Developing and Empowering our Aspiring Leaders Act of 2022

Bill: 117-s-3914
Sponsor: full_name: Sen. Rounds, Mike [R-SD]
Introduced: 2022-03-24
Policy area: Finance and Financial Sector
Subjects: Administrative law and regulatory procedures

Financial services and investments

Securities

Securities and Exchange Commission (SEC)
Latest action: action_date: 2022-04-05
text: Committee on Banking, Housing, and Urban Affairs. Hearings held.

Summaries:
action_date: 2022-03-24
action_desc: Introduced in Senate
text: <p><strong>Developing and Empowering our Aspiring Leaders Act of 2022 </strong> </p> <p>This bill directs the Securities and Exchange Commission to revise venture capital investment regulations. Venture capital funds are exempt from certain regulations applicable to other investment firms, including those related to filings, audits, and restricted communications with investors. Under current law, non-qualifying investments&#8212;which include secondary transactions and investments in other venture capital funds&#8212;may comprise up to 20% of a venture capital fund. </p> <p>The bill allows investments acquired through secondary transactions or investments in other venture capital funds to be considered as qualifying investments for venture capital funds. However, for a private fund to qualify as a venture capital fund, the fund's investments must predominately (1) be acquired directly, or (2) be investments in other venture capital funds.</p> <p>

tv_txt: II 117th CONGRESS 2d Session S. 3914 IN THE SENATE OF THE UNITED STATES March 24, 2022 Mr. Rounds introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To require the Securities and Exchange Commission to revise the definition of a qualifying investment, for purposes of the exemption from registration for venture capital fund advisers under the Investment Advisers Act of 1940, to include an equity security issued by a qualifying portfolio company and to include an investment in another venture capital fund, and for other purposes.

1. Short title This Act may be cited as the Developing and Empowering our Aspiring Leaders Act of 2022 . 2. Definitions Not later than 180 days after the date of enactment of this Act, the Securities and Exchange Commission shall— (1) revise the definition of a qualifying investment under paragraph (c) of section 275.203(l)–1 of title 17, Code of Federal Regulations— (A) to include an equity security issued by a qualifying portfolio company, whether acquired directly from the company or in a secondary acquisition; and (B) to specify that an investment in another venture capital fund is a qualifying investment under that definition; and (2) revise paragraph (a) of section 275.203(l)–1 of title 17, Code of Federal Regulations, to require, as a condition of a private fund qualifying as a venture capital fund under that paragraph, that the qualifying investments of the private fund are— (A) predominantly qualifying investments that were acquired directly from a qualifying portfolio company; or (B) predominantly qualifying investments in another venture capital fund or other venture capital funds.