The Jumpstart our Business Startups Act, signed in April 2012, is a suite of laws and mandates to regulatory agencies such as the Securities and Exchange Commission to encourage entrepreneurship and small business growth. It is designed to encourage small business and startup funding by easing federal regulations and allowing individuals to become investors.
Among the provisions of the JOBS Act are two that have led to rulemakings fronm the SEC:
- Crowdfunding - proposed by the commission in October 2013 and finalized in October 2015.
- Eliminating the Prohibition against General Solicitation and General Advertising ("Hedge Fund Marketing"), proposed in August 2012 and finalized in July 2013.
MarketsWiki.tv Interview with Lance Zinman, Partner, Katten Muchin Rosenman, August 2013
Lance Zinman is a law partner at Katten Muchin Rosenman and head of the firm’s Chicago financial services practice. He regularly advises hedge funds, commodity pools, commodity trading advisors and proprietary trading firms on compliance and regulatory matters. He sat down with John Lothian News Editor-at-Large Doug Ashburn to discuss the SEC rule on private fund solicitation, released July 10, 2013. In the interview, Zinman cuts through the misinformation and explains the key points of the rules. He also explains how the 506 exemption may not be claimed by anyone with a “disqualifying event” and other limitations. He also highlights a few areas in which the rule is unclear or needs to be harmonized with other regulators such as the CFTC.
According to Zinman, it remains to be seen whether this rule will truly usher in a new wave of marketing on behalf of hedge funds and other private funds.
- The JOBS Act: What Startups and Small Businesses Need to Know [Infographic]. Forbes. Retrieved on February 28,2014.