COVID-19: Relief for Public Companies, Investment Funds, and Advisors

COVID-19: Relief for Public Companies, Investment Funds, and Advisors

It is hard to imagine a company that has not been impacted by the COVID-19 pandemic. Thousands of businesses are now working completely remotely, many have had to implement precautionary measures, and some have been forced to shut down operations completely. Travel restrictions and stay-at-home orders have made it challenging to complete filings. It is difficult for companies to view facilities, access necessary information, or work with third parties like accountants.

The SEC recently issued orders providing conditional exemptions to public companies, as well as investment funds and advisors. These exemptions are meant to alleviate the unprecedented challenges that the ongoing Coronavirus crisis has imposed on funds and companies around the world. 

Public Companies

Publicly traded companies that have been affected by COVID-19 and have reports with deadlines between March 1 and July 1st, 2020 have been given an extension of 45 days from the original filing deadline. Filings that may qualify for the extension include Annual Reports (Form 10-K), Quarterly Reports (Form 10-Q), Current Reports (Form 8-K), and Proxy Statements. To take advantage of this exemption, domestic companies must file a Form 8-K and foreign companies must file a Form 6-K stating:

  • The company is relying on the order
  • A description of why they could not file by the original deadline and a new estimated filing date
  • A statement on the impact of COVID-19 on the business, if necessary
  • If the reason the report cannot be filed by the original deadline relates to a third party not being able to furnish any required opinion, report, or certification necessary for the filing due to COVID-19, an exhibit signed by the third party and citing specifics as to why this work could not be completed must be attached. 

A Form 8-K or Form 6-K must be submitted for each filing that a company would like to extend. 

Investment Funds

Qualifying investment funds have been provided temporary relief in regards to in-person meetings and certain filing and delivery requirements. Given certain conditions detailed in this March 25th order, funds may be eligible for the following relief: 

  • Funds are exempt from filing Form N-CEN and Form N-PORT where the original due date is on or prior to June 30, 2020
  • Funds are not required to transmit annual or semi-annual reports to investors where the original due date is on or prior to June 30, 2020
  • Meetings of the board of directors involving voting do not have to be in-person until August 15, 2020
  • Closed-end funds are exempt from filing notices of their intention to call or redeem securities at least 30 days in advance until August 15, 2020

In addition to these orders, the Corporation Finance and the Investment Management Divisions of the SEC released guidance for conducting shareholder meetings given current concerns.

Investment Advisors

In a separate March 25 order, the SEC announced its relief plan for affected investment advisors. The relief is only applicable to obligations with original due dates on or prior to June 30, 2020. During this period registered investment advisors are given an extra 45 days to meet certain filing and delivery requirements for Form ADV and Form PF if the advisor:

  • Is unable to meet a required deadline due to COVID-19
  • Promptly notifies the SEC via email that it is relying on the order 
  • Discloses on their website that it is relying on the order (Not relevant for Form PF)
  • Meets all requirements as soon as practicable, but no later than 45 days after the original due date

Going Forward

The three orders cited above all supersede previous orders from earlier in the same month, which reflects the fluidity of the situation. All three state that the SEC continues to monitor the situation, and that further relief or updates could be provided if necessary. The Commission also noted that filers who may require additional or different assistance to comply with their regulatory obligations are encouraged to contact the SEC, where they are handling issues on a case-by-case basis.