S&P Global Inc. international business activities must comport with U.S. international trade restraints, including economic sanctions regulations administered by the U.S. Treasury Department’s Office of Foreign Assets Controls.
Pursuant to Section 13(r)(3) of the Securities Exchange Act of 1934, S&P Global Inc. (S&P) provides notice to the U.S. Securities and Exchange Commission that disclosure of activity described in Section 13(r)(1) of the Act has been included in the issuer’s Annual Report on Form 10-K for the year ended December 31, 2020, which was filed with the Securities and Exchange Commission on February 9, 2021. Hence the question of what this is all about.
As a global company headquartered in the U.S., S&P is subject to U.S. laws and regulations, including economic sanction laws. These laws include prohibitions or restrictions on the sale or supply of certain products and services to embargoed or sanctioned countries, regions, governments, persons and entities. Embargoes and sanctions laws are changing rapidly for certain geographies, including with respect to Iran, Russia, and Venezuela. These embargoes and sanctions laws may affect S&P’s ability to continue to market and/or sell products and services into these geographies and in turn adversely impact the revenue from such geographies.
Additional international trade restraints may be promulgated at any time and may require changes to S&P’s operations and increase their risk of noncompliance. Failure to comply with these laws and regulations can result in significant fines and penalties and related material adverse effects on S&P’s reputation, business, financial condition and results of operations.
Additionally, S&P is subject to complex U.S., European and other local laws and regulations that are applicable to our operations abroad, including trade sanctions laws, anti-corruption and anti-bribery laws such as the U.S. Foreign Corrupt Practices Act and the UK Bribery Act 2010, anti-money laundering laws, and other financial crimes laws. S&P’s internal controls, policies and procedures and employee training and compliance programs related to these topics may not be effective in preventing employees, contractors or agents from violating or circumventing such internal policies and violating applicable laws and regulations. A determination that S&P has violated such laws could have a material adverse effect on our reputation, business, financial condition or results of operations.
Compliance with international and U.S. laws and regulations that apply to S&P’s international operations increases the cost of doing business in foreign jurisdictions.
Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012, which amended the Exchange Act, an issuer is required to disclose in its annual or quarterly reports, as applicable, whether, during the reporting period, it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with individuals or entities designated pursuant to certain Executive Orders. Disclosure is generally required even where the activities, transactions or dealings were conducted in compliance with applicable laws and regulations.
The following details S&P’s business with companies controlled by the Government of Iran:
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