Publications

On December 19, 2019, the SEC’s Division of Corporation Finance (“Corp Fin”) issued guidance addressing the disclosure of risks to technology and intellectual property that may result from conducting business outside the United States, particularly in jurisdictions that do not have comparable levels of protection of corporate proprietary information and assets such as intellectual property, trademarks, trade secrets, know-how and customer information and records. These risks may include those related to the potential theft or compromise of data, technology and intellectual property from a myriad of sources, including direct cyber intrusions or more indirect routes such as companies being required to compromise protections or yield rights to technology, data or intellectual property in order to conduct business in a foreign jurisdiction. Building on its recent guidance and statements regarding cybersecurity, and business risks more generally, Corp Fin’s new guidance continues to highlight that disclosure may be necessary in a variety of places, including management’s discussion and analysis, the business section, legal proceedings, disclosure controls and procedures, and/or financial statements. Whether or not disclosure is necessary depends on whether or not disclosure of these risks is material to investment and voting decisions, even in the absence of any specific line-item disclosure requirement. The guidance provides a comprehensive list of questions that companies should consider when assessing these risks and evaluating any related disclosure obligations.