On November 2, 2020, the SEC adopted extensive amendments “to harmonize, simplify, and improve the…overly complex exempt offering framework.” As noted in the SEC’s press release announcing the amendments, they are designed to eliminate the many “gaps and complexities” that characterize the current framework, including “multiple exemptions and safe harbors, each with different requirements.”
The new rules will generally:
- Enable issuers to move smoothly from one exemption to another as the business grows;
- Increase the offering limits for Regulation A, Regulation Crowdfunding, and Rule 504 offerings, as well as certain investment limits;
- Set clear and consistent rules governing offering communications; and
- Harmonize certain disclosure and eligibility requirements and “bad actor” disqualifications.
The new rules will be effective 60 days after publication in the Federal Register, with the exception of certain provisions under Regulation Crowdfunding, which will be effective upon publication in the Federal Register.
A more detailed discussion of the new rules will be provided in an upcoming post on The Securities Edge, Gunster’s securities law and corporate governance blog. Until then, please direct any questions or observations to Gunster securities law and corporate governance practice leader Bob Lamm.
