Source: http://www.law.cornell.edu/uscode/text/15/78j-3?quicktabs_8=4
Timestamp: 2015-01-25 17:01:54
Document Index: 220652359

Matched Legal Cases: ['§ 78', '§ 78', '§ 78', 'art 200', 'art 229', 'art 249', 'art 249']

15 U.S. Code § 78j–3 - Compensation committees | LII / Legal Information Institute
U.S. Code › Title 15 › Chapter 2B › § 78j–3 15 U.S. Code § 78j–3 - Compensation committees
Independence of compensation committees (1)
Listing standards The Commission shall, by rule, direct the national securities exchanges and national securities associations to prohibit the listing of any equity security of an issuer, other than an issuer that is a controlled company, limited partnership, company in bankruptcy proceedings, open-ended management investment company that is registered under the Investment Company Act of 1940 [15 U.S.C. 80a–1 et seq.], or a foreign private issuer that provides annual disclosures to shareholders of the reasons that the foreign private issuer does not have an independent compensation committee, that does not comply with the requirements of this subsection.
Independence of compensation committees The rules of the Commission under paragraph (1) shall require that each member of the compensation committee of the board of directors of an issuer be—
Independence The rules of the Commission under paragraph (1) shall require that, in determining the definition of the term “independence” for purposes of paragraph (2), the national securities exchanges and the national securities associations shall consider relevant factors, including—
Exemption authority The rules of the Commission under paragraph (1) shall permit a national securities exchange or a national securities association to exempt a particular relationship from the requirements of paragraph (2), with respect to the members of a compensation committee, as the national securities exchange or national securities association determines is appropriate, taking into consideration the size of an issuer and any other relevant factors.
Independence of compensation consultants and other compensation committee advisers (1)
In general The compensation committee of an issuer may only select a compensation consultant, legal counsel, or other adviser to the compensation committee after taking into consideration the factors identified by the Commission under paragraph (2).
Rules The Commission shall identify factors that affect the independence of a compensation consultant, legal counsel, or other adviser to a compensation committee of an issuer. Such factors shall be competitively neutral among categories of consultants, legal counsel, or other advisers and preserve the ability of compensation committees to retain the services of members of any such category, and shall include—
Compensation committee authority relating to compensation consultants (1)
Authority to retain compensation consultant (A)
In general The compensation committee of an issuer, in its capacity as a committee of the board of directors, may, in its sole discretion, retain or obtain the advice of a compensation consultant.
Direct responsibility of compensation committee The compensation committee of an issuer shall be directly responsible for the appointment, compensation, and oversight of the work of a compensation consultant.
Rule of construction This paragraph may not be construed—
Disclosure In any proxy or consent solicitation material for an annual meeting of the shareholders (or a special meeting in lieu of the annual meeting) occurring on or after the date that is 1 year after July 21, 2010, each issuer shall disclose in the proxy or consent material, in accordance with regulations of the Commission, whether—
Authority to engage independent legal counsel and other advisers (1)
In general The compensation committee of an issuer, in its capacity as a committee of the board of directors, may, in its sole discretion, retain and obtain the advice of independent legal counsel and other advisers.
Direct responsibility of compensation committee The compensation committee of an issuer shall be directly responsible for the appointment, compensation, and oversight of the work of independent legal counsel and other advisers.
Rule of construction This subsection may not be construed—
Compensation of compensation consultants, independent legal counsel, and other advisers Each issuer shall provide for appropriate funding, as determined by the compensation committee in its capacity as a committee of the board of directors, for payment of reasonable compensation—
Commission rules (1)
In general Not later than 360 days after July 21, 2010, the Commission shall, by rule, direct the national securities exchanges and national securities associations to prohibit the listing of any security of an issuer that is not in compliance with the requirements of this section.
Opportunity to cure defects The rules of the Commission under paragraph (1) shall provide for appropriate procedures for an issuer to have a reasonable opportunity to cure any defects that would be the basis for the prohibition under paragraph (1), before the imposition of such prohibition.
Exemption authority (A)
In general The rules of the Commission under paragraph (1) shall permit a national securities exchange or a national securities association to exempt a category of issuers from the requirements under this section, as the national securities exchange or the national securities association determines is appropriate.
Considerations In determining appropriate exemptions under subparagraph (A), the national securities exchange or the national securities association shall take into account the potential impact of the requirements of this section on smaller reporting issuers.
Controlled company exemption (1)
In general This section shall not apply to any controlled company.
Definition For purposes of this section, the term “controlled company” means an issuer—
This is a list of parts within the Code of Federal Regulations for which this US Code section provides rulemaking authority.This list is taken from the Parallel Table of Authorities and Rules provided by GPO [Government Printing Office].It is not guaranteed to be accurate or up-to-date, though we do refresh the database weekly. More limitations on accuracy are described at the GPO site.17 CFR - Commodity and Securities Exchanges17 CFR Part 200 - ORGANIZATION; CONDUCT AND ETHICS; AND INFORMATION AND REQUESTS17 CFR 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-K17 CFR Part 249 - FORMS, SECURITIES EXCHANGE ACT OF 193417 CFR Part 249b - FURTHER FORMS, SECURITIES EXCHANGE ACT OF 1934