California is in the process of attempting to pass legislation, once again, to legalize intrastate investment crowdfunding. If the proposed bill becomes law, California will join dozens of other states that enacted similar regulations to help fund small and emerging companies within their boundaries by matching interested investors with promising small firms. Since California is an enormous regional economy and home to the hottest startup scene in the world, enacting state rules may have significant impact on driving economic growth and of course more jobs.
With intrastate crowdfunding laws the devil is always in the details. Many states have adhered closely to the federal exemption under Title III of the JOBS Act. Some states have gone out of their way to try to improve upon the federal rules.
Below is the synopsis of AB 2178, sponsored by Assembly Member David Chiu. This is the bill that is being kicked around in Sacramento right now. While the process will take quite a bit more time, and much can change over the coming months, this is the document that is being distributed to California legislators now.
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