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Foreign private issuers
SEC registration: As a U.S.-listed company,
a foreign issuer must comply with the
registration provisions and continued
reporting requirements of the Securities
Exchange Act, as amended, as well as
certain registration provisions of this
act. For more information about the SEC
registration and reporting requirements,
please refer to Chapter 5.
Establishing an ADR program: roles and responsibilities of foreign issuer,
depositary bank and other parties
Custodian
• Receive local
shares in
issuer’s home
country.
• Confirm
deposit of
underlying
shares.
• Hold shares
in custody for
the account
of depositary
in the home
market.
Depositary
• Provide advice/perspective on type of program, exchange or
market on which to list or quote.
• Advise on ratio of depositary shares to ordinary shares.
• Appoint custodian.
• File Form F-6 if Level one, 2 or 3 program.
• Review draft registration statement or offering memorandum,
depending on type of program to be established.
• Coordinate with all partners to complete program implementation
steps on schedule.
• Coordinate with legal counsel on Deposit Agreement and
securities law matters.
• Prepare and issue certificates and/or direct registration statements.
• Announce DR program to market (brokers, traders, media, retail/
institutional investors via news releases and internet.
Issuer
• Provide depositary and custodian with
notices of dividends, rights offerings and
other corporate actions, including notices of
annual and special shareholder meetings.
• Ongoing compliance with stock exchange
and SEC regulations, including disclosure
and reporting (coordinating with legal
counsel/accountants).
• Executes U.S. focused investor relations
plan.
Legal counsel (depositary’s
and issuer’s)
• Prepare draft deposit agreement
(depositary bank’s counsel) and file
required registration statements with
the SEC.
• Manage compliance with U.S.
securities laws, rules and regulations
and perfect any securities law
exemptions (if Rule 144A/Reg S
program) (issuer counsel).
Accountants (Level II/III ADRs only)
• Prepare issuer’s financial statements in accordance with, or reconcile to, U.S. GAAP
or accepted IFRS standard.
• Review registration statement or offering circular and provide requisite opinions.
Investor relations advisor/firm
• Develop long-term plan to raise awareness of issuer’s program in the United States.
• Develop communications plan and information materials for launch activities (roadshow
and presentations to investors, launch day promotion, meetings with financial media).
• Coordinate with issuer’s advertising and public relations teams on specific program
plans to support and develop company image in the United States.
Investment banks/Underwriters (Level II/III/Rule 144A/Regulation S ADRs only)
• Advise on type of program to launch and exchange or market on which to list or quote.
• Advise on ratio of depositary shares to ordinary shares.
• Cover issuer through research reports/promote DRs to investors.
• Advise on roadshows, investor meetings, investors to target.
• Advise on capital market issues.
• Where applicable, advise on potential merger/acquisition candidates, and other
matters such as rights offerings, stock distributions, spin-offs, proxy contests, etc.
If concurrent public offering:
• Advise on size, pricing and marketing of offering.
• Act as placement agent or underwriter in offering.
• Conduct roadshows with management/introduce issuer to institutional and
other investors.
• Line up selected dealers and co-underwriters for offering.
100 NYSE IPO Guide