3/19. The House amended and passed HR 3606 [LOC | WW], a bill to reduce securities regulation for small and start up companies. The vote on final passage on March 8 was 390-23. See, Roll Call No. 110. The Senate is scheduled to take up this bill the week of March 19.

This bill was introduced on December 8, 2011, as the "Reopening American Capital Markets to Emerging Growth Companies Act of 2011". As amended by the House, this bill is titled "Jumpstart Our Business Startups Act" or JOBS Act. As amended, it is a composite of provisions from several stand alone bills reported by the House Financial Services Committee (HFSC).

These provisions would reduce securities regulation for small companies. If enacted into law, this bill would incent the creation of new companies, and facilitate their raising of capital. It would particularly benefit the technology sector.

Rep. Eric Cantor (R-VA) stated in the House on March 7 that "Right now it's just too difficult to start up a business. The threat of higher taxes and increased regulations has small businessmen and -women and entrepreneurs frozen in their tracks. Small businesses and start-ups simply do not have the bandwidth to comply with Washington's redtape, and yet they are the ones we're counting on to create jobs.

Rep. Cantor (at right) said that "the JOBS Act will get small businesses and entrepreneurs back into the game by removing costly regulations and making it easier for them to access capital. This legislation also paves the way for more start-ups and small businesses to go public, which will attract new investors and will allow small businesses to grow and create jobs."

Rep. Spencer Bachus (R-AL), Chairman of the HFSC, stated in a release on March 8 that "The House has passed more than two dozen bills that will help grow our economy and create jobs, yet the do-nothing Senate continues to stall. Senator Reid must allow a vote on these needed bills, including the JOBS Act we’re sending him today."

The National Venture Capital Association, Tech America, Information Technology Industry Council (ITIC), and other groups sent a letter to Senators on March 15 "to urge Senate passage of H.R. 3606, the JOBS Act. This measure, supported by the Administration, and passed by the House of Representatives by an overwhelmingly bipartisan margin of 390-23, seeks to modernize the nation's capital formation rules and provide for a transition into public company regulatory compliance for emerging growth companies."

3/19. The following is a summary of HR 3606 [LOC | WW] as passed by the House on March 8, 2012. As amended, it is titled "Jumpstart Our Business Startups Act" or JOBS Act". It includes language from several stand alone bills, along with amendments approved during House consideration.

Title I of the House bill is based upon the original HR 3606, the "Reopening American Capital Markets to Emerging Growth Companies Act of 2011", introduced on December 8, 2011, by Rep. Stephen Fincher (R-TN) and Rep. John Carney (R-DE), and reported by the HFSC on March 1.

It creates a new class of public companies titled "emerging growth companies" or EGCs. It defines an EGC as "an issuer that had total annual gross revenues of less than $1,000,000,000 ... during its most recently completed fiscal year". It also provides numerous forms of regulatory relief for EGCs, including reduced disclosure requirements, and further Sarbox 404 relief.

See also, story titled "House Financial Services Committee to Mark Up Bill to Provide Regulatory Relief to Emerging Growth Companies" in TLJ Daily E-Mail Alert No. 2,336, February 14, 2012.

The National Venture Capital Association (NVCA) stated in a March 8 release that this title creates "a regulatory on-ramp for companies with less than $1 billion in revenues for up to the first five years after an IPO. In addition to offering temporary relief from onerous and costly provisions such as Sarbanes Oxley Section 404b, the measures also allow for these companies to more effectively communicate with investors before, during and after the offering, creating additional safe harbors for additional analyst research coverage and allowing an expanded range of pre-filing communications."

Title II of the House bill is based upon HR 2940 [LOC | WW], the "Access to Capital for Job Creators Act", introduced on September 15, 2011, by Rep. Kevin McCarthy (R-CA), marked up by the HFSC on October 26, and passed by the House on November 3.

Title II of the bill as amended by the House amends Section 4 of the Securities Act of 1933, which is codified at 15 U.S.C. § 77d, to, among other things, remove the regulatory ban that prevents small privately held companies from using advertisements to solicit investors.

Title III of the House bill is based upon the crowdfunding provisions of HR 2930 [LOC | WW], the "Entrepreneur Access to Capital Act", introduced on September 14, 2011, by Rep. Patrick McHenry (R-NC), marked up by the HFSC on October 31, and passed by the House on November 3.

It removes statutory and Securities and Exchange Commission (SEC) restrictions that prevent crowdfunding, which enables raising equity capital from a large pool of small investors who may or may not be considered accredited by the SEC.

It provides an exemption from Section 4 of the Securities Act of 1933. This exemption would apply to certain companies that sell less than $1 Million is securities per year (or $2 Million if the company provides investors an audited financial statement), and no investor is sold more than the lesser of $10,000 in securities per year or 10 percent of such investor's annual income.

Rep. McHenry, the sponsor of the crowdfunding bill, issued a release on March 8 that states that this provides "a crowdfunding exemption to SEC registration requirements for firms raising up to $2 million, with individual investments limited to $10,000 or 10 percent of an investor’s income. The legislation also erases limits on the number of investors that can participate in crowdfunding, extending investment opportunities to everyday investors that are currently not an option under SEC regulation."

Google's Director of Public Policy, Pablo Chavez, stated in a release on March 15 that "entrepreneurs need access to capital to make grow their ideas into successful companies".

"The JOBS Act makes it easier for startups to raise capital. The crowdfunding provisions drafted by Congressman Patrick McHenry and Majority Leader Eric Cantor are particularly exciting and we applaud the House for its focus on helping to promote innovation and economic growth."

Chavez added that "Already, thousands of new companies have been funded by crowdfunding platforms like Kiva, Kickstarter, and IndieGogo. With the growth of social networks and other online platforms, crowdfunding is a promising investment model that would allow more Americans to invest in a new company simply by using the Internet to connect with entrepreneurs."

Title IV of the House bill is based upon HR 1070 [LOC | WW], the "Small Company Capital Formation Act",  introduced on March 14, 2011, by Rep. David Schweikert (R-AZ), marked up by the HFSC on September 14, 2011, and passed by the House on November 2, 2011.

It amends Section 3(b) of the Securities Act of 1933, codified at 15 U.S.C. § 77c(b), to increase the SEC Regulation A exemption threshold from $5 Million to $50 Million.

Title V is based upon HR 2167 [LOC | WW], the "Private Company Flexibility and Growth Act", introduced on June 14, 2011, by Rep. Schweikert, and marked up by the HFSC on December 12, 2011.

It amends Section 12(g)(1)(A) of the Securities Exchange Act of 1934, codified at 15 U.S.C. § 78l(g)(1)(A), to raise the shareholder threshold for mandatory registration with the SEC from 500 to 1,000 shareholders.

3/13. Sen. Jeff Merkley (D-OR) and others introduced S 2190  [LOC | WW], the "Capital Raising Online While Deterring Fraud and Unethical Non-Disclosure Act of 2012" or "CROWDFUND Act".

The original cosponsors are Sen. Michael Bennet (D-CO), Sen. Scott Brown (R-MA), and Sen. Mary Landrieu (D-LA). It was referred to the Senate Banking Committee (SBC).

Sen. Merkley (at left) stated in a release that "The Internet has opened the doors for business growth and innovation of all kinds. The CROWDFUND Act will allow that innovation to continue by allowing small investors to pool their resources to fund promising new ventures".

His release elaborates that "Normally, when a company seeks financing from the public it must register as a security with the Securities and Exchange Commission, providing detailed disclosures. The CROWDFUND Act would provide an alternative to this process, allowing companies to raise up to $1,000,000 annually through crowdfunding on registered internet websites."

This bill is similar to Title III of HR 3606 [LOC | WW], as passed by the House on March 8, 2012. However, it also contains many changes.

The SBC's Subcommittee on Securities, Insurance, and Investment will hold a hearing on March 21 titled "Examining Investor Risks in Crowdfunding". The witnesses will be Mercer Bullard (University of Mississippi law school), Nick Bhargava (Motaavi), Dana Mauriello (ProFounder), and Heath Abshure (Arkansas Securities Department). See, notice

Motaavi states in its web site that it is an "integrated exchange and trading platform where any investor can invest in and trade shares of companies seeking up to $1M a year."

It adds that "Motaavi addresses two major issues. First, startups and small businesses face a funding gap which can be fatal to the company. Second, investments in startups and small businesses have previously been limited to the very wealthy as a result of antiquated regulation. Because of recent legislative initiatives, things are changing. Motaavi solves these issues by allowing anyone to invest in startups and small companies regardless of personal wealth. Companies can harness the power of crowds, and crowds can spread information and risk, creating a vibrant and powerful market."

ProFounder, another crowdfunding platform, wrote in its web site on February 12, 2012, that "the current regulatory environment prevents us from pursuing the innovations we feel would be most valuable to our customers, and we've made the decision to shut down the company."

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The House will return from its one week recess. It will meet at 4:00 PM for legislative business. Votes will be postponed until 6:30 PM. It will consider two bills under suspension of the rules, including HR 3992 [LOC | WW]. See, story titled "House Judiciary Committee Approves Bill to Expand Investor Visa Program" in TLJ Daily E-Mail Alert No. 2,347, March 6, 2012. See also, Rep. Cantor's schedule for the week.

The Senate will meet at 2:00 PM. It is scheduled to consider HR 3606 [LOC | WW], the "Jumpstart Our Business Startups Act" or "JOBS Act",.

12:15 - 1:30 PM. The Federal Communications Commission (FCC) will host an event titled "Meet the 8th Floor Media Advisors". The speakers will be Sherrese Smith (office of Chairman Julius Genachowski), Erin McGrath (office of Commissioner Robert McDowell), Dave Grimaldi (office of Commissioner Mignon Clyburn). The FCBA states that this is an FCBA event. Location: National Association of Broadcasters, 1771 N St., NW.

3:00 PM. The House Appropriations Committee's (HAC) Financial Services and General Government will hold a hearing on the FY 2012 budget for the Federal Communications Commission (FCC). The witnesses will be FCC Chairman Julius Genachowski and FCC Commissioner Robert McDowell. See, notice. The HAC will webcast this hearing. Location: Room 2359, Rayburn Building.

4:00 PM. The House Intelligence Committee (HIC) will hold a closed hearing titled "Ongoing Intelligence Activities". See, notice. Location: Room HVC-304, Capitol Visitor Center.

The House will meet at 10:00 AM for morning hour, and at 12:00  NOON for legislative business. See, Rep. Cantor's schedule for the week.

8:00 -10:00 AM. Broadband Census News LLC will host a panel discussion titled "Maximizing US Health IT and Broadband Investments". The speakers will be Sharon Gillett (Chief of the FCC's Wireline Competition Bureau), Eric Brown (P/CEO of the California Tele-Health Network), Farzad Mostashari (Department of Health and Human Services), Michael Sims (Delaware Health Information Network), Jessica Zufolo (Deputy Administrator of the Rural Utilities Service), and Craig Settles (moderator). Breakfast will be served. This is open to the public. The price to attend is $47.12. See, notice and registration page. This event is also sponsored Comcast, Google, ICF, National Cable & Telecommunications Association (NCTA), and Telecommunications Industry Association (TIA). Location: Clyde's of Gallery Place, 707 7th St., NW.

8:45 AM - 2:00 PM. The Free State Foundation (FSF) will host an event titled "Fourth Annual Telecom Policy Conference: The Internet World: Will It Remain Free From Public Utility Regulation?" The speakers will include Jeffrey Campbell (Cisco), Jim Cicconi (AT&T), Michelle Connolly (Duke University), Steve Largent (CTIA), Kyle McSlarrow (Comcast/NBC Universal), Marius Schwartz (FCC), Howard Shelanski (Georgetown University Law School), Deborah Tate (FSF), Tom Tauke (Verizon), Steven Teplitz (Time Warner Cable), Rick Whitt (Google), Christopher Yoo (University of Pennsylvania Law School). Free. Open to the public. Lunch will be served. Register to attend by contacting Kathee Baker at kbaker at freestatefoundation dot org. Location: National Press Club, 13th Floor, 529 14th St., NW.

10:00 AM. The Senate Finance Committee's (SFC) Subcommittee on Fiscal Responsibility & Economic Growth  will hold a hearing titled "Tax Fraud by Identity Theft, Part 2: Status, Progress, and Potential Solutions". See, notice. Location: Room 215, Dirksen Building.

10:00 AM - 12:00 NOON. The Senate Banking Committee (SBC) will hold a hearing on numerous nominations, including Jerome Powell and Jeremy Stein to be members of the Board of Governors of the Federal Reserve System. See, notice. Location: Room 538, Dirksen Building.

2:30 PM. The Senate Intelligence Committee (SIC) will hold a closed hearing. See, notice. Location: Room 219, Hart Building.

11:59 PM EDT. Deadline to submit FY 2012 Form 471 to the Federal Communications Commission's (FCC) Universal Service Administration Company (USAC). This is the e-rate subsidy program's Services Ordered and Certification Form .

The House will meet at 10:00  AM for morning hour, and at 12:00  NOON for legislative business. See, Rep. Cantor's schedule for the week.

9:30 - 11:30 AM. The Senate Banking Committee's (SBC) Subcommittee on Securities, Insurance, and Investment will hold a hearing titled "Examining Investor Risks in Crowdfunding". The witnesses will be Mercer Bullard (University of Mississippi law school), Nick Bhargava (Motaavi), Dana Mauriello (ProFounder), Heath Abshure (Arkansas Securities Department). See, notice. Location: Room 538, Dirksen Building.

10:00 AM. The House Judiciary Committee's (HJC) Subcommittee on Crime, Terrorism, and Homeland Security will hold a hearing titled "Secure Identification: The REAL ID Act's Minimum Standards for Driver's Licenses and Identification Cards". The witnesses will include David Heyman (DHS Assistant Secretary for Policy). See, notice. The HJC will webcast this event. Location: Room 2141, Rayburn Building.

10:30 AM. The Federal Communications Commission (FCC) will hold an event titled "Open Meeting". See, agenda. Location: FCC, Commission Meeting Room, 445 12th St., SW.

12:00 NOON - 1:30 PM. The DC Bar Association will host an event titled "Data Breach Risks and Protections for Health Lawyers: Do You Know Where Your Information is Today?". The speakers will be Alan Goldberg (George Mason University and American University law schools), Jonathan Joseph (Christian & Barton), and Melinda Murray (Holy Cross Hospital, Silver Spring). The price to attend ranges from $15 to $35. No CLE credits. See, notice. For more information, call 202-626-3463. The DC Bar has a history of barring reporters from its events. Location: DC Bar Conference Center, 1101 K St., NW.

1:30 PM. The House Judiciary Committee's (HJC) Subcommittee on Courts, Commercial and Administrative Law will hold a hearing titled "Office of Information and Regulatory Affairs: Federal Regulations and Regulatory Reform under the Obama Administration". See, notice. The HJC will webcast this event. Location: Room 2141, Rayburn Building.

2:00 PM. The Senate Judiciary Committee's (SJC) Subcommittee on Antitrust, Competition Policy and Consumer Rights will hold a hearing titled "The Verizon/Cable Deals: Harmless Collaboration or a Threat to Competition and Consumers?". The witnesses will be Randal Milch (Verizon), David Cohen (Comcast), Rick Rule (Cadwalader Wickersham & Taft, and Microsoft's outside antitrust counsel), Steven Berry (Rural Cellular Association), Joel Kelsey (Free Press), and Timothy Wu (Columbia University law school). See, notice. The SJC will webcast this event. Location: Room 226, Dirksen Building.

2:00 PM. The House Oversight and Government Reform Committee (HOGRC) will hold a hearing titled "FOIA in the 21st Century: Using Technology to Improve Transparency in Government". See, notice. Location: Room 2154, Rayburn Building.

2:00 - 6:00 PM. The Federal Communications Bar Association's (FCBA) Privacy and Data Security Committee and the American Bar Association's (ABA) Communications Law Forum will host an event titled "7th Annual ABA/FCBA Privacy & Data Security Symposium". CLE credits. Prices vary. Registrations and cancellations are due by 5:00 PM on March 16. See, notice. Location: Arnold & Porter, 555 12th St., NW.

6:00 - 8:00 PM. The Federal Communications Bar Association's (FCBA) will host an event titled "Happy Hour". Location: __.

Deadline to register to attend the Federal Communications Bar Association's (FCBA) lunch on March 28 at which Jamie Barnett, Chief of the FCC's Public Safety and Homeland Security Bureau, will speak.

The House will meet at 9:00 AM for legislative business. See, Rep. Cantor's schedule for the week.

9:00 AM. The House Intelligence Committee (HIC) will hold a closed hearing titled "Ongoing Intelligence Activities". See, notice. Location: Room HVC-304, Capitol Visitor Center.

10:00 AM. The House Financial Services Committee's (HFSC) Subcommittee on Financial Institutions and Consumer Credit will hold a hearing titled "The Future of Money: How Mobile Payments Could Change Financial Services". See, notice. Location: Room 2128, Rayburn Building.

10:00 AM. The Senate Judiciary Committee (SJC) will hold an executive business meeting. The agenda again includes consideration of the nomination of Richard Taranto to be a Judge of the U.S. Court of Appeals (FedCir), and Robin Rosenbaum to be a Judge of the U.S. District Court for the Southern District of Florida. The SJC will webcast this event. Location: Room 226, Dirksen Building.

10:00 AM. The Senate Appropriations Committee (SAC) will hold a hearing on the FY 2013 budget for the Department of Commerce (DOC). Location: Room 192, Dirksen Building.

10:00 AM - 12:00 NOON. The American Enterprise Institute (AEI) will host a panel discussion titled "Chinese Telecom Investment in the U.S.: Weighing Economic Benefits and Security Risks". The speakers will be Claude Barfield (AEI), Theodore Moran (Georgetown University), Derek Scissors (Heritage Foundation), and Timothy Keeler (Mayer Brown). See, notice. The AEI will webcast this event. Location: AEI, 12th floor, 1150 17th St., NW.

2:30 PM. The Senate Intelligence Committee (SIC) will hold a closed hearing. See, notice. Location: Room 219, Hart Building.

Day one of a two day event hosted by the Air Force Association (ASA) titled "Cyber Futures Conference and Technology Exposition". See, notice. Location: Gaylord National Hotel, Maryland Ballroom, 201 Waterfront St.Oxen Hill, MD.

Rep. Cantor's schedule for the week states that "no votes are expected in the House".

Supreme Court conference day. See, calendar. Closed.

Day two of a two day event hosted by the Air Force Association (ASA) titled "Cyber Futures Conference and Technology Exposition". See, notice. Location: Gaylord National Hotel, Maryland Ballroom, 201 Waterfront St.Oxen Hill, MD.

9:00 AM - 2:30 PM. The DC Bar Association will host an event titled "Youth Law Fair. Privacy Awareness: Managing Social Media Networks". This free event is intended for students and parents. Registration closed by early February. The speakers will be Judge Melvin Wright (DC Superior Court), Curtis Etherly (Coca-Cola), and Marsali Hankcock (iKeepSafe). See, DC Bar notice and registration page. For more information, call 202-626-3463. The DC Bar has a history of barring reporters from its events. Location: DC Superior Court, Room 3300, 500 Indiana Ave., NW.

The House will meet. Votes will be postponed until 6:30 PM.

POSTPONED. 12:30 - 2:00 PM. The Federal Communications Bar Association (FCBA) will host a brown bag lunch titled "The Impact of the New Legislation on Public Safety Communications". Location: Harris Corporation, Suite 850E, 600 Maryland Ave.,  SW.