SEC Grants Review of Nasdaq’s $5 Million MVLS Delisting Rule
Welcome news for small cap issuers came recently when, on September 11, 2026, the SEC formally granted the petitions that had been filed by the Small Public Company Coalition and Cemtrex, Inc. for review of Nasdaq’s proposed $5 million Market Value of Listed Securities (“MVLS”) continued listing requirement, which would have provided Nasdaq with the ability to impose immediate suspension and delisting after 30 consecutive business days on issuers whose MVLS fell below $5 million, with no cure period.
What the September 11 Order Does
On September 11, 2026, the SEC issued an order granting the petitions for review filed by the Small Public Company Coalition and Cemtrex, Inc. The MVLS Requirement remains stayed while the review proceeds, meaning it is still unenforceable. The order also opens a public comment window, and any party may file a written statement for or against the rule by October 6, 2026.
Effect on the Market, For Now
For the immediate future, the MVLS Requirement remains stayed and unenforceable. However, given the heightened regulatory scrutiny, issuers should not assume the rule will be permanently struck down. We would encourage clients to continue monitoring their MVLS, evaluating capital structures and financing options in advance, and preparing for a possible Nasdaq Hearings Panel appeal in the event the rule is ultimately adopted.
If you have any questions, please contact Anand Saha (asaha@cronelawgroup.com), Liang Shih (lshih@cronelawgroup.com), Daisy Dai (DDai@cronelawgroup.com), Hongye (Eve) Mao (hmao@cronelawgroup.com) or your usual Crone contact.
