Effective immediately, Tandy representations are no longer needed in filing reviews, according to new guidance from the Securities and Exchange Commission’s Division of Corporation Finance.
Beginning in the mid-1970s, SEC staff began to include in filing review comment letters what became known as “Tandy” representations, a name derived from the Tandy Corporation, the former parent company of RadioShack and the first company to receive a letter with this language. Tandy letters required a company to acknowledge in writing that the disclosure in the document was its responsibility and to affirmatively state that it would not raise the SEC review process and acceleration of effectiveness as a defense in any legal proceeding.
In 2004, CorpFin and the Division of Investment Management announced a new policy to publically release most filing review correspondence without requiring a request under the Freedom of Information Act. In connection with this announcement, SEC staff also indicated that it would begin to include Tandy language in comment letters relating to all disclosure filing reviews. Previously, similar attestations were only required for companies with a pending enforcement action.
“While it remains true that companies are responsible for the accuracy and adequacy of the disclosure in their filings, the staff does not believe that it is necessary for them to make the affirmative representations in their filing review correspondence,” the new guidance says.”Going forward, we will no longer request those representations, but instead will include the following statement in our comment letters.” Companies that have yet to provide requested Tandy representations as of Oct. 5 no longer need do so.
The Division warns, however, “that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the staff.”