Just a few weeks after SEC Commissioner Hester Peirce gave some insight into the SEC’s priorities (see HERE), acting SEC Chair Mark Uyeda got more granular on what we can expect under his regime. Commissioner Uyeda drilled down on particular SEC goals while giving a speech at the Florida Bar’s Annual Federal Securities Institute and M&A Conference.
The overarching goal of the SEC over the next few years will be to foster innovation, job creation and economic growth by maintaining cost effective regulations throughout a business’s life cycle. To accomplish these goals, the SEC intends to “return normalcy” to the SEC by being cognizant of its legal authority, policy priorities and enforcement initiatives, all of which have gone awry over the last few years.
Commissioner Uyeda highlights some of the actions already taken to facilitate these goals, including rescinding Staff Legal Bulletin 14 related to shareholder proposals and proxy statements (for more on Staff Legal Bulletin 14 see HERE); rescinded Staff Accounting Bulletin No. 121 which had effectively prevented banks and broker-dealers from taking custody of crypto assets; and stepped back from the controversial climate disclosure rules (see HERE). Related to digital assets, the SEC has designated Commissioner Hester Peirce to lead a crypto task force with the mission of developing a comprehensive legal framework for registration and disclosure.
Initiatives to Improve Capital Raising
Specifically related to improving access to capital for small businesses, the SEC intends to implement targeted changes to the exempt offering rules including overhauling Regulation CF to decrease the compliance costs.
The SEC also intends to modify the accredited investor definition to allow more access to retail investors. The last time the SEC amended the accredited investor definition was in 2020 (see HERE), at which time the vast consensus was that it just wasn’t enough. Small business committees and groups, including the SEC’s own Office of Advocate for Small Business Capital Formation, have been pushing for reduced thresholds and increased categories to qualify for accredited investor status for many years. The SEC intends to explore both those options as well as a potential sliding scale, allowing all investors to invest at least some amount into all private offerings, including private funds. In that regard, the SEC will consider raising the private fund exemption to allow for more than 99 investors in a fund and still qualify as “private” under the Investment Company Act of 1940.
Improving the IPO Market
To help invigorate the IPO market, the SEC will work to improve disclosure relief for emerging growth companies (EGC) including additional scaled back rules related to areas such as cybersecurity (see HERE), 10b5-1 (HERE), and compensation clawbacks (see HERE). Similarly, the SEC will consider amendments to the definition of an EGC to broaden its scope. For more on the definition of an EGC and scaled disclosure requirements, see HERE and HERE).
Along the same track, the SEC will look at broadening the scaled disclosure availability for both EGC’s and smaller reporting companies, including by potentially amending the definitions of each category of filer (smaller reporting company, accelerated filer and large accelerated filer). For current definitions, see HERE and HERE
The Author
The Author
Laura Anthony, Esq.
Founding Partner
Anthony, Linder & Cacomanolis
A Corporate and Securities Law Firm
Securities attorney Laura Anthony and her experienced legal team provide ongoing corporate counsel to small and mid-size private companies, public companies as well as private companies going public on the Nasdaq, NYSE American or over-the-counter market, such as the OTCQB and OTCQX. For more than two decades Anthony, Linder & Cacomanolis, PLLC has served clients providing fast, personalized, cutting-edge legal service. The firm’s reputation and relationships provide invaluable resources to clients including introductions to investment bankers, broker-dealers, institutional investors and other strategic alliances. The firm’s focus includes, but is not limited to, compliance with the Securities Act of 1933 offer sale and registration requirements, including private placement transactions under Regulation D and Regulation S and PIPE Transactions, securities token offerings and initial coin offerings, Regulation A/A+ offerings, as well as registration statements on Forms S-1, S-3, S-8 and merger registrations on Form S-4; compliance with the Securities Exchange Act of 1934, including registration on Form 10, reporting on Forms 10-Q, 10-K and 8-K, and 14C Information and 14A Proxy Statements; all forms of going public transactions; mergers and acquisitions including both reverse mergers and forward mergers; applications to and compliance with the corporate governance requirements of securities exchanges including Nasdaq and NYSE American; general corporate; and general contract and business transactions. Ms. Anthony and her firm represent both target and acquiring companies in merger and acquisition transactions, including the preparation of transaction documents such as merger agreements, share exchange agreements, stock purchase agreements, asset purchase agreements and reorganization agreements. The ALC legal team assists Pubcos in complying with the requirements of federal and state securities laws and SROs such as FINRA for 15c2-11 applications, corporate name changes, reverse and forward splits and changes of domicile. Ms. Anthony is also the author of SecuritiesLawBlog.com, the small-cap and middle market’s top source for industry news, and the producer and host of LawCast.com, Corporate Finance in Focus. In addition to many other major metropolitan areas, the firm currently represents clients in New York, Los Angeles, Miami, Boca Raton, West Palm Beach, Atlanta, Phoenix, Scottsdale, Charlotte, Cincinnati, Cleveland, Washington, D.C., Denver, Tampa, Detroit and Dallas.
Ms. Anthony is a member of various professional organizations including the Crowdfunding Professional Association (CfPA), Palm Beach County Bar Association, the Florida Bar Association, the American Bar Association and the ABA committees on Federal Securities Regulations and Private Equity and Venture Capital. She is a supporter of several community charities including the American Red Cross for Palm Beach and Martin Counties, Susan Komen Foundation, Opportunity, Inc., New Hope Charities, the Society of the Four Arts, the Norton Museum of Art, Palm Beach County Zoo Society, the Kravis Center for the Performing Arts and several others.
Ms. Anthony is an honors graduate from Florida State University College of Law and has been practicing law since 1993.
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