FR 2021-02864

The document from the Federal Register is a notice by the Securities and Exchange Commission (SEC) regarding the collection of information through Form F-6. This form is significant as it is used by foreign companies to register the sale of American Depositary Receipts (ADRs) under the Securities Act of 1933. The purpose is to ensure that investors are provided with ample information about the deposit agreements and the involved foreign companies. The SEC is seeking public comments regarding this information collection, which is required under the Paperwork Reduction Act of 1995.

General Summary

Form F-6 is crucial for maintaining transparency for investors interested in ADRs, which are a tool to invest in foreign companies. The SEC intends to submit the existing collection of information required by Form F-6 to the Office of Management and Budget for approval. The document outlines the estimation of the time burden faced by respondents completing this form, quantified at approximately 217 hours annually for all respondents combined. The SEC calls for public commentary on several aspects, including the necessity and practical utility of this collection, as well as methods to potentially reduce the reporting burden.

Significant Issues or Concerns

Several concerns emerge from the document:

• Absence of an Abstract: The document metadata is missing an abstract, a concise summary that usually helps in quickly understanding the purpose and scope of the notice.

• Stakeholder Impact: There is no detailed discussion on how this information collection specifically impacts foreign companies, which are essential stakeholders in this process.

• Cost Information: The document does not provide explicit information about the costs associated with compliance, which could be critical for evaluating any financial burden imposed on companies.

• Context for Burden: While the document states the total annual reporting burden, it fails to provide context regarding how significant this burden might be for individual companies or its broader implications.

• Complex Language: The language used to invite public comments could be simplified to ensure clarity and encourage more public participation.

Broad Public Impact

For the general public, especially investors, the document indicates that the SEC is taking steps to ensure transparency and protect investor interests through sufficient disclosure of information related to ADRs. This aligns with the SEC's mandate to protect investors and maintain fair, orderly, and efficient markets. The public is encouraged to participate by submitting comments, which can lead to improvements in information collection practices.

Impact on Specific Stakeholders

• Foreign Companies: These entities might be impacted by the burden of completing Form F-6, and the document subtly highlights the ongoing obligation to provide periodic information to the SEC. The absence of a detailed discussion on potential impacts or considerations for these companies is a notable omission.

• Investors: The enhanced disclosure resulting from this form is beneficial for investors, as it ensures they are well-informed about investments in ADRs. This transparency can increase investor confidence and potentially attract more investments in foreign entities.

Overall, the document plays a crucial role in ensuring comprehensive communication between foreign companies and U.S. investors, while also safeguarding investor interests through transparent disclosure requirements. The invitation for public comment signifies an opportunity for all stakeholders to voice their opinions and assist in refining the process.