The Securities and Exchange Commission (SEC) proposed a new rule that would allow issuers, broker-dealers, investment advisers and others to expand their use of electronic delivery.
The Regulation E-Delivery would make information more accessible and useful for investors and others while preserving the ability to receive delivery in paper format on request, officials said. Currently, required regulatory information is delivered in paper format unless the recipient elects to receive it in other formats. The proposed regulation includes conditions under which required information could be delivered electronically without obtaining investor consent, as well as requirements for that delivery format.
“Today, the Commission took an important step toward allowing the financial services industry to harness technology for the benefit of everyday American investors. By proposing to permit electronic delivery to become the default method for issuers, market intermediaries, and others to communicate with investors, we are taking another stride toward a regulatory framework suitable for the modern era, a key pillar of my agenda,” SEC Chairman Paul S. Atkins said. “In an age of artificial intelligence and blockchain technology, a default to paper delivery should be a relic, not a standard.”
The proposed rule would supersede the Commission’s decades-old guidance on e-delivery and provide issuers, market intermediaries and investors with savings from paper, printing and postage costs.
Officials said the proposal reflects the current market and how it uses electronic media to provide information, and that e-delivery offers investors and others to provide more personalized, interactive and timely experiences than they could with paper delivery. It also provides accessibility and retention benefits, the SEC said.
Public comment on the proposed regulation will be open for 60 days after the publication of the proposal in the Federal Register.