Monday, August 27, 2012

Division of Trading and Markets Issues New JOBS Act Guidance


The SEC’s Division of Trading and Markets has issued guidance for research analysts and underwriters regarding the Jumpstart Our Business Startups (JOBS) Act. Much of the guidance concerns JOBS Act Section 105, which amended provisions within the Securities Act and Exchange Act regarding testing-the-waters, analyst communications, and post offering communications.

The guidance contains 14 new Q&A topics. For example, Question 1 asks whether an emerging growth company’s ability to test the waters conflicts with Exchange Act Rule 15c2-8(e). The staff answered that the JOBS Act provision can be consistent with Rule 15c2-8(e), although an underwriter may wish to seek non-binding indications of interest from its customers about a potential offering, such as the number of shares a customer might buy within a price range. If the underwriter does not seek a commitment to purchase the securities from a customer, the underwriter likely is not soliciting a customer order under Rule 15c2-8(e). The staff also noted that Rule 15c2-8(e) applies to “filed” registration statements, and that the submission of a confidential draft registration statement for staff review under JOBS Act Section 106(a) is not the “filing” of a registration statement.

Separately, the Commission is scheduled to hold an open meeting August 29, 2012 to consider whether to propose rules under JOBS Act Title II.

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