On June 23, 2025, the House of Representatives (the “House”) passed seven bills relating to capital formation. As discussed in a previous post, these bills were reported to the House by the House Committee on Financial Services (the “Committee”).
The House passed H.R. 3394, the Fair Investment Opportunities for Professional Experts Act, by a bipartisan vote of 397-12. This bill will expand the “accredited investor” definition under the Securities Act of 1933 (as amended, the “Securities Act”) to include individuals with certain licenses, qualifying education, or job experience.
H.R. 3422, the Promoting Opportunities for Non-Traditional Capital Formation Act, passed the House by a bipartisan vote of 321-87. H.R. 3422 requires the Securities and Exchange Commission’s (“SEC’s”) Advocate for Small Business Capital Formation to provide educational resources and host events that promote capital-raising options for traditionally underrepresented small businesses and businesses in rural areas.
The following remaining five bills each passed unanimously by voice vote, indicating the House’s bipartisan support for capital formation:
- H.R. 1190, the Expanding Access to Capital for Rural Job Creators Act, would amend the Securities Exchange Act of 1934 (as amended, the “Exchange Act”) to require that the SEC’s Advocate for Small Business Capital Formation include rural small businesses among the categories it monitors for capital access challenges.
- H.R. 2225, the Access to Small Business Investor Capital Act, would allow a registered investment company to exclude from the calculation of “acquired fund fees and expenses” those fees and expenses incurred indirectly from investment in a business development company (“BDC”).
- H.R. 3301, the ELEVATE Act of 2025, would amend the Exchange Act to specify that emerging growth companies, or EGCs, would only need to present two years, rather than three years, of audited financial statements in both initial public offerings (“IPOs”) and spin-off transactions. The bill would also allow a spin-off of an EGC to benefit from the two-year financial statement accommodation, which is currently only available during an IPO.
- H.R. 3352, the Helping Angels Lead Our Startups (“HALOS”) Act of 2025, would codify SEC Rule 148 so communications made at certain “demo day” events would not constitute a “general solicitation” under the Securities Act. The bill also defines “angel investor group” and clarifies the types of sponsors and conditions under which issuers may present without triggering offering restrictions.
- H.R. 3381, the Encouraging Public Offerings Act of 2025, if passed, would codify Rule 163B under the Securities Act and allow any issuer (not just EGCs) to communicate with potential investors to determine interest in a securities offering, either before or after the filing of a registration statement (i.e., “test the waters” communications). The bill also codifies the current SEC Staff position regarding confidential submissions and would allow any issuer to submit a confidential draft registration statement to the SEC for review prior to public filing and updates the public filing condition to allow any IPO issuer to file its registration statement publicly 10 days before the effective date of the registration statement.
The House also passed three other bills (H.R. 910, H.R. 2808 and H.R. 1713) on matters unrelated to capital formation. See the related press release here.
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