Expanding WKSI Eligibility Act

The bill would establish a statutory definition of "well-known seasoned issuer" for purposes of the federal securities laws, setting the qualifying threshold at an aggregate market value of $400,000,000 or more in voting and non-voting common equity held by non-affiliates. This figure would replace the existing market value requirement in SEC Rule 405 (17 CFR § 230.405). A company meeting this threshold — and otherwise satisfying existing Rule 405 requirements — could make automatic shelf registrations, which allow expedited public offerings without waiting for SEC review on a deal-by-deal basis.

The bill would also direct the SEC to report, within 90 days after each calendar year ends, the total number of WKSI applications submitted during that year under Rule 405 that the applicant withdrew. It does not alter any other element of the existing WKSI definition or change how the designation is used once obtained.

Publicly traded companies that currently fall below the existing WKSI market value threshold but would qualify under the new $400 million floor — primarily mid-sized issuers seeking faster access to capital markets. Investment banks and underwriters that assist with shelf-registered offerings would also be affected. The SEC would gain a new annual reporting obligation.

WKSI status lets companies raise capital through automatic shelf registrations, bypassing deal-by-deal SEC review and significantly reducing time to market. Companies that gain the designation under the lower threshold could access capital more quickly and cheaply. The annual withdrawal report would give policymakers data on how many companies are trying — and failing — to obtain the designation.

The $400 million threshold would take effect upon enactment and be measured under Form S-3 general instruction I.B.1. as it existed on the date of enactment, providing a fixed benchmark. The SEC would not need to issue new rules to apply the threshold; it would operate as a statutory override of Rule 405's market value requirement. The annual withdrawn-application report would be published within 90 days of each calendar year end, drawing on the SEC's existing application tracking for ineligible-issuer determinations under Rule 405.