From: Robert Courtney Mangone [rcmangone@foxlex.com]
Sent: Tuesday, August 20, 2002 11:51 AM
To: rule-comments@sec.gov
Subject: Proposed Rulemaking under Securities Exchange Act of 1934 - 
File No. S7-31-02

Securities and Exchange Commission

Attn: Mr. Jonathan G. Katz, Secretary

File No. S7-31-02

 

Gentlemen:

 

            Our brief comments relate to the Commission’s Release No. 34-46313, 
which addresses the amendments to Section 16(a) under the Securities Exchange 
Act of 1934 enacted under the Sarbanes-Oxley Act of 2002 (the “2002 Act”).

            We note that the Release recites the fact the Section 16 applies to 
every person who is the beneficial owner of more than 10% of any class of equity 
security registered under Section 12 of the Exchange Act and each officer and 
director of the issuer of such security.  Section 403 of the 2002 Act similarly 
encompasses all such persons and requires, among other things, that Section 16(a) 
reports of changes in shareholdings be reported to the Commission within 2 days 
of the transaction.

            The Commission’s Rule 3a12-3(b) exempts securities of foreign private 
issuers, as that term is defined in Rule 3b-4, from Section 16 (and certain 
sub-sections of Section 14) of the Exchange Act.  The Commission’s interpretative 
Release No. 34-18114 (September 23, 1981) confirmed this in its Question/Answer 
No. 25. This view is consistent with the long-held recognition that  individual 
officers and directors generally did not have to disclose their shareholdings in 
filed annual reports on Form 20-F unless otherwise required by local law.  

            We suggest that any rule adopted by the Commission relating to 
Section 16 of the Exchange Act specifically address the issue that foreign private 
issuers, as defined, continue to be exempt from that Section, even after the passage 
of the 2002 Act

            We apologize for the late filing of these comments and want to express 
our gratitude to the Commission  for the opportunity to present our views.

 

Very truly yours,

Fox Horan & Camerini LLP

By:  Robert Courtney Mangone
825 Third Avenue
New York, NY 10022
Telephone 212-480-4800