Dodd-Frank Overhaul Bill Could Get New Securities Provisions

By Andrew Ramonas

The Senate’s bid to rewrite parts of the Dodd-Frank Act soon may include several additions aimed at the SEC and the entities it regulates.

The securities provisions were tucked into a bipartisan manager’s amendment to S. 2155, which seeks to mitigate some financial regulation burdens. Senate Banking Committee Chairman Mike Crapo (R-Idaho), chief sponsor of S. 2155, offered the 193-page revision March 7 as the legislation moved closer to a vote.

The additions came out of more than a half-dozen measures that passed the House, mostly by wide margins. Bills that are at least partially reflected in the amendment include the Supporting America’s Innovators Act ( H.R. 1219), Encouraging Employee Ownership Act ( H.R. 1343), Improving Access to Capital Act ( H.R. 2864), U.S. Territories Investor Protection Act ( H.R. 1366), Expanding Investment Opportunities Act ( H.R. 4279), Small Business Capital Formation Enhancement Act ( H.R. 1312), and Securities and Exchange Commission Overpayment Credit Act ( H.R. 1257).

House Bills

The Supporting America’s Innovators Act addition would raise the cap on investors participating in early-stage venture capital funds from 100 to 250 people. Funds that exceed the current 100-person cap must register with the Securities and Exchange Commission.

The Encouraging Employee Ownership Act provision would double to $10 million the amount of stock a company could give its employees as compensation without extra disclosures.

The Improving Access to Capital Act addition would expand the SEC’s Regulation A Plus, which allows issuers to sell millions of dollars of securities without registering with the commission. The measure is intended to help make capital raising easier for small startups.

The U.S. Territories Investor Protection Act provision would require funds operating in Puerto Rico and other U.S. territories to abide by securities laws.

The Expanding Investment Opportunities Act addition would permit closed-end funds to use a simpler securities registration process.

The Small Business Capital Formation Enhancement Act provision would require the SEC to formally respond to recommendations made by its annual Government-Business Forum on Small Business Capital Formation.

The Securities and Exchange Commission Overpayment Credit Act addition would help the agency refund overpayments from stock exchanges by reducing future fees collected from them.

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To contact the editor responsible for this story: Seth Stern at