SEC Modernizes Beneficial Ownership Reporting on Schedule 13D and 13G with XML format

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Our Toppan Merrill experts break down the SEC’s final rule to update beneficial ownership reporting for Schedule 13D and 13G filings in XML.

On October 10, 2023, the SEC adopted an extensive final rule to modernize beneficial ownership reporting for Schedule 13D and 13G filings. Exchange Act Sections 13(D) and 13(G) and the related SEC rules require an investor who beneficially owns more than five percent of a class of voting equity securities registered under Section 12 of the Exchange Act (“covered securities”) report their beneficial ownership and certain changes in that ownership by publicly filing either a Schedule 13D or, if eligible, a Schedule 13G. These filings can often signal the beginning of an acquisition. The disclosure of ownership changes in public companies can trigger a strong reaction in the financial markets.

The rule mandated a range of disclosure and compliance changes, including requiring filers to report in XML format. Several key provisions of the rule have already been implemented.  Filers need to prepare now to comply with the upcoming technical changes to file in XML format beginning December 18, 2024.

Rule Highlights:

  • Modify the filing deadlines for the initial and amended Schedule 13D and 13G filings:
    • Initial Schedule 13D to within five business days after the date on which a person acquires beneficial ownership of more than five percent or losing eligibility to file on Schedule 13G.
    • Initial Schedule 13G filing for Qualified Institutional Investors (“QIIs”) and Exempt Investors to within 45 days after the end of the calendar quarter in which beneficial ownership first exceeds five percent.
    • Amendments:
      • Schedule 13D to two business days after the date on which a material change occurs.
      • Schedule 13G amendments filed to 45 days after the end of the calendar quarter in which a reportable change occurs.
  • Requires filers to submit Schedule 13D and 13G filings using a structured, machine-readable data language (XML)
  • Changes the amendment reporting criteria and timing
  • Extends the filing deadline to 10 pm EST to receive the same day’s filing date

Upcoming XML filing mandate

One of the key changes of the rule is to mandate XML format for Schedule 13D and 13G filings. The SEC also adopted XML reporting for Form 144 beneficial ownership filings recently, adding to their ongoing expansion of structured data. Structured data formats, such as XML and Inline XBRL, provide benefits to filers, the SEC and the marketplace, including easier data analysis and more accurate information.

Schedules 13D/G are currently filed in ASCII or HTML format. The information disclosed in these formats cannot automatically be analyzed by machine.  In the new XML format, fields will have specific required formats, such as text or numeric. Each field name will identify the data reported within it and the structure will be validated by the EDGAR system in order for the filing to be accepted. Filers may need to change their preparation process to comply with the new XML technical requirements. While the SEC updated the EDGAR system to support voluntary XML filings on December 18, 2023, for Schedule 13D/G, beginning December 18, 2024, all Schedules 13D and 13G must be filed in XML.

Rule compliance timing

SEC Final Rule Modernization of Beneficial Ownership Reporting

How Toppan Merrill Can Help

The XML mandate compliance date is Dec 18, 2024.  Have questions regarding this Schedule 13D and 13G XML rule? Contact our team of experts today!

SEC Resources

SEC Fact Sheet

Final Rule

Press Release

Jennifer Froberg - Sr SEC Product Specialist

With over 15 years of industry experience in the SEC regulatory landscape, Jennifer supports and advises clients in how to get their filings right. Part of a Toppan Merrill team of EDGAR experts who provide practical compliance expertise in a variety of subjects, Jennifer focuses on analyzing the scope of SEC rulemaking, where the agency is headed and how regulatory changes will impact the filers, investors and the market. She has a particular focus on structured data and ESG initiatives.

Jennifer Froberg - Sr SEC Product Specialist's Photo

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