House Passes Bills to Boost Job Creation
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With job creation in mind, two bills intended to assist small businesses in acquiring capital were approved by the House of Representatives Wednesday, November 2, 2011. The Small Company Capital Formation Act introduced by Rep. David Schweikert, for example, increases the initial-public offering threshold for small businesses from $5 million to $50 million. This marks the first instance in almost twenty years that the Securities and Exchange Commission raised the threshold for these regulated figures.
The Wall Street Journal elaborates on the bills passed:
Small-business IPOs have been on the decline. In 2010, small businesses used Regulation A only three times, and between 1995 and 2004, the option was used only 78 times, according to a House memo.
Another bill approved Wednesday by a vote of 420 to 2 modifies regulations concerning registration and deregistration of small bank holding companies under securities laws. Sponsored by Rep. James Himes (D-CT), the measure raises the bank shareholder threshold for SEC registration to 2,000 from 500. The threshold has not been adjusted since 1964.
The two bills aim to indirectly bolster job creation among small businesses. With greater access to capital, such concerns will be able to grow and hire more workers, legislators say.
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