The SEC is bringing back discussion on a previously abandoned proposal intended to make it easier for small businesses to raise capital by allowing certain exemptions from agency oversight for individuals.
The proposal is slated for an upcoming meeting of the commission’s small business capital formation advisory committee, according to a Law360 report.
The 2020 proposal would have created two safe harbors: one for the “occasional finder” who participated in no more than one transaction per year and greatly limited the finder’s activity, and a second (with some additional requirements) that allowed a finder to participate more often and to take some additional actions. It will be interesting to see where this goes.
The proposal would have exempted some individuals, known as "finders," from registering as brokers if they were hired to locate investors for small companies. The Republicans who led the commission at the time said the exemption would make it easier for small businesses to raise capital and would provide regulatory clarity in an area in which there has been long-standing uncertainty.
