Federal Proposals the Alliance has Commented on
SEC Rule on Implementation of JOBS Act Allowing Private Funds to Advertise and Solicit for Fundraising
Proposed Rule on Amendments to Form D for General Solicitation and Advertising
SBIA Comments Submitted on September 23, 2013 Regarding Form D
Innovation Coalition Comments to the SEC on October 30
The SEC also issued proposed rules requiring any issuer to file Form D in Rule 506(c) offerings
before the issuer engages in general solicitation and requires the
filing of a closing amendment to Form D after the termination of any
Rule 506 offering.
Proposed Rule on Verification of Accredited Investor Status
Final Rule on Verification of Accredited Investor Status
SBIA Comments Submitted on October 5, 2012 - Available Here
The SEC issued the proposed Rule on September 5th, 2012, to implement the provision in the JOBS Act to allow private funds to advertise and solicit to the public for fundraising purposes. The Act states that Funds must verify the accredited investor status of its investors in order to be allowed to advertise or solicit to the general public. SBIA commented to the SEC to take into consideration new administrative burdens on PE funds, particularly smaller funds, and asks for several safe harbors.
Expected Future Action: Final Rules on verification of accreditation status went into effect on September 23, 2013. Final Rules on Form D have not been finalized.
Volcker Rule Implementation
Financial Stability Oversight Council – Proposed Rule
Comments Submitted on February 13, 2012 – Available Here
Purpose: The Federal Deposit Insurance Corporation ("FDIC”), the Board of Governors of the Federal Reserve System ("Board”), the Securities and Exchange Commission ("SEC”), and the Department of Treasury ("Treas.”) have issued their proposal for implementing the Volcker Rule, which sharply restricts the ability of banks to engage in proprietary investing in private equity funds. According to the proposed rule, banks can still invest in SBIC funds without restrictions.
Expected Future Action: The four agencies overseeing the implementation of the Volcker Rule have not yet released a Final Rule.
Early-Stage Small Business Investment Companies
Small Business Administration – Proposed Rule
Comments Submitted on February 7, 2012 - Available Here
Purpose: The SBA has proposed the guidelines for a new type of Small Business Investment Company called an Early Stage SBIC. This type of SBIC is being created as a vehicle to access SBA leverage and make investments through the newly-formed SBIC Innovation Fund aimed at providing early-stage capital to companies that have not yet achieved positive cash-flows.
Exemption from SEC Registration for Private Funds with less than $150 Assets Under Management
Securities and Exchange Commission - Proposed Rule
Comments Submitted on January 24, 2011 - Available Here
Purpose: As required by Title IV of the Dodd-Frank Act – the Private Fund Investment Advisers Registration Act of 2010, for the purpose of being exempt from SEC registration requirements, the proposed rules would define "venture capital fund” as well as define elements related to the exemption for advisers with less than $150 million in private fund assets under management in the United States. The proposed rule would also clarify the meaning of certain terms included in a new exemption for foreign private advisers.
Expected Future Action: According to the Dodd-Frank Act, the provisions involving SEC registration requirements were effective on 7/21/2011.
Proposed Revisions to SBIC Reporting Form 468
Small Business Administration – Notice of Submission to Office of Management and Budget
Comments Submitted on February 3, 2011 - Available Here
Purpose: In order to ensure the collection of SBIC financial data that is most relevant to the SBA’s Investment Division while attempting to reduce redundancy, the SBA proposed various changes to reporting form 468. SBIA commented and the SBA took into consideration many of our concerns and issues.
Frequently Asked Questions: The SBA has compiled a list of FAQs for the updated changes to the Form 468. Click here to access the FAQS.
Study on Volcker Rule
Financial Stability Oversight Council- Notice and Request for Information
Comments Submitted on November 5, 2010 - Available Here
Purpose: Under Section 619, the Office of the Comptroller of the Currency ("OCC”), the Federal Deposit Insurance Corporation ("FDIC”), the Board of Governors of the Federal Reserve System ("Board”), the Securities and Exchange Commission ("SEC”) and the Commodity Futures Trading Commission ("CFTC”) must consider the recommendations of the FSOC study in developing and adopting regulations to implement the Volcker Rule. To assist the FSOC in conducting the study and formulating its recommendations, the FSOC is issuing this request for information through public comment.
Expected Future Action: The above-referenced study is available here. Agencies are required, not later than nine months after the completion of this study (completion date was January, 2011), to adopt rules to implement the Volcker Rule and must consider the recommendations of the Council in developing and adopting such regulations (The Proposed Rule was released in October 2011 and Alliance commented on it, as seen above).