SEC permits all issuers to submit confidential draft registration statements

Abstract

Purpose

To explain the US Securities and Exchange Commission’s (SEC’s) June 29, 2017 announcement (as updated August 17, 2017) that the staff of its Division of Corporation Finance will accept draft registration statement submissions from all companies for nonpublic review, thereby expanding a popular benefit previously available only to emerging growth companies (ECGs) under the JOBS Act and, in limited circumstances, to certain foreign private issuers under historical Staff practices.

Design/methodology/approach

Explains the rationale and limitations of the new policy, the existing confidential submission process, the expanded class of issuers and transactions that now qualifies for the nonpublic review process, and content and staff processing details.

Findings

Recognizing that the confidential submission process for EGCs proved highly popular and quickly became standard practice for eligible companies seeking to conduct an IPO, the SEC has made the nonpublic review process available to an expanded class of issuers and transactions. The expanded confidential submission process for IPOs addresses some of the typical concerns associated with engaging in the IPO process by giving a company more time and flexibility to determine whether it actually will be able to achieve the benefits of going public before it incurs the burdens and expenses of doing so.

Originality/value

Practical guidance from experienced securities and corporate finance lawyers.

Citation

Brady, A., Breheny, B., Gasaway, M., Kanter, S., Zeidel, M. and Zhou, M. (2017), "SEC permits all issuers to submit confidential draft registration statements", Journal of Investment Compliance, Vol. 18 No. 4, pp. 16-21. https://doi.org/10.1108/JOIC-08-2017-0051