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From Banking and Finance Law Daily, October 12, 2018

Rounds introduces economic growth legislation, seeks to ‘keep the momentum going’

By Charles A. Menke, J.D.

Senator Mike Rounds (R-SD) has introduced a legislative package comprised of six bills intended to remove regulatory burdens for investors and small businesses seeking to raise capital to create jobs and grow the economy. "These bills seek to lessen financial regulatory burdens, making it easier for consumers to invest and for job creators to thrive," said Rounds, who is a member of the Senate Banking, Housing and Urban Affairs Committee. Citing significant progress in the enactment of "pro-growth policies" that have expanded the economy, Rounds added that the "legislation will help keep the momentum going."

Rounds noted that a majority of the introduced bills "have already received strong, bipartisan support in the House of Representatives" since they were part of the JOBS and Investor Confidence Act. That legislation (S. 488), also known as JOBS Act 3.0, was the product of a bipartisan compromise aimed at making it easier for smaller companies to raise capital, and passed the House by a vote of 406-4 (see Banking and Finance Law Daily, July 18, 2018).

The six bills comprising the legislative package introduced by Rounds are:

  1. Alleviating Stress Test Burdens to Help Investors Act (S. 3574), which provides relief to non-bank financial institutions by removing bank-centric stress testing requirements and allows more appropriate regulators, such as the Securities and Exchange Commission or the Commodities Futures Trading Commission, to conduct stress tests on these companies.
  2. Modernizing Disclosures for Investors Act (S. 3575), requiring the SEC to conduct a study on simplifying the quarterly financial reporting system for small, emerging growth companies.
  3. Developing and Empowering our Aspiring Leaders (DEAL Act) Act (S. 3576), requiring the SEC to expand the type of assets that venture capitalists can invest in without having to undergo burdensome registration.
  4. Financial Stability Oversight Council (FSOC) Improvement Act (S. 3577), which enhances the transparency and procedural fairness of the non-bank systemically important financial institutions designation process, and provides affected institutions a greater opportunity to be heard by the functional regulator and modify its business, structure, or operations prior to the SIFI designation.
  5. Improving Investment Research for Small and Emerging Issuers Act (S. 3578), which directs the SEC to study issues that inhibit the dissemination of research on emerging growth companies.
  6. Investment Adviser Regulatory Flexibility Improvement Act (S. 3579), which requires the SEC to revise its definition of a "small business" when assessing the impact of its regulations on small, Main Street investment advisers to look beyond assets under management and include other factors, such as the number of employees at a small advisory firm.

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