In the prior two pieces I discussed how the “Jumpstart Our Business Startups Act” (the JOBS Act) requires the Securities & Exchange Commission (SEC0 to adopt new regulations to allow public advertising of Rule 506 offerings and to allow crowdfunding. This article discusses how real-estate syndications, start-ups and other companies wanting to raise money (offerors/issuers) may want to act based on the bill.
One bright spot is that the JOBS Act preempts state securities laws regarding the public advertising of Rule 506 offerings and also crowdfunding. This is crucial because in the past, where the federal government has not preempted state law, the states have either not passed their own laws allowing use of the exemption or have added conditions that made the exemption unworkable. This is what occurred with the Rule 504, Rule 505 and Reg. A exemptions and why often they are not used. (more…)


