The SEC rulemaking process begins

The SEC today announced that it would start accepting comments from the public on the rulemaking it has to undertake under the JOBS Act, even before it proposes any rules. When it does propose rules, you’ll get a chance to comment on them, but this is an opportunity to help shape the rules before they are proposed.

You can ask for a meeting with the SEC, or you can send in written comments.

If you’re planning to engage with the SEC, here are a few tips to bear in mind:

1. The SEC is looking for specificity. Contact the Staff to alert them to a particular problem, or a particular solution. Saying things like “the Staff should bear in mind the need to balance investor protection with entrepreneurs’ access to capital” is just about as useful as saying “the Staff should be kind to puppies.” They are balancing the interests of investors . . . yada yada. That’s their job. You do not need to tell them how to do it.

2. Don’t go in to visit them just to chat or introduce yourselves or your outfit. I’m sure the Staff likes you and your organization a whole bunch and would just love to meet for fruit smoothies (although they have to buy their own) at some later date. But right now they have rules to write.

3. The statute is the statute. If you have a problem with the statute, take it up with the people who wrote it (that would be Congress, FAOD). The Staff can neither change the statute, nor can they redefine it. They for super-sure cannot say that “audited financials” shall be defined to mean anything other than “audited financials.” READ THE STATUTE and know what Congress has instructed the SEC to do before you put your drafting crayons to paper.

4. Respectfully written, well-reasoned and concise letters from identified persons addressing a specific issue of concern beat signing on to internet petitions every time.

SEC release: http://www.sec.gov/news/press/2012/2012-60.htm

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