The SEC has amended Regulation FD to remove an exemption for disclosures made to nationally recognized statistical rating organizations and credit rating agencies for the purpose of determining or monitoring credit ratings (Rel. No. 33-9146, September 29, 2010). The amendment was mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act. The amendment removed Rule 100(b)(2)(iii) from Regulation FD. The amendment is effective upon publication in the Federal Register.

Regulation FD provides that when an issuer, or a person acting on its behalf, discloses material nonpublic information to certain parties, the information must also be publicly disclosed. The rule generally affects securities market professionals and holders of the issuer’s securities who may trade on the basis of the information. Section 939B of the Dodd-Frank Act required the SEC to remove the exemption for entities whose primary business is the issuance of credit ratings within 90 days after the date of enactment. The effective date of the legislation was July 21, 2010.

Regulation FD was adopted to address the selective disclosure of information to those who would reasonably be expected to trade securities on the basis of the information or who may provide others with advice about securities trading. If the selective disclosure is intentional, an issuer must simultaneously provide the disclosure to the public. In other circumstances, the issuer must promptly disclose the information by filing or furnishing a Form 8-K, or through another method that will broadly distribute the information to the public.

Under the exemption that has been eliminated, issuers or persons acting on their behalf did not have to publicly disclosure material nonpublic information that was made to a credit rating agency that made its ratings publicly available, or that was made pursuant to Rule 17g-5(a)(3) to a nationally recognized statistical rating organization. Since the revision was required by Congress, the SEC deemed it unnecessary to provide a public notice and comment period.

□ Release No. 33-9146 will be published in a forthcoming Report.