New York (HedgeCo.Net) – SEC commissioners voted 4-1 to invite public comment for the proposed rules for the Jumpstart Our Business Startups Act or JOBS Act. Included is Rule 506 of Regulation D and Rule 144A of the Securities Act, which will eliminate the prohibition of solicitation and advertising for certain securities offerings such as hedge funds and startups.
The SEC will take comments on the proposed rules for 30 days, then review the comments and determine whether to adopt the proposed rules.
“I believe that the proposed rules fulfill Congress’s clear directive that issuers be given the ability to communicate freely to attract capital, while obligating them to take steps to ensure that this ability is not used to sell securities to those who are not qualified to participate in such offerings,” said SEC Chairman Mary Schapiro.
Rule 506 is typically relied on by hedge funds and other private pooled investment vehicles when selling interests to investors.
The JOBS Act encourages funding of small businesses by easing securities regulations. It passed with bipartisan support, and was signed into law by President Obama in April 2012. It’s passing has been delayed by the SEC a number of times.
Editor for HedgeCo.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership in HedgeCo.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!