Division of Corporation Finance Issues New CDIs Related to Rating Agency Consents in Securities Offerings
July 26, 2010
On July 22, 2010, the Division of Corporation Finance issued new Securities Act Rules Compliance and Disclosure Interpretations (CDIs) to address the repeal of Rule 436(g) under Dodd-Frank. Rule 436(g) provided an exemption from the requirement to include the consent of the rating agency where the registration statement for debt or preferred stock includes disclosure of a credit rating by the rating agency. To facilitate offerings in the corporate debt market following the repeal of Rule 436(g), the new CDIs provide guidance on when rating agency consents are and are not required for securities that are not subject to the asset-backed regulations. With respect to asset-backed securities, where the rating agencies have indicated they are unwilling to provide consents at this time, the Division of Corporation Finance issued a no-action letter permitting asset-backed issuers for a period of six months to omit credit ratings from registration statements filed under Regulation AB.
http://www.sec.gov/divisions/corpfin/guidance/securitiesactrules-interps.htm (Questions 233.04-233.08)
http://www.sec.gov/divisions/corpfin/cf-noaction/2010/ford072210-1120.htm
Related Practices