Securities Advisory: Trades By Insiders During Retirement Plan Blackout Periods
4/4/2003
The Securities and Exchange Commission (the SEC) has adopted final Regulation BTR, or Blackout Trading Restriction, implementing Section 306(a) of the Sarbanes-Oxley Act of 2002. Regulation BTR prohibits directors and executive officers of an issuer from purchasing, selling, or otherwise acquiring or transferring, directly or indirectly, any equity security of that issuer at any time during which at least 50% of the issuer's retirement plan participants and beneficiaries are unable to effect transactions in the issuer's securities that are held in their plan accounts. BTR took effect on January 26, 2003. This advisory discusses the types of retirement plans affecting this rule, who is subject to BTR, when a blackout period occurs under BTR, prohibited securities, potential penalties, issuers responsibilities for notifying directors and officers, and required disclosures to the SEC.
