On November 17, 2025, the Division of Corporation Finance of the U.S. Securities and Exchange Commission announced that it will not respond substantively to no-action requests regarding companies’ intent to exclude shareholder proposals under Rule 14a-8 of the Exchange Act of 1934, as amended, other than no-action requests related to Rule 14a-8(i)(1). The announcement applies to the current proxy season (October 1, 2025 – September 30, 2026) as well as to no-action requests received before October 1, 2025 to which the Staff has not yet responded.
The Division cited the recent federal government shutdown, the large volume of registration statements and other filings requiring the attention of the Staff, and the extensive body of guidance from the SEC available to companies and shareholder proponents relating to most bases for exclusion under Rule 14a-8, as reasons for the announcement.
Rule 14a-8(i)(1). The SEC will continue to respond substantively to no-action requests related to Rule 14a-8(i)(1) due to “recent developments regarding the application of state law and Rule 14a-8(i)(1) to precatory proposals.” Rule 14a-8(i)(1) permits a company to exclude a 14a-8 shareholder proposal “[i]f the proposal is not a proper subject for action by shareholders under the laws of the jurisdiction of the company’s organization.” A no-action request to the SEC seeking to exclude a shareholder proposal under Rule 14a-8(i)(1) must include “a supporting opinion of counsel” that the proposal is not proper under the applicable state law.
In October 2025, SEC Chair Paul Atkins delivered remarks at the John L. Weinberg Center for Corporate Governance suggesting that the SEC may be open to eliminating the ability of shareholders to submit precatory, or non-binding, shareholder proposals to companies incorporated in Delaware. In the speech, Chair Atkins referred to a forthcoming publication in the Michigan Business & Entrepreneurial Law Review that concludes that precatory proposals are not a “proper subject” because Delaware law does not confer on stockholders an inherent right to vote on precatory proposals. According to Chair Atkins, such proposals should be excludable under Rule 14a-8(i)(1). Atkins stated that if a company submitted a no-action letter with a Delaware legal opinion indicating that the proposal is “‘not a proper subject’ for shareholder action under Delaware law... I have high confidence that the SEC staff will honor this position.”
The Delaware courts have not directly addressed whether shareholders have a fundamental right to bring precatory proposals or whether such proposals are a “proper subject.” If the courts were to hold that no such right exists, or that precatory proposals are not a proper subject, that decision could potentially eliminate a substantial portion of the Rule 14a-8 proposals companies currently receive.
No-Action Requests. Companies that intend to exclude Rule 14a-8 shareholder proposals from their proxy materials must still notify the SEC and proponents no later than 80 calendar days before filing a definitive proxy statement; however, the notification requirement is informational only.
Companies intending to exclude Rule 14a-8 shareholder proposals other than under Rule 14a-8(i)(1) may request an acknowledgment from the SEC by submitting a Rule 14a-8(j) notice to the SEC along with an unqualified representation from the company or its counsel that the company has a reasonable basis to exclude the proposal based on the provisions of Rule 14a-8, prior published guidance or applicable case law. In these cases, the Staff will issue a letter stating that, based solely on the company’s representation, it will not object if the company omits the proposal, but it will not evaluate the merits of the exclusion.
Companies that have already submitted requests (other than under Rule 14a-8(i)(1)) and wish to obtain an acknowledgment letter must update their submission through the SEC’s Shareholder Proposal Form with the required representation, but the original date still applies for the 80-day rule.
The Staff noted that the absence of a prior response concurring with a basis for exclusion or a prior response indicating that the Staff could not concur with a basis for exclusion does not prevent companies from determining that they have a reasonable basis to exclude the same or a similar proposal. However, Staff responses to no-action requests and Rule 14a-8(j) notifications are not binding on the SEC and do not preclude the SEC from taking enforcement action in appropriate circumstances.
The Division’s statement is available here. Commissioner Caroline Crenshaw issued a statement on the announcement, available here.
This publication is for general information purposes only. It is not intended to provide, nor is it to be used as, a substitute for legal advice. In some jurisdictions it may be considered attorney advertising.