Nasdaq Gains Authority to Reject IPOs with Manipulation Risks

According to Odaily, the Nasdaq Stock Exchange has been granted increased discretion to reject IPO applications that pose manipulation risks. This new regulation was approved by the U.S. Securities and Exchange Commission (SEC) on Friday and is effective immediately. The rule empowers Nasdaq to deny company listings under certain conditions, such as when the company's business location does not cooperate with U.S. regulatory reviews, or if underwriters, brokers, lawyers, or auditing firms have been involved in problematic transactions. Additionally, concerns about the integrity of management or major shareholders can lead to rejection. This measure aims to address the issue of small IPOs experiencing significant price drops post-listing. Over the past year, half of Nasdaq's IPOs raised less than $15 million, with most experiencing a price decline of over 35% within a year.