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On December 6, the Securities and Exchange Commission overruled a staff letter in the case of National Semiconductor concerning the right of shareholders to request a vote on expensing options.

Few companies, most notably CH2MHill, operate internal stock markets to allow employees to buy and sell shares. There are a number of reasons for this, but one has always been regulatory cost and complexity.

On July 5, 2007, the SEC issued a proposal to exempt certain stock options and their underlying shares from the current rule that they be counted toward the 500-shareholder rule requiring companies to comply with securities laws if they have more than 500 shareholders and $10 million in assets.

The SEC is proposing major changes to Rule 144 under the Securities Act of 1933.

The Securities and Exchange Commission has rejected a proposal from Cisco Systems to value its options based on a market in employee options the company would create. Under the proposal, Cisco would create a new derivative security whose terms would be the same as its employee options.

The Securities and Exchange Commission has ruled that companies cannot exclude shareholder proposals under the Rule 14a-8 exclusion that allows companies to avoid shareholder votes on proposals dealing with "ordinary business matters," such as employee compensation.

The Securities and Exchange Commission has issued new guidance stating that if a company allows employees with options to turn in shares obtained through the exercise of stock options in exchange for new options, then this will trigger variable accounting procedures.

In Staff Accounting Bulletin No. 107, the SEC staff has issued guidelines intended largely to assure companies that it will provide some leeway in implementing FAS 123(R) to allow for a variety of "reasonable" interpretations. Most significantly, it will allow a number of valuation formulas.

In a December 6 letter to the United Brotherhood of Carpenters and Joiners, Martin Dunn, the SEC's deputy director of corporation finance, said that following an SEC review of the matter, "in the future, we will not treat shareholder proposals requesting the expensing of stock options as relating

The staff of the Securities and Exchange Commission (SEC) has recommended that the SEC commissioners vote to delay by six months the starting date for implementation of requirements that companies must expense options, and the commissioners are expected to soon do so, according to the Wall Street