The section one must abide when he or she decides to buy back stocks is Section 10b-18. This law reduces liability and gives companies and their associates a safe harbor when the company or their affiliate repurchase the common stock of the company’s shares. Applying this section, the Securities and Exchange Commission will not consider it as a violation against the Securities Exchange Act of 1934.
however, there are still limitations to this section where the companies need to provide detailed information of share repurchases such as the manner of purchase, price, timing, and volume. These conditions must be met to ensure no company will not violate this rule.
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