114-HR4498 HALOS Act
(Sec. 3) This bill directs the Securities and Exchange Commission (SEC) to amend Regulation D (governing the limited offer and sale of securities without registration under the Securities Act of 1933) to make the prohibition against general solicitation or general advertising inapplicable to events with specified kinds of sponsors (including angel investor groups not connected to broker-dealers or investment advisers) where:
| Legislation | |
|---|---|
| Title | 114-HR4498 Helping Angels Lead Our Startups (HALOS) Act |
| Congress | 114 |
| Sponsor | Rep. Chabot, Steve (R-OH-1) |
| Committee(s) | House - Financial Services, Senate - Banking, Housing, and Urban Affairs |
| Status | Died |
| Keywords | McCarthy |
| © edegan.com, 2016 | |
presentations or communications are made by or on behalf of an issuer, the advertising does not refer to any specific offering of securities by the issuer, the sponsor does not engage in certain activities (such as offering investment recommendations or advice to attendees), the sponsor does not receive compensation for the event which would require registration as a broker or dealer or as an investment advisor, and no specific information regarding a securities offering is communicated (other than that the issuer is in the process of offering or planning to offer securities, including the type and amount of securities being offered). This bill may only be construed as requiring the SEC to amend Regulation D with respect to presentations and communications, and not with respect to purchases or sales.
Bill Text
Congressional Bills 114th Congress From the U.S. Government Publishing Office H.R. 4498 Referred in Senate (RFS)
114th CONGRESS 2d Session H. R. 4498
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 28, 2016
Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs
_______________________________________________________________________
AN ACT
To clarify the definition of general solicitation under Federal
securities law.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Helping Angels Lead Our Startups
Act or the ``HALOS Act.
SEC. 2. DEFINITION OF ANGEL INVESTOR GROUP.
As used in this Act, the term ``angel investor group means any
group that--
(1) is composed of accredited investors interested in
investing personal capital in early-stage companies;
(2) holds regular meetings and has defined processes and
procedures for making investment decisions, either individually
or among the membership of the group as a whole; and
(3) is neither associated nor affiliated with brokers,
dealers, or investment advisers.
SEC. 3. CLARIFICATION OF GENERAL SOLICITATION.
(a) In General.--Not later than 6 months after the date of
enactment of this Act, the Securities and Exchange Commission shall revise Regulation D of its rules (17 CFR 230.500 et seq.) to require that in carrying out the prohibition against general solicitation or general advertising contained in section 230.502(c) of title 17, Code of Federal Regulations, the prohibition shall not apply to a presentation or other communication made by or on behalf of an issuer which is made at an event--
(1) sponsored by--
(A) the United States or any territory thereof, by
the District of Columbia, by any State, by a political
subdivision of any State or territory, or by any agency
or public instrumentality of any of the foregoing;
(B) a college, university, or other institution of
higher education;
(C) a nonprofit organization;
(D) an angel investor group;
(E) a venture forum, venture capital association,
or trade association; or
(F) any other group, person or entity as the
Securities and Exchange Commission may determine by
rule;
(2) where any advertising for the event does not reference
any specific offering of securities by the issuer;
(3) the sponsor of which--
(A) does not make investment recommendations or
provide investment advice to event attendees;
(B) does not engage in an active role in any
investment negotiations between the issuer and
investors attending the event;
(C) does not charge event attendees any fees other
than administrative fees; and
(D) does not receive any compensation with respect
to such event that would require registration of the
sponsor as a broker or a dealer under the Securities
Exchange Act of 1934, or as an investment advisor under
the Investment Advisers Act of 1940; and
(4) where no specific information regarding an offering of
securities by the issuer is communicated or distributed by or
on behalf of the issuer, other than--
(A) that the issuer is in the process of offering
securities or planning to offer securities;
(B) the type and amount of securities being
offered;
(C) the amount of securities being offered that
have already been subscribed for; and
(D) the intended use of proceeds of the offering.
(b) Rule of Construction.--Subsection (a) may only be construed as
requiring the Securities and Exchange Commission to amend the requirements of Regulation D with respect to presentations and communications, and not with respect to purchases or sales.
Passed the House of Representatives April 27, 2016.
Attest:
KAREN L. HAAS,
Clerk.
