no-action letter

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No-action letter

A letter from the Securities and Exchange Commission agreeing that the commission will take no civil or criminal action against a party, regarding a specific activity.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

No-Action Letter

A letter from the SEC stating that it will seek no civil or criminal penalties for a given activity. The SEC sends no-action letters in response to inquiries from organizations regulated by it. For example, if a company wishes to take a certain action but is uncertain as to its legality, it requests clarification from the SEC. Receiving a no-action letter equates to permission to take the action in question.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

no-action letter

A response from the SEC staff to an individual inquiry, stating that the staff will recommend to the Commission that no action be taken on a specific transaction if the transaction is carried out in the fashion indicated.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
No-action letters are administrative review letters aimed at improving the transparency of administration by replying in writing to inquiries from companies and individuals about the government's interpretations of laws affecting them.
For instance, Phelps said, nonprecedential documents like SEC no-action letters and other documents generated by regulatory agencies are now easy to access.
In a series of no-action letters (a letter responding to a request for confirmation that no enforcement action would be taken in response to a particular course of conduct), the staff has developed the following guidelines for determining whether an entity has been formed for the purpose of circumventing the 100 beneficial owner limit:
The 1996 proxy season saw a decline in the number of no-action requests by companies.(115) IRRC reports indicate that thirteen companies requested no-action letters for fourteen labor-submitted proposals.(116) Five of these were granted, primarily on the basis of the proposals being rendered moot under Rule 14a-8(c)(10).(117) Similar IRRC data for January 1997 show thirteen companies challenging fifteen proposals.(118) So far, the SEC has not concurred with companies' arguments that it should exclude proposals on the ground that they are aimed at remedying personal grievances.(119) Such proposals would be excludable under Rule 14a-8(c)(4).(120)
For those of you who may not be familiar with no-action letters, they are responses given by the staff of the SEC that indicate that the staff will not recommend that the SEC bring an enforcement action if the requestor proceeds with the activity or transaction described in his or her request.
Again, because these no-action letters raise the possibility that under different factual circumstances the broker-dealer registration provisions could apply to the sale of membership interests in risk retention groups, groups desiring reassurance on this point will have to seek their own no-action letters from the SEC.
* Limiting imposing new regulations through informal guidance, no-action letters or interpretation, instead of through notice and comment rulemaking.
However, there are published no-action letters and SEC releases that challenge this assumption and evince the SEC's intent to prohibit practically any testimonial advertisements that even mention an investment advisor.
The agency has already released more than 40 no-action letters postponing other Dodd-Frank rules, and officials have signaled that more are coming.
case exemplified the increasingly murky interrelation of Delaware's traditional authority in corporate law, the SEC's influence in the field via its promulgation of corporate governance rules and no-action letters, and ultimately the willingness of the SEC to defer to Delaware courts.
Securities Cases Archive," "SEC No-Action Letters," "Corporate Acquisitions & Mergers," "International Mergers and Acquisitions," "International Securities Outlook" and "SECnet," a monthly resource for online securities filing research and news.