On September 17, 2025, the SEC issued a policy statement to the effect that the presence of a mandatory arbitration clause in an issuer’s governing documents with respect to investor claims arising under the federal securities laws will not impact the SEC staff’s decisions regarding whether to accelerate the effectiveness of an issuer’s registration statement under the Securities Act of 1933. When considering acceleration requests, the SEC staff will instead focus on the adequacy of the registration statement’s disclosures, including disclosure regarding any such mandatory arbitration clause. The SEC stated that its position would also apply to considering whether to accelerate the effectiveness of registration statements filed under the Securities Exchange Act of 1934, declare effective post-effective amendments to registration statements, and qualify an offering statement or a post-qualification amendment under Regulation A.

The policy statement reverses the SEC staff’s prior practice of not accelerating the effectiveness of Securities Act registration statements of issuers seeking to include a mandatory arbitration clause in their governing documents. In considering acceleration requests, the SEC staff evaluates certain criteria under Section 8(a) of the Securities Act and Rule 461 thereunder, which focus on ensuring complete and adequate disclosure of material information in the registration statement and also require consideration of “the public interest and the protection of investors.” According to the policy statement, the staff’s prior practice was generally based on the view that (1) mandatory arbitration clauses could potentially violate the anti-waiver provisions of the federal securities laws by foreclosing a judicial forum and unduly impede investors’ ability to bring private actions to vindicate their rights under the federal securities laws by foreclosing class action litigation in the courts, and (2) such anti-waiver provisions override the Federal Arbitration Act’s (FAA) policy favoring enforcement of arbitration agreements.

Based on its analysis of applicable U.S. Supreme Court precedent, the SEC now rejects that prior view and states that neither the anti-waiver provisions nor any other provisions of the federal securities laws override the FAA and that the inability to proceed in a judicial forum due to a mandatory arbitration clause would not violate the anti-waiver provisions of the federal securities laws. Accordingly, the SEC concluded that the existence of a mandatory arbitration clause is not an appropriate consideration under the public interest/investor protection standard. The SEC made clear, however, that it does not express a view on whether mandatory arbitration clauses are “appropriate or optimal for issuers or investors.”

The SEC’s policy statement is available here, and its related press release is available here.