Once the [new Public Company Accounting Oversight] Board is operational, it will need to determine a plan to consider and address issues regarding foreign firms. The Act provides that we, or the Board subject to our approval, may exempt any foreign public accounting firm from any provision of the Act or the rules promulgated under the Act. Once the Board is operational, we and it will explore the basis and need for exempting foreign audit firms. Ultimately, our decision must balance the fundamental regulatory objectives of Sarbanes-Oxley with our role as one of many regulators in the community of nations. We want to work closely with you in making these determinations and we will give real credence to the auditor oversight approaches other nations take.

In implementing Sarbanes-Oxley, we will be fully faithful to its letter and spirit, and we will also be fully mindful of the impact of regulation on both U.S. and global markets. In doing so we will continue a tradition that we have been following for many decades. Our philosophy is simple - U.S. persons invest around the globe, and therefore the interests of U.S. investors and U.S. markets are best served if foreign companies trade in our markets and meet our disclosure and accounting standards. I am well aware that there are those, especially outside the United States, who believe that recent events call our disclosure and accounting rules into question. However, I am confident, first, that our standards best serve the needs of our investors, and, second, that following the improvements that we have made and are in the process of making, including those mandated by the Sarbanes-Oxley Act, our standards are and will be the equal of any, and the standard for many....

We intend to implement fully the Sarbanes-Oxley Act for all companies, foreign and domestic. That is our mandate. And, as we write our rules to implement the Act, foreign companies can expect that many of the new rules will apply to them. But we are prepared to consider how we can fulfill the mandate of the Act through our rulemaking and interpretive authority in ways that accommodate the home country requirements and regulatory approaches of the home jurisdiction of our foreign registrants and potential registrants.