In an effort to facilitate capital formation, the SEC's Division of Corporation Finance expanded its nonpublic review process to permit all companies to submit draft registration statements relating to an initial public offering (IPO) for review on a nonpublic basis.

Now Congress is expanding on that idea. On October 2, 2017, Rep. Ted Budd (R-NC) and Rep. Gregory Meeks (D-NY)  –  both members of the House Financial Services Committee and the Subcommittee on Capital Markets, Securities and Investment – introduced a bill to further facilitate IPOs and follow-on public offerings.

The bill, H.R. 3903, would amend the Securities Act of 1933 to extend to all issuers certain provisions of the Jumpstart Our Business Startups Act that are currently available only to emerging growth companies.

Specifically, the bill would allow all issuers to:

• submit a draft registration statement for confidential nonpublic review by the SEC prior to the public filing of an IPO registration statement
• submit a draft registration statement for confidential nonpublic review for an offering within one year following an IPO
• test the waters with institutional investors