Richard H. Rowe
Member of the Firm
Direct Dial 202.416.6820
November 20, 2001
VIA E-MAIL: email@example.com
Jonathan G. Katz, Secretary
U.S. Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0609
Re: File No. SF-18-01
We are writing to comment on a narrow but, we believe important, aspect of the Commission's proposals to amend its Regulation S-T and related rules to require foreign issuers to submit documents to the Commission electronically through its EDGAR system. We have limited our comments to certain aspects of the proposals, discussed in Section II.D of Rel. 33-8016 (the "Proposing Release"), that would require foreign issuers to submit English translations of exhibits and certain other documents, rather than English summaries of those documents.
We represent a number of foreign private issuers with world-wide operations, and we believe this requirement would impose unnecessary burdens without any demonstrated demands by investors to change the current rules which permit summaries in English of certain documents in lieu of full English translations. We note that summaries of these documents in English do not present the technical issues discussed in footnote 102 and the accompanying text in the Proposing Release because these summaries would not contain foreign language symbols and characters.
We find particularly troublesome the proposals, discussed in Section II.D.3 of the Proposing Release, which would require that all documents required to be furnished to the Commission on Form 6-K, "including offering circulars relating solely to foreign offerings," to be fully translated into English. We believe that this requirement would be unduly burdensome and of limited benefit to U.S. investors, since these offerings are not and, indeed, cannot be made to them. We do not understand why an English summary of these documents would not be sufficient. Moreover, we are not aware of any demands by U.S. investors for full English translations of these documents.
We note that, although among the reasons underlying these proposals is a goal of leveling the playing field between foreign and domestic issuers, a U.S. issuer, which made an offering overseas by means of an offering circular prepared in a foreign language, would not be required to furnish that offering circular to the Commission translated into English or any other language.
In addition, we are concerned about the proposed requirement, discussed in Section II.D.2 of the Proposing Release, that would require all exhibits to be translated into English.
We understand the need for codifying current SEC staff practices that require articles of incorporation, by-laws and other governing instruments, instruments defining the rights of security holders, voting agreements, exhibits containing financial statements and exhibits subject to requests for confidential treatment be translated into English. However, we believe it would be unduly burdensome to require documents, such as material contracts, that are not routinely translated into English, to be translated into English to be filed through EDGAR, rather than being summarized in English. Again, we do not believe that the Commission has demonstrated a demand by U.S. investors for full translation of these documents.
The limited relief provided by the hardship exemptions under Regulation S-T would not alleviate these problems, since documents permitted to be filed on paper rather than through EDGAR would be required to be translated into English.
As an alternative, we suggest that the Commission consider requiring an undertaking by registrants permitted to file English summaries of exhibits that they will provide the Commission with full English translations of those exhibits on request.
Finally, we do not believe that the proposed requirement for a written representation signed by a designated officer or official of the registrant that each English translation is a fair and accurate translation of each foreign language docuoment is necessary in view of the requirements for authorized persons to sign registration statements and reports and the liabilities for materially misleading filings imposed under our securities laws. Moreover, as the Commission recognizes in the Proposing Release, registrants may use translation services and requiring an official of the registrant to make representations about a third party's work appears unnecessarily burdensome.
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If the Commission or its staff wishes to discuss our comments further, please telephone Richard H. Rowe, Esq., in our Washington, D.C. office, at (202) 416-6820.
PROSKAUER ROSE LLP
bcc: Ron Papa, Esq.
Lauren Boglivi, Esq.
Delia Spitzer, Esq.
Carlos Martinez, Esq.
James Waddington, Esq.
Stanley Komaroff, Esq.