SEC proposal: Registered offering reform

Defining Issues | May 2026

Learn about the SEC’s proposal to expand the use of Form S-3 to more issuers and the ability to incorporate by reference into Form S-1.

Issuers – Here's what matters

The proposed amendments would significantly broaden the population of issuers eligible to conduct shelf offerings and access other offering-related efficiencies. Companies should consider how expanded eligibility, changes to communication rules, and updated registration processes may impact their financing flexibility, governance and investor engagement.

The Securities and Exchange Commission (SEC) has proposed amendments to modernize the registered offering framework. The proposal would revise Form S-3 eligibility, extend key registration and communication flexibilities to a broader group of issuers, and streamline aspects of the offering process.

We summarize the proposal, provide context on its development, and highlight key considerations for issuers evaluating how these proposed changes may affect capital raising strategies, disclosure practices and transaction readiness.

Applicability

This information applies to issuers registered under the Securities Act of 1933 (Securities Act) that access the public capital markets through registered offerings, including those that currently rely on Form S-1 and Form S-3. The proposed amendments would affect domestic reporting companies subject to the Securities Exchange Act of 1934 (Exchange Act or 1934 Act), as well as business development companies (BDCs) and certain registered closed-end funds (CEFs).

The proposal is also relevant for companies evaluating public capital raising strategies – including initial public offerings, follow-on offerings and shelf registrations– as well as issuers considering changes to their offering practices, communication approaches and disclosure processes, including insurance companies offering certain registered products.

Relevant dates

The SEC seeks feedback from all stakeholders on the proposal. Comments are due within 60 days after publication of the proposing release in the Federal Register. The effective date of these amendments is to be determined.

Issuer action

Companies are encouraged to consider providing feedback to the SEC during the comment period. Stakeholders may also wish to assess how the proposed changes to Form S-3 eligibility, shelf offerings and communication rules could affect their capital raising strategies, transaction readiness and internal processes.

Proposal highlights

The SEC has proposed amendments to revise the registered offering framework with the intention of expanding issuers’ access to the public capital markets.

Expanded Form S-3 eligibility: The proposal would broaden eligibility to use Form S-3 (the short-form registration statement historically available only to ‘seasoned issuers’) by eliminating the minimum public float, ‘one-year seasoning’ and certain other requirements. Eligibility would instead focus primarily on whether an issuer is current and timely in its Exchange Act reporting. As a result, the number of issuers able to access short-form and shelf registration would significantly increase.

Extension of registration and communication flexibilities: The proposal would extend key offering-related benefits—many of which are currently limited to well-known seasoned issuers (WKSI)—to a broader set of issuers by replacing the WKSI construct. For example, a new category of ‘seasoned eligible listed issuers’ would allow more companies to qualify for automatic shelf registration.

Modernization of Form S-1: The proposal would greatly expand the ability to incorporate information by reference into Form S-1, including by permitting all issuers to forward incorporate information that otherwise meet the incorporation by reference requirements.

Preemption of state securities law registration: The proposal would expand federal preemption of state Blue Sky Laws regarding registration and qualification requirements to all registered offerings, including those involving unlisted securities.

Additional updates to offering practices: The proposal also includes conforming changes for certain BDCs and CEFs that use Form N-2, and other proposed amendments to advertising provisions for certain insurance products, with the overall objective of improving efficiency while maintaining investor protections.

Regulatory context and background

Registered offerings under the Securities Act play a central role in providing issuers with access to the public capital markets while offering investors the benefit of standardized disclosures and liability protections. Over time, the SEC has sought to balance these objectives by refining the disclosure framework and the offering process to promote capital formation while maintaining investor protection.

The current registered offering framework—particularly the eligibility requirements for Form S‑3 and the availability of shelf registration and related communication benefits—has evolved over several decades. These requirements have historically relied on factors such as public float and Exchange Act reporting history as indicators of the availability of issuer information.

In recent years, questions have been raised about whether these eligibility requirements continue to reflect how information is disseminated and accessed in today’s capital markets. Advances in technology, including widespread electronic access to SEC filings through EDGAR and other digital channels, have significantly increased the availability and timeliness of issuer information.

Against this backdrop, the SEC has proposed amendments intended to modernize the registered offering framework by expanding access to short-form registration and offering-related flexibilities. The proposal reflects a broader regulatory focus on supporting capital raising while intending to preserve key investor protection mechanisms embedded in the federal securities laws.

Expansion of Form S‑3 eligibility

The proposal would broaden the population of issuers eligible to use Form S-3. Currently, Form S-3 eligibility is based on a combination of registrant requirements (who can use the form) and transaction requirements (what types of offerings can be conducted on the form). Key requirements include:

Minimum public float threshold: To register offerings on Form S-3, an issuer generally must have at least $75 million of public float. Issuers that do not meet this threshold may still register certain transactions on Form S-3, but only if they satisfy alternative transaction-specific conditions.
‘One-year seasoning’ requirement: An issuer must have been subject to the requirements of Section 12 or 15(d) of the Exchange Act for at least 12 calendar months immediately preceding the filing of the registration statement.
Current and timely reporting: An issuer must be current in its filings and have filed all materials required to be filed pursuant to Section 13, 14, or 15(d) of the Exchange Act for at least 12 calendar months immediately preceding the filing of the registration statement.
Certain failures to make payments and defaults: An issuer must not have, since the end of its last fiscal year, failed to pay dividends or defaulted on certain debt or lease obligations.
Electronic filings and Interactive Data Files: An issuer must have submitted all required electronic filings and related structured data (e.g., XBRL) in accordance with SEC requirements.

The proposal would eliminate all of the requirements above except for the current and timely reporting requirement and would shift the focus of Form S-3 eligibility primarily to ongoing disclosure compliance. The proposal would also introduce new registrant limitations that restrict certain issuers from using Form S-3.

In particular, the proposal would prohibit a subset of ‘ineligible issuers’ from accessing the form. These generally include companies that may present a higher risk of non-compliance with the federal securities laws or potential investor protection concerns – such as shell companies, blank check companies and issuers involved in penny stock offerings – as well as issuers that have recently been subject to certain criminal convictions, antifraud enforcement actions or stop orders on registration statements. Notably however, former shell company registrants that were Special Purpose Acquisition Companies (SPACs) would remain eligible under the proposal to use Form S-3.

KPMG Perspective: The SEC indicates that this approach is intended to align the treatment of post de-SPAC companies with traditional IPO companies. In effect, the SEC views the de-SPAC transaction as functionally similar to a public offering of the operating company and therefore permits these companies to access Form S-3, subject to the same reporting and eligibility requirements as other issuers.

The proposal would also continue to permit certain majority-owned subsidiaries that are not Exchange Act reporting companies to rely on a parent’s Form S-3 eligibility in limited circumstances—particularly in connection with guarantee-related offerings—provided the parent satisfies the eligibility requirements and the subsidiary is included as a co-registrant on the registration statement.

Finally, the proposed expansion of Form S-3 eligibility would increase the population of issuers able to conduct at-the-market (ATM) offerings, which involve selling securities into the public market at prevailing prices. The proposal would introduce additional requirements to help ensure these offerings occur in markets with appropriate levels of liquidity, transparency and investor protections.

Recalibration of enhanced registration and communication benefits

Today, the most expansive set of registration permissions—often referred to as Enhanced Registration and Communication Benefits (ERCB)—is reserved primarily for registrants that qualify as WKSIs. The proposal would significantly revise the framework that determines which issuers can access ERCB, resulting in an expansion of eligible issuers.

To qualify as a WKSI, an issuer generally must:

Have at least $700 million in public float, or
Have issued at least $1 billion of non-convertible debt in registered offerings over the prior three years.

The proposal would remove the WKSI definition for issuers and replace it with two new categories:

Eligible Listed Issuers (ELIs) - Issuers that:
- Meet the revised Form S-3 eligibility requirements; and
- Have at least one class of common equity securities listed on a national securities exchange.
Seasoned Eligible Listed Issuers (SELIs) - ELIs that also have at least 12 months of Exchange Act reporting history.

Under this approach, ELIs would have access to all benefits currently available to WKSIs, except automatic shelf registration which would be limited to SELIs. Foreign Private Issuers (FPIs) would remain subject to current WKSI rules however.

The proposal would also extend ERCB to majority-owned subsidiaries by allowing them to rely on a parent’s ELI or SELI status—under specified conditions—even if the subsidiary does not independently meet the eligibility criteria.

Incorporation by reference on Form S-1

The proposal seeks to modernize Form S-1 by expanding the ability to incorporate information by reference. Currently, Form S-1 permits issuers to backward incorporate previously filed Exchange Act reports if they satisfy the form’s eligibility criteria to incorporate by reference. Form S-1 does not permit issuers, other than Smaller Reporting Companies (SRCs), to automatically update information in the prospectus via forward incorporation of their Exchange Act filings.

The proposal would amend Form S-1’s incorporation by reference provisions by:

Allowing broader use of backward incorporation by eliminating the eligibility criteria that the issuer must have filed an annual report for its most recently completed fiscal year; and
Expanding forward incorporation to all issuers that otherwise meet the incorporation by reference requirements.

Business Development Companies and Closed-End Funds

The proposal would amend the registration and offering process for certain categories of BDCs and registered CEFs, consistently with operating companies previously discussed. For these issuers, the WKSI definition would be replaced with new categories of ELI affected funds and SELI affected funds that would be defined in Rule 405.

The proposal would extend certain benefits currently available to BDCs and CEFs that are WKSIs and eligible to use Form S-3 by:

Expanding access to short-form shelf registration: Removing seasoning and public float requirements to use short-form shelf registration statements for Form N-2 to extend eligibility to a wider group of ELI and SELI affected funds.
Extending ERCB flexibilities to ELI affected funds: Providing certain benefits currently available only to WKSIs to ELI affected funds – regardless of seasoning – including but not limited to, omitting certain information from a base prospectus and exercising greater flexibility over pre-filing communications.
Expanding access to automatic shelf registration for SELI affected funds: Allowing SELI affected funds to use automatic shelf registration statements, consistent with the rights currently afforded to WKSIs. As a result, a larger population of affected funds would be able to access these benefits due to the removal of public float thresholds and other legacy requirements.

Preemption of state securities law registration requirements

The SEC’s proposal would expand federal preemption of Blue Sky Laws regarding registration and qualification requirements. Currently, such preemption generally applies only to ‘covered securities’, including securities listed on a national securities exchange and certain other specified categories. Under the proposal, the SEC would define ‘qualified purchasers’ for the purposes of Section 18(b)(3) of the Securities Act in a manner that would, in practice, preempt Blue Sky Laws regarding registration and qualification requirements for all registered offerings, including those involving unlisted securities.

Other rule amendments

The proposal also includes a number of targeted amendments intended to modernize the registration and offering framework, simplify regulatory requirements, and align related rules with the proposed changes to Form S‑3 eligibility and offering practices.

Insurance product advertising

Rule 482 currently governs advertising rules for variable annuities. The proposal would amend Rule 482 by making its use available, in certain circumstances, to insurance companies advertising registered index-linked annuities (RILAs) and registered market value adjustment annuities (MVA annuities).

Delaying amendments

Rule 473 currently permits issuers to include a ‘delaying amendment’ in a registration statement. This prevents the statement from becoming effective automatically under Section 8(a) of the Securities Act until either the issuer files an amendment affirming effectiveness or the SEC accelerates effectiveness.

The proposal would amend Rule 473 to provide that effectiveness of a registration statement would be deemed to be delayed by default (other than for automatically effective filings), unless the issuer affirmatively indicates that the registration statement should become effective in accordance with Section 8(a).

Loss reporting companies

The proposal would remove income-related conditions under Rule 3-01(c) and Rule 8-08(b) for SRCs in Regulation S-X for loss reporting companies and extend grace periods related to the age of audited annual financial statements included in a registration statement or certain proxy solicitations.

Comment period

The SEC is soliciting public comment on the proposal. The comment period will remain open for 60 days following publication of the proposing release in the Federal Register.