The 2021 proxy season is just around the corner. This quick reference guide, which is intended to supplement Shearman & Sterling’s 18th Annual Corporate Governance & Compensation Survey, summarizes themes from the 2020 proxy season and developing trends to consider for 2021. It also identifies possible future changes in disclosure rules that U.S. public companies should consider for the upcoming proxy season.

On November 30, 2020, the U.S. Department of Treasury (“Treasury”) and the IRS issued final regulations (T.D. 9933) on how an exempt organization determines if it has more than one unrelated trade or business, and, if so, how the exempt organization calculates its unrelated business taxable income (the “Final Regulations”). The Final Regulations address guidance under Section 512(a)(6) of the Internal Revenue Code of 1986, as amended (the “Code”) and largely adopt proposed regulations (REG-106864-18) issued in April 2020 (the “Proposed Regulations”), as summarized in our previous publication titled “Proposed Regulations Clarify UBTI ‘Silo’ Rules, Preserve Relief for Tax-Exempt Investments in Private Equity Funds.”

It is now time for foreign private issuers (FPIs) to prepare their annual reports on Form 20-F. For companies with a calendar year-end, the Form 20-F must be filed with the U.S. Securities and Exchange Commission (the SEC) by April 30, 2021. To help you with the preparation of this filing, consider the following recent developments, trends and topics that may be areas of focus of the SEC during the 2021 review process.

On January 5, 2021, the Internal Revenue Service (the IRS) and the U.S. Department of the Treasury issued final regulations in T.D. 9943 (the “2021 Final Regulations”) under section 163(j) of the Internal Revenue Code (the “Code”). These regulations finalize certain provisions of the proposed regulations (REG-107911-18) under section 163(j) issued on July 28, 2020 (the “2020 Proposed Regulations”). The 2020 Proposed Regulations were issued concurrently with a more extensive package of final regulations under section 163(j) (the “2020 Final Regulations”) that finalized regulations that were proposed in 2018 (the “2018 Proposed Regulations”).

ICE Benchmark Administration Proposes to Cease the Publication of Certain USD LIBOR Settings and US Regulators Encourage Banks to Stop Using LIBOR for New Contracts by December 31, 2021

Partner Donna Parisi (New York - Finance) co-authored an Op-Ed piece in CoinDesk and was interviewed on Breaking Banks regarding the strengths of the U.S. regulatory framework for crypto and digital assets.

Shearman & Sterling has published the latest issue of its bi-annual FCPA Digest report, highlighting how FCPA enforcement actions have fared amid a difficult year marked by the COVID-19 outbreak, the presidential elections, natural disasters and the ensuing disruptions of market and governmental activity.

On December 27, 2020 President Trump signed the Consolidated Appropriations Act, 2021 (the Act). The Act reopens the Small Business Administration’s (SBA) Paycheck Protection Program (PPP) that allows businesses to apply for a loan for the first time or allows existing PPP borrowers to apply for a second loan. First-time PPP borrowers will be subject to the PPP’s original eligibility rules, and second-time PPP borrowers will be subject to requirements outlined in this publication.

On December 27, 2020, President Trump signed into law The Consolidated Appropriations Act, 2021 (the CAA). The CAA contains multiple income and employment-tax related provisions that will impact both corporate and individual taxpayers and also contains welcomed resolution to certain issues created under the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”).

Partners Nils Eliasson (Hong Kong/Beijing-International Arbitration) and Emmanuel Jacomy (Beijing/Singapore-International Arbitration) were quoted in a China Business Law Journal article titled “Force for change.”