SEC Expands Confidentiality Protection for Draft Registration Statements

The SEC Division of Corporation Finance (the "Division") will expand a JOBS Act provision to include all companies in order to allow them to submit confidential draft registration statements.

Currently, the JOBS Act provision allows for emerging growth companies to submit draft registration statements for nonpublic review by the Division. With the expansion of this provision, initial public offerings ("IPOs") and "most offerings made in the first year after a company has entered the public reporting system" will be eligible for confidential review. However, the nonpublic review process will be restricted to initial submissions. Companies will be required to publish responses to Division comments publicly.

SEC Chair Jay Clayton expressed his hope that the new policy will help to remedy the decline in IPOs:

"We are striving for efficiency in our processes to encourage more companies to consider going public, which can result in more choices for investors, job creation, and a stronger U.S. economy."

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