Report Deadlines Moved Up

The Securities and Exchange Commission voted unanimously Wednesday to move up the deadlines for large public companies to file annual reports, overriding complaints from firms that the rule would hamper their ability to file accurate information.

Companies with $700 million or more of shares outstanding will have to file annual reports within 60 days of the end of a fiscal year under the new rule, down from 75 days.

The SEC delayed implementation by a year, applying the rule to fiscal years ending on or after Dec. 15, 2006.

Executives from General Motors Corp., Whole Foods Market Inc., URS Corp. and about 20 other companies had urged the SEC to reconsider the plan, saying it would strain their ability to file comprehensive and accurate reports as required by the 2002 Sarbanes-Oxley law, which tightened corporate governance rules. SEC commissioners said the one-year delay would provide companies with time to adjust to the new requirements.

“There really is no compelling reason not to wait until next year, especially in light of the considerable negative comment we received,” Commissioner Paul Atkins said.

“While I’m sure the issuers could have met the 60-day deadline in 2006, my fear concerns the costs incurred for gaining those 15 days,” he said.

The commission also voted 5 to 0 to propose a new rule making it easier for non-U.S. companies to deregister from the agency. The SEC estimated the revised rule would allow two-thirds of non-U.S. issuers of securities to cut ties to the SEC, up from half.

Also Wednesday, the SEC proposed revisions to its “best price” rule for tender offers, which gives all shareholders of a company targeted for takeover the opportunity to sell at the highest price offered to any holder.

Court cases have produced differing interpretations of the rule. The SEC’s proposed amendments would clarify that it applies only to securities in a tender offer.