Congressman Garrett recently renewed discussions regarding additional individual legislative initiatives or other proposals relating to promoting capital formation that might well be grouped together into a single “JOBS Act 2.0” measure. These matters had been scheduled (prior to the shutdown) to be considered at a hearing on October 9, 2013.
Commentators have noted that the IPO on-ramp alone cannot be expected to revitalize the U.S. IPO market, especially the market for offerings by smaller companies. Various measures have been suggested, including addressing tick sizes, reviewing disclosure requirements for registration statements, leveling further the information playing field as between retail and institutional investors, and taking additional steps to encourage additional research coverage.
For smaller public companies that completed their IPOs prior to the JOBS Act enactment, additional disclosure and corporate governance accommodations may be appropriate. Various groups also have urged the Securities & Exchange Commission to review the thresholds for the designation of entities as smaller reporting companies and accelerated filers. Before the JOBS Act, the Commission had committed to reviewing existing communications safe harbors. Given technological advancements, IPO communications restrictions (such as the quiet period), and offering related communications may benefit from revamping. The 2005 Securities Offering Reform changes were principally focused on the largest, most sophisticated issuers, but many of those measures could be applied to a broader group of companies. In addition, modernizing the regulations applicable to business development companies, along the lines contemplated by legislation already introduced in Congress, would facilitate capital formation for BDCs.