08 Apr House Committee Starts Exciting Work on JOBS 2.0

A key subcommittee of the US House Financial Services Committee has announced a hearing tomorrow morning to begin consideration of a group of 7 bills that could coalesce into a large initiative to benefit small businesses and smaller public companies. Some are saying this, along with a previous bill passed by the House on tick size spreads, could indeed become the 2.0 version of 2012’s Jumpstart Our Business Startups (JOBS) Act, which brought many tremendous changes to the small business regulatory environment. The subcommittee’s memorandum summarizes the substance of the bills to be discussed, which also are pretty darn exciting, to include:

1. Expanding short form registration on Form S-3 to all reporting companies regardless of public float or whether their stock is traded on a national exchange.

2. Allowing Form S-1 registrations to do “forward incorporation by reference” after effectiveness, eliminating costly and risky post-effective amendments.

3. Preempting state blue sky review of securities issued by all smaller reporting and emerging growth companies.

4. Reducing the holding period to allow public sale under SEC Rule 144 from 6 months to 3 months.

5. Easing the burdens of registration on advisors to small business investment companies.

6. Expanding those who can file an automatically effective Form S-3 to those with $250 million public float and up.

7. Very important for us reverse merger folks: allowing former shells to have no special restrictions under Rule 144(i) starting two years after ceasing to be a shell.

A cool thing: after  a number of the bills’ descriptions, they include a statement that these are based on recommendations from the SEC’s annual government-business forum on small business, which we have worked hard over the years to make meaningful and substantive. When could this hit the House floor and Senate? I leave that to my expert friends in Washington. Kudos on all of this House FSC!