NSBA Leadership Testifies on JOBS Act ImplementationSeptember 13, 2012
Today, NSBA Treasurer Jeff Van Winkle of Clark Hill, PLC in Grand Rapids, Michigan testified before Congress on the importance of easing access to capital for small business as the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) work to implement the JOBS Act. Passed in April, the JOBS Act was designed to greatly ease restrictions on small business investment.
“The passage of the JOBS Act demonstrates the broad bipartisan understanding that existing securities laws pose an unreasonable burden on the ability of small firms to access capital,” stated Van Winkle. “We are deeply concerned that complex and costly regulations and huge delays in issuing the rules will frustrate the intent of Congress and the President, and have an adverse impact on the ability of small firms to raise capital.”
Testifying before a joint hearing of the Oversight and Government Reform Subcommittee on TARP, Financial Services and Bailouts of Public and Private Programs, and the Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises, Van Winkle urged lawmakers to take steps beyond the JOBS Act to improve small-business access to capital, which continues to evade one third of small-business owners, according to a recent NSBA report.
Ardent supporters of the JOBS Act, NSBA has weighed in several times with the SEC urging them to craft regulations that help—not hinder—small businesses ability to raise capital. NSBA believes the onus of verifying investor incomes or net worth should reside with investors—not the small businesses. Another issue of concern is that the regulations concerning crowdfunding will be so heavy-handed they make crowdfunding web sites uneconomic, nullifying the intent of Congress. Finally, NSBA has urged, unsuccessfully, the SEC to stop treating small investment “finders” as if they were a major Wall Street firm.
On August 29 the SEC issued a proposed rule governing small businesses seeking investors in private offerings, just the first of many forthcoming regulations responding to the JOBS Act, and nearly two months after a final rule was supposed to have been issued.
“At the end of the day, we will support this proposal in order to move the law forward,” stated Van Winkle, “But our support is driven primarily by the belief that our concerns are falling upon deaf ears.”
Please click here to download the full testimony.