Wilmer Hale
MONTH-IN-BRIEF (Sep 2022)
Securities Regulation
SEC Adopts JOBS Act Inflation Adjustments
By Marissa Dressor, Mayer Brown
On September 9, 2022, the Securities and Exchange Commission (SEC) announced amendments to its rules in order to implement inflation adjustments mandated by the JOBS Act. The SEC’s amendments increase the annual gross revenue threshold for emerging growth companies and raise certain dollar amounts contained in Regulation Crowdfunding. Pursuant to the JOBS Act, the SEC is required to make inflation adjustments to various JOBS Act rules at least once every five years.
Title I of the JOBS Act added Securities Act Section 2(a)(19) and Exchange Act Section 3(a)(80) that define the term “emerging growth company.” Pursuant to the statutory definition, the SEC is required to index to inflation the annual gross revenue amount used in determining EGC status. The SEC therefore adopted amendments to Securities Act Rule 405 and Exchange Act Rule 12b-2 to adjust the EGC threshold from $1.07 billion to $1.235 billion.