Rep. Scott Garrett (R-NJ), Chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, issued the following statement after the Securities and Exchange Commission (SEC) adopted a new rule to implement a JOBS Act requirement to lift the ban on general solicitation or general advertising for certain private securities offerings.
"More than a year ago, in a strong bipartisan manner, Congress passed the JOBS Act. As mandated by Section 201 of the JOBS Act, the Securities and Exchange Commission (SEC) has finally voted to lift the prohibition on general solicitation and general advertising in certain private securities offerings to accredited investors and qualified institutional buyers. This key provision of the JOBS Act will provide an important new avenue for startups and small companies to raise much-need capital in order to grow their businesses, create American jobs, and boost the economy. I am pleased that this significant milestone on the road to improving small business capital formation is finally complete, and I urge the SEC immediately to take up implementation of the remaining provisions of the JOBS Act.
"In another instance of unnecessary regulatory overreach, however, the SEC also took the opportunity this morning--over the objections of two Commissioners--to propose additional amendments to Form D filings which were not called for under Section 201 of the JOBS Act. These amendments would likely increase regulatory burdens on small businesses seeking to conduct Regulation D offerings and thereby undermine the fundamental goals of the JOBS Act. Despite receiving a narrow and straightforward mandate from Congress, the SEC's actions today once again call into question its commitment to small business capital formation and its ability to properly execute its core mission."