My friend and fellow lawyer Joe Wallin thinks a lot about how laws passed by Congress - often including laws that have good purposes in the appropriate arenas - end up having adverse effects on startups.
I know this about Joe for almost as long as I've known him. In fact, we often collaborate on projects to identify threats to startups and startup investing, such as the Save Reg D campaign.
Even so, I was blown away by an email he sent last week on which I was copied, in which he laid out, bullet by bullet, what amounts to a truly pro-startup federal policy agenda. With Joe's permission, I'm posting his email below and at startuppolicy.org.
Joe Wallin's Ideas:
• Make Section 1202 permanent. Right now, it expires at the end of this year.
• Make the 60 day window on 1045 longer. 60 days is too short in startup land to find a replacement investment.
• Shorten the 5 year holding period under 1202 to 2 years.
• Repeal the bad actor provisions in the Dodd-Frank Bill. These provisions are a form of extreme overkill. They are going to make it a lot harder for startups to startup and grow.
• Repeal the increase the accredited investor threshold in the Dodd-Frank bill. Why make it harder to invest in startups?
• Repeal the second sentence of section 201(a) of the JOBS Act:(a) Modification of Rules-This second sentence is what has hung up the SEC. Why require SEC regulations at all. Repeal the current regulatory barriers directly!
(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)).
Also, the crowdfunding bill ought to be amended. Bill and I have sets of amendments that are places to start.
Also see this on quora.com.
It's possible startuppolicy.org will be a place where Joe might further iterate his list, or where others might add or develop policy ideas.
Photo: "Petition of Ohioans to the Senate and House of Representatives Regarding Land Sale Policy, 01/10/1810," The U.S. National Archives / Flickr.