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December 16, 2020

Stroock Client Alert

By: Akshay N. Belani, Evan Hudson, Richard G. Madris, André B. Nance, Eric Requenez, John J. Sottile

On December 4, 2020, upon publication in the Federal Register, the SEC’s amendments to Regulation S-T, permitting the use of electronic signatures for authentication documents in connection with electronic filings, became effective.[1] The SEC also made corresponding amendments to certain rules and forms under the Securities Act, Exchange Act, and Investment Company Act, allowing for use of electronic signatures for authentication documents in connection with both paper and electronic filings when those filings contain typed or duplicated signatures. Stating that since these amendments only relate to agency procedure or practice and do not substantially alter the rights of non-agency parties, and given the substantial benefits they provide in terms of cost and convenience, the SEC found good cause to make the amendments effective immediately upon publication in the Federal Register.[2]

Prior to the amendments, under Rule 302(b) of Regulation S-T, when electronic filings were made with the SEC through the EDGAR system, the signatories to those filings were required to manually sign authentication documents to “authenticate, acknowledge, or otherwise adopt” the electronically typed signature on the filing.[3] The electronic filer was required to keep this manually signed authentication document for five years and provide a copy to the SEC upon request. Under the amended Rule 302(b), spurred mainly by the safety concerns and difficulties associated with arranging for manual signatures in light of the COVID-19 pandemic, authentication documents may now be signed electronically, while retaining the five-year retention and requested copy production requirements. The SEC updated the EDGAR Filer Manual to specify that the electronic signing process for authentication documents must:

  • Require the signatory to present a physical, logical, or digital credential that authenticates the signatory’s individual identity;
  • Reasonably provide for non-repudiation of the signature;
  • Provide that the signature be attached, affixed, or otherwise logically associated with the signature page or document being signed; and
  • Include a timestamp to record the date and time of the signature.[4]

Amended Rule 302(b)(2) also provides that signatories that are electronically signing authentication documents must also manually sign a document “attesting that the signatory agrees that the use of an electronic signature in any authentication document constitutes the legal equivalent of such individual’s manual signature for purposes of authenticating the signature to any filing for which it is provided.” The electronic filer must keep this manually signed document for as long as the signatory may use an electronic signature to sign an authentication document, and for a minimum of seven years after the date of the most recent electronically signed authentication document, while also providing a copy of this document to the SEC upon request.

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The SEC’s amendments to Regulation S-T permitting electronic signatures to authentication documents in connection with electronic filings became effective upon publication in the Federal Register on December 4, 2020. For questions regarding these or any recent amendments or changes to SEC regulations, please contact any of the authors.

___________________________________________

For More Information:

Akshay N. Belani

Evan Hudson

Richard Madris

André B. Nance

Eric Requenez

John J. Sottile

[1] Electronic Signatures in Regulation S-T Rule 302, Release Nos. 33-10889; 34-90441; 39-2534; IC-34096 (Nov. 17, 2020), available at: https://www.sec.gov/rules/final/2020/33-10889.pdf.

[2] See Release Nos. 33-10889; 34-90441; 39-2534; IC-34096, at 8.

[3] See Release Nos. 33-10889; 34-90441; 39-2534; IC-34096, at 3.

[4] See Release Nos. 33-10889; 34-90441; 39-2534; IC-34096, at 5.

This Stroock publication offers general information and should not be taken or used as legal advice for specific situations, which depend on the evaluation of precise factual circumstances. Please note that Stroock does not undertake to update its publications after their publication date to reflect subsequent developments. This Stroock publication may contain attorney advertising. Prior results do not guarantee a similar outcome.