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Apr 29, 2024

New push to lower 13F filing deadlines

Society for Corporate Governance, NIRI and NYSE write to the SEC calling for new rule-making process

A new push is under way in the US market to make investment firms disclose their equity holdings in a more timely fashion.

The Society for Corporate Governance, NIRI and the NYSE have jointly petitioned the SEC to reduce the deadline for 13F filings, which currently stands at 45 days after the end of each quarter.

13F filings are one of the main ways market participants, from issuers to other investors and academics, understand what buying and selling is taking place within the US stock market.

Critics have long argued, however, that the current disclosure regime means the information is largely out of date by the time it is made public.

The three parties have asked the SEC to initiate a new rule-making process covering 13F filings and say the disclosure deadline should be lowered to ‘no more than five business days’ once the quarter finishes.

Among the arguments put forward by the group is that the SEC has recently modernized other reporting rules, such as shortening the disclosure time for investors holding positions of more than 5 percent from 10 days to five days.

The group adds that technological advances and the speed of today’s market mean it would not be difficult for investors to comply with a more timely disclosure regime.

‘In an environment where US equity markets are about to move to T+1 settlement, and trades are executed in millionths of a second, shareholdings are reported just four times per year, 45 days after the end of each quarter,’ says Matthew Brusch, CEO of NIRI, in a LinkedIn post.

‘IR professionals, corporate governance professionals, public company C-suites and boardrooms: this is your opportunity to support 13F modernization.’

Despite long-standing pressure to shorten the 13F filing deadline, the SEC surprised the market in 2020 by proposing a change that would have removed thousands of investors from needing to reveal their holdings. After widespread opposition, the plan was dropped.

NIRI has called on public companies to submit letters to support the new campaign, and has created a letter template to facilitate the process. Separately, the body is also pushing for congressional legislation that would allow the SEC to switch 13F filings from a quarterly to monthly basis.