Crowdfunding Proposal: Quick First Look

Today the SEC voted to propose a crowdfunding framework.  We provide highlights below based on today's meeting:

Intermediaries:  All offerings must be conducted through an intermediary that is either a registered broker-dealer or a registered funding portal.  The Commission is proposing a series of rules governing the activities of intermediaries participating in crowdfunding offerings.  The Staff noted that FINRA is expected to propose its own regulations on portals.

Eligible Issuers:  Certain companies will not be eligible to avail themselves of the crowdfunding exemption, including foreign issuers, SEC-reporting companies, companies that are registered under the Investment Company, issuers with no specific business plan, SPACs or blind pools, or issuers that are delinquent in their SEC filings.