Crowdfunding Beat News Desk, A select group of congressional members has once again submitted a request to SEC Chair Mary Jo White on accelerating the review and promulgation of Title III Crowdfunding provisions. Recall that the JOBS Act passed in the spring of 2012, with Congress tossing the baton to the SEC to develop guidelines. Other aspects of the JOBS Act have been introduced to the the market, such as Title II (General Solicitation) while Title IV (Reg A), has found stewardship at the state level. But as a core theme of legislation, the Title III debate continues ad nauseum.
Like with many legislative endeavors, is the sight of the forest being missed for the trees, and the analysis becomes paralysis? Maybe it time to just begin with a ‘beta” effort, and see how it flies, being aware that it may need to be adjusted or improved upon in time. But at least, it begins.
The Innovation Caucus says the SEC is 500 days past deadline.
BY JACK SMITH IV
Congressmen Jared Polis and Darrell Issa, along with the 28 other members of the House Innovation and Entrepreneurship Caucus, have drafted a letter to pressure the SEC into finishing the job. The law already passed in the house and was signed off on by the President, and the caucus is sick of waiting for the SEC to get around to writing out the rules so that the laws can be exercised and enforced.
The way it stands now, if you take part in crowdfunding a project on Kickstarter or Indiegogo, you can get all sorts of perks and commodities, like T-shirts and a trial version of a product. You cannot, however, get any stake in the company like a shareholder, angel investor or venture capitalist. The long-awaited reform would allow for people who aren’t accredited investors (i.e. the extremely wealthy) to get something back if, say, a company you gave some Kickstarter money to sold to Facebook for $3 billion.
Unfortunately, those laws have stalled out, sitting in limbo even as crowdfunding starts to become a more popular form of raising money for tech companies.
“The SEC has now missed their legal deadline to promulgate these rules by more than 500 days,” Mr. Polis’ office told Betabeat.
In the mean time, companies that use crowdfunding to raise money for their startups will offer their backers what they legally can: trinkets, posters and a thank you in the credits.
Read more at http://betabeat.com/2014/08/congressmen-to-sec-crowdfunding-laws-are-taking-way-too-long-to-pass/#ixzz3AJsnIrdj
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