Sec. 304. Study on IPO fees
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In this section: The term IPO means an initial public offering. The term small- and medium-sized company means an issuer with an initial public float determination of less than $700,000,000. The Commission, in consultation with the Financial Industry Regulatory Authority, shall carry out a study of the costs associated with small- and medium-sized companies to undertake IPOs and Tier 2 offerings, as defined in section 230.251 of title 17, Code of Federal Regulations, or any successor regulation.
In carrying out the study required under paragraph (1), the Commission shall— consider the direct and indirect costs of an IPO, including— fees, such as gross spreads paid to underwriters, promoters, investment advisory firms, and other professionals; compliance with Federal and State securities laws at the time of the IPO; and such other IPO-related costs as the Commission determines appropriate; compare and analyze the costs of an IPO with the costs of obtaining alternative sources of financing and of liquidity; consider the impact of the costs of an IPO on capital formation; analyze the impact of the costs of an IPO on the availability of public securities of small- and medium-sized companies to retail investors; and analyze trends in IPOs over a time period the Commission determines is appropriate to analyze IPO pricing practices, considering— the number of IPOs; how costs for IPOs have evolved over time, including fees paid to underwriters, investment advisory firms, financial advisers, and other professions for services in connection with an IPO; the number of brokers and dealers active in underwriting IPOs; the different types of services that underwriters, promoters, investment advisory firms, and other professionals provide before and after a small- or medium-sized company IPO and the factors impacting underwriting costs; changes in the costs and availability of investment research for small- and medium-sized companies; and any other consideration the Commission considers necessary and appropriate.
Not later than 1 year after the date of enactment of this Act, the Commission shall submit to Congress a report containing all findings and determinations made in carrying out the study required under subsection
(b)and any administrative or legislative recommendations the Commission may have with respect to the matters considered under the study.