Elon Musk agrees to new tweeting rules with SEC

Elon Musk agrees to new tweeting rules with SEC

Tesla CEO Elon Musk reached a deal with the U.S. Securities and Exchange Commission on Friday over his use of Twitter, according to a filing in Manhattan federal court.

Elon Musk has struck a deal over his Twitter use with the US Securities and Exchange Commission, averting a decision by a federal judge on whether the billionaire should be held in contempt of court. The SEC viewed that as a violation of the agreement and asked Judge Nathan to hold Musk in contempt. The updated deal outlines a slew of topics Musk can not tweet about until he obtains pre-approval from an "experienced securities lawyer".

With 5,315 new cars registered, Tesla's Model 3 accounted for 29 percent of the new sales.

In the early morning of February 26, after the regulator filed its contempt motion, Musk tweeted: "Something is broken with SEC oversight".

Friday's agreement "removes an overhang" for Tesla shareholders, said Dan Ives, managing director for equity research at Wedbush Securities.

Last December Musk had publicly admitted that he had "no respect" for the SEC, in his second attack on the United States financial regulator after it forced him to step down as chairman of Tesla and pay $20m in penalties.

Tesla did not immediately reply to a request for comment.

Under the terms of the settlement of that fraud case, Musk and Tesla each paid a $20 million fine, Musk agreed to surrender his title as chairman, and he agreed to have tweets about Tesla reviewed in advance by a company overseer.

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Musk corrected his tweet hours later, saying the company's pace of production would amount to 500,000 vehicles, but Tesla would only produce 400,000 in the calendar year.

Last year Musk, 47, tweeted that he had "funding secured" to take the vehicle maker private at $420 a share, or $72bn (£56bn).

Musk's legal team argued at one point that the SEC was trying to take away his First Amendment rights.

The stock rose in extended trading, gaining as much as 1.4 per cent to US$238.50 at 5:22pm in NY.

This all started in the summer of 2018 when Musk tweeted about taking Tesla private.

That agreement, made public today by the SEC, adds greater clarity to the restrictions on Mr Musk's communications, on Twitter or elsewhere.

John Hueston, an attorney representing Musk, had countered that Musk's February 19 tweet was not consequential to investors, and that the language in the settlement was ambiguous on what types of information needed to be reviewed prior to publication.

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