Regulatory & Compliance

This week’s governance, compliance and risk-management stories from around the web – The Wall Street Journal (paywall) reported that a federal judge blocked JetBlue Airways from acquiring Spirit Airlines, agreeing with the US Department of Justice (DoJ) that the $3.8 bn deal would eliminate a competitor important to price-conscious travelers. The DoJ said JetBlue’s purchase of Spirit would remove an ultra-low-cost carrier that benefits travelers and puts pressure on other airlines to keep down fares. Removing Spirit as a rival would allow JetBlue to increase prices by as much as 30 percent, the government said. Judge William Young agreed that…

Lawmaker Dragos Tudorache explains how the regulation – which will also apply to many US firms – will affect companies in Europe Governance Intelligence’s sister publication IR Magazine recently spoke with Dragos Tudorache, a member of the European Parliament,about the new EU Artificial Intelligence (AI) Act, which was finalized last month. Tudorache has been a key player in helping get the regulation across the finish line. Here, he explains what the regulation means and who it affects. Why did you think AI needed to be regulated within the European space? First of all, the impact was there. It is a…

Penalties can be severe, with senior officers and in-house lawyers likely to be targets, say Olivia Radics and Jamie Schafer Beginning January 1, 2024, the Corporate Transparency Act (CTA) will require most entities formed in the US to disclose information relating to their owners, officers and control persons – known as beneficial ownership information (BOI) – to the Financial Crimes Enforcement Network (FinCEN). The CTA, a sweeping law that received broad bipartisan support at its passage in 2021, aims to enhance transparency about ownership of corporate structures in the US and thereby strengthen the federal government’s efforts to combat money…

Sarah Fortt and Malorie Medellin explain how proposals may pull sustainability matters into audit processes, procedures and expenses The Public Company Accounting Oversight Board (PCAOB) on June 6 proposed new auditing standards designed to further its ‘investor-protection mandate’. These standards, if adopted, would heighten requirements for auditors to identify, evaluate and communicate regarding a company’s possible or actual non-compliance with laws and regulations. In proposing the standards, PCAOB chair Erica Williams cited a recent $1 bn class-action settlement regarding alleged misleading corporate compliance statements. She noted the ‘devastating consequences’ of corporate non-compliance, specifically the ‘sanctions, fines and civil settlements [that]…

Failing to obtain – and document – board approval for certain actions can have important implications for a company Recordkeeping can be a hassle: it costs money and time to maintain records. But it is a necessary and crucial part of every company. The failure to maintain proper records can have detrimental consequences on the validity of a company’s actions, particularly when that failure is the failure to properly document board approval of key company decisions. Every company that has a board of directors or board of managers – regardless of the company’s size, maturity or industry – has a…