The End of the 8K?

Companies will soon be able to publish market-sensitive information on their websites and link to other sites without being liable for third-party information, according to FinancialWeek.

The Securities and Exchange Commission approved guidance that seeks to “harness the power provided by the Internet to disseminate as much information as possible” to individual investors, said new commissioner Elisse Walter at her first public meeting.

The 50-page guidance would allow companies to publish information on their website has the sole vehicle of information under Regulation FD. Approved by former chairman Arthur Levitt, Regulation FD requires the distribution of market-moving data to the general public as opposed to select analysts or investors.

Previously, websites were used as one source to publish information about expected earnings, sales, lawsuits, mergers, etc. These recent changes come after companies complained that the 2000 policy was too vague and subject to interpretation, according to FW.

“You’ll see more robust use of third-party links almost immediately,” said Jeffrey Morgan to FW. Morgan is president of the National Investor Relations Institute, which represents 4,000 corporate officers. “Companies have always wondered if they’re responsible for information on third-party links.”

Commissioner Paul Atkins expressed concern that Regulation FD violations could negatively effect the flow of information to investors. However he acknowledged that the move will allow disclosure to be more transparent.