On December 9, 2021, the SEC Office of the Advocate for Small Business Capital Formation released its 2021 annual report condensing a treasure trove of data related to exempt and registered offerings by small businesses for the period July 1, 2020 to June 30, 2021 and providing related policy recommendations to support such businesses.
New Rules Modernize Securities Filings and Eliminate Pre-Offer Filing Requirements, Now Consistent with Federally Set Timelines
Recognizing the longstanding need for a new approach to the regulation of finders who help smaller businesses raise early stage capital, the SEC has published a notice of a proposed exemptive order and request for comment to formalize the regulatory status of unregistered finders. The proposed finders exemption from broker-dealer registration would facilitate a role for unregistered finders in the capital-raising process and clarify the circumstances under which issuers can legally compensate finders who comply with specified conditions. The author’s thoughts on the proposed finders exemption follow a summary of the rule proposal.