S.E.C. Sets Rules For Using Social Media To Make Disclosures

S.E.C. Sets Rules For Using Social Media To Make Disclosures

Chief executives can now feel free to post, blog or tweet — as long as they inform investors about their social media strategy first.

The Securities and Exchange Commission on Tuesday outlined new disclosure rules that clarify how companies can use Facebook, Twitter and other social networks to disseminate information provided they meet certain requirements. Still, the new move may reduce spontaneity because companies may limit their communications to official corporate accounts and file the information with the agency at the same time.

With the decision, the S.E.C is playing catch-up to the new era of social media.

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