SEC Chair Mary Jo White opened up last weeks Investor Advisory Committee meeting with a brief welcome and recap of recent events. She first commented on the final rules for Reg A+ “which are intended to enhance the ability of small companies to raise capital”, highlighting the increased funding cap to $50 million, and the fact that state review will no longer take place (Tier 2 only). She made certain to mention NASAA, a special interest group that lobbied aggressively to maintain state Blue Sky review, and their “coordinated review process” which remains incomplete.
The JOBS Act was signed into law 3 years ago and has endured a torturous journey to actually become law. The portions of the bill that required SEC insight and input have slowly climbed the regulatory process. Title III, retail crowdfunding, is the final section of the ACT that remains incomplete. Chair White, who stated it was a priority in 2014 as well, closed her remarks claiming;
“On the JOBS Act side, adoption of final crowdfunding rules is our last major rulemaking to complete, which is also a priority for 2015.”
In her defense (and the SECs) they have been busy with the mountainous requirements of Dodd-Frank that has “
overwhelmed the regulatory system, stifled the financial industry and impaired economic growth”.
For now it is more of a question as to whether or not Congress will be able to mobilize and fix Title III crowdfunding, something that is broadly viewed as DOA due to excessive cost and problematic liabilities, before the SEC will feel compelled to live up to its claim. Either way – final rules should be deciphered before 2016.
