On December 3rd, the SEC approved FINRA Rule 5123, which requires firms that sell a security in a private placement to file with FINRA a copy of any private placement memorandum, term sheet or other offering document used by the firm within fifteen days of the sale. The Rule provides for limited exemptions. FINRA also issued “frequently asked questions” regarding the substantive and procedural requirements of the filings. Morrison & Foerster has summary of these requirements and exemptions in a recent News Bulletin.
On December 6, 2012, the SEC lifted the two-year-old moratorium on active exchange-traded funds’ (“ETF”) use of derivatives. The news came during a speech by Norm Champ, the SEC’s Director of the Division of Investment Management. During the moratorium, the SEC would only approve ETFs that represented that they did not make any investments in options, futures, or swaps. In a recent Legal Update, Dechert discusses the implications and limitations of the proposal.