Davis Polk partner and Corporate practice head Michael Kaplan discussed the SEC’s new guidance for companies seeking to IPO during the government shutdown with Law.com.

Michael explained that companies looking to go public without an SEC review face risks, especially if they were unable to answer questions from the commission before the shutdown. A company could choose to get a deal done instead of waiting for the government to reopen and risk the SEC later finding an IPO prospectus misleading, he added.

For that reason, companies hoping to launch IPOs through automatic effectiveness are now largely those that have answered all or most of the SEC’s questions before the government closed, Michael noted. But the patience of IPO-hungry companies with more unanswered questions might wear thin if the government stays closed, he added.

“If the shutdown goes much longer, at some point people might just say, ‘I can’t wait until the SEC reopens,’” Michael said, commenting that he thinks “the SEC has been trying to do what they can to facilitate capital formation even when they’re shut down.”

“SEC Eases Path for IPOs to Proceed During Shutdown,” Law.com (October 14, 2025) (subscription required) 

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