By Lauren Mack On August 6, 2015, the SEC’s Division of Corporation Finance (“DCF”) updated its Compliance and Disclosure Interpretations (“CDI”) with eleven new CDI on general solicitation and advertising in Regulation D offerings. That same day, the DCF also issued a no-action letter finding that an online venture capital firm’s procedures for creating online pre-existing substantial relationships did not constitute general solicitation and advertising …
SEC Moves to Update Regulation A
By Kathryn Dachille and Simon Riveles December 18, 2013, the SEC voted to propose amendments to Regulation A that would allow offerings of up to $50 million in any twelve month period (“Tier 2 offerings”), as mandated by Title IV of the JOBS Act (so called Regulation A+”). While Tier 2 offerings would be subject to significant additional requirements, such as the provision of audited …
The “Bad Actor” Amendments: Private Issuer Compliance with Rule 506
By Simon Riveles and Peter Tyson On July 10, 2013, the Securities and Exchange Commission (SEC) adopted amendments to Rule 506 of the Securities Act of 1933 to disqualify securities offerings relying on the Rule 506 exemption that involve certain “felons and other ‘bad actors’”. The final amendments (the Final Rules) went into effect on September 23, 2013 (the Effective Date) and apply to all …
SEC Grants “Accredited Crowdfunding” Platforms Relief from Broker Dealer Registration
By Ryan Finn and Simon Riveles In two recent no action letters the SEC granted exemptive relief from broker dealer registration to crowdfunding sites on the basis that the platforms received carried interest rather than transaction base compensation. Although the SEC made it clear that the no-action letters were to be narrowly construed to the specific facts of each case, some commentators extrapolated that the …
SEC Posts Q&A About Broker-Dealer Exemption in JOBS Act
On its website, the SEC posted responses to frequently asked questions regarding Broker-Dealer Registration under Title II of the Jobs Act.
The JOBS Act: Important Questions Remain Unresolved For Private Funds
On August 29, 2012, the SEC proposed rules implementing the Jumpstart Our Business Startups Act’s (JOBS) eliminating the long-standing ban on general solicitation and general advertising for certain exempt securities offerings. The proposal would require (1) all purchasers of securities sold in such offerings to be accredited investors and (2) that issuers take reasonable steps to verify that their purchasers are accredited investors. The proposed …
SEC Issues Proposed Rule on Lifting Ban on General Solicitation under Rule 506 Offerings
On August 29, 2012, the SEC voted, by a 4-1 margin, to issue a proposed rule (“proposed rule”) that would eliminate the current ban on general solicitation and general advertising (collectively “General Solicitation”) under Rule 506 and Rule 144A of the 1933 Securities Act. New rule 506(c) of Reg. D is the first rule proposed for implementing the Jumpstart Our Business Startup Act (the “JOBS …
MFA Provides Recommendations on Implementation of JOBS Act
In a letter to the SEC, dated May 4, 2012, the Managed Futures Association (“MFA”), a hedge fund industry advocacy group, made several recommendations to the Commission regarding implementation of the repeal of the ban on general solicitation under the JOBS Act (the “Act”), particularly ways in which the Act can better be harmonized with existing securities laws. Passed in early April, 2012, the Act …