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CITE

    15 USC Sec. 78m                                             01/05/2009

EXPCITE

    TITLE 15 - COMMERCE AND TRADE
    CHAPTER 2B - SECURITIES EXCHANGES

HEAD

    Sec. 78m. Periodical and other reports

STATUTE

    (a) Reports by issuer of security; contents
      Every issuer of a security registered pursuant to section 78l of
    this title shall file with the Commission, in accordance with such
    rules and regulations as the Commission may prescribe as necessary
    or appropriate for the proper protection of investors and to insure
    fair dealing in the security -
        (1) such information and documents (and such copies thereof) as
      the Commission shall require to keep reasonably current the
      information and documents required to be included in or filed
      with an application or registration statement filed pursuant to
      section 78l of this title, except that the Commission may not
      require the filing of any material contract wholly executed
      before July 1, 1962.
        (2) such annual reports (and such copies thereof), certified if
      required by the rules and regulations of the Commission by
      independent public accountants, and such quarterly reports (and
      such copies thereof), as the Commission may prescribe.
    Every issuer of a security registered on a national securities
    exchange shall also file a duplicate original of such information,
    documents, and reports with the exchange.
    (b) Form of report; books, records, and internal accounting;
      directives
      (1) The Commission may prescribe, in regard to reports made
    pursuant to this chapter, the form or forms in which the required
    information shall be set forth, the items or details to be shown in
    the balance sheet and the earning statement, and the methods to be
    followed in the preparation of reports, in the appraisal or
    valuation of assets and liabilities, in the determination of
    depreciation and depletion, in the differentiation of recurring and
    nonrecurring income, in the differentiation of investment and
    operating income, and in the preparation, where the Commission
    deems it necessary or desirable, of separate and/or consolidated
    balance sheets or income accounts of any person directly or
    indirectly controlling or controlled by the issuer, or any person
    under direct or indirect common control with the issuer; but in the
    case of the reports of any person whose methods of accounting are
    prescribed under the provisions of any law of the United States, or
    any rule or regulation thereunder, the rules and regulations of the
    Commission with respect to reports shall not be inconsistent with
    the requirements imposed by such law or rule or regulation in
    respect of the same subject matter (except that such rules and
    regulations of the Commission may be inconsistent with such
    requirements to the extent that the Commission determines that the
    public interest or the protection of investors so requires).
      (2) Every issuer which has a class of securities registered
    pursuant to section 78l of this title and every issuer which is
    required to file reports pursuant to section 78o(d) of this title
    shall -
        (A) make and keep books, records, and accounts, which, in
      reasonable detail, accurately and fairly reflect the transactions
      and dispositions of the assets of the issuer;
        (B) devise and maintain a system of internal accounting
      controls sufficient to provide reasonable assurances that -
          (i) transactions are executed in accordance with management's
        general or specific authorization;
          (ii) transactions are recorded as necessary (I) to permit
        preparation of financial statements in conformity with
        generally accepted accounting principles or any other criteria
        applicable to such statements, and (II) to maintain
        accountability for assets;
          (iii) access to assets is permitted only in accordance with
        management's general or specific authorization; and
          (iv) the recorded accountability for assets is compared with
        the existing assets at reasonable intervals and appropriate
        action is taken with respect to any differences; and
        (C) notwithstanding any other provision of law, pay the
      allocable share of such issuer of a reasonable annual accounting
      support fee or fees, determined in accordance with section 7219
      of this title.
      (3)(A) With respect to matters concerning the national security
    of the United States, no duty or liability under paragraph (2) of
    this subsection shall be imposed upon any person acting in
    cooperation with the head of any Federal department or agency
    responsible for such matters if such act in cooperation with such
    head of a department or agency was done upon the specific, written
    directive of the head of such department or agency pursuant to
    Presidential authority to issue such directives. Each directive
    issued under this paragraph shall set forth the specific facts and
    circumstances with respect to which the provisions of this
    paragraph are to be invoked. Each such directive shall, unless
    renewed in writing, expire one year after the date of issuance.
      (B) Each head of a Federal department or agency of the United
    States who issues a directive pursuant to this paragraph shall
    maintain a complete file of all such directives and shall, on
    October 1 of each year, transmit a summary of matters covered by
    such directives in force at any time during the previous year to
    the Permanent Select Committee on Intelligence of the House of
    Representatives and the Select Committee on Intelligence of the
    Senate.
      (4) No criminal liability shall be imposed for failing to comply
    with the requirements of paragraph (2) of this subsection except as
    provided in paragraph (5) of this subsection.
      (5) No person shall knowingly circumvent or knowingly fail to
    implement a system of internal accounting controls or knowingly
    falsify any book, record, or account described in paragraph (2).
      (6) Where an issuer which has a class of securities registered
    pursuant to section 78l of this title or an issuer which is
    required to file reports pursuant to section 78o(d) of this title
    holds 50 per centum or less of the voting power with respect to a
    domestic or foreign firm, the provisions of paragraph (2) require
    only that the issuer proceed in good faith to use its influence, to
    the extent reasonable under the issuer's circumstances, to cause
    such domestic or foreign firm to devise and maintain a system of
    internal accounting controls consistent with paragraph (2). Such
    circumstances include the relative degree of the issuer's ownership
    of the domestic or foreign firm and the laws and practices
    governing the business operations of the country in which such firm
    is located. An issuer which demonstrates good faith efforts to use
    such influence shall be conclusively presumed to have complied with
    the requirements of paragraph (2).
      (7) For the purpose of paragraph (2) of this subsection, the
    terms "reasonable assurances" and "reasonable detail" mean such
    level of detail and degree of assurance as would satisfy prudent
    officials in the conduct of their own affairs.
    (c) Alternative reports
      If in the judgment of the Commission any report required under
    subsection (a) of this section is inapplicable to any specified
    class or classes of issuers, the Commission shall require in lieu
    thereof the submission of such reports of comparable character as
    it may deem applicable to such class or classes of issuers.
    (d) Reports by persons acquiring more than five per centum of
      certain classes of securities
      (1) Any person who, after acquiring directly or indirectly the
    beneficial ownership of any equity security of a class which is
    registered pursuant to section 78l of this title, or any equity
    security of an insurance company which would have been required to
    be so registered except for the exemption contained in section
    78l(g)(2)(G) of this title, or any equity security issued by a
    closed-end investment company registered under the Investment
    Company Act of 1940 [15 U.S.C. 80a-1 et seq.] or any equity
    security issued by a Native Corporation pursuant to section
    1629c(d)(6) of title 43, is directly or indirectly the beneficial
    owner of more than 5 per centum of such class shall, within ten
    days after such acquisition, send to the issuer of the security at
    its principal executive office, by registered or certified mail,
    send to each exchange where the security is traded, and file with
    the Commission, a statement containing such of the following
    information, and such additional information, as the Commission may
    by rules and regulations, prescribe as necessary or appropriate in
    the public interest or for the protection of investors -
        (A) the background, and identity, residence, and citizenship
      of, and the nature of such beneficial ownership by, such person
      and all other persons by whom or on whose behalf the purchases
      have been or are to be effected;
        (B) the source and amount of the funds or other consideration
      used or to be used in making the purchases, and if any part of
      the purchase price is represented or is to be represented by
      funds or other consideration borrowed or otherwise obtained for
      the purpose of acquiring, holding, or trading such security, a
      description of the transaction and the names of the parties
      thereto, except that where a source of funds is a loan made in
      the ordinary course of business by a bank, as defined in section
      78c(a)(6) of this title, if the person filing such statement so
      requests, the name of the bank shall not be made available to the
      public;
        (C) if the purpose of the purchases or prospective purchases is
      to acquire control of the business of the issuer of the
      securities, any plans or proposals which such persons may have to
      liquidate such issuer, to sell its assets to or merge it with any
      other persons, or to make any other major change in its business
      or corporate structure;
        (D) the number of shares of such security which are
      beneficially owned, and the number of shares concerning which
      there is a right to acquire, directly or indirectly, by (i) such
      person, and (ii) by each associate of such person, giving the
      background, identity, residence, and citizenship of each such
      associate; and
        (E) information as to any contracts, arrangements, or
      understandings with any person with respect to any securities of
      the issuer, including but not limited to transfer of any of the
      securities, joint ventures, loan or option arrangements, puts or
      calls, guaranties of loans, guaranties against loss or guaranties
      of profits, division of losses or profits, or the giving or
      withholding of proxies, naming the persons with whom such
      contracts, arrangements, or understandings have been entered
      into, and giving the details thereof.
      (2) If any material change occurs in the facts set forth in the
    statements to the issuer and the exchange, and in the statement
    filed with the Commission, an amendment shall be transmitted to the
    issuer and the exchange and shall be filed with the Commission, in
    accordance with such rules and regulations as the Commission may
    prescribe as necessary or appropriate in the public interest or for
    the protection of investors.
      (3) When two or more persons act as a partnership, limited
    partnership, syndicate, or other group for the purpose of
    acquiring, holding, or disposing of securities of an issuer, such
    syndicate or group shall be deemed a "person" for the purposes of
    this subsection.
      (4) In determining, for purposes of this subsection, any
    percentage of a class of any security, such class shall be deemed
    to consist of the amount of the outstanding securities of such
    class, exclusive of any securities of such class held by or for the
    account of the issuer or a subsidiary of the issuer.
      (5) The Commission, by rule or regulation or by order, may permit
    any person to file in lieu of the statement required by paragraph
    (1) of this subsection or the rules and regulations thereunder, a
    notice stating the name of such person, the number of shares of any
    equity securities subject to paragraph (1) which are owned by him,
    the date of their acquisition and such other information as the
    Commission may specify, if it appears to the Commission that such
    securities were acquired by such person in the ordinary course of
    his business and were not acquired for the purpose of and do not
    have the effect of changing or influencing the control of the
    issuer nor in connection with or as a participant in any
    transaction having such purpose or effect.
      (6) The provisions of this subsection shall not apply to -
        (A) any acquisition or offer to acquire securities made or
      proposed to be made by means of a registration statement under
      the Securities Act of 1933 [15 U.S.C. 77a et seq.];
        (B) any acquisition of the beneficial ownership of a security
      which, together with all other acquisitions by the same person of
      securities of the same class during the preceding twelve months,
      does not exceed 2 per centum of that class;
        (C) any acquisition of an equity security by the issuer of such
      security;
        (D) any acquisition or proposed acquisition of a security which
      the Commission, by rules or regulations or by order, shall exempt
      from the provisions of this subsection as not entered into for
      the purpose of, and not having the effect of, changing or
      influencing the control of the issuer or otherwise as not
      comprehended within the purposes of this subsection.
    (e) Purchase of securities by issuer
      (1) It shall be unlawful for an issuer which has a class of
    equity securities registered pursuant to section 78l of this title,
    or which is a closed-end investment company registered under the
    Investment Company Act of 1940 [15 U.S.C. 80a-1 et seq.], to
    purchase any equity security issued by it if such purchase is in
    contravention of such rules and regulations as the Commission, in
    the public interest or for the protection of investors, may adopt
    (A) to define acts and practices which are fraudulent, deceptive,
    or manipulative, and (B) to prescribe means reasonably designed to
    prevent such acts and practices. Such rules and regulations may
    require such issuer to provide holders of equity securities of such
    class with such information relating to the reasons for such
    purchase, the source of funds, the number of shares to be
    purchased, the price to be paid for such securities, the method of
    purchase, and such additional information, as the Commission deems
    necessary or appropriate in the public interest or for the
    protection of investors, or which the Commission deems to be
    material to a determination whether such security should be sold.
      (2) For the purpose of this subsection, a purchase by or for the
    issuer or any person controlling, controlled by, or under common
    control with the issuer, or a purchase subject to control of the
    issuer or any such person, shall be deemed to be a purchase by the
    issuer. The Commission shall have power to make rules and
    regulations implementing this paragraph in the public interest and
    for the protection of investors, including exemptive rules and
    regulations covering situations in which the Commission deems it
    unnecessary or inappropriate that a purchase of the type described
    in this paragraph shall be deemed to be a purchase by the issuer
    for purposes of some or all of the provisions of paragraph (1) of
    this subsection.
      (3) At the time of filing such statement as the Commission may
    require by rule pursuant to paragraph (1) of this subsection, the
    person making the filing shall pay to the Commission a fee at a
    rate that, subject to paragraphs (5) and (6), is equal to $92 per
    $1,000,000 of the value of securities proposed to be purchased. The
    fee shall be reduced with respect to securities in an amount equal
    to any fee paid with respect to any securities issued in connection
    with the proposed transaction under section 6(b) of the Securities
    Act of 1933 [15 U.S.C. 77f(b)], or the fee paid under that section
    shall be reduced in an amount equal to the fee paid to the
    Commission in connection with such transaction under this
    paragraph.
      (4) Offsetting collections. - Fees collected pursuant to this
    subsection for any fiscal year shall be deposited and credited as
    offsetting collections to the account providing appropriations to
    the Commission, and, except as provided in paragraph (9), shall not
    be collected for any fiscal year except to the extent provided in
    advance in appropriation Acts. No fees collected pursuant to this
    subsection for fiscal year 2002 or any succeeding fiscal year shall
    be deposited and credited as general revenue of the Treasury.
      (5) Annual adjustment. - For each of the fiscal years 2003
    through 2011, the Commission shall by order adjust the rate
    required by paragraph (3) for such fiscal year to a rate that is
    equal to the rate (expressed in dollars per million) that is
    applicable under section 6(b) of the Securities Act of 1933 [15
    U.S.C. 77f(b)] for such fiscal year.
      (6) Final rate adjustment. - For fiscal year 2012 and all of the
    succeeding fiscal years, the Commission shall by order adjust the
    rate required by paragraph (3) for all of such fiscal years to a
    rate that is equal to the rate (expressed in dollars per million)
    that is applicable under section 6(b) of the Securities Act of 1933
    [15 U.S.C. 77f(b)] for all of such fiscal years.
      (7) Pro rata application. - The rates per $1,000,000 required by
    this subsection shall be applied pro rata to amounts and balances
    of less than $1,000,000.
      (8) Review and effective date. - In exercising its authority
    under this subsection, the Commission shall not be required to
    comply with the provisions of section 553 of title 5. An adjusted
    rate prescribed under paragraph (5) or (6) and published under
    paragraph (10) shall not be subject to judicial review. Subject to
    paragraphs (4) and (9) -
        (A) an adjusted rate prescribed under paragraph (5) shall take
      effect on the later of -
          (i) the first day of the fiscal year to which such rate
        applies; or
          (ii) five days after the date on which a regular
        appropriation to the Commission for such fiscal year is
        enacted; and
        (B) an adjusted rate prescribed under paragraph (6) shall take
      effect on the later of -
          (i) the first day of fiscal year 2012; or
          (ii) five days after the date on which a regular
        appropriation to the Commission for fiscal year 2012 is
        enacted.
      (9) Lapse of appropriation. - If on the first day of a fiscal
    year a regular appropriation to the Commission has not been
    enacted, the Commission shall continue to collect fees (as
    offsetting collections) under this subsection at the rate in effect
    during the preceding fiscal year, until 5 days after the date such
    a regular appropriation is enacted.
      (10) Publication. - The rate applicable under this subsection for
    each fiscal year is published pursuant to section 6(b)(10) of the
    Securities Act of 1933 [15 U.S.C. 77f(b)(10)].
    (f) Reports by institutional investment managers
      (1) Every institutional investment manager which uses the mails,
    or any means or instrumentality of interstate commerce in the
    course of its business as an institutional investment manager and
    which exercises investment discretion with respect to accounts
    holding equity securities of a class described in subsection (d)(1)
    of this section having an aggregate fair market value on the last
    trading day in any of the preceding twelve months of at least
    $100,000,000 or such lesser amount (but in no case less than
    $10,000,000) as the Commission, by rule, may determine, shall file
    reports with the Commission in such form, for such periods, and at
    such times after the end of such periods as the Commission, by
    rule, may prescribe, but in no event shall such reports be filed
    for periods longer than one year or shorter than one quarter. Such
    reports shall include for each such equity security held on the
    last day of the reporting period by accounts (in aggregate or by
    type as the Commission, by rule, may prescribe) with respect to
    which the institutional investment manager exercises investment
    discretion (other than securities held in amounts which the
    Commission, by rule, determines to be insignificant for purposes of
    this subsection), the name of the issuer and the title, class,
    CUSIP number, number of shares or principal amount, and aggregate
    fair market value of each such security. Such reports may also
    include for accounts (in aggregate or by type) with respect to
    which the institutional investment manager exercises investment
    discretion such of the following information as the Commission, by
    rule, prescribes -
        (A) the name of the issuer and the title, class, CUSIP number,
      number of shares or principal amount, and aggregate fair market
      value or cost or amortized cost of each other security (other
      than an exempted security) held on the last day of the reporting
      period by such accounts;
        (B) the aggregate fair market value or cost or amortized cost
      of exempted securities (in aggregate or by class) held on the
      last day of the reporting period by such accounts;
        (C) the number of shares of each equity security of a class
      described in subsection (d)(1) of this section held on the last
      day of the reporting period by such accounts with respect to
      which the institutional investment manager possesses sole or
      shared authority to exercise the voting rights evidenced by such
      securities;
        (D) the aggregate purchases and aggregate sales during the
      reporting period of each security (other than an exempted
      security) effected by or for such accounts; and
        (E) with respect to any transaction or series of transactions
      having a market value of at least $500,000 or such other amount
      as the Commission, by rule, may determine, effected during the
      reporting period by or for such accounts in any equity security
      of a class described in subsection (d)(1) of this section -
          (i) the name of the issuer and the title, class, and CUSIP
        number of the security;
          (ii) the number of shares or principal amount of the security
        involved in the transaction;
          (iii) whether the transaction was a purchase or sale;
          (iv) the per share price or prices at which the transaction
        was effected;
          (v) the date or dates of the transaction;
          (vi) the date or dates of the settlement of the transaction;
          (vii) the broker or dealer through whom the transaction was
        effected;
          (viii) the market or markets in which the transaction was
        effected; and
          (ix) such other related information as the Commission, by
        rule, may prescribe.
      (2) The Commission, by rule, or order, may exempt, conditionally
    or unconditionally, any institutional investment manager or
    security or any class of institutional investment managers or
    securities from any or all of the provisions of this subsection or
    the rules thereunder.
      (3) The Commission shall make available to the public for a
    reasonable fee a list of all equity securities of a class described
    in subsection (d)(1) of this section, updated no less frequently
    than reports are required to be filed pursuant to paragraph (1) of
    this subsection. The Commission shall tabulate the information
    contained in any report filed pursuant to this subsection in a
    manner which will, in the view of the Commission, maximize the
    usefulness of the information to other Federal and State
    authorities and the public. Promptly after the filing of any such
    report, the Commission shall make the information contained therein
    conveniently available to the public for a reasonable fee in such
    form as the Commission, by rule, may prescribe, except that the
    Commission, as it determines to be necessary or appropriate in the
    public interest or for the protection of investors, may delay or
    prevent public disclosure of any such information in accordance
    with section 552 of title 5. Notwithstanding the preceding
    sentence, any such information identifying the securities held by
    the account of a natural person or an estate or trust (other than a
    business trust or investment company) shall not be disclosed to the
    public.
      (4) In exercising its authority under this subsection, the
    Commission shall determine (and so state) that its action is
    necessary or appropriate in the public interest and for the
    protection of investors or to maintain fair and orderly markets or,
    in granting an exemption, that its action is consistent with the
    protection of investors and the purposes of this subsection. In
    exercising such authority the Commission shall take such steps as
    are within its power, including consulting with the Comptroller
    General of the United States, the Director of the Office of
    Management and Budget, the appropriate regulatory agencies, Federal
    and State authorities which, directly or indirectly, require
    reports from institutional investment managers of information
    substantially similar to that called for by this subsection,
    national securities exchanges, and registered securities
    associations, (A) to achieve uniform, centralized reporting of
    information concerning the securities holdings of and transactions
    by or for accounts with respect to which institutional investment
    managers exercise investment discretion, and (B) consistently with
    the objective set forth in the preceding subparagraph, to avoid
    unnecessarily duplicative reporting by, and minimize the compliance
    burden on, institutional investment managers. Federal authorities
    which, directly or indirectly, require reports from institutional
    investment managers of information substantially similar to that
    called for by this subsection shall cooperate with the Commission
    in the performance of its responsibilities under the preceding
    sentence. An institutional investment manager which is a bank, the
    deposits of which are insured in accordance with the Federal
    Deposit Insurance Act [12 U.S.C. 1811 et seq.], shall file with the
    appropriate regulatory agency a copy of every report filed with the
    Commission pursuant to this subsection.
      (5)(A) For purposes of this subsection the term "institutional
    investment manager" includes any person, other than a natural
    person, investing in or buying and selling securities for its own
    account, and any person exercising investment discretion with
    respect to the account of any other person.
      (B) The Commission shall adopt such rules as it deems necessary
    or appropriate to prevent duplicative reporting pursuant to this
    subsection by two or more institutional investment managers
    exercising investment discretion with respect to the same
    amount.(!1)
    (g) Statement of equity security ownership
      (1) Any person who is directly or indirectly the beneficial owner
    of more than 5 per centum of any security of a class described in
    subsection (d)(1) of this section shall send to the issuer of the
    security and shall file with the Commission a statement setting
    forth, in such form and at such time as the Commission may, by
    rule, prescribe -
        (A) such person's identity, residence, and citizenship; and
        (B) the number and description of the shares in which such
      person has an interest and the nature of such interest.
      (2) If any material change occurs in the facts set forth in the
    statement sent to the issuer and filed with the Commission, an
    amendment shall be transmitted to the issuer and shall be filed
    with the Commission, in accordance with such rules and regulations
    as the Commission may prescribe as necessary or appropriate in the
    public interest or for the protection of investors.
      (3) When two or more persons act as a partnership, limited
    partnership, syndicate, or other group for the purpose of
    acquiring, holding, or disposing of securities of an issuer, such
    syndicate or group shall be deemed a "person" for the purposes of
    this subsection.
      (4) In determining, for purposes of this subsection, any
    percentage of a class of any security, such class shall be deemed
    to consist of the amount of the outstanding securities of such
    class, exclusive of any securities of such class held by or for the
    account of the issuer or a subsidiary of the issuer.
      (5) In exercising its authority under this subsection, the
    Commission shall take such steps as it deems necessary or
    appropriate in the public interest or for the protection of
    investors (A) to achieve centralized reporting of information
    regarding ownership, (B) to avoid unnecessarily duplicative
    reporting by and minimize the compliance burden on persons required
    to report, and (C) to tabulate and promptly make available the
    information contained in any report filed pursuant to this
    subsection in a manner which will, in the view of the Commission,
    maximize the usefulness of the information to other Federal and
    State agencies and the public.
      (6) The Commission may, by rule or order, exempt, in whole or in
    part, any person or class of persons from any or all of the
    reporting requirements of this subsection as it deems necessary or
    appropriate in the public interest or for the protection of
    investors.
    (h) Large trader reporting
      (1) Identification requirements for large traders
        For the purpose of monitoring the impact on the securities
      markets of securities transactions involving a substantial volume
      or a large fair market value or exercise value and for the
      purpose of otherwise assisting the Commission in the enforcement
      of this chapter, each large trader shall -
          (A) provide such information to the Commission as the
        Commission may by rule or regulation prescribe as necessary or
        appropriate, identifying such large trader and all accounts in
        or through which such large trader effects such transactions;
        and
          (B) identify, in accordance with such rules or regulations as
        the Commission may prescribe as necessary or appropriate, to
        any registered broker or dealer by or through whom such large
        trader directly or indirectly effects securities transactions,
        such large trader and all accounts directly or indirectly
        maintained with such broker or dealer by such large trader in
        or through which such transactions are effected.
      (2) Recordkeeping and reporting requirements for brokers and
        dealers
        Every registered broker or dealer shall make and keep for
      prescribed periods such records as the Commission by rule or
      regulation prescribes as necessary or appropriate in the public
      interest, for the protection of investors, or otherwise in
      furtherance of the purposes of this chapter, with respect to
      securities transactions that equal or exceed the reporting
      activity level effected directly or indirectly by or through such
      registered broker or dealer of or for any person that such broker
      or dealer knows is a large trader, or any person that such broker
      or dealer has reason to know is a large trader on the basis of
      transactions in securities effected by or through such broker or
      dealer. Such records shall be available for reporting to the
      Commission, or any self-regulatory organization that the
      Commission shall designate to receive such reports, on the
      morning of the day following the day the transactions were
      effected, and shall be reported to the Commission or a self-
      regulatory organization designated by the Commission immediately
      upon request by the Commission or such a self-regulatory
      organization. Such records and reports shall be in a format and
      transmitted in a manner prescribed by the Commission (including,
      but not limited to, machine readable form).
      (3) Aggregation rules
        The Commission may prescribe rules or regulations governing the
      manner in which transactions and accounts shall be aggregated for
      the purpose of this subsection, including aggregation on the
      basis of common ownership or control.
      (4) Examination of broker and dealer records
        All records required to be made and kept by registered brokers
      and dealers pursuant to this subsection with respect to
      transactions effected by large traders are subject at any time,
      or from time to time, to such reasonable periodic, special, or
      other examinations by representatives of the Commission as the
      Commission deems necessary or appropriate in the public interest,
      for the protection of investors, or otherwise in furtherance of
      the purposes of this chapter.
      (5) Factors to be considered in Commission actions
        In exercising its authority under this subsection, the
      Commission shall take into account -
          (A) existing reporting systems;
          (B) the costs associated with maintaining information with
        respect to transactions effected by large traders and reporting
        such information to the Commission or self-regulatory
        organizations; and
          (C) the relationship between the United States and
        international securities markets.
      (6) Exemptions
        The Commission, by rule, regulation, or order, consistent with
      the purposes of this chapter, may exempt any person or class of
      persons or any transaction or class of transactions, either
      conditionally or upon specified terms and conditions or for
      stated periods, from the operation of this subsection, and the
      rules and regulations thereunder.
      (7) Authority of Commission to limit disclosure of information
        Notwithstanding any other provision of law, the Commission
      shall not be compelled to disclose any information required to be
      kept or reported under this subsection. Nothing in this
      subsection shall authorize the Commission to withhold information
      from Congress, or prevent the Commission from complying with a
      request for information from any other Federal department or
      agency requesting information for purposes within the scope of
      its jurisdiction, or complying with an order of a court of the
      United States in an action brought by the United States or the
      Commission. For purposes of section 552 of title 5, this
      subsection shall be considered a statute described in subsection
      (b)(3)(B) of such section 552.
      (8) Definitions
        For purposes of this subsection -
          (A) the term "large trader" means every person who, for his
        own account or an account for which he exercises investment
        discretion, effects transactions for the purchase or sale of
        any publicly traded security or securities by use of any means
        or instrumentality of interstate commerce or of the mails, or
        of any facility of a national securities exchange, directly or
        indirectly by or through a registered broker or dealer in an
        aggregate amount equal to or in excess of the identifying
        activity level;
          (B) the term "publicly traded security" means any equity
        security (including an option on individual equity securities,
        and an option on a group or index of such securities) listed,
        or admitted to unlisted trading privileges, on a national
        securities exchange, or quoted in an automated interdealer
        quotation system;
          (C) the term "identifying activity level" means transactions
        in publicly traded securities at or above a level of volume,
        fair market value, or exercise value as shall be fixed from
        time to time by the Commission by rule or regulation,
        specifying the time interval during which such transactions
        shall be aggregated;
          (D) the term "reporting activity level" means transactions in
        publicly traded securities at or above a level of volume, fair
        market value, or exercise value as shall be fixed from time to
        time by the Commission by rule, regulation, or order,
        specifying the time interval during which such transactions
        shall be aggregated; and
          (E) the term "person" has the meaning given in section
        78c(a)(9) of this title and also includes two or more persons
        acting as a partnership, limited partnership, syndicate, or
        other group, but does not include a foreign central bank.
    (i) Accuracy of financial reports
      Each financial report that contains financial statements, and
    that is required to be prepared in accordance with (or reconciled
    to) generally accepted accounting principles under this chapter and
    filed with the Commission shall reflect all material correcting
    adjustments that have been identified by a registered public
    accounting firm in accordance with generally accepted accounting
    principles and the rules and regulations of the Commission.
    (j) Off-balance sheet transactions
      Not later than 180 days after July 30, 2002, the Commission shall
    issue final rules providing that each annual and quarterly
    financial report required to be filed with the Commission shall
    disclose all material off-balance sheet transactions, arrangements,
    obligations (including contingent obligations), and other
    relationships of the issuer with unconsolidated entities or other
    persons, that may have a material current or future effect on
    financial condition, changes in financial condition, results of
    operations, liquidity, capital expenditures, capital resources, or
    significant components of revenues or expenses.
    (k) Prohibition on personal loans to executives
      (1) In general
        It shall be unlawful for any issuer (as defined in section 7201
      of this title), directly or indirectly, including through any
      subsidiary, to extend or maintain credit, to arrange for the
      extension of credit, or to renew an extension of credit, in the
      form of a personal loan to or for any director or executive
      officer (or equivalent thereof) of that issuer. An extension of
      credit maintained by the issuer on July 30, 2002, shall not be
      subject to the provisions of this subsection, provided that there
      is no material modification to any term of any such extension of
      credit or any renewal of any such extension of credit on or after
      July 30, 2002.
      (2) Limitation
        Paragraph (1) does not preclude any home improvement and
      manufactured home loans (as that term is defined in section 1464
      of title 12), consumer credit (as defined in section 1602 of this
      title), or any extension of credit under an open end credit plan
      (as defined in section 1602 of this title), or a charge card (as
      defined in section 1637(c)(4)(e) of this title), or any extension
      of credit by a broker or dealer registered under section 78o of
      this title to an employee of that broker or dealer to buy, trade,
      or carry securities, that is permitted under rules or regulations
      of the Board of Governors of the Federal Reserve System pursuant
      to section 78g of this title (other than an extension of credit
      that would be used to purchase the stock of that issuer), that is
      -
          (A) made or provided in the ordinary course of the consumer
        credit business of such issuer;
          (B) of a type that is generally made available by such issuer
        to the public; and
          (C) made by such issuer on market terms, or terms that are no
        more favorable than those offered by the issuer to the general
        public for such extensions of credit.
      (3) Rule of construction for certain loans
        Paragraph (1) does not apply to any loan made or maintained by
      an insured depository institution (as defined in section 3 of the
      Federal Deposit Insurance Act (12 U.S.C. 1813)), if the loan is
      subject to the insider lending restrictions of section 375b of
      title 12.
    (l) Real time issuer disclosures
      Each issuer reporting under subsec. (a) of this section or
    section 78o(d) of this title shall disclose to the public on a
    rapid and current basis such additional information concerning
    material changes in the financial condition or operations of the
    issuer, in plain English, which may include trend and qualitative
    information and graphic presentations, as the Commission
    determines, by rule, is necessary or useful for the protection of
    investors and in the public interest.

SOURCE

    (June 6, 1934, ch. 404, title I, Sec. 13, 48 Stat. 894; Pub. L. 88-
    467, Sec. 4, Aug. 20, 1964, 78 Stat. 569; Pub. L. 90-439, Sec. 2,
    July 29, 1968, 82 Stat. 454; Pub. L. 91-567, Secs. 1, 2, Dec. 22,
    1970, 84 Stat. 1497; Pub. L. 94-29, Sec. 10, June 4, 1975, 89 Stat.
    119; Pub. L. 94-210, title III, Sec. 308(b), Feb. 5, 1976, 90 Stat.
    57; Pub. L. 95-213, title I, Sec. 102, title II, Secs. 202, 203,
    Dec. 19, 1977, 91 Stat. 1494, 1498, 1499; Pub. L. 98-38, Sec. 2(a),
    June 6, 1983, 97 Stat. 205; Pub. L. 100-181, title III, Secs. 315,
    316, Dec. 4, 1987, 101 Stat. 1256; Pub. L. 100-241, Sec. 12(d),
    Feb. 3, 1988, 101 Stat. 1810; Pub. L. 100-418, title V, Sec. 5002,
    Aug. 23, 1988, 102 Stat. 1415; Pub. L. 101-432, Sec. 3, Oct. 16,
    1990, 104 Stat. 964; Pub. L. 107-123, Sec. 5, Jan. 16, 2002, 115
    Stat. 2395; Pub. L. 107-204, title I, Sec. 109(h), title IV, Secs.
    401(a), 402(a), 409, July 30, 2002, 116 Stat. 771, 785, 787, 791.)

REFERENCES IN TEXT

      This chapter, referred to in subsecs. (b)(1), (h)(1), (2), (4),
    (6), and (i), was in the original "this title". See References in
    Text note set out under section 78a of this title.
      The Investment Company Act of 1940, referred to in subsecs.
    (d)(1) and (e)(1), is title I of act Aug. 22, 1940, ch. 686, 54
    Stat. 789, as amended, which is classified generally to subchapter
    I (Sec. 80a-1 et seq.) of chapter 2D of this title. For complete
    classification of this Act to the Code, see section 80a-51 of this
    title and Tables.
      The Securities Act of 1933, referred to in subsec. (d)(6)(A), is
    act May 27, 1933, ch. 38, title I, 48 Stat. 74, as amended, which
    is classified generally to subchapter I (Sec. 77a et seq.) of
    chapter 2A of this title. For complete classification of this Act
    to the Code, see section 77a of this title and Tables.
      The Federal Deposit Insurance Act, referred to in subsec. (f)(4),
    is act Sept. 21, 1950, ch. 967, Sec. 2, 64 Stat. 873, as amended,
    which is classified generally to chapter 16 (Sec. 1811 et seq.) of
    Title 12, Banks and Banking. For complete classification of this
    Act to the Code, see Short Title note set out under section 1811 of
    Title 12 and Tables.
      Section 7201 of this title, referred to in subsec. (k)(1), was in
    the original "section 2 of the Sarbanes-Oxley Act of 2002", Pub. L.
    107-204, which enacted section 7201 of this title and amended
    section 78c of this title.

AMENDMENTS

      2002 - Subsec. (b)(2)(C). Pub. L. 107-204, Sec. 109(h), added
    subpar. (C).
      Subsec. (e)(3). Pub. L. 107-123, Sec. 5(1), substituted "a fee at
    a rate that, subject to paragraphs (5) and (6), is equal to $92 per
    $1,000,000 of the value of securities proposed to be purchased" for
    "a fee of  1/50  of 1 per centum of the value of securities
    proposed to be purchased".
      Subsec. (e)(4) to (10). Pub. L. 107-123, Sec. 5(2), added pars.
    (4) to (10).
      Subsecs. (i), (j). Pub. L. 107-204, Sec. 401(a), added subsecs.
    (i) and (j).
      Subsec. (k). Pub. L. 107-204, Sec. 402(a), added subsec. (k).
      Subsec. (l). Pub. L. 107-204, Sec. 409, added subsec. (l).
      1990 - Subsec. (h). Pub. L. 101-432 added subsec. (h).
      1988 - Subsec. (b)(4) to (7). Pub. L. 100-418 added pars. (4) to
    (7).
      Subsec. (d)(1). Pub. L. 100-241 inserted "or any equity security
    issued by a Native Corporation pursuant to section 1629c(d)(6) of
    title 43".
      1987 - Subsec. (c). Pub. L. 100-181, Sec. 315, struck out "of"
    after "thereof".
      Subsec. (h). Pub. L. 100-181, Sec. 316, struck out subsec. (h)
    which required Commission to report to Congress within thirty
    months of Dec. 19, 1977, with respect to effectiveness of ownership
    reporting requirements contained in this chapter and desirability
    and feasibility of reducing or otherwise modifying the 5 per centum
    threshold used in subsecs. (d)(1) and (g)(1) of this section.
      1983 - Subsec. (e)(3). Pub. L. 98-38 added par. (3).
      1977 - Subsec. (b). Pub. L. 95-213, Sec. 102, designated existing
    provisions as par. (1) and added pars. (2) and (3).
      Subsec. (d)(1). Pub. L. 95-213, Sec. 202, inserted references to
    residence and citizenship of persons and to nature of beneficial
    ownership of persons in subpar. (A), and inserted references to
    background, identity, residence, and citizenship of associates of
    persons in subpar. (D).
      Subsecs. (g), (h). Pub. L. 95-213, Sec. 203, added subsecs. (g)
    and (h).
      1976 - Subsec. (b). Pub. L. 94-210 substituted provisions
    relating to exceptions for inconsistent rules and regulations, for
    provisions relating to reporting requirements for carriers subject
    to the provisions of section 20 of title 49, or other carriers
    required to make reports of the same general character as those
    required under section 20 of title 49.
      1975 - Subsec. (f). Pub. L. 94-29 added subsec. (f).
      1970 - Subsec. (d)(1). Pub. L. 91-567, Sec. 1(a), included equity
    securities of insurance companies which would have been required to
    be registered except for the exemption contained in section
    78l(g)(2)(G) of this title, and substituted "5 per centum" for "10
    per centum".
      Subsec. (d)(5), (6). Pub. L. 91-567, Sec. 1(b), added par. (5)
    and redesignated former par. (5) as (6).
      Subsec. (e)(2). Pub. L. 91-567, Sec. 2, inserted provisions
    empowering the Commission to make rules and regulations
    implementing the paragraph in the public interest and for the
    protection of investors.
      1968 - Subsecs. (d), (e). Pub. L. 90-439 added subsecs. (d) and
    (e).
      1964 - Subsec. (a). Pub. L. 88-467 substituted provisions which
    require the issuer of a security registered pursuant to section 78l
    of this title to file reports with the Commission rather than with
    the exchange and to furnish the exchange with duplicate originals
    and prohibit the Commission from requiring the filing of any
    material contract wholly executed before July 1, 1962 for former
    provisions which required the issuer of a security registered on a
    national securities exchange to file certain reports with the
    exchange and to file duplicates with the Commission.
                     EFFECTIVE DATE OF 2002 AMENDMENT
      Amendment by Pub. L. 107-123 effective Oct. 1, 2001, except that
    authorities provided by subsec. (e)(9) of this section to not apply
    until Oct. 1, 2002, see section 11 of Pub. L. 107-123, set out as a
    note under section 78ee of this title.
                     EFFECTIVE DATE OF 1976 AMENDMENT
      Amendment by Pub. L. 94-210 not applicable to any report by any
    person with respect to a fiscal year of such person which began
    before Feb. 5, 1976, see section 308(d)(2) of Pub. L. 94-210, set
    out as a note under section 80a-3 of this title.
                     EFFECTIVE DATE OF 1975 AMENDMENT
      Amendment by Pub. L. 94-29 effective June 4, 1975, see section
    31(a) of Pub. L. 94-29, set out as a note under section 78b of this
    title.
                     EFFECTIVE DATE OF 1964 AMENDMENT
      Amendment by Pub. L. 88-467 effective Aug. 20, 1964, see section
    13 of Pub. L. 88-467, set out as a note under section 78c of this
    title.

TRANSFER OF FUNCTIONS

      For transfer of functions of Securities and Exchange Commission,
    with certain exceptions, to Chairman of such Commission, see Reorg.
    Plan No. 10 of 1950, Secs. 1, 2, eff. May 24, 1950, 15 F.R. 3175,
    64 Stat. 1265, set out under section 78d of this title.

CONSULTATION

      Pub. L. 106-102, title II, Sec. 241, Nov. 12, 1999, 113 Stat.
    1407, provided that:
      "(a) In General. - The Securities and Exchange Commission shall
    consult and coordinate comments with the appropriate Federal
    banking agency before taking any action or rendering any opinion
    with respect to the manner in which any insured depository
    institution or depository institution holding company reports loan
    loss reserves in its financial statement, including the amount of
    any such loan loss reserve.
      "(b) Definitions. - For purposes of subsection (a), the terms
    'insured depository institution', 'depository institution holding
    company', and 'appropriate Federal banking agency' have the same
    meaning as given in section 3 of the Federal Deposit Insurance Act
    [12 U.S.C. 1813]."

ASSIGNMENT OF FUNCTION RELATING TO GRANTING OF AUTHORITY FOR ISSUANCE OF CERTAIN DIRECTIVES

      Memorandum of President of the United States, May 5, 2006, 71
    F.R. 27943, provided:
      Memorandum for the Director of National Intelligence
      By virtue of the authority vested in me by the Constitution and
    laws of the United States, including section 301 of title 3, United
    States Code, I hereby assign to you the function of the President
    under section 13(b)(3)(A) of the Securities Exchange Act of 1934,
    as amended (15 U.S.C. 78m(b)(3)(A)). In performing such function,
    you should consult the heads of departments and agencies, as
    appropriate.
      You are authorized and directed to publish this memorandum in the
    Federal Register.
                                                         George W. Bush.

FOOTNOTE

    (!1) So in original. Probably should be "account."
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