Small start-up companies that applauded the 2012 Jump Start Our Business Start-ups Act have 90 days to respond to the SEC's October 23, 2013 proposal. The single-spaced Table of Contents for the proposal exceeds 2 pages. The goal of the Act the SEC seeks to implement was intended to help small issuers reach numerous small investors via the internet. Yet the proposal contains hundreds of pages of “restrictions,” “limitations,” and requirements.
The media was all a-buzz last week about the long awaited proposal. In all fairness, the SEC was put in a bit of a bind by the JOBS Act's crowd funding provisions. How does one fashion a new system that keeps the fraudulent wolf at bay while simultaneously making it much easier for less sophisticated sheep to answer his knock at the door? The SEC's primary suggested method is an online portal coupled with the Act's explicit investment caps.
The proposal's introductory comments (pp. 6-11) provide an excellent succinct overview. After that—you are on your own until we at Cosgrove Law Group have a chance to work through it ourselves. And if you are really too busy at the moment, the Wall Street Journal and the Washington Post boil the entire matter down to a couple of dozen paragraphs.