House Bill Includes Insider Trading Plan Study
News of Rep. Chris Collins’ (R-N.Y.) recent indictment for insider trading has brought attention to a little-known provision in the JOBS and Investor Confidence Act of 2018. Passing through the House of Representatives last month, the bill dubbed “JOBS Act 3.0” features a measure requiring the Securities and Exchange Commission (“SEC”) to study insider trading plans administered by Rule 10b5-1 of the Securities Exchange Act. Such plans let company insiders trade stock on a fixed schedule and avoid liability from insider trading. The study includes examining the new restrictions to Rule 10b5-1, such as when an issuer can implement a 10b5-1 plan. Currently, Rule 10b5-1 offers an organized approach. Read More.
JOBS Act Exemptions to Expire Soon for Emerging Growth Companies
Businesses that went public under the designation of emerging growth companies shortly after the JOBS Act of 2012 was enacted could soon lose their exemptions from the law. The five-year exemptions included in the JOBS Act, which curtails regulations for young companies that raise investor funds and encourages initial public offerings, are set to expire soon. Once the exemptions expire, hundreds of young companies will be subject to various accounting, disclosure and corporate governance requirements foreign to them. One exemption set to go away relates to Section 404(b) of the Sarbanes-Oxley Act. Section 404(b) requires an external auditor to review. Read More.
Topics: Dodd-Frank Act, Emerging Growth Companies, JOBS Act, Jumpstart Our Business Startups Act "JOBS Act", Pay Ratio Disclosure, Sarbanes-Oxley Act "SOX", SEC, Securities and Exchange Commission "SEC"
Deregulatory Bills Clear the House Financial Services Committee
On October 12, the House Financial Services Committee approved almost two dozen financial deregulation bills. The measures included bills that allow more investors to participate in private stock offerings, expand the JOBS Act, and update the Dodd-Frank Act’s systemic risk designation process for banking institutions. Several of the House-approved bills include the following: The Fostering Innovation Act of 2017 expands small company exemptions from the auditor attestation requirements of the Sarbanes-Oxley Act of 2002. The bill exempts a company from Section 404(b) compliance for an additional five years after losing its emerging growth company status, provided that the company remains. Read More.
Topics: Acquisitions, and Brokerage Simplification Act, Deregulation, Dodd-Frank Act, Encouraging Public Offerings Act, Fair Investment Opportunities for Professional Experts Act, Fostering Innovation Act, House Financial Services Committee, JOBS Act, Market Data Protection Act, Micro Offering Safe Harbor Act, sales, Sarbanes-Oxley Act "SOX", Securities Act of 1933, Securities and Exchange Commission "SEC", Small Business Mergers, Systemic Risk Designation Improvement Act, Systemically Important Financial Institution "SIFI", Taking Account of Institutions with Low Operation Risk Act
Montana and Massachusetts Officials to Challenge Regulation A+
In federal appeals court later this month, state securities regulators and the Securities and Exchange Commission (“SEC”) will square off over the agency’s Regulation A+ amendments under the JOBS Act. Montana and Massachusetts officials seek to overturn the capital formation rule, contending it overlaps state management of certain securities offerings. Issued in June 2015, Release No. 33-9741, Amendments to Regulation A, the rules increase the amount companies can raise (up to $50 million) in transactions that are compared frequently to small-scale initial public offerings, but have lesser disclosure and accounting requirements than more traditional registered offerings. The final rules allowed companies to. Read More.
GATE Global Impact Petitions for Change to Anti-Fraud Rule
Last month, GATE Global Impact Inc., filed a rulemaking petition asking the Securities and Exchange Commission (“SEC”) to amend Rule 15c2-11 under the Securities Exchange Act of 1934. The New York-based electronic marketplace says the decades-old rule against microcap fraud must be changed to account for what it believes to be an unintentional consequence of the JOBS Act. Per its petition, GATE predicted that SEC adoption of the JOBS Act’s “Regulation A+” capital formation rules would increase the number of securities bound by Rule 15c2-11. Without making changes to the “piggyback” exception to Rule 15c2-11, GATE insisted that the rise. Read More.