IIB 

115TH CONGRESS 

1ST SESSION H. R. 2201 

IN THE SENATE OF THE UNITED STATES 

NOVEMBER 13, 2017 

Received; read twice and referred to the Committee on Banking, Housing, and 

Urban Affairs 

AN ACT 

To amend the Securities Act of 1933 to exempt certain 

micro-offerings from the registration requirements of 

such Act, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Micro Offering Safe 

3 Harbor Act’’. 

4 SEC. 2. EXEMPTIONS FOR MICRO-OFFERINGS. 

5 (a) IN GENERAL.—Section 4 of the Securities Act of 

6 1933 (15 U.S.C. 77d) is amended— 

7 (1) in subsection (a), by adding at the end the 

8 following: 

9 ‘‘(8) transactions meeting the requirements of 

10 subsection (f).’’; and 

11 (2) by adding at the end the following: 

12 ‘‘(f) CERTAIN MICRO-OFFERINGS.— 

13 ‘‘(1) IN GENERAL.—The transactions referred 

14 to in subsection (a)(8) are transactions involving the 

15 sale of securities by an issuer (including all entities 

16 controlled by or under common control with the 

17 issuer) that meet all of the following requirements: 

18 ‘‘(A) PRE-EXISTING RELATIONSHIP.—Each 

19 purchaser has a substantive pre-existing rela20 tionship with an officer of the issuer, a director 

21 of the issuer, or a shareholder holding 10 per22 cent or more of the shares of the issuer. 

23 ‘‘(B) 35 OR FEWER PURCHASERS.—There 

24 are no more than, or the issuer reasonably be25 lieves that there are no more than, 35 pur26 chasers of securities from the issuer that are 


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1 sold in reliance on the exemption provided 

2 under subsection (a)(8) during the 12-month 

3 period preceding such transaction. 

4 ‘‘(C) SMALL OFFERING AMOUNT.—The ag5 gregate amount of all securities sold by the 

6 issuer, including any amount sold in reliance on 

7 the exemption provided under subsection (a)(8), 

8 during the 12-month period preceding such 

9 transaction, does not exceed $500,000. 

10 ‘‘(2) DISQUALIFICATION.— 

11 ‘‘(A) IN GENERAL.—The exemption pro12 vided under subsection (a)(8) shall not be avail13 able for a transaction involving a sale of securi14 ties if any person described in subparagraph 

15 (B) would have triggered disqualification pursu16 ant to section 230.506(d) of title 17, Code of 

17 Federal Regulations. 

18 ‘‘(B) PERSONS DESCRIBED.—The persons 

19 described in this subparagraph are the fol20 lowing: 

21 ‘‘(i) The issuer. 

22 ‘‘(ii) Any predecessor of the issuer. 

23 ‘‘(iii) Any affiliated issuer. 

24 ‘‘(iv) Any director, executive officer, 

25 other officer participating in the offering, 


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1 general partner, or managing member of 

2 the issuer. 

3 ‘‘(v) Any beneficial owner of 20 per4 cent or more of the issuer’s outstanding 

5 voting equity securities, calculated on the 

6 basis of voting power. 

7 ‘‘(vi) Any promoter connected with 

8 the issuer in any capacity at the time of 

9 such sale. 

10 ‘‘(vii) Any investment manager of an 

11 issuer that is a pooled investment fund. 

12 ‘‘(viii) Any person that has been or 

13 will be paid (directly or indirectly) remu14 neration for solicitation of purchasers in 

15 connection with such sale of securities. 

16 ‘‘(ix) Any general partner or man17 aging member of any such investment 

18 manager or solicitor. 

19 ‘‘(x) Any director, executive officer, or 

20 other officer participating in the offering of 

21 any such investment manager or solicitor 

22 or general partner or managing member of 

23 such investment manager or solicitor.’’. 


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1 (b) EXEMPTION UNDER STATE REGULATIONS.—Sec2 tion 18(b)(4) of the Securities Act of 1933 (15 U.S.C. 

3 77r(b)(4)) is amended— 

4 (1) in subparagraph (F), by striking ‘‘or’’ at 

5 the end; 

6 (2) in subparagraph (G), by striking the period 

7 and inserting ‘‘; or’’; and 

8 (3) by adding at the end the following: 

9 ‘‘(H) section 4(a)(8).’’. 

Passed the House of Representatives November 9, 

2017. 

Attest: KAREN L. HAAS, 

Clerk. 


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