8-K Trading Gap Act of 2019

Bill: 116-hr-4335
Sponsor: full_name: Rep. Maloney, Carolyn B. [D-NY-12]
Introduced: 2019-09-16
Policy area: Finance and Financial Sector
Subjects: Banking and financial institutions regulation

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Corporate finance and management

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Securities
Latest action: action_date: 2020-01-14
text: Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:
action_date: 2019-09-16
action_desc: Introduced in House
text: <p><b>8&#8211;K Trading Gap Act of 2019 </b></p> <p>This bill requires certain issuers of securities to create policies reasonably designed to prevent executive officers and directors from trading their securities after a significant corporate event but before disclosing that event through a public filing. </p>

action_date: 2020-01-13
action_desc: Passed House
text: <p><b>8&#8211;K Trading Gap Act of 2019 </b></p> <p>This bill requires certain issuers of securities to create policies reasonably designed to prevent executive officers and directors from trading their securities after a significant corporate event but before disclosing that event through a public filing. Certain issuers required by regulation to adopt a code of ethics are exempt from this requirement.</p>

tv_txt: I 116th CONGRESS 1st Session H. R. 4335 IN THE HOUSE OF REPRESENTATIVES September 16, 2019 Mrs. Carolyn B. Maloney of New York introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the Securities Exchange Act of 1934 to require the Securities and Exchange Commission to issue rules that prohibit officers and directors of certain companies from trading securities in anticipation of a current report, and for other purposes.

1. Short title This Act may be cited as the 8–K Trading Gap Act of 2019 . 2. Prohibition on certain trading in anticipation of a current report The Securities Exchange Act of 1934 ( 15 U.S.C. 78a et seq.) is amended by inserting after section 10D the following: 10E. Prohibition on certain trading in anticipation of a current report (a) Prohibition Not later than 1 year after the date of enactment of this section, the Commission shall issue rules that require each issuer that is subject to reporting requirements under section 13(a) or 15(d) to establish and maintain policies, controls, and procedures that are reasonably designed to prohibit executive officers and directors of the issuer from purchasing, selling, or otherwise transferring any equity security of the issuer, directly or indirectly— (1) with respect to an event described in sections 1 through 6 of Form 8–K, between— (A) the occurrence of such event; and (B) the filing or furnishing of a current report on Form 8–K with respect to such event; and (2) with respect to an event described in section 7 or 8 of Form 8–K, between— (A) the date on which the issuer determines that it will disclose such event; and (B) the filing or furnishing of a current report on Form 8–K with respect to such event. (b) Permissible transactions In issuing rules under subsection (a), the Commission— (1) may exempt certain transactions that the Commission determines is appropriate, including those that— (A) occur automatically; (B) are made pursuant to an advance election; or (C) except as provided in paragraph (2), involve a purchase or sale of equity securities that satisfies the conditions under section 240.10b5–1(c) of title 17, Code of Federal Regulations; and (2) may not exempt from those rules a transaction made by an executive officer or director of an issuer under a plan that— (A) is described in section 240.10b5–1(c)(1)(i)(A)(3) of title 17, Code of Federal Regulations; and (B) was adopted— (i) with respect to an event described in sections 1 through 6 of Form 8–K, between— (I) the occurrence of such event; and (II) the filing or furnishing of a current report on Form 8–K with respect to such event; and (ii) with respect to an event described in section 7 or 8 of Form 8–K, between— (I) the date on which the issuer determines that it will disclose such event; and (II) the filing or furnishing of a current report on Form 8–K with respect to such event. .

tv_txt: I 116th CONGRESS 2d Session H. R. 4335 IN THE HOUSE OF REPRESENTATIVES AN ACT To amend the Securities Exchange Act of 1934 to require the Securities and Exchange Commission to issue rules that prohibit officers and directors of certain companies from trading securities in anticipation of a current report, and for other purposes.

1. Short title This Act may be cited as the 8–K Trading Gap Act of 2019 . 2. Prohibition on certain trading in anticipation of a current report The Securities Exchange Act of 1934 ( 15 U.S.C. 78a et seq.) is amended by inserting after section 10D the following: 10E. Prohibition on certain trading in anticipation of a current report (a) Prohibition Not later than 1 year after the date of enactment of this section, the Commission shall issue rules that require each issuer that is subject to reporting requirements under section 13(a) or 15(d) to establish and maintain policies, controls, and procedures that are reasonably designed to prohibit executive officers and directors of the issuer from purchasing, selling, or otherwise transferring any equity security of the issuer, directly or indirectly— (1) with respect to an event described in sections 1 through 6 of Form 8–K, between— (A) the occurrence of such event; and (B) the filing or furnishing of a current report on Form 8–K with respect to such event; and (2) with respect to an event described in section 7 or 8 of Form 8–K, between— (A) the date on which the issuer determines that it will disclose such event; and (B) the filing or furnishing of a current report on Form 8–K with respect to such event. (b) Permissible transactions In issuing rules under subsection (a), the Commission— (1) may exempt certain transactions that the Commission determines is appropriate, including those that— (A) occur automatically; (B) are made pursuant to an advance election; or (C) except as provided in paragraph (2), involve a purchase or sale of equity securities that satisfies the conditions under section 240.10b5–1(c) of title 17, Code of Federal Regulations; (2) may not exempt from those rules a transaction made by an executive officer or director of an issuer under a plan that— (A) is described in section 240.10b5–1(c)(1)(i)(A)(3) of title 17, Code of Federal Regulations; and (B) was adopted— (i) with respect to an event described in sections 1 through 6 of Form 8–K, between— (I) the occurrence of such event; and (II) the filing or furnishing of a current report on Form 8–K with respect to such event; and (ii) with respect to an event described in section 7 or 8 of Form 8–K, between— (I) the date on which the issuer determines that it will disclose such event; and (II) the filing or furnishing of a current report on Form 8–K with respect to such event; and (3) shall exempt from those rules— (A) issuers required to adopt and administer a code of ethics pursuant section 270.17j–1 of title 17, Code of Federal Regulations, and any other issuers registered under the Investment Company Act of 1940 whose investment advisers are required to adopt and administer a code of ethics pursuant to section 275.204A–1 of title 17, Code of Federal Regulations; and (B) any event where such event is described in sections 1 through 6 of Form 8–K and the issuer has announced such event in a press release or other method of dissemination that complies with the requirements of section 101(e)(2) of Regulation FD (17 CFR Part 243.101(e)(2)). .

Passed the House of Representatives January 13, 2020. Cheryl L. Johnson, Clerk.

tv_txt: IIB 116th CONGRESS 2d Session H. R. 4335 IN THE SENATE OF THE UNITED STATES January 14, 2020 Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs AN ACT To amend the Securities Exchange Act of 1934 to require the Securities and Exchange Commission to issue rules that prohibit officers and directors of certain companies from trading securities in anticipation of a current report, and for other purposes.

1. Short title This Act may be cited as the 8–K Trading Gap Act of 2019 . 2. Prohibition on certain trading in anticipation of a current report The Securities Exchange Act of 1934 ( 15 U.S.C. 78a et seq.) is amended by inserting after section 10D the following: 10E. Prohibition on certain trading in anticipation of a current report (a) Prohibition Not later than 1 year after the date of enactment of this section, the Commission shall issue rules that require each issuer that is subject to reporting requirements under section 13(a) or 15(d) to establish and maintain policies, controls, and procedures that are reasonably designed to prohibit executive officers and directors of the issuer from purchasing, selling, or otherwise transferring any equity security of the issuer, directly or indirectly— (1) with respect to an event described in sections 1 through 6 of Form 8–K, between— (A) the occurrence of such event; and (B) the filing or furnishing of a current report on Form 8–K with respect to such event; and (2) with respect to an event described in section 7 or 8 of Form 8–K, between— (A) the date on which the issuer determines that it will disclose such event; and (B) the filing or furnishing of a current report on Form 8–K with respect to such event. (b) Permissible transactions In issuing rules under subsection (a), the Commission— (1) may exempt certain transactions that the Commission determines is appropriate, including those that— (A) occur automatically; (B) are made pursuant to an advance election; or (C) except as provided in paragraph (2), involve a purchase or sale of equity securities that satisfies the conditions under section 240.10b5–1(c) of title 17, Code of Federal Regulations; (2) may not exempt from those rules a transaction made by an executive officer or director of an issuer under a plan that— (A) is described in section 240.10b5–1(c)(1)(i)(A)(3) of title 17, Code of Federal Regulations; and (B) was adopted— (i) with respect to an event described in sections 1 through 6 of Form 8–K, between— (I) the occurrence of such event; and (II) the filing or furnishing of a current report on Form 8–K with respect to such event; and (ii) with respect to an event described in section 7 or 8 of Form 8–K, between— (I) the date on which the issuer determines that it will disclose such event; and (II) the filing or furnishing of a current report on Form 8–K with respect to such event; and (3) shall exempt from those rules— (A) issuers required to adopt and administer a code of ethics pursuant section 270.17j–1 of title 17, Code of Federal Regulations, and any other issuers registered under the Investment Company Act of 1940 whose investment advisers are required to adopt and administer a code of ethics pursuant to section 275.204A–1 of title 17, Code of Federal Regulations; and (B) any event where such event is described in sections 1 through 6 of Form 8–K and the issuer has announced such event in a press release or other method of dissemination that complies with the requirements of section 101(e)(2) of Regulation FD (17 CFR Part 243.101(e)(2)). .

Passed the House of Representatives January 13, 2020. Cheryl L. Johnson, Clerk