PricewaterhouseCoopers LLP

February 18, 2003

Mr. Jonathan G. Katz, Secretary
U.S. Securities and Exchange Commission
450 Fifth Street N.W.
Washington, D.C. 20549-0609

Re: File No. S7-40-02

Dear Mr. Katz:

We at PricewaterhouseCoopers LLP appreciate the opportunity to comment on the Commission's Proposed Rule: Disclosures Required by Sections 406 and 407 of the Sarbanes-Oxley Act of 2002.

In the adopting release regarding Sections 406 and 407, the Commission requested comments about the disclosures relating to audit committee financial experts that assumes adoption of the accommodation for foreign private issuers regarding the independence of audit committee members that has been proposed in Securities Act Release No. 8173. Specifically, the request for comment addresses the situation in which the Commission adopts a special accommodation that allows the board of auditors or statutory auditors of foreign private issuers to meet the requirements of the home country with respect to the independence of their audit committees if certain conditions are met.

As indicated in our separate letter regarding the Commission's proposed accommodation with respect to boards of auditors and statutory auditors, we support the Commission's objective to ensure that that spirit of the Sarbanes-Oxley Act is achieved without causing a conflict with the laws and regulations of other countries. However, we view the issue regarding disclosures about the audit committee financial expert differently because it is simply an issue of disclosure and not about conflict of laws or regulations.

We believe that all foreign private issuers should be required to disclose if they have an audit committee financial expert and, if applicable, the reasons why they do not have one. There is virtually no cost to providing this information, and it is valuable to a US investor. The need for this disclosure would be based on the group that is acting as the equivalent to the audit committee. Accordingly, if there were a person that would meet the definition of a financial expert but that person is not a member of the group acting as the audit committee, then that person should not be disclosed as an audit committee financial expert.

Likewise, with respect to disclosure of independence, we believe the disclosure should be consistent with the requirements for all other issuers. In other words, a foreign private issuer that has a board of auditors or statutory auditors that does not meet the Commission's independence standards should be required to disclose that fact. Allowing some foreign private issuers to disclose that the board of auditors or statutory auditors are independent in accordance with their home country standards without disclosing non-compliance with U.S. standards will result in non-comparability among companies, and could potentially lead to investor confusion. A foreign private issuer could always expand the disclosure to explain, if applicable, that the persons are independent under the applicable laws of the home country. Again, there is no incremental cost to providing the disclosure, and it is relevant to a US investor.

We appreciate the opportunity to express our views and would be pleased to discuss our comments or answer any questions that the staff may have on our submission. Please do not hesitate to contact Wayne Carnall (973-236-7233) regarding our submission.


PricewaterhouseCoopers LLP