The SEC’s Office of Compliance Inspections and Examinations (OCIE) announced on January 7th its 2020 examination priorities. OCIE publishes its priorities on an annual basis to enhance the transparency of its examination program and to provide insights into its risk-based approach, including the areas it believes present potential risks to investors and the integrity of the US capital markets. Developing the annual examination priorities is a collaborative effort that begins with feedback from examination staff (who are uniquely positioned to identify the practices, products, services, and other factors that may pose risk to investors or markets) and other sources of input and advice from the SEC Chairman, other Commissioners, other SEC divisions and departments, and other federal financial regulatory agencies.

Version 5.2a of all applications in the GoFiler Suite has been released. This release corresponds to EDGAR 20.1 and contains changes to various EDGAR forms. Additionally, changes and improvements have been made to the Find and Replace and Proof to Browser functions and to Risk Return XDX. It also includes a new function, the ID Manager, to help manage and correct duplicate IDs inside HTML documents.

On January 27, 2020, EDGAR Release 20.1 was released by the Securities and Exchange Commission. This release included changes to Form ATS-N, a new “accelerated filer status” field on a number of form types, and an upgrade to require Transport Layer Security (TLS) 1.2 when connecting to the EDGAR System.

While the Novaworks tools are principally used for EDGAR, sometimes there are non-EDGAR things to do. One of my activities is maintaining a website for a not-for-profit group supporting amateur radio. As part of my duties, the front page of the site has a section on recent non-club news which requires me to perform a little research and then add the links to the page. This script helps reduce the time to create the links.

As part of security enhancements in the forthcoming EDGAR 20.1 release, the SEC will no longer accept connections to the EDGAR system that do not follow the TLS 1.2 standard. Since the GoFiler family of products uses Microsoft’s Security Support Provider Interface to connect to the EDGAR system, support for TLS 1.2 in the application is based on the current Windows operating system and Internet Explorer.

On January 9, 2020, the Securities and Exchange Commission announced the second fee rate advisory for fiscal year 2020. Starting on February 18, 2020, the fee rates applicable to most securities transactions will be set at $22.10 per million dollars.

On December 30th, the SEC proposed amendments to codify certain staff consultations and modernize certain aspects of its auditor independence framework. These amendments would update select aspects of the nearly two-decade-old auditor independence rule set to structure the independence rules and analysis more effectively such that relationships and services that would not pose threats to an auditor’s objectivity and impartiality do not trigger non-substantive rule breaches or potentially time consuming committee review.

On December 18th, the SEC approved a package of rule amendments, guidance, and a related order to expand and improve the framework for the regulation of cross-border security-based swaps, including single-name credit default swaps. This package also supports the SEC’s broad security-based swap regulatory regime in that it triggers the compliance date for security-based swap entities to register with the SEC and the implementation period for the previously adopted rules under Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The rules create a coherent approach to the regulation of margin, capital, segregation, recordkeeping, reporting, and business conduct for security-based swaps.

On December 18th, the SEC approved new rules requiring the application of risk mitigation techniques to portfolios of uncleared security-based swaps. These new rules (15Fi-3, 15Fi-4, and 15Fi-5) establish requirements for registered security-based swap dealers and major security-based swap participants (SBS Entities) to: periodically reconcile outstanding security-based swaps with counterparties, engage in certain forms of portfolio compression exercises, as appropriate, and execute written trading relationship documentation with each of their counterparties prior to, or simultaneously with, executing a security-based swap transaction.

The SEC will be closed Wednesday, January 1st in observance of New Year’s Day. The EDGAR System will not receive, process or accept filings on this day. Filings with a due date of January 1 will be due the following business day.

Last week, the SEC voted to propose rules that would require resource extraction issuers to disclose payments made to foreign governments or the US federal government for the commercial development of oil, natural gas, or mineral resources. These proposed rules come after a series of SEC actions, court proceedings, and Congressional actions. As mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act, the SEC first adopted rules pertaining to resource extraction issuers in 2012, which were subsequently vacated by the US District Court for the District of Columbia. The SEC then adopted new rules in 2016, but these rules were disapproved by a joint resolution of Congress pursuant to the Congressional Review Act. After the 2016 rules were vacated, the statutory mandate remains in effect, requiring the SEC to issue a rule in these regards. Furthermore, that rule must not be “substantially the same”, according to the Congressional Review Act. These new proposed rules attempt to meet that mandate.

The SEC will be closed Tuesday, December 24 and Wednesday, December 25 due to the closure of the federal government in these two days. The EDGAR System will not receive, process or accept filings on either of these days. Filings with a due date of December 24 or December 25 will be considered timely if filed on or before December 26.

On December 18th, the SEC proposed amendments to the definition of accredited investor, which is one of the principal tests for who is eligible to participate in private capital markets. The changes would update and improve the definition to identify more effectively those institutional and individual investors who have the knowledge and expertise to participate in these markets. By amending this and other related definitions, more investors would be able to participate in private offerings through the addition of new categories of natural persons that may quality as accredited investors based on their professional knowledge, experience, or certifications. The proposal would also expand the list of entities that may qualify as accredited investors by allowing any entity that meets an investments test to qualify, among other ways. Specifically, the changes focus on the definition of "accredited investor" in the SEC's rules and the definition of "qualified institutional buyer" in Rule 144A under the Securities Act of 1933.