Release No. 34-19188

October 28, 1982

Beneficial Ownership Disclosure Requirements

ACTION: Final Amendment.

SUMMARY: The Commission announces the adoption of an amendment to its beneficial ownership disclosure rules which eliminates the requirement to file an annual amendment to a Schedule 13G 17 CFR 240.13d-102 when no changes have occurred in the information contained therein.

EFFECTIVE DATE: (Insert date 30 days after publication in the Federal Register).

FOR FURTHER INFORMATION CONTACT: Prior to the effective date, questions should be directed to Arthur H. Miller, (202) 272-2589, Office of Disclosure Policy, Division of Corporation Finance, Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549. After the effective date, questions should be directed to Joseph G. Connolly, Jr. or Robert E. Burns, (202) 272-3097, Office of Tender Offers, Division of Corporation Finance, Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.

SUPPLEMENTARY INFORMATION: The Commission announces the adoption of an amendment to Rule 13d-2(b) 17 CFR 240.13d-2(b), which currently requires that any person who has filed a Schedule 13G beneficial ownership disclosure statement must amend such statement within forty-five days after the end of each calendar year to reflect, as of the end of the calendar year, any changes in the information reported in the previous filing on that Schedule, or if there are no changes from the previous filing, file a signed statement to that effect under cover of Schedule 13G. The amendment deletes that part of Rule 13d-2(b) that requires a person to file a statement when no changes have occurred in the information contained in the previously filed Schedule 13G.

Discussion

In its Report to Congress on Beneficial Ownership Reporting Requirements, ¹ the Commission noted that it was in the process of reviewing the amendment procedures with respect to reports filed on Schedule 13G. ² As a result of that review, on June 10, 1982, the Commission published for comment a proposed amendment to Rule 13d-2(b) under the Securities Exchange Act of 1934 (the "Exchange Act"). ³ The proposed amendment would eliminate the requirement to file an annual amendment to a Schedule 13G when no changes have occurred in the beneficial ownership information contained therein. After consideration of the comments received in response to the Proposing Release, the Commission has determined to adopt the proposed amendment with minor modification. The amendment is based on the Commissions assessment that the current requirement to file an annual amendment when there are no changes in information imposes an unnecessary burden on persons required to file a Schedule 13G.

Seven of the nine commentators responding to the Commissions request for comments in the Proposing Release supported the amendment. ⁴ Some of these commentators, however, suggested modifications to the proposal. These modifications would have provided that a filing person would not have to file an annual amendment to a Schedule 13G if: (1) the only change in information previously reported is a change in the percentage of outstanding shares beneficially owned and such change results solely from a change in the aggregate number of the issuers shares outstanding, or (2) only immaterial changes in a filing persons holdings had occurred over the course of the year.

The Commission has considered the suggested modifications and has determined to incorporate the first of the suggested modifications into the final amendment. The Commission believes that adoption of this modification is necessary to eliminate the undue burden on reporting persons to file an amendment when their percentage of outstanding shares previously reported has changed solely as a result of a change in the aggregate number of the issuers shares outstanding -- an occurrence which is beyond the control of the reporting person and which does not involve a change in the reporting persons holdings. On the other hand, the Commission does not believe that the second suggested modification should be adopted, since it might add an element of uncertainty as to the continuing accuracy of information in the beneficial ownership disclosure system while not resulting in any appreciable cost savings or reduction in compliance burdens as compared to the amendment as proposed.

As required by Section 23(a)(2) of the Exchange Act, the Commission has specifically considered the impact that the amendment will have on competition. The Commission finds that compliance with the amendment will not impose a burden on competition.

List of Subjects in 17 CFR Part 240

Reporting Requirements, Securities

Text of Amendment

In accordance with the foregoing, Part 240 of Chapter II, Title 17 of the Code of Federal Regulations is amended as follows:

PART 240 -- GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF 1934

1. Section 240.13d-2 is amended by revising paragraph (b) to read as follows:

§240.13d-2 Filing of amendments to Schedules 13D or 13G.

* * * * *

(b) Schedule 13G -- Notwithstanding paragraph (a) of this rule, and provided that the person or persons filing a statement pursuant to Rule 13d-1(b) continues to meet the requirements set forth therein, any person who has filed a short form statement on Schedule 13G shall amend such statement within forty-five days after the end of each calendar year if, as of the end of such calendar year, there are any changes in the information reported in the previous filing on that Schedule; Provided, however, that such amendment need not be filed with respect to a change in the percent of class outstanding previously reported if such change results solely from a change in the aggregate number of securities outstanding. Six copies of such amendment, including all exhibits, shall be filed with the Commission and one each sent, by registered or certified mail, to the issuer of the security at its principal executive office and to the principal national securities exchange where the security is traded. Once an amendment has been filed reflecting beneficial ownership of five percent or less of the class of securities, no additional filings are required unless the person thereafter becomes the beneficial owner of more than five percent of the class and is required to file pursuant to Rule 13d-1 (§240.13d-1).

Note: For persons filing a short form statement pursuant to Rule 13d-1(b), See also Rule 13d-1(b)(2), (3) and (4).

AUTHORITY

This amendment is adopted pursuant to Sections 13(g) and 23(a) of the Securities Exchange Act of 1934.

Sec. 23, 48 Stat. 901; sec. 203(a), 49 Stat. 704; sec. 8, 49 Stat. 1379; sec. 10, 78 Stat. 580; sec. 18, 89 Stat. 155; secs. 102, 202, 203, 91 Stat. 1494, 1498, 1499; 15 U.S.C. 78m(g), 78w(a).

By the Commission.

¹ Report of the Securities and Exchange Commission on Beneficial Ownership Reporting Requirements Pursuant to Section 13(h) of the Securities Exchange Act of 1934, 96th Cong., 2d Sess. 53 (Comm. Print 1980).

² Reports on Schedule 13G are filed by two classes of persons. First, a Schedule 13G may be filed by a person who would otherwise be required to file a Schedule 13D 17 CFR 240.13d-101, because such person acquired more than five percent of a class of certain equity securities, if certain specified conditions are met. Second, a Schedule 13G is required to be filed by certain beneficial owners of more than five percent of a class of securities who are not subject to Section 13(d) of the Exchange Act.

³ Release No. 34-18801 (June 10, 1982) 47 FR 26161 (the "Proposing Release").

⁴ These comment letters are available for public inspection in the Commissions Public Reference Room. See File No. S7-931.