Web proxy statements being weighed by SEC

November 29, 2005|By BLOOMBERG NEWS

WASHINGTON -- The Securities and Exchange Commission, which moved into the electronic age by allowing companies to post their prospectuses on the Internet, may propose extending the cost-saving measure to proxy statements.

Rules that take effect Thursday let companies meet their investor-notification responsibilities for securities offerings by filing final prospectuses electronically with the SEC. The SEC will consider today a similar system for proxy solicitations, which cost U.S. companies $1 billion a year to print and mail.

"You don't have to deliver that 100-page booklet that costs a lot of money and makes printers and the U.S. Postal Service rich," said Stanley Keller, a specialist in securities law at Edwards, Angell, Palmer & Dodge LLP in Boston. "You can just file it on EDGAR, and that satisfies the requirement."

EDGAR, which stands for electronic data gathering, analysis and retrieval system, is the SEC's computer method for listing filings by public companies.

The proposals reflect the implementation of a principle, known as "access equals delivery," that the SEC has pursued under its last four chairmen. The rule taking effect Thursday says "investors are presumed to have access to the Internet."

Still, only 26 percent of Americans age 65 and up go online, according to a poll released last month by the Pew Internet & American Life Project. The poll also found 67 percent of those 50-64 years old, 80 percent of those 30-49 years old and 84 percent of those 18-29 years old spend time online. Investors who want paper copies of the information have to contact the issuer.

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