Confidential Treatment Application/ Request

Keep things hush hush. No fingerprints. That’s the ticket.

It’s important to know where the bodies are buried, but never reveal where Jimmy Hoffa might be. It’s all about being confidential.

So, let’s say you run a public company, and it's time for you to report quarterly earnings. You'll be filing reports to the SEC. However, you have an important business matter that you don't want to report publicly due to concerns about material damage to your organization, or because that information might help your competitors. You can apply to obtain a confidentiality order on that specific information through Rule 24b-2 under the Securities Exchange Act of 1934. This is known as a Confidential Treatment Request (CTR).

When you file a CTR, the SEC will decide whether to provide a “Confidential Treatment Order,” or approval of your request. If granted, the secretive information can be redacted from the SEC filing, and it will not be disclosed publicly for a certain period of time. If you love acronyms for documents, you'll love the SEC, because government officials are so lazy, they only speak in abbreviations.

The SEC has said that pricing terms, milestone payments, and technical specifications are three primary reasons why companies receive the right to confidentiality in their filings. However, if you do receive a CTO from the SEC, every investor will speculate that you're about to be purchased by another company.

There are a lot of things that must be disclosed: large customers (10% of sales), backlog orders values, patent durations, interest expenses, among others. You must really like regulations to be reading this.