Two routes off the exchange, one form. Rule 12d2-2 distinguishes a delisting the exchange initiates from a withdrawal the company chooses. For the exchange to strike a security under its own standards, its rules must at a minimum provide "notice to the issuer of the exchange's decision to delist its securities," an opportunity for appeal to the exchange's board or a board committee, and public notice of the final determination by press release and website posting "no fewer than 10 days before the delisting becomes effective." For a voluntary withdrawal, the company must give the exchange written notice no fewer than 10 days before it files Form 25 with the SEC, publish its intention and reasons in a press release and on its website, and, if it has not arranged for the security to be listed on another exchange or quoted in an over-the-counter quotation medium, say so in that notice. Either way the instrument is Form 25, and it carries two clocks: the delisting itself is effective 10 days after Form 25 is filed, while the withdrawal of the security's registration under Section 12(b) is effective 90 days after filing, or sooner if the SEC allows. The SEC can postpone effectiveness to check that the application followed the exchange's rules.
Delisted, deregistered and non-reporting are three different states. Section 12(d) says a company whose security is stricken is relieved of compliance with Sections 12 and 13 "as to the securities so withdrawn or stricken," but Rule 12d2-2 is explicit that Form 25 reaches only exchange listing and Section 12(b) registration. A company with enough holders of record may still be registered under Section 12(g), and a company that has sold registered securities to the public may still owe reports under Section 15(d). Rule 12d2-2(d)(5) through (7) spell out how those duties survive or resume. In practice a delisted company that wants to stop reporting has to take further steps, and one that does not, or cannot, keeps filing.
What triggers it: continued-listing standards, with Nasdaq's price rule as the worked case. Every exchange sets initial listing standards and lower continued-listing standards, and price is the one most companies stumble on. Nasdaq's Bid Price Requirement is a closing bid of at least $1.00 per share. A failure occurs when the closing bid is below $1.00 for 30 consecutive business days; Nasdaq then notifies the company and grants an automatic compliance period of 180 calendar days, and compliance is regained by closing at or above $1.00 for a minimum of 10 consecutive business days. A company on the Nasdaq Capital Market that meets certain conditions and notifies Nasdaq of its intent to cure the deficiency may receive a second 180-day period. If it is not eligible for a second period, or fails to cure within it, Nasdaq issues a Delisting Determination, which the company may appeal to a Listing Qualifications Hearings Panel; the Panel may allow up to 180 further days from the Delisting Determination, so, in the SEC's words, a company "may be continuously deficient with the Bid Price Requirement and continue trading on Nasdaq for more than 360 days but not more than 540 days." Two shortcuts bypass the compliance periods: a closing bid of $0.10 or less for 10 consecutive trading days during any compliance period requires a Delisting Determination, and a company that effected a reverse stock split within the prior year, or reverse splits totaling 250-to-1 over two years, gets no compliance period at all (the reverse stock split page has the detail). Since 2025 an appeal no longer stays the trading suspension for a company that already used a second compliance period; its shares move to the over-the-counter market while the Panel considers the case.
Nasdaq added a second hard floor in 2026. An SEC order of July 22, 2026 approved a new continued-listing requirement that companies on the Nasdaq Global Select, Global and Capital Markets maintain a Market Value of Listed Securities of at least $5 million, and a company that fails it for 30 consecutive business days is "immediately subject to suspension and delisting" with no cure or compliance period; a hearing request does not stay the suspension, and the Panel may reverse a staff error or grant up to 180 days for the company to show it meets all initial listing requirements again. Market Value of Listed Securities is the consolidated closing bid price multiplied by the listed shares, so a small company's price and its share count now both matter.
The NYSE version. The NYSE's Price Criteria are breached when the average closing price is below $1.00 over a consecutive 30 trading-day period. The company then has six months to bring both its closing price and its 30-day average closing price back to at least $1.00, and it must tell the exchange within 10 business days that it intends to cure. The same reverse-split bar applies as at Nasdaq, with a 200-to-1 cumulative threshold over two years. In August 2026 the SEC approved a further NYSE rule, effective July 1, 2027, under which a closing price below $0.25 on any trading day triggers immediate suspension and delisting proceedings with no cure period; the exchange told the SEC it already initiates suspension and delisting promptly when a stock trades below $0.10, and the new rule raises that figure and writes it into the rulebook.
Where the shares go. The SEC's bulletin on public-company bankruptcy states the general position plainly: companies in bankruptcy "are generally unable to meet the listing standards to continue to trade on the NYSE or NASDAQ," but "even when a company is delisted from one of these stock exchanges, its shares may continue to trade on over-the-counter securities markets." The same is true of a company delisted for any other reason. There is no federal law that stops a delisted security from trading; what changes is the venue, the liquidity, the spread between bid and ask, and, if the company also stops reporting, the information available about it. Index funds that track exchange-listed indexes generally sell on delisting, and a stock that is no longer listed on any exchange is not a "margin security" as the Federal Reserve's Regulation T defines one, so it carries no loan value in a margin account. The practical consequences extend beyond the exchange's own decision.
One statutory delisting that runs through the SEC rather than the exchange. The Holding Foreign Companies Accountable Act, codified at 15 U.S.C. 7214(i), requires the SEC to identify each reporting company whose auditor has a branch or office in a foreign jurisdiction that the Public Company Accounting Oversight Board "is unable to inspect or investigate completely" because of that jurisdiction's position. If the SEC determines that a company has "2 consecutive non-inspection years," it "shall prohibit the securities of the covered issuer from being traded" on a national securities exchange or through any other method within the SEC's jurisdiction, expressly including over-the-counter trading. Summaries written when the law was passed in 2020 describe a three-year trigger; the statute as codified today says two, the result of a December 2022 amendment. The prohibition lifts when the company certifies that it has retained an auditor the PCAOB has inspected. Which companies are currently identified changes with each year's audit reports and is not described here.
