On July 22 and 23, 2025, the House Committee on Financial Services (the “Committee”) held a full committee markup during which it considered certain bills that, if passed, would improve investor access to the capital markets. These bills have been ordered to be reported to the House of Representatives (the “House”) for consideration. While there were other bills considered and acted on relating to bank regulatory, sanctions and other matters, this post focuses on bills affecting the federal securities laws.
The 118th Congress had considered prior versions of the following four bills as part of H.R.2799, the Expanding Access to Capital Act, which passed the House by a 212-205 recorded vote. One of these bills pertains to Well-Known Seasoned Issuer (“WKSI”) status while the remaining three relate to the Investment Advisers Act of 1940 (the “Advisers Act”). The proposed bills are discussed below:
- H.R. 4430, the Expanding WKSI Eligibility Act, would expand availability of WKSI status by reducing the public float requirement to qualify as a WKSI to $75 million from the current $700 million, provided that all other requirements for WKSI eligibility are met. WKSIs are able to use “automatic” shelf registration statements and reduction in the public float threshold would allow more issuers to utilize this expedited securities offering process.
- H.R. 3673, the Small Business Investor Capital Access Act, would amend the Advisers Act to require the SEC to adjust the exemption from registration requirements applicable to investment advisers of small private funds. Currently, investment advisers of private funds of less than $150 million in assets under management are exempt from registration. This bill, if passed, would require the SEC to annually adjust the dollar threshold for this exemption, to account for inflation based on the Consumer Price Index.
- H.R. 4429, the Developing and Empowering our Aspiring Leaders (DEAL) Act would, if passed, require the SEC to revise the definition of a “qualifying investment” for purposes of the exemption from registration applicable to venture capital fund advisers under the Advisers Act. Currently, to be exempt from registration, the non-qualifying investments held by a “venture capital fund” cannot exceed 20%, which includes both secondary transactions and “fund of fund” investments in other venture capital funds. If passed, the bill would expand the “qualifying investment” definition to include (1) an equity security issued by a qualifying portfolio company, whether acquired directly or through a secondary acquisition; and (2) an investment in another venture capital fund (i.e., fund of funds investments). This bill would also require that a private fund’s investments must predominately either (1) be acquired directly or (2) be investments in other venture capital funds, for such private fund to qualify as a venture capital fund.
- H.R. 4431, the Improving Capital Allocation for Newcomers (ICAN) Act, would modify the Qualifying Venture Capital Fund Exemption under Section 3(c)(1) of the Investment Company Act of 1940 by increasing the cap on aggregate capital contributions and uncalled capital commitments from $10 million to $150 million. The bill would also increase the allowable number of beneficial owners in a qualifying venture capital fund from 250 to 2,000 (the version of the bill that had passed the House had set this higher number at 600). Venture capital funds are currently exempt from certain regulations applicable to other investment firms, including those related to filings, audits and restricted communications with investors. Currently, an investment firm qualifies as a venture capital fund if, among other requirements (1) the fund’s securities are owned by 250 persons or less, and (2) the fund has $10 million or less in aggregate capital contributions and uncalled committed capital.
The Committee also considered H.R. 4449, the Advocating for Small Business Act, which would create Offices of Small Business within each rule writing division of the Securities and Exchange Commission to coordinate with the Office of the Advocate for Small Business Capital Formation on rules and policy priorities related to capital formation for small businesses. The number of votes on each bill during the markup may be viewed here.
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