The SEC released the final rule lifting the ban on general solicitation and advertising for private placements. Here is a collection of stories on that topic.
SEC Adopts JOBS Act Title II Rules by Dave Lynn in Corporate Counsel.net
July 4th fireworks came a week late to 100 F Street yesterday, as the SEC adopted the changes to Rule 506 of Regulation D mandated by Title II of the JOBS Act, in what was sometimes a contentious open meeting. The changes to Rule 506–permitting the use of general solicitation and general advertising in a Rule 506 offering provided that the issuer takes reasonable steps to verify that purchasers are accredited investors–were over a year late, and generated a good bit of comment and criticism.
SEC releases final rule allowing general advertising for certain private offerings by Usha Rodrigues in The Conglomerate
What exactly are “reasonable steps?” There’s the rub. The final rules track the proposed ones closely, save that the agency heeded the pleas of many, myself included, to articulate some concrete methods as to what constitutes a “reasonable step.” I asked for a safe harbor, but the SEC declined to go so far.
I am actually sort of fascinated to see what the upshot will be. It will allow all manner of advertising by hedge funds in all manner of venues. I suspect you will see hedge funds all over Google, newspapers and magazines, and even on the Twitter. Anthony Scaramucci, of SkyBridge Capital, makes no bonesabout his plans for this liberation. As he said last year, “I am hellbent on creating a global brand and the only way to do that is through advertising.” At a more mundane level, other private fund managers who want to give interviews to, say, Barron’s or the Wall Street Journal will be able to do so now without fear that their comments will be construed as generally soliciting investors for their funds.
Facilitating General Solicitation at the Expense of Investors by Luis A. Aguilar, Commissioner, U.S. Securities and Exchange Commission
It is without doubt the responsibility of the Commission to implement Section 201 of the JOBS Act. It is equally without doubt that this responsibility cannot be separated from the Commission’s duty to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation. Congress established the Commission as the independent agency with the expertise and authority to administer the federal securities laws. By statute, the Commission has the power to make, amend, and rescind the rules and regulations needed from time to time to carry out the provisions of such laws.
Commission Also Adopts Rule to Disqualify Bad Actors from Certain Offerings and Proposes Rules to Enable SEC to Monitor New Market and Bolster Investor Protections