares 

purchased (column (b)) includes all 

shares (or units) repurchased by the 

issuer, regardless of whether made 

pursuant to publicly announced plans 

or programs. 

(c) The average price paid per share 

(or unit) (column (c)) shall be reported 

in U.S. dollars and exclude brokerage 

commissions and other costs of 

execution. 

(d) Total Number of Shares Purchased 

on the Open Market (column (d)) 

includes all shares (or units) 

repurchased by the issuer in openmarket transactions, and does not 

include shares (or units) purchased in 

tender offers, in satisfaction of the 

issuer’s obligations upon exercise of 

outstanding put options issued by the 

issuer, or other transactions. 

(e) Total Number of Shares Purchased 

in Reliance on the Safe Harbor in 17 

CFR 240.10b–18 (column (e)) includes 

all shares (or units) repurchased in 

reliance on 17 CFR 240.10b–18. 

(f) Total Number of Shares Purchased 

Pursuant to a Plan that is Intended to 

Satisfy the Affirmative Defense 

Conditions of 17 CFR 240.10b5–1(c) 

(column (f)) includes all shares (or 

units) repurchased where the issuer 

intended to satisfy the affirmative 

defense conditions of 17 CFR 240.10b5– 

1(c). 

III. Preparation of Report 

This form is not to be used as a blank 

form to be filled in, but only as a guide 

in the preparation of the report meeting 

the requirements of 17 CFR 240.13a–21. 

The report shall contain all columns of 

the table, and any columns for which 

there is no relevant information may be 

appropriately marked or left blank. The 

table may contain additional columns as 

necessary to provide disclosure 

responsive to the requirements of 17 

CFR 240.13a–21 provided the answers 

thereto are prepared in the manner 

specified in Rule 12b–13 (17 CFR 

240.12b–13). These General Instructions 

are not to be filed with the report. 

IV. Submission of the Form 

This form must be submitted in 

electronic format via our Electronic Data 

Gathering Analysis and Retrieval 

System (EDGAR) in accordance with 

EDGAR rules set forth in Regulation S– 

T (17 CFR part 232). You must provide 

the signatures required for the Form in 

accordance with 17 CFR 232.302. 


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8472 Federal Register / Vol. 87, No. 31 / Tuesday, February 15, 2022 / Proposed Rules 

ISSUER PURCHASES OF EQUITY SECURITIES

(a) (b) (c) (d) (e) (f) 

Date Class of 

shares 

Total number 

of shares 

purchased 

Average 

price paid 

per share 

Total number 

of shares 

purchased on 

the open 

market 

Total number of shares 

purchased in reliance 

on the safe harbor in 

17 CFR 240.10b–18 

Total number of shares purchased 

pursuant to a plan that is intended 

to satisfy the affirmative defense 

conditions of 17 CFR 240.10b5–1(c) 

SIGNATURES 

Pursuant to the requirements of the 

Act, the registrant has duly caused this 

report to be signed on its behalf by the 

undersigned hereunto duly authorized. 

lllllllllllllllllll

(Registrant) 

Date: llllllllllllllll

lllllllllllllllllll

(Signature) * 

* Print name and title of the signing 

officer under their signature. 

[FR Doc. 2022–01068 Filed 2–14–22; 8:45 am] 

BILLING CODE 8011–01–P 

DEPARTMENT OF HOMELAND 

SECURITY 

Coast Guard 

33 CFR Part 165 

[Docket Number USCG–2022–0040] 

RIN 1625–AA87 

Security Zone, Delaware River, 

Philadelphia, PA 

AGENCY: Coast Guard, Department of 

Homeland Security, (DHS). 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The Coast Guard is proposing 

to establish a security zone for certain 

waters of the Delaware River. This 

action is necessary to provide protection 

of Very Important Persons (VIPs) while 

attending the Democratic National 

Caucus (DNC) on the Delaware River in 

the vicinity of Penns Landing located in 

Philadelphia, PA. This security zone 

will be enforced intermittently and only 

for the protection of VIPs when in the 

area and will restrict vessel traffic while 

the zones are being enforced. This 

proposed rulemaking would prohibit 

persons and vessels from being in the 

security zone unless authorized by the 

Captain of the Port Delaware Bay or a 

designated representative. We invite 

your comments on this proposed 

rulemaking. 

DATES: Comments and related material 

must be received by the Coast Guard on 

or before February 23, 2022. 

ADDRESSES: You may submit comments 

identified by docket number USCG– 

2022–0040 using the Federal Decision 

Making Portal at https://

www.regulations.gov. See the ‘‘Public 

Participation and Request for 

Comments’’ portion of the 

SUPPLEMENTARY INFORMATION section for 

further instructions on submitting 

comments. 

FOR FURTHER INFORMATION CONTACT: If 

you have questions on this rule, call or 

email Petty Officer Jennifer Padilla, 

Sector Delaware Bay, Waterways 

Management Division, U.S. Coast 

Guard; telephone 215–271–4889, email 

Jennifer.L.Padilla@uscg.mil. 

SUPPLEMENTARY INFORMATION: 

I. Table of Abbreviations 

CFR Code of Federal Regulations 

DHS Department of Homeland Security 

FR Federal Register 

NPRM Notice of proposed rulemaking 

§ Section 

U.S.C. United States Code 

II. Background, Purpose, and Legal 

Basis 

On January 12, 2022, the United 

States Capitol Police notified the Coast 

Guard that the Democratic National 

Caucus (DNC) is being held in the 

vicinity of Penns Landing located in 

Philadelphia, PA from 11 a.m. on March 

9, 2022 through 11:59 p.m. on March 11, 

2022. The DNC is being held adjacent to 

the Delaware River and this security 

zone is needed to provide protection 

and security of the VIPs attending the 

Democratic National Caucus in the 

vicinity of this waterway. The presence 

of these persons creates unique safety 

and security concerns. The Captain of 

the Port Delaware Bay (COTP) has 

determined that attendance of VIPs at 

the Democratic National Caucus March 

9, 2022, through March 11, 2022, 

presents a potential target for terrorist 

acts, sabatoge, or other subversive acts, 

accidents, or other causes of a similar 

nature. 

The purpose of this rulemaking is to 

protect these persons, the public, and 

the surrounding waterway, because the 

Democratic National Caucus is being 

held at Penns landing which is a highly 

populated area, adjacent to the Delaware 

River. The Coast Guard is proposing this 

rulemaking under authority in 46 U.S.C. 

70034 (previously 33 U.S.C. 1231). 

III. Discussion of Proposed Rule 

The COTP is proposing to establish a 

security zone from March 9, 2022, 

through March 11, 2022, on certain 

waters of the Delaware River in 

Philadelphia, PA. Specifically, the 

security zone would cover all waters 

within the Delaware River contiguous to 

the Pennsylvania shoreline and 

extending out into the Delaware River 

approximately 250 yards, within an area 

bounded by a line connecting the 

following points: Beginning at the 

Pennsylvania shoreline at latitude 

39°56.87′ N, longitude 075°8.36′ W, 

thence east to latitude 39°56.85′ N, 

longitude 075°8.20′ W, thence south to 

latitude 39°56.45′ N, longitude 075°8.25′ 

W, thence west to the Pennsylvania 

shoreline at latitude 39°56.47′ N, 

longitude 075°8.41′ W, thence north 

following the shoreline to the 

originating point. 

This zone will be enforced 

intermittently during the effective dates. 

Enforcement of this zone will be 

broadcast via Broadcast Notice to 

Mariners on VHF–FM marine channel 

16 as well as actual notice via on scene 

Coast Guard Personnel. 

No vessel or person will be permitted 

to enter or transit these security zones 

without obtaining permission from the 

COTP or a designated representative 

and must proceed as directed by on 

scene enforcement vessels. Any vessel 

permitted to transit the zone will be 

required to continue through the zone 

without pause or delay as directed by on 

scene enforcement vessels. 

The regulatory text we are proposing 

appears at the end of this document. 

IV. Regulatory Analyses 

We developed this proposed rule after 

considering numerous statutes and 

Executive orders related to rulemaking. 

Below we summarize our analyses 

based on a number of these statutes and 


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