Requires the Securities and Exchange Commission (SEC) to conduct a study and rulemaking on the definition of “small entity” for securities laws.
Defines “small entity” based on existing definitions in the Regulatory Flexibility Act and includes definitions for “small business,” “small organization,” and “small governmental jurisdiction.”
Mandates the SEC to conduct a study within one year of enactment and again five years later, focusing on:
Alignment of the current definition with findings from the Regulatory Flexibility Act.
Growth of financial markets since the last amendment of the definition.
Recommendations for a definition that encompasses a meaningful number of entities.
Requires the SEC to submit a report to Congress with study results and recommendations for amending the definition.
After each study, the SEC must revise its rules based on the study’s findings, following public notice and comment.
Mandates adjustments to the dollar figures in the definition of “small entity” every five years to reflect changes in the Consumer Price Index.