NYSE MKT material news notification policy now aligned with its big board

Effective March 29, 2016 , the NYSE has modified its regulations on the release of material news, amending Section 401 and 402 of the NYSE Markets (MKT) Listed Company Manual related to material news and trading halts. The policy is now the same as the September 2015 policy that NYSE-listed issuers must follow.

Of keen interest to shareholder communicators are these three new policy changes regarding:

  • Pre-market notice
  • Post-closing announcements
  • Methods of releasing material news

Collaterally, the proposal makes the following changes that grant the NYSE the authority to halt trading:

  • During pre-market hours at the request of a listed company
  • When the NYSE requests certain, more clarifying information from an issuer
  • When an NYSE MKT issuer is dual-listed, including as an DR (Depository Receipt), and that other exchange halts trading for its own regulatory motives

Pre-market notice 

Section Sections 401 and 402 of the NYSE MKT Listed Company Manual requires that issuers alert the NYSE preceding the release of material news to the market. This alert – generally the providing of an upcoming news release – is a “heads-up” for the NYSE to evaluate the information and to provide sufficient per-market time and opportunity to halt trading in the company’s securities, if necessary.

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The previous version of the policy requires companies to provide ten minutes in advance of the release of material news, if the news is scheduled for release during the market hours of 9:30 am and 4:00 pm ET. 

For pre-market material disclosures, currently the NYSE MKT requires to be alerted “shortly before” the opening of trading, between 9:00 and 9:30 am ET.  According to the NYSE, most issuers release their material news between 7:00 am and 9:30 am, which, more and more, has the potential to influence pre-market trading on non-USA exchanges as well as on the NYSE itself upon that morning’s opening.

The new amendments expand the pre-market timeframe to begin at 7:00 am ET plus combine that timeframe and the trading hours into one “material” time block. Consequently, following the new amendments, NYSE MKT-listed companies will be required to notify the NYSE at least ten minutes before the release of material news anytime between the hours of 7:00 am and 4:00 pm ET.

To comply with the Material News Policy’s notification requirements during the expanded pre-market hours, listed issuers must call the NYSE MKT’s Market Watch Group at 212-656-5414 or 877-699-2578 and provide a copy of any written form of the material news or non-routine announcement at the same time via email to nysealert@nyse.com.

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Post-closing announcements

The update of the NYSE MKT guidance also affects (effects?)  the release of material news after the close of trading. Specifically, the update states that companies should delay releasing material news until the earlier of either the publication of their security’s official closing price on the NYSE or fifteen minutes after the close of trading at 4:00 pm. This is to avoid interfering with the NYSE MKT’s complete closing procedure.

Methods of releasing material news

The amendments update the methods set forth in SEC under Item 2.02 for releasing material news, which is outdated ie: stating telephone, fax and hand-delivery are acceptable means for disclosure.

Consistent with current synchronized disclosure practices (RegFD-ish), listed companies will be required to either 1.) include the news in a Form 8-K or other appropriate SEC filing or 2.) issue the material news in a news release to reach, at a minimum, Dow Jones, Reuters and Bloomberg Business News.

As always, we’re pleased to work alongside the NYSE to support all issuers with our Best Practices expertise and solutions to streamline the disclosure process for EDGAR filing and news distribution to help mitigate disclosure risk.

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