The Innovation Caucus Sounds Off on Title III Enactment
Equity crowdfunding portals and enthusiasts across the country have grown increasingly impatient with the SEC and their inability to enact Title III. In fact, 13 states have already passed or will shortly pass their own intrastate crowdfunding laws in reaction to the delay. State governments have taken matters into their own hands and done so successfully up to this point. When President Obama signed the JOBS Act back on April 5th, 2012, everyone knew the entire legislation wouldn’t be passed overnight, but the federal government is taking an exceptionally long time in enacting Title III. For the record, Title II was passed on September 23rd, 2013.
On August 8th, 2014, Congressmen Jared Polis, Darrell Issa, Scott Peters, and Vern Buchanan, co-chairs of the House Innovation and Entrepreneurship Caucus, sent a letter to the SEC Chair Mary Jo White. The letter, which was signed by a combined 26 Congressmen, pushed for White to finalize Title III “as soon as practicable” and noted that the JOBS Act originally called for this to be done by the end of 2012.
Here is an excerpt from the letter:
“There is ample evidence that the market and investors are ready and waiting for the SEC to finalize the rules in a manner that will allow new capital to efficiently find its way to startup companies. Moreover, companies desperate to bring their innovative products to the market are collaborating with businesses that found avenues around the SEC’s delays in promulgating crowdfunding rules. Due in large part to the lack of finalized federal rulemaking, states are now leading the way, harnessing the power of new technologies to connect entrepreneurs with investors. We urge the SEC to comply with Congressional intent to build a new cutting edge infrastructure that will provide innovative funding opportunities for startups and robust investor protections for decades to come.”
If the SEC was obligated to declare the rules for Title III enactment by the end of 2012, and today is August 18th, 2014, that would put their overdue date closer to 600 days. The full year of 2013 (365 days) plus 2014 so far (230 days) amounts to 595 days.
But hey, who’s counting?
If you would like to see the actual signed letter to Securities and Exchange Commission Chair Mary Jo White, please click here.