HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.
![handle is hein.congrecreports/crptxaaew0001 and id is 1 raw text is: AUTHENTICATEO
U.S. GOVERNMENT
INFORMATION
Gp
115TH CONGRESS REPORT
1st Session HOUSE OF REPRESENTATIVES 115-70
SUPPORTING AMERICA'S INNOVATORS ACT OF 2017
MARCH 29, 2017.-Committed to the Committee of the Whole House on the State
of the Union and ordered to be printed
Mr. HENSARLING, from the Committee on Financial Services,
submitted the following
REPORT
[To accompany H.R. 1219]
[Including cost estimate of the Congressional Budget Office]
The Committee on Financial Services, to whom was referred the
bill (H.R. 1219) to amend the Investment Company Act of 1940 to
expand the investor limitation for qualifying venture capital funds
under an exemption from the definition of an investment company,
having considered the same, report favorably thereon without
amendment and recommend that the bill do pass.
PURPOSE AND SUMMARY
Introduced by Representative McHenry on February 27, 2017,
H.R. 1219, the Supporting America's Innovators Act of 2017, in-
creases the limit on the number of individuals who can invest in
certain venture capital funds before those funds must register as
investment companies with the Securities and Exchange Commis-
sion (SEC) under the Investment Company Act of 1940 (Investment
Company Act). Section 3(c)(1) of the Investment Company Act sets
forth exemptions from the definition of investment company. Cur-
rently, the Investment Company Act limits the number of investors
in a fund to 100 for the fund to be exempt from SEC registration.
H.R. 1219 amends this cap to allow 250 investors in a qualified
venture capital fund to be exempt from SEC registration. H.R.
1219 generally defines a qualifying venture capital fund to be any
venture capital fund that does not purchase more than $10,000,000
in invested capital of any one issuer, adjusted for inflation. Thus,
for example, H.R. 1219 would permit angel funds-which run syn-
dicates that allow accredited investors to participate in investing in
startups-to obtain funds from a greater number of investors. As
a result, investors will benefit from new investment opportunities
69-006](ViewImageLocal?handle=hein.congrecreports/crptxaaew0001&div=1&collection=&method=preview&ext=.png&size=3)