The SEC will reopen, for an additional 30 days, the comment period for rule changes tagged onto lifting the longstanding ban on general solicitation in private securities offerings.
On July 10, the SEC adopted a rule to implement the Jumpstart Our Business Startups Act (JOBS Act) requirement to lift the ban on general solicitation and advertising for certain private securities offerings. Companies seeking to raise capital through the sale of securities must either register the securities offering with the SEC or rely on an exemption from registration. Rule 506 of Regulation D is the most widely-used exemption and Congress directed the SEC to remove the prohibition on general solicitation for those offerings if sales are limited to accredited investors.
