USA—Introduction to the Securities Exchange Act of 1934 and the Securities Act of 1933
Produced in partnership with Tom O’Neill of Herbert Smith Freehills
USA—Introduction to the Securities Exchange Act of 1934 and the Securities Act of 1933

The following Financial Services guidance note Produced in partnership with Tom O’Neill of Herbert Smith Freehills provides comprehensive and up to date legal information covering:

  • USA—Introduction to the Securities Exchange Act of 1934 and the Securities Act of 1933
  • Background and purposes of the Securities Exchange Act
  • Registration under the Exchange Act
  • Periodic reporting
  • Proxy solicitations
  • Tender and exchange offers
  • Broker-dealer requirements
  • Section 16—directors, officers and principal stockholders
  • Manipulative and deceptive practices/liability
  • Insider trading
  • more

Background and purposes of the Securities Exchange Act

The Securities Exchange Act of 1934 (the Exchange Act or the 34 Act) was enacted on June 6, 1934. Unlike the Securities Act of 1933 (the Securities Act), which regulates the offer and sale of securities in what is known at the primary market, the Exchange Act is the principal US federal regulatory framework governing the ownership and trading of securities. Each year many trillions of dollars of securities are traded in the secondary markets in the United States. The Exchange Act states as its principal purpose is 'to provide for the regulation of the securities exchanges and of the over-the-counter markets operating in interstate and foreign commerce and through the mails, to prevent inequitable and unfair practices on such exchanges and markets, and for other purposes'. The Exchange Act also established the US Securities and Exchange Commission (the SEC), which is the independent agency in the executive branch of the US government that is responsible for enforcing and implementing the federal securities laws.

The basic sections of the Exchange Act, and the areas that they regulate are Section 10 (deceptive practices), Section 12 (registration), Section 13 (periodic reporting), Section 14 (proxy statements for US domestic issuers and tender and exchange offers), Section 15 (registration of broker and dealers), Section 16