HALOS Act of 2023

Bill: 118-hr-1553
Sponsor: full_name: Rep. Lawler, Michael [R-NY-17]
Introduced: 2023-03-10
Policy area: Finance and Financial Sector
Subjects: Administrative law and regulatory procedures

Business investment and capital

Financial services and investments

Higher education

Marketing and advertising

Securities

Securities and Exchange Commission (SEC)

Social work, volunteer service, charitable organizations
Latest action: action_date: 2023-12-12
text: Placed on the Union Calendar, Calendar No. 250.

Summaries:
action_date: 2023-03-10
action_desc: Introduced in House
text: <p><b>Helping Angels Lead Our Startups Act of 2023 or the HALOS Act of 2023</b></p> <p>This bill directs the Securities and Exchange Commission (SEC) to revise Regulation D, which exempts certain securities offerings from SEC registration requirements but prohibits general solicitation or general advertising with respect to such offerings. Under the bill, this prohibition shall not apply to events with specified kinds of sponsors&#8212;including <i>angel investor groups</i> unconnected to broker-dealers or investment advisers&#8212;where presentations or communications are made by or on behalf of an issuer, if</p> <ul> <li>the advertising does not refer to any specific offering of securities by the issuer; </li> <li>the sponsor does not provide investment recommendation or advice to attendees, engage in investment negotiations with attendees, charge certain fees, or receive certain compensation; and </li> <li>no specific information regarding a securities offering is communicated beyond&nbsp;the type and amount of securities being offered, the amount of securities already subscribed for, and the intended use of proceeds from the offering.</li></ul> In addition, the SEC is prohibited from requiring additional filings for a general solicitation or general advertising of a Regulation D security.

action_date: 2023-12-12
action_desc: Reported to House
text: <p><strong>Helping Angels Lead Our Startups Act of 2023 or the HALOS Act of 2023</strong></p><p>This bill directs the Securities and Exchange Commission (SEC) to revise Regulation D, which exempts certain securities offerings from SEC registration requirements but prohibits general solicitation or general advertising with respect to such offerings. Under the bill, this prohibition shall not apply to events with specified kinds of sponsors—including <em>angel investor groups</em> unconnected to broker-dealers or investment advisers—where presentations or communications are made by or on behalf of an issuer, if</p><ul><li>the advertising does not refer to any specific offering of securities by the issuer;</li><li>the sponsor does not provide investment recommendation or advice to attendees, engage in investment negotiations with attendees, charge certain fees, or receive certain compensation; and</li><li>no specific information regarding a securities offering is communicated beyond&nbsp;the type and amount of securities being offered, the amount of securities already subscribed for, and the intended use of proceeds from the offering.</li></ul>

tv_txt: IB Union Calendar No. 250 118th CONGRESS 1st Session H. R. 1553 [Report No. 118–310] IN THE HOUSE OF REPRESENTATIVES March 10, 2023 Mr. Lawler (for himself and Mr. Gottheimer ) introduced the following bill; which was referred to the Committee on Financial Services December 12, 2023 Additional sponsor: Mr. Nickel December 12, 2023 Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed Strike out all after the enacting clause and insert the part printed in italic For text of introduced bill, see copy of bill as introduced on March 10, 2023 A BILL To require the Securities and Exchange Commission to revise rules relating to general solicitation or general advertising to allow for presentations or other communication made by or on behalf of an issuer at certain events, and for other purposes.

1. Short title This Act may be cited as the Helping Angels Lead Our Startups Act of 2023 or the HALOS Act of 2023 . 2. Clarification of general solicitation (a) Definitions For purposes of this Act and the revision of rules required under this Act: (1) Angel investor group The term angel investor group means any group that— (A) is composed of accredited investors interested in investing personal capital in early-stage companies; (B) holds regular meetings and has defined processes and procedures for making investment decisions, either individually or among the membership of the group as a whole; and (C) is neither associated nor affiliated with brokers, dealers, or investment advisers. (2) Issuer The term issuer means an issuer that is a business, is not in bankruptcy or receivership, is not an investment company, and is not a blank check, blind pool, or shell company. (b) In general Not later than 6 months after the date of enactment of this Act, the Securities and Exchange Commission shall revise Regulation D (17 CFR 230.500 et seq.) to require that in carrying out the prohibition against general solicitation or general advertising contained in section 230.502(c) of title 17, Code of Federal Regulations, the prohibition shall not apply to a presentation or other communication made by or on behalf of an issuer which is made at an event— (1) sponsored by— (A) the United States or any territory thereof, the District of Columbia, any State, a political subdivision of any State or territory, or any agency or public instrumentality of any of the foregoing; (B) a college, university, or other institution of higher education; (C) a nonprofit organization; (D) an angel investor group; (E) a venture forum, venture capital association, or trade association; or (F) any other group, person, or entity as the Securities and Exchange Commission may determine by rule; (2) where any advertising for the event does not reference any specific offering of securities by the issuer; (3) the sponsor of which— (A) does not make investment recommendations or provide investment advice to event attendees; (B) does not engage in an active role in any investment negotiations between the issuer and investors attending the event; (C) does not charge event attendees any fees other than reasonable administrative fees; (D) does not receive any compensation for making introductions between investors attending the event and issuers, or for investment negotiations between such parties; (E) makes readily available to attendees a disclosure not longer than one page in length, as prescribed by the Securities and Exchange Commission, describing the nature of the event and the risks of investing in the issuers presenting at the event; and (F) does not receive any compensation with respect to such event that would require registration of the sponsor as a broker or a dealer under the Securities Exchange Act of 1934, or as an investment advisor under the Investment Advisers Act of 1940; and (4) where no specific information regarding an offering of securities by the issuer is communicated or distributed by or on behalf of the issuer, other than— (A) that the issuer is in the process of offering securities or planning to offer securities; (B) the type and amount of securities being offered; (C) the amount of securities being offered that have already been subscribed for; and (D) the intended use of proceeds of the offering. (c) Rule of construction Subsection (b) may only be construed as requiring the Securities and Exchange Commission to amend the requirements of Regulation D with respect to presentations and communications, and not with respect to purchases or sales. (d) No pre-existing substantive relationship by reason of event Attendance at an event described under subsection (b) shall not qualify, by itself, as establishing a pre-existing substantive relationship between an issuer and a purchaser, for purposes of Rule 506(b).

December 12, 2023 Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed

tv_txt: I 118th CONGRESS 1st Session H. R. 1553 IN THE HOUSE OF REPRESENTATIVES March 10, 2023 Mr. Lawler (for himself and Mr. Gottheimer ) introduced the following bill; which was referred to the Committee on Financial Services A BILL To require the Securities and Exchange Commission to revise rules relating to general solicitation or general advertising to allow for presentations or other communication made by or on behalf of an issuer at certain events, and for other purposes.

1. Short title This Act may be cited as the Helping Angels Lead Our Startups Act of 2023 or the HALOS Act of 2023 . 2. Clarification of general solicitation (a) Definitions For purposes of this Act and the revision of rules required under this Act: (1) Angel investor group The term angel investor group means any group that— (A) is composed of accredited investors interested in investing personal capital in early-stage companies; (B) holds regular meetings and has defined processes and procedures for making investment decisions, either individually or among the membership of the group as a whole; and (C) is neither associated nor affiliated with brokers, dealers, or investment advisers. (2) Issuer The term issuer means an issuer that is a business, is not in bankruptcy or receivership, is not an investment company, and is not a blank check, blind pool, or shell company. (b) In general Not later than 6 months after the date of enactment of this Act, the Securities and Exchange Commission shall revise Regulation D of its rules (17 CFR 230.500 et seq.) to require that in carrying out the prohibition against general solicitation or general advertising contained in section 230.502(c) of title 17, Code of Federal Regulations, the prohibition shall not apply to a presentation or other communication made by or on behalf of an issuer which is made at an event— (1) sponsored by— (A) the United States or any territory thereof, the District of Columbia, any State, a political subdivision of any State or territory, or any agency or public instrumentality of any of the foregoing; (B) a college, university, or other institution of higher education; (C) a nonprofit organization; (D) an angel investor group; (E) a venture forum, venture capital association, or trade association; or (F) any other group, person, or entity as the Securities and Exchange Commission may determine by rule; (2) where any advertising for the event does not reference any specific offering of securities by the issuer; (3) the sponsor of which— (A) does not make investment recommendations or provide investment advice to event attendees; (B) does not engage in an active role in any investment negotiations between the issuer and investors attending the event; (C) does not charge event attendees any fees other than reasonable administrative fees; (D) does not receive any compensation for making introductions between investors attending the event and issuers, or for investment negotiations between such parties; (E) makes readily available to attendees a disclosure not longer than one page in length, as prescribed by the Securities and Exchange Commission, describing the nature of the event and the risks of investing in the issuers presenting at the event; and (F) does not receive any compensation with respect to such event that would require registration of the sponsor as a broker or a dealer under the Securities Exchange Act of 1934, or as an investment advisor under the Investment Advisers Act of 1940; and (4) where no specific information regarding an offering of securities by the issuer is communicated or distributed by or on behalf of the issuer, other than— (A) that the issuer is in the process of offering securities or planning to offer securities; (B) the type and amount of securities being offered; (C) the amount of securities being offered that have already been subscribed for; and (D) the intended use of proceeds of the offering. (c) Rule of construction Subsection (b) may only be construed as requiring the Securities and Exchange Commission to amend the requirements of Regulation D with respect to presentations and communications, and not with respect to purchases or sales. (d) No pre-Existing substantive relationship by reason of event Attendance at an event described under subsection (b) shall not qualify, by itself, as establishing a pre-existing substantive relationship between an issuer and a purchaser, for purposes of Rule 506(b). 3. Restrictions on new filing requirements in connection with a general solicitation With respect to any offer or sale of a security under Regulation D (17 CFR 230.500 et seq.) that is exempt from the prohibition against general solicitation or general advertising contained in section 230.502(c) of title 17, Code of Federal Regulations, the Securities and Exchange Commission may not issue any rule that would apply additional filing requirements (including requirements to file information with the Commission before or after a general solicitation or general advertising) to a general solicitation or general advertising of such a security that were not in effect on the date of enactment of this Act.