II 

114TH CONGRESS 

2D SESSION S. 3453 

To amend provisions in the securities laws relating to regulation crowdfunding 

to raise the dollar amount limit and to clarify certain requirements 

and exclusions for funding portals established by such Act. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 28, 2016 

Mr. DAINES introduced the following bill; which was read twice and referred 

to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To amend provisions in the securities laws relating to regulation crowdfunding to raise the dollar amount limit and 

to clarify certain requirements and exclusions for funding 

portals established by such Act. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Crowdfunding En5 hancement Act’’. 

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1 SEC. 2. CROWDFUNDING VEHICLES. 

2 (a) AMENDMENTS TO THE SECURITIES ACT OF

3 1933.—The Securities Act of 1933 (15 U.S.C. 77a et 

4 seq.) is amended— 

5 (1) in section 4A(f)(3), by inserting ‘‘by any of 

6 paragraphs (1) through (14) of’’ before ‘‘section 

7 3(c)’’; and 

8 (2) in section 4(a)(6)(B), by inserting after 

9 ‘‘any investor’’ the following: ‘‘, other than a 

10 crowdfunding vehicle (as defined in section 2(a) of 

11 the Investment Company Act of 1940),’’. 

12 (b) AMENDMENTS TO THE INVESTMENT COMPANY

13 ACT OF 1940.—The Investment Company Act of 1940 (15 

14 U.S.C. 80a–1 et seq.) is amended— 

15 (1) in section 2(a), by adding at the end the 

16 following: 

17 ‘‘(55) The term ‘crowdfunding vehicle’ means a 

18 company— 

19 ‘‘(A) whose purpose (as set forth in its or20 ganizational documents) is limited to acquiring, 

21 holding, and disposing securities issued by a 

22 single company in one or more transactions and 

23 made pursuant to section 4(a)(6) of the Securi24 ties Act of 1933; 

25 ‘‘(B) which issues only one class of securi26 ties; 

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1 ‘‘(C) which receives no compensation in 

2 connection with such acquisition, holding, or 

3 disposition of securities; 

4 ‘‘(D) no associated person of which re5 ceives any compensation in connection with 

6 such acquisition, holding or disposition of secu7 rities unless such person is acting as or on be8 half of an investment adviser registered under 

9 the Investment Advisers Act of 1940 or reg10 istered as an investment adviser in the State in 

11 which the investment adviser maintains its prin12 cipal office and place of business; 

13 ‘‘(E) the securities of which have been 

14 issued in a transaction made pursuant to sec15 tion 4(a)(6) of the Securities Act of 1933, 

16 where both the crowdfunding vehicle and the 

17 company whose securities it holds are co18 issuers; 

19 ‘‘(F) which is current in its ongoing disclo20 sure obligations under Rule 202 of Regulation 

21 Crowdfunding (17 C.F.R. 227.202); 

22 ‘‘(G) the company whose securities it holds 

23 is current in its ongoing disclosure obligations 

24 under Rule 202 of Regulation Crowdfunding 

25 (17 C.F.R. 227.202); and 

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1 ‘‘(H) is advised by an investment adviser 

2 registered under the Investment Advisers Act of 

3 1940 or registered as an investment adviser in 

4 the State in which the investment adviser main5 tains its principal office and place of business.’’; 

6 and 

7 (2) in section 3(c), by adding at the end the fol8 lowing: 

9 ‘‘(15) Any crowdfunding vehicle.’’. 

10 SEC. 3. CROWDFUNDING EXEMPTION FROM REGISTRA11 TION. 

12 Section 12(g)(6) of the Securities Exchange Act of 

13 1934 (15 U.S.C. 78l(g)(6)) is amended— 

14 (1) by striking ‘‘The Commission’’ and insert15 ing the following: 

16 ‘‘(A) IN GENERAL.—The Commission’’; 

17 (2) by striking ‘‘section 4(6)’’ and inserting 

18 ‘‘section 4(a)(6)’’; and 

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

20 ‘‘(B) TREATMENT OF SECURITIES ISSUED

21 BY CERTAIN ISSUERS.—An exemption under 

22 subparagraph (A) shall be unconditional for se23 curities offered by an issuer that had a public 

24 float of less than $75,000,000 as of the last 

25 business day of the issuer’s most recently commstockstill on DSK3G9T082PROD with BILLS

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1 pleted semiannual period, computed by multi2 plying the aggregate worldwide number of 

3 shares of the issuer’s common equity securities 

4 held by non-affiliates by the price at which such 

5 securities were last sold (or the average bid and 

6 asked prices of such securities) in the principal 

7 market for such securities or, in the event the 

8 result of such public float calculation is zero, 

9 had annual revenues of less than $50,000,000 

10 as of the issuer’s most recently completed fiscal 

11 year.’’. 

Æ 

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