Securities Registration Post-Effective Period - Explained
Post-Effective Period Limitations on Securities Issuers
Written by Jason Gordon
Updated at April 6th, 2023
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What is an issuer allowed to do during the Post-Effective Period?
During the Post-Effective Period, the issuer can begin selling securities. The issuer must still deliver a statutorily prescribed prospectus to offerees. Additional rules benefiting WKSIs exist during this stage that allow for an automatic shelf registration. Shelf registration is the pre-registration of securities that will not be issued until a later date. This can be useful when the business plans for multiple stages of funding over a period of time.
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Discussion Question
Why do you think the securities laws are less restrictive on communications by issuers following the post-effective period? Should there be any continued regulation (beyond the requirement to provide purchasers with a prospectus) following the post-effective date?
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