Financial Services Committee
House Approves Bills Promoting Small Business Capital Formation and Job Creation
Washington, Nov 2 -
The House of Representatives approved two bills today to modernize outdated regulations by the Securities and Exchange Commission (SEC) and make it easier for small businesses to access capital so they can invest and hire.
Access to capital is essential for entrepreneurs and small companies to grow their businesses and hire workers.
Both bills passed the House with strong bipartisan support and were earlier approved by the Financial Services Committee, which has led efforts this year to reduce regulatory burdens so small businesses can attract new sources of capital. Two other pro-jobs bills that originated in the Financial Services Committee are scheduled to be debated by the House later this week.
“These bills will lower regulatory barriers and help small businesses grow and create jobs. The American people want Republicans and Democrats to work together and focus on jobs, and these bills show we can do that,” said Financial Services Committee Chairman Spencer Bachus. “The House has acted once again to support private sector job growth. Now the Senate should quit stalling and pass these bipartisan jobs bills."
The two bills approved by the House today are:
H.R. 1070, the Small Company Capital Formation Act, introduced by Rep. David Schweikert
H.R. 1070 makes it easier for small businesses to go public by increasing the offering threshold for companies exempted from SEC registration from $5 million to $50 million. The SEC has the authority to raise this threshold but has not done so for almost two decades. H.R. 1070 was approved by a vote of 421 to 1.
Amending Regulation A to make it a viable channel for small companies to access capital will permit greater investment in these companies, resulting in economic growth and jobs. Over the years, Regulation A offerings have steadily declined. Between 1995 and 2004, small businesses used Regulation A only 78 times; and in 2010 small businesses used Regulation A only three times.
H.R. 1965, introduced by Rep. Jim Himes
H.R. 1965 modifies regulations concerning registration and deregistration of small bank holding companies under securities laws.
H.R. 1965 would raise the bank shareholder threshold for SEC registration from 500 to 2,000. The threshold has not been adjusted since 1964. The legislation was approved by a vote of 420 to 2.