Potential Ramifications Of A Government Shutdown For The SEC


If congressional leaders and President Obama are unable to resolve the current budget standoff, it is expected that much of the federal government would shut down as of the close of business today. The Securities and Exchange Commission (SEC) would be impacted by a shutdown and public reporting companies should expect some changes in connection with their dealings with the SEC during a government shutdown. We encourage all public reporting companies to monitor the SEC’s website (http://www.sec.gov) for the latest information regarding a shutdown and the status of SEC operations. As of early Friday, the SEC had already posted some information related to its contingency planning.

Although the SEC was able to stay open during the 1995 government shutdown, that will not occur this time. According to SEC Commissioner Mary Schapiro and the SEC’s contingency plan, the SEC would keep a skeleton staff in place along with the SEC’s five commissioners to monitor the markets and “work in activities that are necessary to protect life and property.”1 However, the bulk of the SEC’s routine activities would be put on hold during a shutdown. Of specific concern to public reporting companies, a substantial majority of the SEC’s staff would not have access to their offices or internal systems. As a result, the SEC would take no action involving communication with, or action by, the SEC’s staff, including comment letters relating to pending registration statements; reviews of periodic reports, proxy statements, confidential treatment requests, or no-action requests; and rulemaking activities. Additionally, SEC staffers will not be available to respond to interpretative questions. Other than for purposes of certain rule-making by self-regulatory organizations, a government shutdown would not change what constitutes a “business day” for purposes of the Securities Act, the Exchange Act, or the SEC’s rules promulgated under those statutes.

Please see full alert below for more information.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Wilson Sonsini Goodrich & Rosati | Attorney Advertising

Written by:


Wilson Sonsini Goodrich & Rosati on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.