Under SEC Rule 425, communications about a business combination must be

Under SEC Rule 425, any communications related to a business combination, such as mergers and acquisitions, must be treated with specific regulatory requirements to ensure that investors have access to material information. When the rule states that these communications are to be defined as a prospectus and filed with the SEC, it emphasizes the necessity for transparency and compliance with securities regulations.

The rationale behind this requirement is that any communication made by companies involved in a business combination can potentially affect the decision-making of investors, and thus, these communications need to be filed for review. This filing serves to protect market participants by ensuring that they receive critical information and are not misled in the investment decision-making process. As such, this requirement contributes significantly to maintaining fair and efficient capital markets, especially in contexts where businesses are undergoing significant structural changes like mergers or acquisitions.