SEC Extends Comment Period for Section 506 Reg D Advertising Rules


Washington, DC – The Securities and Exchange Commission extended the public comment period for proposed, new rules that would govern how businesses can advertise equity offerings to accredited investors under Rule 506 Regulation D.

SEC

SEC

On July 10, 2013, the SEC issued rules that would lift the ban against general solicitations for Rule 506 Regulation D offering as mandated by Title II of the Jumpstart Our Business Startups Act.  The new rules lifted the ban effective September 23, 2013; however, the SEC also proposed for public comment additional rules that would regulate general advertising for Rule 506 offerings.

The comment period for the new rules closed on September 23, 2013, but on September 27, 2013, the SEC said it will reopen the public comment period.

Rule 506 exempts business from registering their securities with the SEC if they are offering and selling their equity only to “accredited investors” under Rule 501 of Regulation D. On July 10, 2013, the SEC also proposed, newadditional rules for public comment that would add restrictions to general solicitations.  The SEC’s new proposals would:

1.   Require the filing of a Form D no later than 15 days in advance of a general solicitation followed by a closing Form D amendment 20 days after the Rule 506 offering. The Crowdfund Intermediary Regulatory Advocates (CFIRA) commented to the SEC that the proposal is  ”inconsistent with the principles of the JOBS Act for general solicitation and advertising.”

2.  Require the placement of  a legend — that is, a disclaimer that the advertising is offering a private placement of securities — with any advertising. CFIRA noted that such a proposal would make it impossible to use services such as Twitter to make an offering.

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About Stephen G. Barr, Group Publisher

Author, Syndicated Columnist, Editor In-Chief and Group Publisher at SGB Media Group, a social media marketing firm specializing in digital media content production, publishing, affiliate marketing, public relations and advertising. Over 25 years experience in retailing, advertising, website & online forum development, niche social networking, affiliate marketing, search optimization, branding and identity, site location, non-profit fund raising. Event planning, promotion, production and MC/Host at public events. Author, Editor & Publisher of 35 syndicated, digital publications utilizing multiple digital distribution channels in conjunction with launching and administrating national advertising campaigns for major Fortune 500 advertisers in partnership with Google, Ning, Facebook, Myspace, Yahoo, DoubleClick, LinkShare, PepperJam and other industry leading third party affiliate networks. Product development team member from conception to launch on many websites, tangible goods and organizational structure for start ups. Specialties: Public relations, retailing, advertising, website & online forum development, niche social networking, blogging, email campaigns, affiliate/performance marketing, search optimization, branding and identity, site location, event production & promotion, non-profit fund raising and tasteful, responsible adult content publishing. An internationally recognized and read social media columnist & pundit on The Examiner, Associate Content, Vator.tv, X-Biz.net and Technorati and his own affiliated sites.
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One Response to SEC Extends Comment Period for Section 506 Reg D Advertising Rules

  1. Pingback: SEC’s Sunshine Act Meeting « The Crowd Funding Times™

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