The SEC has permanently scrapped its no-action letter process for shareholder proposals, removing the main channel companies and investors used to seek staff guidance before annual meetings.
That shift pushes disputes into court instead, raising costs sharply and making it harder for both sides to judge whether a proposal can be excluded from proxy materials.
Investors and companies now lose the SEC’s long-standing referee role, complicating planning around shareholder resolutions and increasing legal uncertainty in proxy season.
The change marks a structural rewrite of how U.S. shareholder proposal battles are resolved, with litigation replacing staff review as the default path.