A bill designed to foster initial public offerings (IPO) for private companies has garnered House approval.
Reps. Gregory Meeks (D-NY) and Ted Budd (R-NC) said the Encouraging Public Offerings Act of 2017, which passed by a vote of 419-0, would offer a more feasible option for businesses.
“Taking a company public is a crucial option for entrepreneurs, allowing them to access funding, build on their ideas and create jobs,” Meeks said. “Yet, inherent in the current framework are barriers and costs, which should be minimized to allow companies to grow sustainably. In addition to protecting investors by maintaining reasonable safeguards, Congress should help create a streamlined process that keeps IPOs viable for budding businesses.”
The lawmakers said the Act has three provisions that aid the IPO fostering initiative by expanding the JOBS Act’s confidential registration provisions beyond emerging growth companies to all issuers, allowing confidential registration for follow-on offerings for all issuers while codifying into law actions undertaken by the Securities Exchange Commission earlier this year, and expanding the testing the waters provision in the JOBS Act to all issuers by allowing companies in the initial public offerings process to gauge accredited and institutional investor interest in a securities offering.
Meeks said the bill’s passage indicates the House acknowledges the importance of keeping IPOs viable for budding businesses. He said he is looking forward to the Senate advancing the legislation in the near future.