Middle Market IPO Cost Act

This bill orders a federal watchdog to study how much it costs small and mid-sized companies to go public (sell stock to the public for the first time). The study must look at fees paid to accountants, underwriters, and other advisors, plus the cost of meeting federal and state rules. It will also compare these IPO costs to other ways companies raise money or get liquidity, and examine how these costs affect building capital and the choices available to everyday investors who buy stocks. The study will review trends like the number of IPOs, what services underwriters provide before and after an offering, changes in investment research for smaller companies, the number of active brokers and dealers, and the impact of lawsuits and legal costs on being public. A report to Congress with findings and any recommendations is due within 360 days after the law takes effect.

Key points

• Who is affected: Small and mid-sized companies considering going public; retail investors who buy public stocks.
• What changes: A required government study, done with input from the SEC and FINRA, on IPO costs, alternatives, and market trends.
• When: The report is due within 360 days after enactment.