On November 17, 2020, the SEC announced that it will begin to permit the use of electronic signatures for certain filings. To take advantage of the new rule amendments, which become effective upon publication in the Federal Register, officers and directors who want to use electronic signatures must first manually sign an attestation form, as discussed below.
Rule 302(b) of Regulation S-T currently requires that signatories manually sign a signature page or other authentication document for registration statements, reports, or other documents filed on EDGAR. The company is then required to retain such manual or “wet ink” signatures for a period of five years.
As amended, Rule 302(b) will permit signatories to sign EDGAR filings electronically, provided that such electronic signatures and the applicable signing processes meet standards set forth in the revised EDGAR Filer Manual. The minimum requirements for electronic signatures to be valid include that:
- the signing process require the signer to authenticate his or her identity through a physical, logical, or digital credential (e.g., a password);
- the signing process provide reasonable assurance that the signer cannot falsely deny (or repudiate) the electronic signature at a later time;
- the signature be attached to, or clearly associated with, the applicable filing; and
- the signature be timestamped with the date and time of execution.
Electronically-signed authentication documents remain subject to the existing five-year retention requirement.
The amendments to Rule 302(b) require that a signatory provide a manually-signed attestation that his or her electronic signature is the legal equivalent of a manual signature prior to the utilization of such electronic signature in an EDGAR filing. Filers must retain this manually-signed attestation for at least seven years following the most recent filing made with a person’s electronic signature.
The SEC also amended other rules and forms under the Securities Act, the Exchange Act, and the Investment Company Act to permit electronic signatures consistent with those permitted under Rule 302(b).
These amendments will provide EDGAR filers with important flexibility, particularly in light of the COVID-19 pandemic, and will more closely align EDGAR filing practices with the widespread adoption of electronic signatures in day-to-day business operations.