Confidential Treatment Order (CTO)

What Is a Confidential Treatment Order (CTO)?

A confidential treatment order (CTO) is an order that provides confidential treatment for certain documents and information that a company would otherwise have disclosed in filings with the Securities and Exchange Commission (SEC). The CTO is granted by the SEC in response to a company's request—known as a confidential treatment request (CTR).

Key Takeaways

  • A confidential treatment order (CTO) is issued by the Securities and Exchange Commission (SEC) and allows a company to omit or withhold information that would originally be disclosed in SEC filings.
  • The SEC issues CTOs in response to a company's request to withhold info, known as a confidential treatment request (CTR).
  • CTOs can only be in effect for a set period of time, where the company will set the expiration date in the CTR.
  • The SEC only allows certain types of information to be kept confidential, notably, information that, if disclosed, could negatively affect the company or its financial position.
  • CTOs often include non-public information that would hurt the company if disclosed, such as technical specifications and terms of pricing.

How a Confidential Treatment Order (CTO) Works

A confidential treatment order (CTO) is issued by the SEC and may only be in effect for a certain period of time. If a company wishes to omit certain information from their required filings they can complete a confidential treatment order request, which is reviewed by the SEC.

The SEC has key items that it considers non-public information that would hurt the company if disclosed, such as technical specifications and terms of pricing.

Special Considerations

Companies would typically seek a confidential treatment order to keep information secret that would otherwise put it at a competitive disadvantage if revealed. Again, the first key requirement for a company seeking a confidential treatment order is to fill out a formal request—a confidential treatment request (CTR)—with the SEC.

The request must contain the information the company is looking to withhold and the time period the company is looking to withhold the information. This includes providing a date upon which the CTO would expire. Only certain types of information can be held confidential and the requesting company must provide evidence that disclosure of the information would provide it competitive harm.

On the SEC's website, investors can search for CTOs. This includes being able to search by specific companies. The form type on the SEC website for CTOs is "CT ORDER." The SEC database includes CTO orders starting May 1, 2008.

Example of a Confidential Treatment Order

For example, a company may apply for a confidential treatment order by completing a confidential treatment request to keep information regarding a pricing arrangement made with a potential acquisition target secret.

This request could be made on the basis that the company's competitors may use this information to go after the target with a more competitive price. Other common items kept confidential include milestone payments and other technical specifications. The information may then be revealed after the CTO expires.

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  1. U.S. Securities and Exchange Commission. "Confidential Treatment Applications Submitted Pursuant to Rules 406 and 24b-2." Accessed Nov. 16, 2021.

  2. Securities and Exchange Commission. "Search for Confidential Treatment Orders." Accessed Nov. 16, 2021.