SEC Mulls Extending Sarbanes-Oxley Deadline For Non-US Firms

by Glen Shapiro, LawAndTax-News.com, New York

27 January 2005

Speaking at the London School of Economics on Tuesday, chairman of the US Securities and Exchange Commission, William Donaldson revealed that the regulator is considering extending the deadline for non-US firms with secondary listings in the United States to come into compliance with new US corporate governance rules regarding internal controls and the adequacy of financial statements.

"I have asked the staff of the Commission to consider whether to recommend that we delay the effective date of the internal control on financial reporting requirements for non-US companies," Mr Donaldson told those attending the meeting at the LSE, adding that:

"We are prepared to reach out and engage in an open dialogue to address concerns regarding reporting on internal controls."

The SEC chief also acknowledged the dual regulatory burden being faced by European firms with US listings, observing that:

"Section 404 (of the Sarbanes-Oxley Act) has even led some foreign issuers to declare that they may wish to leave America's capital markets altogether rather than to have their internal controls certified."

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