Sunday, September 16, 2012

House Leader Urges SEC to Quickly Implement JOBS Act Provision Ending Reg. D Ban on General Solicitation

Rep. Scott Garrett (R-NJ), Chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, said he was dismayed to learn that the SEC, after missing its initial 60 day requirement for the implementation of the JOBS Act elimination of the ban on general solicitation in Regulation D had again delayed implementation by proposing rehulations after the staff had proposed moving forward with an interim final rule. This type of delay on what is a very simple and straightforward requirement from Congress is completely unacceptable, he emphasized in an opening statement today at a joint Capital Markets Subcommittee and the Subcommittee on TARP, Financial Services Bailouts of Public and Private Programs hearing on the implementation of the JOBS Act:

This rulemaking process under the JOBS Act is not setting up a regulatory framework for the multi-trillion derivatives market, he noted, rather it on a topic that has been around for a long time and is well known by the SEC and market participants. Chairman Garrett expects the SEC to move forward with finalizing this rule in the near future.

Earlier this year, Congress passed the Jumpstart Our Business Startups (JOBS) Act. Specifically, the JOBS Act would ease the burden of capital formation on entrepreneurial growth companies that have traditionally served as the U.S. economy's primary job creators. In addition, said the Chair, this legislation would provide a larger pool of investors with access to information and investment options on these companies that do not currently exist.

In the Chairman's view, the implementation of the JOBS Act will provide start-up companies with a cost effective means to access capital and keep this country at the forefront of medical, scientific, and technological breakthroughs. Thus, he emphasized that the bipartisan JOBS Act implementation must become a higher priority at the SEC and be completed in the very near future.