Today, Congressman Patrick McHenry (R-NC), Chairman of the Financial Services Subcommittee on Oversight and Investigations, joined bipartisan leaders in Congress to introduce H.R. 701, legislation providing the U.S. Securities and Exchange Commission (SEC) with an October 31st deadline to finalize Regulation A rules.
Congressman McHenry announced, "This legislation simply codifies an intended deadline for Regulation A as part of the JOBS Act. The target date is reasonable, nearly 19 months after the JOBS Act was signed into law and 5 months before the official Reg A review would need to occur. Our economy needs efficient, vibrant capital markets to thrive and this legislation is a step in the right direction."
Congressman Schweikert said, "It was a big win for the American people when we passed the Reg A bill to help small businesses go public. It will be an even bigger success if we can put Washington on a deadline to relieve small businesses from expensive underwriting costs as soon as possible."
Congressman Eshoo said, "This bill puts the SEC on deadline to finalize new Regulation A rules so that startup businesses can have access to additional capital. When Congress raised the SEC Regulation A offering limit, we did so because it was essential in meeting the capital formation needs of startup businesses in our country. It will create jobs, strengthen our economy, and promote the high-tech, sustainable energy, and life science sectors. Now, it's the SEC's turn to follow through."
Congressman Garrett said, "Congress took bipartisan action to pass the JOBS Act nearly a year ago. The SEC has yet to finalize its rules. This abject failure to implement key components -- like Regulation A -- stands in the way of economic growth and harms our capital markets. I thank Congressman McHenry for his hard work on this bill, and I look forward to its swift passage."
Congressman Scott said, "This bill is an important step in providing small businesses an exemption from burdensome requirements by offering a reasonable but firm deadline for finalizing the rules for Regulation A. The JOBS Act passed with strong support in the House, and this legislation builds on that progress by putting the release of the final rules in sight."
Regulation A offers small businesses an exemption from the registration requirements of the Securities Act of 1933. The JOBS Act requires the SEC to amend Regulation A by raising its threshold to $50 million and enact new regulations resolving issues that have made Regulation A unfeasible to date.