Overview

• Issued policy statement and amended Rule 431, confirming that issuer–investor arbitration clauses will not affect acceleration of registration statements and removing automatic stays on challenges to staff acceleration decisions.
• The Commission says federal securities statutes do not displace the Federal Arbitration Act in this context, reinforcing a default favoring arbitration agreements.
• Commissioner Crenshaw dissented, warning of reduced transparency and class relief for retail investors and criticizing the absence of public comment.
• Companies must still evaluate whether such provisions are valid under state corporate law, with recent Delaware measures potentially limiting their use.
• Chairman Atkins framed the actions as part of a deregulatory push to encourage IPOs, and observers note the reliance on a policy statement rather than full notice-and-comment rulemaking.