SEC Approves Nasdaq’s New $5 Million MVLS Continued Listing Standard

Published On July 24, 2026 and Updated on July 31st, 2026

New rule provides for immediate suspension of trading on Nasdaq after 30 consecutive business days below the threshold, without an ordinary cure period or a stay pending appeal

Update—SEC Approval Order Temporarily Stayed.

On July 29, 2026, the Securities and Exchange Commission (the “SEC”) notified Nasdaq that it had received notices of intent to petition for review of the Division of Trading and Markets’ delegated approval of the new $5 million MVLS (as defined below) continued listing requirement. Under SEC Rule of Practice 431(e), the filing of those notices automatically stayed the SEC’s July 22 approval order until the SEC orders otherwise unless any narrow exceptions apply. Accordingly, Nasdaq’s new $5 million MVLS continued listing requirement is stayed and is not effective.

The Small Public Company Coalition, an organization representing small public companies and one of the parties that filed a notice of intent to petition for review, has indicated that it plans to ask the full Commission to review the Division of Trading and Markets’ delegated approval action.

The SEC may decline review or affirm, modify, reverse, set aside or remand the Division of Trading and Markets’ approval, with no prescribed deadline for its decision. Because SEC review is generally a prerequisite to judicial review, the matter could later proceed to a federal court of appeals, potentially extending the stay and significantly delaying implementation.

Key Elements of the New Rule

New $5 Million MVLS Continued Listing Requirement. On July 22, 2026, the SEC approved a significant change to Nasdaq’s continued listing standards. Under the new rule, a company listed on the Nasdaq Global Select Market, Nasdaq Global Market or Nasdaq Capital Market must maintain a Market Value of Listed Securities (“MVLS”) of at least $5 million.

Immediate Suspension Without an Ordinary Cure Period. A company whose MVLS remains below $5 million for 30 consecutive business days will receive a Staff Delisting Determination (“Delisting Determination”) and become immediately subject to suspension and delisting. Unlike most other quantitative listing deficiencies, the company will not receive an automatic cure or compliance period. Moreover, requesting a hearing before a Nasdaq Hearings Panel (the “Panel”) will not stay the suspension of trading and the securities will remain suspended from trading on Nasdaq while the appeal is pending.

Limited Relief Through the Hearings Panel. A company may appeal the Delisting Determination to the Panel. The Panel may (1) reverse the determination if Nasdaq Staff made an error; or (2) grant an exception for a period of up to 180 days from the date of the Delisting Determination. The second form of relief, however, is substantially more demanding than an ordinary continued listing cure period. To resume trading on Nasdaq, the company must demonstrate compliance with all applicable initial listing requirements, rather than merely restoring its MVLS above $5 million or satisfying the applicable continued listing standards. Initial listing requirements vary by Nasdaq market and listing standard and may include requirements relating to minimum bid price, market value of publicly held shares, stockholders’ equity, market capitalization, public float, round-lot holders and operating history.

Practical Implications for Nasdaq-Listed Companies

The rule will materially change the risk profile for companies approaching the $5 million MVLS threshold. A company may have only a limited window in which to address the deficiency before suspension, and many traditional responses to other listing deficiencies may not be effective.

Establish Enhanced MVLS Monitoring

Companies approaching the $5 million MVLS threshold should monitor their MVLS daily and maintain an internal count of consecutive business days below the threshold. Management should establish escalation levels above $5 million so that the board of directors, disclosure committee, legal counsel, financial advisers and investor relations team are engaged before the 30-business-day period begins to run. Companies should also confirm the number of securities included in Nasdaq’s MVLS calculation and promptly investigate any discrepancy in Nasdaq’s calculation.

Evaluate Initial Listing Eligibility Before an Appeal Is Needed

Because a Panel exception will require compliance with all applicable initial listing requirements, a company should not wait until it receives a Delisting Determination to evaluate those requirements. The analysis should identify, among other matters: (i) the Nasdaq market and initial listing standard the company could satisfy; (ii) whether the company meets the applicable minimum bid price requirement; (iii) the market value and number of publicly held shares; (iv) applicable stockholders’ equity, market capitalization or income requirements; (v) public-holder and market-maker requirements; and (vi) any other applicable quantitative or qualitative listing conditions.

Consider Capital and Strategic Alternatives Early

Companies near the threshold should assess available capital-raising, balance-sheets and strategic alternatives well before the end of the 30-business-day period. Because a reverse stock split generally does not change the company’s MVLS, it will not, by itself, cure the deficiency. Potential responses will depend on the company’s circumstances and could include an equity financing, strategic investment, business combination, asset transaction, debt restructuring or other transaction that increases the value of the listed equity. Companies should carefully consider dilution, shareholder approval requirements, financing covenants and the possibility that a distressed financing could create additional pressure on the trading price.

Prepare for Immediate Suspension

An issuer approaching the threshold should develop a contingency plan addressing:

• arrangements for potential trading on the over-the-counter (“OTC”) market;
• communications with investors, employees, lenders and business partners;
• institutional or index-related selling;
• contractual provisions tied to continued Nasdaq listing;
• disclosure obligations arising from the deficiency, Delisting Determination or suspension;
• the evidentiary record necessary to seek Panel relief.

What Happens Next

In connection with the SEC’s notice to Nasdaq on July 29, 2025, the SEC’s July 22 approval order will remain stayed unless and until the SEC orders otherwise. The SEC will consider the forthcoming petitions for review, although the timing of that process is uncertain and the SEC may lift or otherwise modify the stay. Nasdaq-listed companies should continue monitoring further SEC and Nasdaq developments regarding the rule’s effectiveness and implementation.

Our team will provide timely updates of this new Nasdaq rule and is available to advise Nasdaq-listed companies on implementation, compliance planning and the Panel review process.