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ARTICLE · 08 APRIL 2013

Advertised Private Placements: Update On Status

The Jumpstart Our Business Startups Act of 2012 requires that the SEC amend Rule 506 of Regulation D to permit general solicitation and advertising in private placements as long as all purchasers are accredited investors.

United StatesCorporate/Commercial Law

New SEC Chairman Will Get the Ball Rolling Again

The Jumpstart Our Business Startups Act of 2012 (JOBS Act) requires that the SEC amend Rule 506 of Regulation D to permit general solicitation and advertising in private placements as long as all purchasers are accredited investors. This change has the potential to significantly alter the way in which capital is raised by start-ups, operating businesses and private funds. This article discusses the current status of the JOBS Act mandated changes to Rule 506 (506 Advertising Rules).

Regulatory Background

The JOBS Act was signed into law on April 5, 2012. It requires that the SEC make these changes to Rule 506 by July 4, 2012. This timeframe has proven unrealistic.

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