Bill Summary
This legislation, known as the Investment Adviser Regulatory Flexibility Improvement Act, requires the Securities and Exchange Commission to revise their definitions of a "small business" and "small organization" for the purpose of assessing the impact of their rulemakings under the Investment Advisers Act of 1940. The act also gives the Commission a one-year period to make these revisions and suggests considering alternative methods for determining small business or organization status, such as a threshold based on the number of nonclerical employees.
Possible Impacts
1. The revised definitions of "small business" and "small organization" could potentially exclude certain businesses and organizations from receiving the benefits or exemptions that are available to them under the Investment Advisers Act of 1940. This could potentially limit their growth and success in the financial industry.
2. The alternative methods for qualifying as a "small business" or "small organization" could potentially create confusion and additional administrative burden for businesses and organizations, causing delays in their operations and decision-making processes.
3. The consideration of a threshold based on the number of nonclerical employees could potentially result in businesses and organizations having to either cut down on their workforce or limit their hiring in order to continue qualifying as a "small business" or "small organization." This could have a negative impact on employment opportunities and job growth.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2436 Introduced in House (IH)]
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116th CONGRESS
1st Session
H. R. 2436
To require the Securities and Exchange Commission to revise the
definitions of a ``small business'' and ``small organization'' for
purposes of assessing the impact of the Commission's rulemakings under
the Investment Advisers Act of 1940.
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IN THE HOUSE OF REPRESENTATIVES
May 1, 2019
Mr. San Nicolas (for himself and Mr. Huizenga) introduced the following
bill; which was referred to the Committee on Financial Services
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A BILL
To require the Securities and Exchange Commission to revise the
definitions of a ``small business'' and ``small organization'' for
purposes of assessing the impact of the Commission's rulemakings under
the Investment Advisers Act of 1940.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Investment Adviser Regulatory
Flexibility Improvement Act''.
SEC. 2. DEFINITION OF SMALL BUSINESS OF SMALL ORGANIZATION.
Not later than the end of the 1-year period beginning on the date
of the enactment of this Act, the Securities and Exchange Commission
shall revise the definitions of a ``small business'' and ``small
organization'' under section 275.0-7 of title 17, Code of Federal
Regulations, to provide alternative methods under which a business or
organization may qualify as a ``small business'' or ``small
organization'' under such section. In making such revision, the
Commission shall consider whether such alternative methods should
include a threshold based on the number of nonclerical employees of the
business or organization.
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