New NYSE Rule Regarding Notification of Dividends and Stock Distributions Effective February 1, 2018
In its annual guidance memo for listed companies, the New York Stock Exchange (NYSE) announced its new rule regarding notification of dividends and stock distributions will be effective February 1, 2018. The new rule revises the NYSE Listed Company Manual to specify that notice of any dividend or stock distribution required by Section 204.12 of the manual, or the fixing of a record date with respect to a dividend or stock distribution under Section 204.21 of the manual, must be provided to the NYSE at least 10 minutes before its public announcement to the news media, including when such announcement is being made outside of NYSE trading hours. Currently, prior notice is only required for public announcements during the hours of 7 a.m. and 4 p.m. Eastern Time. The new rule also amends the manual to explicitly state that NYSE listed companies must comply with the immediate news release policy with respect to all announcements relating to a dividend or stock distribution.
The new rule is intended to allow NYSE staff time to resolve any rule compliance issues with a listed company’s dividend or stock distribution action prior its public announcement. In this respect, the NYSE has stated that it intends to have its staff available at all times to review dividend or stock distribution notices immediately upon receipt, regardless of the time or date the notices are received.