US exchanges in talks with SEC to ease public company regulations, aiming to encourage startups to list

From Yahoo Finance: 2025-06-25 06:18:00

U.S. exchange operators are discussing easing regulatory burdens with the SEC to encourage more startups to list. Talks involve Nasdaq, NYSE, and could mark significant regulatory reform since 2012. Nasdaq President Griggs emphasized making public markets more attractive but experts warn of increased investor risk with relaxed regulations.

Regulatory rollback discussions focus on making it easier for companies to list and stay public by reducing fees, curbing activist shareholder influence, and facilitating follow-on offerings. Efforts include easing regulations for companies listing through SPACs and raising capital through additional shares.

Public companies have faced increased disclosure requirements since 2002, leading to heightened regulatory oversight. The SEC has enhanced disclosure on various issues, contributing to a decrease in the number of public companies listed on U.S. exchanges. Efforts to roll back regulations have been seen in the past, including during Trump’s first term.

Some companies avoid IPOs due to disclosure requirements and regulatory scrutiny. SpaceX, for example, has been reluctant to list. Easing regulatory burdens may not lead to an immediate increase in IPOs, as companies’ decisions will depend on returns and valuations. Experts caution against the potential risks associated with relaxing regulations.

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