WASHINGTON, Oct 9 (Reuters) - Wall Street's top

regulator on Thursday eased the way for companies to proceed

with initial public offerings during the federal government's

shutdown, according to an announcement on its website.

Companies are normally prevented from debuting on Wall

Street during periods when Congress has not approved funding for

government operations, because officials are unable to review

and approve registration statements. That has prompted investor

concerns that partisan gridlock in Washington could dent the IPO

market.

However, companies can allow their statements to become

effective automatically, which involves setting their IPO

pricing 20 days before the listing instead of finalizing it the

night before after a U.S. Securities and Exchange Commission

review.

In an announcement posted on its website on Thursday, the

SEC said because officials were unavailable to review

registration statements, the regulator would not seek to punish

companies that omit pricing information from prospectuses filed

during the shutdown and then go public either during the

shutdown or afterwards.

An SEC spokesperson declined to comment.

In a client alert, law firm Davis Polk said the change had

occurred following "discussions" the firm and others had held

with the agency. The firm did not immediately respond to a

request for comment on Thursday.