SEC Guidance On Potential Government Shutdown: What Filers Should Know

As Congress grapples with enacting appropriations by September 30, 2025, to avoid a government shutdown, public companies must begin to consider how the operations of the Securities and Exchange Commission (the "SEC") will be impacted by a shutdown. Although the SEC's Division of Corporation Finance (the "Division") is yet to issue new guidance, the Division has issued guidance in previous instances of a looming shutdown, most recently in March this year.

To help companies prepare for a possible shutdown, pending new guidance from the Division, we summarize key points from the Division's March guidance, as well as the SEC's operations plan during a shutdown, along with action steps that companies should take before and during a shutdown. Importantly, based on prior guidance, although EDGAR will be fully operational during a shutdown, the Division's operations will be extremely limited. Specifically, the Division will not be able to accelerate the effectiveness of registration statements and will not review or comment on filings, issue no-action letters (including for shareholder proposals) or provide interpretive advice.

EDGAR remains operational

• EDGAR will remain fully operational during a shutdown and companies and other filers will be able to electronically submit all their filings under the Securities Act of 1933 (the "Securities Act") or the Securities Exchange Act of 1934.
• Filing deadlines under the federal securities laws continue to apply; the days during a shutdown will still count as "business days" for purposes of rules involving day counting.

Registration statements and offerings

• The Division staff will not declare registration statements or post-effective amendments effective.
  • Well-known seasoned issuers ("WKSIs") can continue offering activity since their Form S-3/F-3 registration statements are automatically effective upon filing.
  • Non-WKSIs with already-effective shelf registration statements may proceed with offerings through prospectus supplements.
  • Non-WKSIs without effective shelf registration statements should consider putting one in place and requesting acceleration of effectiveness as soon as possible while the SEC is fully operational; the Division staff will consider granting acceleration requests even without a FINRA "no objections letter" if the underwriters confirm they will not execute an underwriting agreement or confirm sales until the FINRA letter is received.
• While the Division staff will not issue comment letters or respond to responses to their comments during this period, companies may submit responses via EDGAR.
• If a registration statement is declared effective prior to a shutdown and the related offering will price during the shutdown but not within 15 business days of effectiveness as required under Securities Act Rule 430A, the issuer may restart the 15-day clock by filing a Securities Act Rule 462(c) post-effective amendment (i.e., a post-effective amendment that does not include substantive changes to the effective prospectus) as such a post-effective amendment is effective upon filing.
• 20-day automatic effectiveness path: while historically not a path that companies have used, the Division notes that a company may file a new registration statement without a delaying amendment under Securities Act Rule 473 or amend a pending filing to remove a delaying amendment so the registration statement becomes effective after 20 days by operation of Section 8(a) of the Securities Act.
  • This path is not available for traditional IPOs that rely on Securities Act Rule 430A to omit pricing information at registration statement effectiveness because Rule 430A is only available for registration statements that are declared effective.
  • If the SEC reopens during the 20‑day period, the Division staff may ask the company to re‑insert a delaying amendment.
  • Post‑effectiveness, the SEC may review and could request amendments or, in emergencies, issue a stop order under Section 8(d) of the Securities Act suspending the effectiveness of the registration statement.

Proxy statements

• The Division staff will not respond to no-action requests seeking exclusion of shareholder proposals from proxy statements.

Action steps

Before a shutdown (non-WKSIs without effective registration statements only)

• Consider putting a shelf registration statement in place and submitting an acceleration request as soon as your filing is substantially complete and statutory requirements are met.
• Line up any necessary EDGAR access codes and passwords given constrained staffing during a shutdown.

During a shutdown

• Continue timely Exchange Act filings via EDGAR.
• Companies with effective shelf registration statements may proceed with offerings via prospectus supplements (and, for WKSIs, via post-effective amendments, if needed).
• Non-WKSIs that must update an effective registration statement should consider whether they can proceed without a post-effective amendment that will need to be declared effective.
• For offerings relying on Rule 430A that missed the 15-day pricing window, consider Rule 462(c) post-effective amendments to restart the 15-day period.
• If the shutdown is protracted, non-WKSIs may want to evaluate whether to use the 20-day automatic effectiveness path, if available, after carefully weighing risks (eligibility, review status, unresolved comments), including the antifraud and liability provisions of the federal securities laws, which apply equally to registration statements that go effective by operation of law.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.