[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 1031 Introduced in Senate (IS)]
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115th CONGRESS
1st Session
S. 1031
To amend provisions in the securities laws relating to regulation
crowdfunding to raise the dollar amount limit and to clarify certain
requirements and exclusions for funding portals established by such
Act.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 3, 2017
Mr. Daines introduced the following bill; which was read twice and
referred to the Committee on Banking, Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To amend provisions in the securities laws relating to regulation
crowdfunding to raise the dollar amount limit and to clarify certain
requirements and exclusions for funding portals established by such
Act.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Crowdfunding Enhancement Act''.
SEC. 2. CROWDFUNDING VEHICLES.
(a) Amendments to the Securities Act of 1933.--The Securities Act
of 1933 (15 U.S.C. 77a et seq.) is amended--
(1) in section 4A(f)(3) (15 U.S.C. 77d-1(f)(3)), by
inserting ``by any of paragraphs (1) through (14) of'' before
``section 3(c)''; and
(2) in section 4(a)(6)(B) (15 U.S.C. 77d(a)(6)(B)), by
inserting ``, other than a crowdfunding vehicle (as defined in
section 2(a) of the Investment Company Act of 1940 (15 U.S.C.
80a-2(a))),'' after ``any investor''.
(b) Amendments to the Investment Company Act of 1940.--The
Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.) is amended--
(1) in section 2(a) (15 U.S.C. 80a-2(a)), by adding at the
end the following:
``(55) The term `crowdfunding vehicle' means a company--
``(A) whose purpose (as set forth in its
organizational documents) is limited to acquiring,
holding, and disposing securities issued by a single
company in one or more transactions and made pursuant
to section 4(a)(6) of the Securities Act of 1933 (15
U.S.C. 77d(a)(6));
``(B) that issues only 1 class of securities;
``(C) that receives no compensation in connection
with such acquisition, holding, or disposition of
securities;
``(D) no associated person of which receives any
compensation in connection with such acquisition,
holding or disposition of securities unless such person
is acting as or on behalf of an investment adviser
registered under the Investment Advisers Act of 1940
(15 U.S.C. 80b-1 et seq.) or registered as an
investment adviser in the State in which the investment
adviser maintains its principal office and place of
business;
``(E) the securities of which have been issued in a
transaction made pursuant to section 4(a)(6) of the
Securities Act of 1933 (15 U.S.C. 77d(a)(6)), if both
the crowdfunding vehicle and the company whose
securities it holds are co-issuers;
``(F) that is current in its ongoing disclosure
obligations under section 227.202 of title 17, Code of
Federal Regulations;
``(G) the company whose securities it holds is
current in its ongoing disclosure obligations under
section 227.202 of title 17, Code of Federal
Regulations; and
``(H) is advised by an investment adviser
registered under the Investment Advisers Act of 1940
(15 U.S.C. 80b-1 et seq.) or registered as an
investment adviser in the State in which the investment
adviser maintains its principal office and place of
business.''; and
(2) in section 3(c) (15 U.S.C. 80a-3(c)), by adding at the
end the following:
``(15) Any crowdfunding vehicle.''.
SEC. 3. CROWDFUNDING EXEMPTION FROM REGISTRATION.
Section 12(g)(6) of the Securities Exchange Act of 1934 (15 U.S.C.
78l(g)(6)) is amended--
(1) by striking ``The Commission'' and inserting the
following:
``(A) In general.--The Commission'';
(2) by striking ``section 4(6)'' and inserting ``section
4(a)(6)''; and
(3) by adding at the end the following:
``(B) Treatment of securities issued by certain
issuers.--An exemption under subparagraph (A) shall be
unconditional for securities offered by an issuer that
had a public float of less than $75,000,000 as of the
last business day of the issuer's most recently
completed semiannual period, computed by multiplying
the aggregate worldwide number of shares of the
issuer's common equity securities held by non-
affiliates by the price at which such securities were
last sold (or the average bid and asked prices of such
securities) in the principal market for such securities
or, in the event the result of such public float
calculation is zero, had annual revenues of less than
$50,000,000 as of the issuer's most recently completed
fiscal year.''.
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