SEC votes to propose new cybersecurity rules

The Securities and Exchange Commission is voting on Wednesday to propose new cybersecurity rules for public firms.  

There are two elements to the proposal:

  • Mandatory cybersecurity incident reporting: "Material" incidents would have to be reported on an 8-Ok type inside 4 enterprise days of the incident. While the SEC has sought to get firms to disclose cybersecurity incidents since 2011, the company has described the reporting of incidents as "inconsistent." 
  • Required disclosures on firm insurance policies to handle cybersecurity dangers: Companies should additionally present updates on beforehand reported materials cybersecurity incidents. 
  • The proposed amendments can be put out for a public remark interval, which can be both 30 days from when it’s revealed within the Federal Register, or 60 days after it’s issued, whichever is longer.

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    These proposed measures are a part of a broader push by the SEC to improve cybersecurity disclosure. On Feb. 9, the SEC issued proposed rules associated to cybersecurity insurance policies for funding advisors and registered funds, that are nonetheless out for public remark.

    Now the regulators are turning their consideration to public firms.

    "A lot of issuers already provide cybersecurity disclosure to investors," SEC Chair Gary Gensler mentioned in a press release. "I think companies and investors alike would benefit if this information were required in a consistent, comparable, and decision-useful manner."

    An SEC spokesperson famous that these proposals had been into consideration for a while, however that the disaster within the Ukraine had given them a "special relevance."

    Cybersecurity is simply a small a part of the bold regulatory agenda Gensler has laid out. There are over 50 regulatory proposals into consideration by the SEC, one of many largest regulatory agendas in many years.

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