On March 3, 2025, the SEC’s Division of Corporation Finance announced an expansion of its policy providing for the confidential, nonpublic review of draft registration statements, which allows an issuer to delay (or avoid, if it decides not to go ahead with the offering) public disclosure of the plans for, and information required by, a registered offering. These changes are modest but helpful to companies, and likely just the first step in the SEC’s efforts to make public offerings more attractive and SEC reporting less burdensome, as discussed by the Acting SEC Chair in recent remarks.
Originally, the JOBS Act of 2012 only permitted emerging growth companies to submit draft IPO registration statement to the SEC staff for nonpublic review. In 2017, the staff expanded the policy to cover all companies conducting certain securities offerings, including IPOs and follow-on offerings within one year of the IPO. Under the policy, an issuer must confirm in a cover letter to its submission that it will publicly file its registration statement and nonpublic draft submissions at least 15 days prior to any road show or, in the absence of a road show, at least 15 days prior to the requested effective date of the registration statement. The SEC staff will also publicly release staff comment letters and issuer responses on EDGAR no less than 20 business days following the effective date of the registration statement.
The changes include:
- Section 12(g) Exchange Act registration – Prior to the recent changes, the confidential review policy only covered draft initial registration statements submitted under the Securities Act of 1933 and Section 12(b) of the Securities and Exchange Act of 1934. The new policy now allows for the confidential review of draft registration statements for the initial registration of securities under Exchange Act Section 12(g) on Forms 10, 20-F, or 40-F. No changes have been made to the 15-day requirement, and comment letters and responses will still be released on EDGAR after the effective date.
- Subsequent Securities Act offerings and Exchange Act registration – Prior to the changes, the SEC staff accepted only subsequent draft registration statements submitted prior to the end of the twelve-month period following the effective date of an issuer’s initial Securities Act registration statement or an issuer’s Exchange Act Section 12(b) registration statement. Under the new policy, the staff will now accept for nonpublic review a subsequent draft registration statement for any offering under the Securities Act or registration of a class of securities under either Exchange Act Section 12(b) or Section 12(g), regardless of how much time has passed since the issuer became subject to the reporting requirements of Exchange Act Section 13(a) or 15(d).
Nonpublic review in these cases is limited to the initial submission, however. An issuer responding to staff comments must do so with a public filing, not with a revised draft registration statement. Further, an issuer submitting a subsequent draft registration statement for nonpublic review should confirm in its cover letter that it will file its registration statement and nonpublic draft submission on EDGAR at least two business days prior to any requested effective time and date. It is possible that the staff may comment on these public filings, which may affect an issuer’s desired effectiveness timing. In addition, issuers will need to publicly file Exchange Act registration statements on Forms 10, 20-F, and 40-F so that the full 30- or 60-day period for automatic effectiveness, as applicable, will run prior to effectiveness.
- De-SPAC transactions – The new policy will allow issuers to submit a registration statement for a de-SPAC transaction for nonpublic review as if it were an initial Securities Act registration statement (i.e., an IPO) where the co-registrant target would otherwise be independently eligible to submit a draft registration statement under this policy.
- Omissions from draft registration statement – While an issuer should take all steps to ensure that a draft registration statement is substantially complete when submitted, the SEC staff will not delay processing if an issuer reasonably believes omitted financial information will not be required at the time the registration statement is publicly filed. The staff will also consider an issuer’s specific facts and circumstances in connection with any request made under Rule 3-13 of Regulation S-X. Under the new policy, issuers may omit the name of the underwriter(s) from their initial submissions, when such information is otherwise required by Items 501 and 508 of Regulation S-K, provided that they include the name of the underwriter(s) in subsequent submissions and public filings.
The policy also reaffirms that certain foreign private issuers (primarily those that are listed or concurrently listing on a non-US exchange) still have the option to submit their draft registration statements for confidential review under the separate FPI policy, which had been informally suspended during the last few years. The FPI policy does not require public filing of the draft registration statement 15 days before any road show or the requested effective date.
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