EGC eligibility threshold amended under JOBS Act
Defining Issues | September 2022
SEC adopts final rules implementing inflation adjustments required by the JOBS Act.
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The SEC has adjusted certain thresholds including the revenue threshold to qualify as an emerging growth company (EGC). The JOBS Act requires the SEC to make inflation adjustments at least every five years.
Applicability
SEC Release Nos. 33-11098; 34-95715
- Emerging growth companies
Relevant dates
- September 9, 2022 – Final rule amendments adopted
- September 20, 2022 – Effective date
Key Impacts:
- In accordance with the JOBS Act, the Commission is required to make inflation adjustments every five years.
- The last adjustments were made in 2017.
- Inflation-adjusted annual gross revenue threshold for EGCs has been increased from $1.07 billion to $1.235 billion.
- The amendments also increase certain financial thresholds in Regulation Crowdfunding, such as offering maximum and investment limits.
The SEC has posted a fact sheet providing an overview of the amendments.