Sullivan
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On September 8, 2025, Sullivan & Worcester submitted a comment letter to the U.S. Securities and Exchange Commission (SEC) in response to Release No. 33-11376; File No. S7-2025-01, which seeks public input on the definition of “foreign private issuer” (FPI) and potential reforms to the framework.

The letter, authored by Partners Oded Har-Even, Howard Berkenblit and Eric Victorson, with contributions from Associate Ilana Neck Levin, draws on the firm’s extensive experience advising foreign private issuers, particularly Israeli companies, which comprise a significant portion of the U.S.-listed FPI market.

Sullivan’s comments emphasize that the Business Contacts Test should remain the central determinant of FPI status. The letter explains that the shareholder test is often unreliable due to incomplete ownership data, volatility in investor residency and its limited alignment with policy objectives. In contrast, the Business Contacts Test, which focuses on where a company’s management, assets and operations are located, provides a consistent, substance-based standard that has served the markets well for decades.

The firm noted that putting too much emphasis on shareholder residency or trading activity could wrongly classify genuine foreign companies as U.S. issuers, creating confusion for investors and making it harder for those companies to raise capital. Instead, Sullivan urged the SEC to keep the current framework in place, making only targeted adjustments where there are clear market concerns.