H.R. 3448, the Small Cap Liquidity Reform Act of 2013, Passes 412-4

WASHINGTON — In a vote of 412-4, the House today passed legislation introduced by Congressman Carney (D-DE) and Rep. Sean Duffy (R-WI) to increase investments in small companies that are looking to grow and create jobs. It passed the House Financial Services Committee unanimously on November 14, 2014.

 “Small businesses are the engine of job creation in this country,” said Rep. Carney. “This bill encourages the investment community to take a closer look at small businesses and gives them greater access to capital. Better access to capital means small businesses can continue to innovate, create jobs, and expand operations both here in Delaware and throughout the country. I’m encouraged by today’s bipartisan vote and was pleased to work across the aisle with Congressman Duffy to focus on the most important issue facing our country -- creating jobs and growing the economy.” 

“Small companies that go public increase employment by 156% on average,” said Rep. Duffy.  “This is how the Googles and the Apples, the Twitters and the Facebooks of the world started.  The bill that Mr. Carney and I have introduced supports America’s newest jobs creators by creating a pilot project to maximize their trading liquidity.  Our hope is that our bill will give these emerging growth companies greater access to much needed capital so they can expand their businesses and create much needed American jobs.”

The Small Cap Liquidity Reform Act of 2013, H.R. 3448, would create a pilot program under the Securities and Exchange Commission (SEC) that would allow small companies to trade in larger increments, with the goal of making their stock more attractive to investors. The SEC has expressed a willingness to create such a pilot program -- this legislation would require it to do so. The pilot program would test whether the stocks of companies that are permitted to trade in larger increments experience more success than other companies.

This legislation builds on Rep. Carney’s IPO on-ramp provision passed last year as part of the JOBS Act. That provision makes it easier for small- and medium-sized companies to undertake IPOs and become public companies.

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