Washington, D.C. - Congressman Tom Emmer (MN-06) today introduced the Micro Offering Safe Harbor Act which will help small businesses raise capital.
This legislation makes a simple technical amendment to the Securities Act of 1933 by defining exactly what qualifies under the “non-public offering” exemption. This would allow small businesses to operate with confidence that they are not in violation of the law when doing a non-public securities offering if one or more of the following requirements are met:
- Each investor has a substantive pre-existing relationship with an owner,
- There are 35 or fewer purchasers, or
- The amount does not exceed $500,000
“Entrepreneurs will be able to more easily launch their startups and existing businesses will have better prospects for growth,” said Emmer. “By simply clarifying an old law, more small businesses will raise capital through non-public offerings, easing the burdens of red-tape, onerous paperwork, and the threat of lawsuits. Congress has much more work to do to fully unleash the American economic engine and this legislation is one of many steps I will take to help Minnesotans achieve the American Dream. With labor force participation at an all time low and many families still having less income than they had before the 2008 economic collapse, it is my duty to do everything I can to get America's economy firing on all cylinders.”
Several small business advocacy organizations have endorsed the Micro Offering Safe Harbor Act including the National Small Business Association and the Small Business & Entrepreneurship Council (SBEC). The SBEC stated, “The legislation would appropriately scale federal rules and regulatory compliance for small businesses, thus providing another practical option for entrepreneurs to raise the capital they need to startup or grow their firms.”
Coupled with Emmer’s CREATE Jobs Act which would make the income tax rate for many American businesses lower than their competition in other countries, the Micro Offering Safe Harbor Act is yet another sign that prospects for normal economic growth are here.
The Micro Offering Safe Harbor is H.R. 4850. Click here to read the full text.
Read what the Crowdfund Insider says about the bill. Click here.
Emmer serves as a Member of the House Financial Services Committee