In early September, a U.S. Securities and Exchange Commission (SEC) advisory committee endorsed rule changes to increase disclosure regulations for special purpose acquisition companies (SPACs). For almost a year now, the SEC has signaled that there may be a need to beef up rules around SPAC mergers, and this recent move all but confirms its plans to do so. SEC Chairman Gary Gensler, who pushed for stricter investor protection, asked staff to “look closely at each stage of the SPAC process to ensure that all investors are being protected.” And while any action on SPAC regulation changes likely remain months away, the agency listed the matter as a “rulemaking priority.” If the previously issued guidance, public warnings from SEC officials, and a July 2021 enforcement action are any indication, the SEC will most likely look closely at stock dilution, SPAC founder incentives, conflicts, and a safe harbor for mergers allowing the use of financial projections. READ MORE