Reg Cf Requirements

(f) Financial accounting and reporting of monetary and foreign transactions. A funding portal subject to the requirements of the Foreign Exchange and Foreign Transactions Reporting Act of 1970 (15 U.S.C. 5311 et seq.) must comply with the reporting, record-keeping, and retention requirements of 31 CFR, Chapter X. If 31 CFR Chapter X and Section 227.404(a) and (b) require that the same records or reports be retained for different periods of time, those records or reports must be retained for the longer period. The basic disclosure requirements in a FC settlement offer are as follows: For example, if an issuer with a calendar fiscal year end makes an offer in April 2020, it would be permissible to include the financial statements for the year ended December 31, 2018 if the financial statements for the year ended December 31, 2019 are not yet available. As soon as more than 120 days have elapsed since the end of the last financial year of the issuer`s financial accounts, the issuer is required to attach the financial statements for the last financial year for which the financial accounts were closed. What if your business is starting up and hasn`t done anything yet? You must still have audited the financial statements. It should be noted, however, that, as with the requirements of Regulation A, newly incorporated corporations only need to file audited financial statements from the date of incorporation until a date within 134 days of filing in order to meet the requirements. This means that you can use Regulation CF (and Regulation A) even if you have been in business for less than two years. An offer made on the basis of the FC Regulation would not be integrated or combined with another exempt offer of the issuer, provided that each offer meets the requirements of the applicable exemption on which the respective offer is based. For example, an issuer making a competing exempt offer for which no general solicitation is permitted must be satisfied that the purchasers of that bid were not solicited by the bid by relying on section 4(a)(6). The requirements of the CF Regulation are summarised in the following table: (iii) the requirements of paragraph (a)(3)(i) and (ii) of this Section shall not apply to an issuer if the relevant intermediary frequently updates the issuer`s progress towards reaching the target amount of the bid on the intermediary`s platform; However, the issuer must always file a Form C-U (¢§ 239.900 of this chapter) in order to disclose the total amount of securities sold under the offer no later than five business days after the expiry of the offer period. Section 2 (t).

An emitter may voluntarily comply with the requirements of this paragraph (t) for a higher aggregate target issuance. The SEC also believes that for a crowd to effectively exchange information, a meeting place is more advantageous for it to obtain and share information, thus avoiding dilution of the «amount.» Restricting a crowdfunding transaction to an individual intermediary`s online platform also helps to minimise the risk that issuers will circumvent the requirements of the Crowdfunding Regulation. (1) An issuer shall not promote, directly or indirectly, the terms of an offer made under Section 4(a)(6) of the Securities Act (15 U.S.C. 77d(a)(6)), except for oral or written communications that satisfy the requirements of paragraph (b) of this section or section 227.206. In another example, an issuer making a simultaneous exempt offer for which a general invitation is permitted, for example: pursuant to Rule 506(c) of the Securities Act, not to include in such a general solicitation any disclosure of the terms of an offer made on the basis of the FC Regulation, unless such disclosure complies with section 4(a)(6). Accordingly, a simultaneous offer would be subject to the more restrictive requirements of crowdfunding regulations, unless the issuer can conclude that the purchasers of the FC settlement offer were not solicited by the 506(c) offer. Section 4A(b)(1)(D) requires «a description of the financial position of the issuer.» It also establishes a framework for tiered financial disclosure requirements based on the overall target amounts of the offer and any other offer made under the FC Regulation during the previous 12-month period. (a) have reasonable grounds to believe that an issuer wishing to offer and sell securities through the intermediary`s platform pursuant to Section 4(a)(6) of the Securities Act (15 U.S.C. 77d(a)(6)) satisfies the requirements of Section 4A(b) of the Act (15 U.S.C. 77d-1(b)) and the related requirements of this Part. In order to comply with this requirement, an intermediary may rely on the issuer`s representations to comply with those requirements, unless it has reason to doubt the reliability of those assurances; Instruction on § 227.201.

If disclosure under a paragraph of this Section also satisfies the requirements of one or more other paragraphs of this Division, the disclosure need not be repeated. Instead of repeating the information, an issuer may include a reference to information provided elsewhere in the offer statement or report, including information contained in the financial statements. bb) Between March 1, 2021 and August 28, 2022, an issuer may satisfy the requirements of paragraph (t)(1) of this Section instead of paragraph (t)(2) of this Section for an offer or offer sold with any other amount sold pursuant to Section 4(a)(6) of the Securities Act (15 U.S.C. 77d(a)(6)) in the preceding 12-month period; have a total amount of the target offer greater than $107,000 but less than or equal to $250,000, and the issuer`s financial statements that have been audited or audited by an independent auditor of the issuer are not available at the time of filing.