As much as I hate the government shutdown shenanigans, the closing of the SEC for extended periods of time is interesting for securities lawyers. This government shutdown was notable for the shift in the Staff’s position on the use of Rule 430A, which permitted IPOs to price during the course of the shutdown, which was something that was definitely not on my Bingo card for 2025. In retrospect, it will be useful to observe how things played out during the course of this shutdown once we get past the “hair on fire” phase. To that end, Cleary Gottlieb recently posted an interesting summary of the registration statement filings that omitted or removed the delaying amendment during the shutdown. The piece notes:

To assess how issuers are navigating the shutdown in light of this guidance, we reviewed registration statements on Forms S-1 and F-1 that removed the typical delaying effectiveness legend and affirmatively included the Rule 473(b) automatic-effectiveness legend and were filed between October 1 to November 6. This cohort represents issuers willing to move forward without formal SEC clearance, offering a practical glimpse into how the market is utilizing the auto-effectiveness pathway.

While the vast majority of S-1 and F-1 filings observed during this period continue to retain the standard delaying legend, our dataset identified 132 S-1 or F-1 registration statements including the exact wording of the automatic-effectiveness legend set forth under Rule 473(b) required for proceeding with this approach. Out of the total dataset, 71 were S-1/As and 33 were new S-1s, with 25 F-1/As and 3 new F-1s representing the remainder. The majority were amendments—approximately 73%. This finding suggests that many issuers originally on file with delaying legends prior to the shutdown elected to pivot to the automatic-effectiveness approach following the lapse in government funding (potentially having already addressed initial SEC staff comments).

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The number of companies relying on auto-effectiveness during this shutdown is significant compared to the last extended government shutdown (December 22, 2018 – January 25, 2019). Over that 34-day period, only 23 registration statements could be identified as including the Rule 473(b) automatic-effectiveness legend. This represents roughly one-sixth of the filings observed during the current shutdown (October 1 to November 6, 2025), and to our knowledge, none of the filings from 2018-2019 actually went effective.

I look forward to seeing more analytics along these lines once the shutdown is in the rear-view mirror, because the experience will be helpful the next time the federal government inevitably shuts down!

– Dave Lynn