Government Shutdown: SEC Impact

In light of the risk of an imminent government shutdown, now is a good time to review the SEC’s “Operations Plan under a Lapse in Appropriations and Government Shutdown.” While the Operations Plan only covers a total government shutdown and not a partial shutdown (which occurred in 2013), the Operations Plan notes that:

  • the SEC’s EDGAR system will remain fully functional as long as funding for the contractor remains available through permitted means; and
  • SEC personnel will be able to process requests for EDGAR access codes and password resets and to answer questions about fee-bearing EDGAR filings and other emergency questions regarding EDGAR submissions.

However, the Operations Plan indicates that the Divisions of Corporation Finance, Investment Management, and Trading and Markets, and the Office of Compliance Inspections and Examinations will be unable to process filings, provide interpretive advice, issue no-action letters or conduct any other normal Division and Office activities. As a result, new or pending registration statements or applications for exemptive relief will not be processed regardless of the status of any review of those filings.
While a potential shutdown should not have a significant impact in the short-term on current reporting companies, for issuers with registration statements under review that are planning to clear comments and go effective prior to the February 14th financial statement staleness date, the timing could not be much worse.
The SEC has not yet made any announcements regarding the timing for implementation of the Operations Plan, but today announced that, in the event of a shutdown after January 19th, the SEC will remain open for a limited number of days, fully staffed and focused on the agency’s mission. Changes in the SEC’s operational status will be announced at

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