Solicitations of Interest Prior to a Registered Public Offering ‘Test-the-Waters Communications’
Summary
SIFMA provides comments to the Securities and Exchange Commission (SEC) on the new rule and related amendments to expand the permitted use of communications between issuers and potential investors to assess investor interest in a contemplated registered public offering (“test-the-waters communications”) to all issuers as set forth in the Commission’s Proposed Rule Release No. 33-10607.
Excerpt
April 29, 2019
Via Electronic Mail ([email protected])
Securities and Exchange Commission 100 F Street, N.E. Washington, D.C. 20549-1090
Attention: Ms. Vanessa A. Countryman, Acting Secretary
Re: Solicitations of Interest Prior to a Registered Public Offering (File Number S7-01-19)
Dear Acting Secretary Countryman:
The Securities Industry and Financial Markets Association (“SIFMA”) is writing to respond to the invitation of the Securities and Exchange Commission (“Commission”) for public comment on the new rule and related amendments to expand the permitted use of communications between issuers and potential investors to assess investor interest in a contemplated registered public offering (“test-the-waters communications”) to all issuers as set forth in the Commission’s Proposed Rule Release No. 33-10607 (the “Release”). We appreciate the opportunity to provide comments to the Commission on the Release.
We commend the Commission’s efforts to further streamline the public offering process as a means to encourage additional participation in the public markets and thereby facilitate capital formation in a manner that does not compromise investor protection. As referenced in the Commission’s Release, SIFMA was party to a 2018 report1 encouraging the expansion of test-the-waters communications to all issuers as an enhancement to the JOBS Act, and, in line with our position in such report, we support the proposals in the Release.
In this letter, we first respond to several of the specific requests for comment posed by the Commission in the Release and thereafter provide additional comments relating to the Release.
1 Expanding the On-Ramp: Recommendations to Help More Companies Go and Stay Public, Sec. Industry and Fin. Markets Association & Center for Capital Markets Competitiveness, U.S. Chamber of Commerce, et al., at 10–11 (2018), https://www.centerforcapitalmarkets.com/wp-content/uploads/2018/05/CCMC_IPO-Report_v17.pdf.
1 SIFMA is the leading trade association for broker-dealers, investment banks and asset managers operating in the U.S. and global capital markets. On behalf of our industry’s nearly 1 million employees, we advocate for legislation, regulation and business policy, affecting retail and institutional investors, equity and fixed income markets and related products and services. We serve as an industry coordinating body to promote fair and orderly markets, informed regulatory compliance, and efficient market operations and resiliency. We also provide a forum for industry policy and professional development. SIFMA, with offices in New York and Washington, D.C., is the U.S. regional member of the Global Financial Markets Association (GFMA).