No Registration Opinions (2015 Update)

摘要

The Securities Act of 1933 (the Securities Act) makes it unlawful for any person to use jurisdictional means to offer or sell any security unless a registration statement is in effect as to that security or an exemption from registration is available. One of the principal exemptions is section 4(a)(2), which relates to "transactions by an issuer not involving any public offering." These few words are the foundation for securities offerings that take place every day, without any involvement of the Securities and Exchange Commission (the SEC), based on legal advice regarding the application of section 4(a)(2) and related SEC rules to particular transactions. In many of these offerings, lawyers, in addition to advising their clients on the availability of a section 4(a)(2) or other exemption, deliver opinions to the effect that registration of the securities under the Securities Act is not required. This Subcommittee published a report on no registration opinions in 2007. This report updates the 2007 report in light of amendments adopted by the SEC in 2013 to Rule 144A and Rule 506 of Regulation D under the Securities Act. The amendments implement provisions of the Jumpstart Our Business Startups Act (or "JOBS Act") that directed the SEC to amend those rules to eliminate the prohibition on general solicitation and general advertising (collectively, general solicitation) for securities offerings conducted in reliance upon those rules. In the case of Rule 506, new Rule 506(c) permits general solicitation if all purchasers in the offering are "accredited investors" as defined in Regulation D and the issuer has taken reasonable steps to verify that the purchasers are accredited investors. The amendments also implement a provision of the Dodd-Frank Wall Street Reform and Consumer Protection Act that directed the SEC to make the Rule 506 exemption unavailable for offerings in which certain disqualified persons ("bad actors") participate, subject to a "reasonable care" exception. This report considers implications of these amendments for no registration opinions.