Sec. 201. MODIFICATION OF EXEMPTION
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## SEC. 201 MODIFICATION OF EXEMPTION ###
(a)Modification of Rules **[**[15 U.S.C. 77d note](/us/usc/t15/s77d)**]** ####
(1)Not later than 90 days after the date of the enactment of this Act, the Securities and Exchange Commission shall revise its rules issued in section 230.506 of title 17, Code of Federal Regulations, to provide that the prohibition against general solicitation or general advertising contained in section 230.502(c) of such title shall not apply to offers and sales of securities made pursuant to section 230.506, provided that all purchasers of the securities are accredited investors. Such rules shall require the issuer to take reasonable steps to verify that purchasers of the securities are accredited investors, using such methods as determined by the Commission. Section 230.506 of title 17, Code of Federal Regulations, as revised pursuant to this section, shall continue to be treated as a regulation issued under section 4(2) of the Securities Act of 1933 (15 U.S.C. 77d(2)). ####
(2)Not later than 90 days after the date of enactment of this Act, the Securities and Exchange Commission shall revise subsection (d)(1) of section 230.144A of title 17, Code of Federal Regulations, to provide that securities sold under such revised exemption may be offered to persons other than qualified institutional buyers, including by means of general solicitation or general advertising, provided that securities are sold only to persons that the seller and any person acting on behalf of the seller reasonably believe is a qualified institutional buyer. ###
(b)Consistency in Interpretation Section 4 of the Securities Act of 1933 (15 U.S.C. 77d) is amended— ####
(1)by striking “The provisions of section 5” and inserting “(a) The provisions of section 5”; and ####
(2)by adding at the end the following: > > ### “(b) > > Offers and sales exempt under section 230.506 of title 17, Code of Federal Regulations (as revised pursuant to section 201 of the Jumpstart Our Business Startups Act) shall not be deemed public offerings under the Federal securities laws as a result of general advertising or general solicitation.” > . ###
(c)Explanation of Exemption Section 4 of the Securities Act of 1933 (15 U.S.C. 77d) is amended— ####
(1)by striking “The provisions of section 5” and inserting “(a) The provisions of section 5”; and ####
(2)by adding at the end the following: > > ### “(b) > > > ####
(1)> > With respect to securities offered and sold in compliance with Rule 506 of Regulation D under this Act, no person who meets the conditions set forth in paragraph
(2)shall be subject to registration as a broker or dealer pursuant to section 15(a)(1) of this title, solely because— > > > ##### “(A) > > that person maintains a platform or mechanism that permits the offer, sale, purchase, or negotiation of or with respect to securities, or permits general solicitations, general advertisements, or similar or related activities by issuers of such securities, whether online, in person, or through any other means; > > > ##### “(B) > > that person or any person associated with that person co-invests in such securities; or > > > ##### “(C) > > that person or any person associated with that person provides ancillary services with respect to such securities. > > > #### “(2) > > The exemption provided in paragraph
(1)shall apply to any person described in such paragraph if— > > > ##### “(A) > > such person and each person associated with that person receives no compensation in connection with the purchase or sale of such security; > > > ##### “(B) > > such person and each person associated with that person does not have possession of customer funds or securities in connection with the purchase or sale of such security; and > > > ##### “(C) > > such person is not subject to a statutory disqualification as defined in section 3(a)(39) of this title and does not have any person associated with that person subject to such a statutory disqualification. > > > #### “(3) > > For the purposes of this subsection, the term ‘ancillary services’ means— > > > ##### “(A) > > the provision of due diligence services, in connection with the offer, sale, purchase, or negotiation of such security, so long as such services do not include, for separate compensation, investment advice or recommendations to issuers or investors; and > > > ##### “(B) > > the provision of standardized documents to the issuers and investors, so long as such person or entity does not negotiate the terms of the issuance for and on behalf of third parties and issuers are not required to use the standardized documents as a condition of using the service.” > . # TITLE III CROWDFUNDING
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Sec. 201
MODIFICATION OF EXEMPTION
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