On 24 October 2019, the SEC proposed changes that would modernise filing fee disclosure and payment methods, by amending the fee-bearing forms, schedules, statements and related rules, including registration statements for making public securities offerings. The current methods by which filers and the SEC staff process and validate EDGAR filing fee information within filings are highly manual, labour-intensive and, further, are not machine readable. Under existing rules, the calculation of filing fees can be difficult, particularly in complex transactions or situations in which a company is engaged in several transactions.
The amendments would require the fee table on the cover page of a filing and all related explanatory notes to (i) include all required information for the applicable fee calculations and (ii) be presented in an Inline eXtensible Business Reporting Language (Inline XBRL) format. The Inline XBRL format would eliminate the need to include fee data in several places within a filing and the related EDGAR submission header, thereby reducing data input error risks and enabling more efficient automated processing of fee calculation information by the SEC.
The proposal would add to the fee table:
- a "Reliance on Rule(s)" column to show (with checkboxes) whether the filer is planning to carry forward or include an equivalent amount of unsold securities, use a combined prospectus, offset a fee paid in connection with the same or a prior transaction or is calculating a fee based on maximum aggregate offering price;
- a requirement for basic fee calculation information (for certain forms);
- a "fee rate" column (for certain forms, mainly for business combinations); and
- various clarifying instructions regarding fee table presentation, calculations and related disclosure content and presentation.
The proposed rule would allow the payment of filing fees via Automated Clearing House and discontinue the option to pay fees by paper cheques and money orders.
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