Revised rules set to take effect on Friday will make it easier for some U.S. and Canadian companies to sell securities with reduced fees, limited regulatory reporting and less legal liability, the Wall Street Journal reported today. The U.S. Securities and Exchange Commission’s updated Regulation A rules will allow U.S. and Canadian companies that are not SEC reporting issuers to sell up to $50 million of their U.S. securities annually, and will permit their shareholders to sell up to $15 million in any 12-month period, with immediate public trading in the U.S. of the purchased securities. The previous version of the rules had set the cap at $5 million, which made it infrequently used, said Spencer Feldman, a partner at law firm Olshan Frome Wolosky LLP. The changes make it easier for smaller issuers to access capital on U.S. trading markets, and will offer lower initial and ongoing expenses, reduced legal liability, potentially higher valuations, limited SEC reporting and no ongoing Sarbanes-Oxley compliance, said Guy Lander, a partner at law firm Carter Ledyard & Milburn.
