59–008 

114TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 114–725 

PROVIDING FOR CONSIDERATION OF THE BILL (H.R. 2357) TO DIRECT THE 

SECURITIES AND EXCHANGE COMMISSION TO REVISE FORM S–3 SO AS 

TO ADD LISTING AND REGISTRATION OF A CLASS OF COMMON EQUITY 

SECURITIES ON A NATIONAL SECURITIES EXCHANGE AS AN ADDITIONAL BASIS FOR SATISFYING THE REQUIREMENTS OF GENERAL INSTRUCTION I.B.1. OF SUCH FORM AND TO REMOVE SUCH LISTING AND 

REGISTRATION AS A REQUIREMENT OF GENERAL INSTRUCTION I.B.6. 

OF SUCH FORM, AND PROVIDING FOR CONSIDERATION OF THE BILL 

(H.R. 5424) TO AMEND THE INVESTMENT ADVISERS ACT OF 1940 AND TO 

DIRECT THE SECURITIES AND EXCHANGE COMMISSION TO AMEND ITS 

RULES TO MODERNIZE CERTAIN REQUIREMENTS RELATING TO INVESTMENT ADVISERS, AND FOR OTHER PURPOSES 

SEPTEMBER 6, 2016.—Referred to the House Calendar and ordered to be printed 

Mr. SESSIONS, from the Committee on Rules, 

submitted the following 

R E P O R T 

[To accompany H. Res. 844] 

The Committee on Rules, having had under consideration House 

Resolution 844, by a record vote of 9 to 2, report the same to the 

House with the recommendation that the resolution be adopted. 

SUMMARY OF PROVISIONS OF THE RESOLUTION

The resolution provides for consideration of H.R. 2357, the Accelerating Access to Capital Act of 2015, under a structured rule. The 

resolution provides one hour of general debate equally divided and 

controlled by the chair and ranking minority member of the Committee on Financial Services. The resolution waives all points of 

order against consideration of the bill. The resolution makes in 

order as original text for the purpose of amendment an amendment 

in the nature of a substitute consisting of the text of Rules Committee Print 114–62 and provides that it shall be considered as 

read. The resolution waives all points of order against that amendment in the nature of a substitute. The resolution makes in order 

only those further amendments printed in part A of this report. 

Each such amendment may be offered only in the order printed in 

this report, may be offered only by a Member designated in this report, shall be considered as read, shall be debatable for the time 

specified in this report equally divided and controlled by the proponent and an opponent, shall not be subject to amendment, and 


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shall not be subject to a demand for division of the question. The 

resolution waives all points of order against the amendments printed in part A of this report. The resolution provides one motion to 

recommit with or without instructions. 

Section 2 of the resolution provides for consideration of H.R. 

5424, the Investment Advisers Modernization Act of 2016, under a 

structured rule. The resolution provides one hour of debate equally 

divided and controlled by the chair and ranking minority member 

of the Committee on Financial Services. The resolution waives all 

points of order against consideration of the bill. The resolution provides that the amendment in the nature of a substitute recommended by the Committee on Financial Services now printed in 

the bill shall be considered as adopted, and the bill, as amended, 

shall be considered as read. The resolution waives all points of 

order against provisions in the bill, as amended. The resolution 

makes in order only the further amendment printed in part B of 

this report, if offered by the Member designated in this report, 

which shall be considered as read, shall be debatable for the time 

specified in this report equally divided and controlled by the proponent and an opponent, shall not be subject to amendment, and 

shall not be subject to a demand for division of the question. The 

resolution waives all points of order against the amendment printed in part B of this report. The resolution provides for one motion 

to recommit with or without instructions. 

EXPLANATION OF WAIVERS

Although the resolution waives all points of order against consideration of H.R. 2357, the Committee is not aware of any points of 

order. The waiver is prophylactic in nature. 

The waiver of all points of order against the amendment in the 

nature of a substitute to H.R. 2357 made in order as original text 

includes a waiver of clause 7 of rule XVI, which requires that no 

motion or proposition on a subject different from that under consideration shall be admitted under color of amendment. 

Although the resolution waives all points of order against the 

amendments printed in part A of this report, the Committee is not 

aware of any points of order. The waiver is prophylactic in nature. 

The waiver of all points of order against consideration of H.R. 

5424 includes a waiver of clause 3(e)(1) of rule XIII (‘‘Ramseyer’’), 

requiring a committee report accompanying a bill amending or repealing statutes to show, by typographical device, parts of statute 

affected. The waiver is provided because the submission provided 

by the Committee on Financial Services was insufficient to meet 

the standards established by the rule in its current form. The Committee on Rules continues to work with the House Office of Legislative Counsel and committees to determine the steps necessary to 

comply with the updated rule. 

Although the resolution waives all points of order against provisions in H.R. 5424, as amended, the Committee is not aware of any 

points of order. The waiver is prophylactic in nature. 

Although the resolution waives all points of order against the 

amendment printed in part B of this report, the Committee is not 

aware of any points of order. The waiver is prophylactic in nature. 


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COMMITTEE VOTES

The results of each record vote on an amendment or motion to 

report, together with the names of those voting for and against, are 

printed below: 

Rules Committee record vote No. 204 

Motion by Ms. Foxx to report the rule. Adopted: 9–2 

Majority Members Vote Minority Members Vote 

Ms. Foxx ............................................................ Yea Ms. Slaughter .................................................. ...................

Mr. Cole ............................................................ Yea Mr. McGovern ................................................... Nay 

Mr. Woodall ...................................................... Yea Mr. Hastings of Florida ................................... Nay 

Mr. Burgess ...................................................... Yea Mr. Polis ........................................................... ...................

Mr. Stivers ........................................................ Yea 

Mr. Collins ........................................................ Yea 

Mr. Byrne .......................................................... Yea 

Mr. Newhouse ................................................... Yea 

Mr. Sessions, Chairman ................................... Yea 

SUMMARY OF THE AMENDMENTS TO H.R. 2357 IN PART A MADE IN

ORDER

1. DeSantis (FL): Requires companies to publically disclose if 

they engage in business within Iran or with the Government of 

Iran. (10 minutes) 

2. Hinojosa (TX): Limits unaccredited investor purchasers to 35, 

and limits the amount they may invest to $5,000. Issuers of exempted securities must provide updated disclosure documents to 

purchasers. (10 minutes) 

SUMMARY OF THE AMENDMENT TO H.R. 5424 IN PART B MADE IN

ORDER

Foster (IL): Removes provisions related to brochure delivery and 

the requirement for annual audits at select private funds. (10 minutes) 

PART A—TEXT OF AMENDMENTS MADE IN ORDER

1. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE DESANTIS

OF FLORIDA OR HIS DESIGNEE, DEBATABLE FOR 10 MINUTES

Page 1, line 7, strike ‘‘Not later’’ and insert ‘‘(a) IN GENERAL.— 

Not later’’. 

Page 2, after line 6, insert the following: 

(b) ISSUERS CONDUCTING BUSINESS ACTIVITIES IN IRAN.—Not 

later than 45 days after the date of the enactment of this Act, the 

Securities and Exchange Commission shall require any issuer that 

registers its securities under the Securities Act of 1933 (15 U.S.C. 

77a et seq.) to indicate on the registration statement whether or 

not such issuer is an issuer that— 

(1) does business in Iran; or 

(2) engages in transactions with— 

(A) the Government of Iran; or 

(B) any entity that is organized under the laws of Iran. 


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2. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE HINOJOSA

OF TEXAS OR HIS DESIGNEE, DEBATABLE FOR 10 MINUTES

Page 3, strike lines 4 through 10, and insert the following: 

‘‘(B) LIMITATIONS ON NON-ACCREDITED INVESTORS.—With 

respect to non-accredited investors— 

‘‘(i) there are no more than 35, or the issuer reasonably believes that there are no more than 35, non-accredited investor purchasers of securities from the 

issuer that are sold in reliance on the exemption provided under subsection (a)(8) during the 12-month period preceding such transaction; and 

‘‘(ii) the amount that any non-accredited investor 

purchases of such securities does not exceed $5,000.’’. 

Page 5, line 8, strike the quotation marks and following period 

and insert after such line the following: 

‘‘(3) DISCLOSURE REQUIREMENT.— 

‘‘(A) IN GENERAL.—With respect to any actual or potential purchasers of a security sold in reliance on the exemption provided under subsection (a)(8), the issuer of such security shall provide such purchasers with a disclosure document containing the material elements of the offering. 

‘‘(B) UPDATE REQUIREMENT.—An issuer shall update the 

disclosure document described under subparagraph (A), 

and provide such updated disclosure document to purchasers, if a material change occurs before the purchase is 

completed or the offering ends. 

‘‘(C) TREATMENT OF FINANCIAL STATEMENTS OR PROJECTIONS.—An issuer shall not be required to provide financial statements or projections in the disclosure document 

described under subparagraph (A), but, if the issuer provides any financial statement or projection to any actual or 

potential purchaser, the issuer shall provide such financial 

statement or projection to all actual or potential purchasers. 

‘‘(4) TREATMENT AS RESTRICTED SECURITIES.—Securities sold 

in reliance on the exemption under subsection (a)(8) shall be 

deemed to be restricted securities within the meaning of Rule 

144 (17 C.F.R. 230.144). 

‘‘(5) FORM D REQUIREMENT.—The Commission shall require 

the issuer of any security sold in reliance on the exemption 

provided under subsection (a)(8) to comply with the filing requirements for Form D.’’. 

PART B—TEXT OF AMENDMENT MADE IN ORDER

1. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE FOSTER OF

ILLINOIS OR HIS DESIGNEE, DEBATABLE FOR 10 MINUTES

Page 6, strike line 14 and all that follows through page 7, line 

5. 

Page 7, strike line 18 and all that follows through ‘‘Consistent 

with’’ on page 9, line 16, and insert ‘‘Regulations, consistent with’’. 

Page 9, beginning on line 20, strike ‘‘the Commission shall,’’. 


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Page 9, line 23, insert ‘‘, so as to’’ after ‘‘such section’’. 

Æ 


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