The Massachusetts Securities Division (the “Division”) is circulating the following proposed regulations for comments:
Funding Portals in the Commonwealth. The Division solicits comments on a proposed regulation that requires a notice filing from any Funding Portal having a principal place of business in the Commonwealth.
The proposed regulation would require the notice filing of a copy of Form Funding Portal (FP), as filed with the SEC. The regulation also sets forth amendment and withdrawal requirements for Funding Portals.
950 CMR 12.206 (PDF)
Policy on the Use of Electronic Offering Documents and Subscription Agreements. This proposed regulation is intended to provide flexibility for issuers, while incorporating the investor protections included in the NASAA Statement of Policy on the Use of Electronic Offering Documents and Subscription Agreements.
950 CMR 13.305(A) (PDF)
Update of Exemption for Exchange-Listed Securities. The revised regulation lists the exchanges designated as covered exchanges in Section 18(b)(1) of the Securities Act and SEC Rule 146.
950 CMR 14.402(A)(8) (PDF)
Revocation of Massachusetts Uniform Limited Offering Exemption. Based on the SEC’s May 2017 repeal of Rule 505 of Regulation D, the Division proposes to remove this state exemption because it is obsolete.
950 CMR 14.402(B)(13)(i) (PDF)
Inclusion of SEC Rule 147A in the Massachusetts Crowdfunding Exemption. The proposed amendment to the Massachusetts exemption will specifically reference SEC Rule 147A. The amended regulation will accommodate modern business practices and communications technology and will provide an alternative means for smaller companies to raise capital locally.
950 CMR 14.402(B)(13)(o) (PDF)
Notice Filing for Federal Crowdfunding Offerings. The Division solicits comments on a proposed regulation that requires a short notice filing from a crowdfunding issuer that is conducting its crowdfunding offering in the Commonwealth and: (a) such issuer has its principal place of business in the Commonwealth or (b) 50% or greater of the aggregate amount of the offering has been purchased by residents of the Commonwealth.
The proposed regulation would require the filing of a notice, the materials filed with the SEC (including SEC Form C), a consent to service of process on Form U2, and Form U-2A (if applicable). The regulation also sets forth renewal and amendment requirements for federal crowdfunding offerings.
950 CMR 14.402(B)(13)(p) (PDF)
Notice Filing for Regulation A, Tier 2 Offerings. The Division solicits comments on a proposed regulation requiring a notice filing from an issuer that is conducting a Regulation A, Tier 2 offering in the Commonwealth.
The notice filing under the proposed regulation will use the notice form adopted by NASAA for Tier 2 offerings, along with Form U-2A (if applicable) and a filing fee. This proposed amendment also includes designation of the NASAA model notice form as a form accepted by the Division.
A public hearing to receive comments will be held at 11:00 a.m. on January 18, 2018 at the offices of the Massachusetts Securities Division, John W. McCormack Building, One Ashburton Place - 17th Floor, Boston, MA 02108. The deadline to submit written comments is January 19, 2018.
Comments may be submitted by clicking the “Submit a Comment” button, below. Comments submitted will become part of the record for this rule making. The Securities Division will make the comments publicly available. If you have questions about the proposed regulations, please contact Peter Cassidy, Esq. at 617-727-3548.
I urge the Division to adopt notice filing rules that utilize the Uniform Notice of Federal Crowdfunding Offering Form U-CF developed by NASAA rather than requiring an issuer to duplicate efforts and file everything that is permanently, and publicly available on EDGAR and the Form U-2. As offering materials prepared for offerings under Regulation Crowdfunding are created for digital display, the proposed rules would be especially burdensome without the state having its own digital filing system on par with EDGAR.
Further, every other state that has adopted rules for notice filings for offerings under Regulation Crowdfunding has adopted the Form U-CF. Being consistent with other regimes will assist with compliance.
VP of Product Management and Strategy