The Shareholder Communication Act of 1985 (SCA) requires financial institutions to disclose to issuers the beneficial owners of the issuer's securities, if the beneficial owner does not object to the disclosure. Objecting to the disclosure is known as:

The term "opting out" in the context of the Shareholder Communication Act of 1985 (SCA) refers to the action taken by beneficial owners who choose not to allow their information to be disclosed to issuers of securities. This terminology is used in various regulations and practices related to privacy and information sharing, where individuals or entities have the right to refuse participation in a particular program or disclosure.

In the case of the SCA, beneficial owners have the choice to "opt out" of having their ownership information shared with issuers. This protects their privacy and allows them to control the visibility of their investment holdings. When beneficial owners do not object to the disclosure, they are effectively permitting their information to be shared, which aligns with the intention of the law to facilitate communication and transparency between shareholders and issuers.

Understanding this concept is crucial for anyone working within the financial services industry, as it underscores the balance between regulatory compliance and individual privacy rights.