House Subcommittee Holds Hearing on Legislative Proposals to Enhance Capital Formation and Reduce Regulatory Burdens

The House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises (the "Subcommittee") held a hearing titled "Legislative Proposals to Enhance Capital Formation and Reduce Regulatory Burdens."

Witnesses discussed 12 legislative proposals on capital formation for small businesses, including the "Small Business Investment Advisers Relief Act of 2015" (H.R. 432) and a bill to amend the CEA and the Securities Exchange Act to specify how clearing requirements apply to certain transactions between affiliates (H.R. 1317).

North American Securities Administrators Association ("NASAA") President William Beatty submitted a statement to the Subcommittee for the record in which he stated that NASAA shares Congress's desire to foster capital formation for small and emerging businesses. Mr. Beatty described several recent steps taken by NASAA and its members to "promote responsible capital formation". These include the establishment of an electronic filing depository system to allow private company issuers to file a Form D for Regulation D, Rule 506 securities offerings in one or more states electronically, and a "modernized and simplified" review process for Regulation A offerings.

Mr. Beatty went on to comment on eight of the legislative proposals before the Subcommittee:

• The Small Business Mergers, Acquisitions, Sales, and Brokerage Simplification Act of 2015 (H.R. 686);

• The Reforming Access for Investments in Startup Enterprises Act of 2015 (H.R. 1839);

• The Small Business Investment Company Advisers Relief Act of 2015 (H.R. 432);

• The Disclosure Modernization and Simplification Act of 2015 (H.R. 1525);

• The Encouraging Employee Ownership Act of 2015 (H.R. 1317);

• The Small Business Freedom and Growth Act of 2015 (H.R. 1723);

• The Small Company Disclosure Simplification Act of 2015 (H.R. 1965); and

• The Improving Access to Capital for Emerging Growth Companies Act (Discussion Draft).

See: House Subcommittee Hearing Information; Mr. Beatty's Statement.