Overview

• The SEC posted updated shutdown guidance on Thursday stating it will not seek to punish companies that omit pricing information in prospectuses filed during the lapse in funding.
• Issuers may let registration statements become effective automatically, which typically requires setting the IPO price about 20 days before listing rather than the night before.
• Because staff are unavailable to review or accelerate effectiveness, the relief enables offerings to proceed during or after the shutdown without traditional SEC declarations of effectiveness.
• To use automatic effectiveness, companies must file without a delaying amendment or amend a pending filing to remove it, and antifraud obligations continue to apply.
• An SEC spokesperson declined to comment, and Davis Polk said the change followed discussions the firm and others had with the agency.