Potential Impact of Government Shutdown on SEC

potential federal government shutdown. The Division outlined key points in their guidance, advising companies to review the full announcement on the SEC’s website for detailed information.

In the event of a shutdown, the SEC’s operations would be limited due to restrictions on federal agencies operating without appropriations, with few exceptions for property protection. Companies involved in securities transactions should be aware that certain services would be unavailable during a shutdown period. These include the declaration of registration statements as effective, the qualification of offering statements, and processing other filings that require SEC staff review.

Companies should also expect delays in processing filings once the shutdown concludes, as staff will not provide feedback on pending submissions or respond to interpretive questions. Rulemaking activities and no-action requests, including Rule 14a-8 requests, would not be processed during this time.

However, the EDGAR system, which facilitates electronic filing of reports with the SEC, would remain operational. Public reporting companies are encouraged to continue filing routine reports, such as Forms 8-K, 10-Q, and 10-K, as well as other required documents like definitive proxy statements.

While certain SEC staff services may be limited during a shutdown, assistance with certain requests, like Form ID applications and EDGAR code generation, is expected to be available. For further information or assistance, companies can reach out to legal counsel or contact professionals in capital markets or public company practices.

It’s important for companies to consider the risks outlined in the Division of Corporation Finance’s guidance and consult with legal experts before taking significant actions, such as proceeding with registration statements without delaying amendments or filing proxy statements shortly after initial submissions. The SEC staff may issue feedback post-shutdown or request amendments to registration statements as needed. By staying informed and seeking guidance where necessary, companies can navigate potential challenges during a government shutdown period.