[Federal Register Volume 87, Number 95 (Tuesday, May 17, 2022)]
[Notices]
[Pages 29891-29892]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-10503]


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SECURITIES AND EXCHANGE COMMISSION

[SEC File No. 270-774, OMB Control No. 3235-0726]


Submission for OMB Review; Comment Request; Extension: Rules 300-
304 of Regulation Crowdfunding (Intermediaries)

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC 
20549-2736

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 (``PRA'') (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (``Commission'') has submitted to the Office of Management 
and Budget (``OMB'') a request for approval of extension of the 
previously approved collection of information provided for in Rules 
300-304 of Regulation Crowdfunding.\1\
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    \1\ See Regulation Crowdfunding, Exchange Act Release No. 76324 
(Oct. 30, 2015), 80 FR 71387 (Nov. 16, 2015) (Final Rule) 
(``Regulation Crowdfunding'').
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    Rules 300-304 of Regulation Crowdfunding enumerate the requirements 
with which intermediaries must comply to participate in the offer and 
sale of securities in reliance on Section 4(a)(6) of the Securities Act 
of 1933 (``Section 4(a)(6)''). Rule 300 requires an intermediary to be 
registered with the Commission as a broker or as a funding portal and 
be a member of a registered national securities association.\2\
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    \2\ Currently, FINRA is the only registered national securities 
association.
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    Rule 301 requires intermediaries to have a reasonable basis for 
believing that an issuer seeking to offer and sell securities in 
reliance on Section 4(a)(6) through the intermediary's platform 
complies with the requirements in Section 4A(b) of the Securities Act 
and the related requirements in Regulation Crowdfunding. Rule 302 
provides that no intermediary or associated person of an intermediary 
may accept an investment commitment in a transaction involving the 
offer or sale of securities made in reliance on Section 4(a)(6) until 
the investor has opened an account with the intermediary and the 
intermediary has obtained from the investor consent to electronic 
delivery of materials. Rule 303 requires an intermediary to make 
publicly available on its platform the information that an issuer of 
crowdfunding securities is required to provide to potential investors, 
in a manner that reasonably permits a person accessing the platform to 
save, download, or otherwise store the information, for a minimum of 21 
days before any securities are sold in the offering, during which time 
the intermediary may accept investment commitments. Rule 303 also 
requires intermediaries to comply with the requirements related to the 
maintenance and transmission of funds. An intermediary that is a 
registered broker is required to comply with the requirements of Rule 
15c2-4 of the Securities Exchange Act of 1934 (``Exchange Act'') 
(Transmission or Maintenance of Payments Received in Connection with 
Underwritings).\3\ An intermediary that is a registered funding portal 
must direct investors to transmit the money or other consideration 
directly to a qualified third party that has agreed in writing to hold 
the funds for the benefit of, and to promptly transmit or return the 
funds to, the persons entitled thereto in accordance with Regulation 
Crowdfunding.
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    \3\ 17 CFR 240.15c2-4.
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    The rules also require intermediaries to implement and maintain 
systems to comply with the information disclosure, communication 
channels, and investor notification requirements. These requirements 
include providing disclosure about compensation at account opening 
(Rule 302), obtaining investor acknowledgements to confirm

[[Page 29892]]

investor qualifications and review of educational materials (Rule 303), 
providing investor questionnaires (Rule 303), providing communication 
channels with third parties and among investors (Rule 303), notifying 
investors of investment commitments (Rule 303), confirming completed 
transactions (Rule 303) and confirming or reconfirming offering 
cancellations (Rule 304).
    The Commission staff estimates that there will be 136 
intermediaries engaged in crowdfunding activity and therefore subject 
to Rules 300-304. The Commission staff estimates the annualized 
industry burden will be 38,317 hours to comply with Rules 300-304. The 
Commission staff further estimates that the costs associated with 
complying with Rules 300-304 will be a total amount of $18,750,000.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information under the PRA unless it 
displays a currently valid OMB control number.
    The public may view background documentation for this information 
collection at the following website: >www.reginfo.gov<. Find this 
particular information collection by selecting ``Currently under 30-day 
Review--Open for Public Comments'' or by using the search function. 
Written comments and recommendations for the proposed information 
collection should be sent by June 16, 2022 to (i) 
>[email protected]< and (ii) David Bottom, 
Director/Chief Information Officer, Securities and Exchange Commission, 
c/o John Pezzullo, 100 F Street NE, Washington, DC 20549, or by sending 
an email to: [email protected].

    Dated: May 11, 2022.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-10503 Filed 5-16-22; 8:45 am]
BILLING CODE 8011-01-P


