SEC Proposes Securities Act Reform

Originally published December 17, 2004

On October 26, 2004, the Securities and Exchange Commission proposed modifications to the securities registration and offering processes under the Securities Act of 1933. Release Nos. 33-8501; 34-50624; IC-26649. It is the first attempt by the SEC to make wholesale revisions to the capital raising process since the SEC’s "aircraft carrier" proposals in 1998. Release No. 33-7606A. The proposals would build on a number of concepts from the "aircraft carrier" release, but would apply them in different ways than previously proposed as an attempt to avoid the negative reaction from many market participants in response to the previous release. This initiative promises to be critically important to any company that accesses the public securities markets and to the investment banking firms that underwrite public offerings.