The House on Tuesday approved letting companies with up to $1 billion in annual revenue sidestep some regulations on disclosure, auditing and corporate governance when launching IPOs or raising cash.
The Jumpstart Our Business Startups Act is expected to be signed by President Barack Obama within the coming weeks, fulfilling his pledge to remove regulatory hurdles for new companies. The Senate passed the bill March 22.
Under the legislation, full regulatory oversight would be restored after five years or once a company reaches $1 billion in annual revenues, whichever comes first.
The National Venture Capital Association, in a statement, praised the final vote as “much-needed relief from the cumulative effect of costly regulations that were dissuading companies from entering the public markets.”
Paul Maeder, NVCA chairman and general partner at Highland Capital Partners, said the law “will help revitalize an IPO market that has suffered in recent years under the weight of market volatility and one-size-fits-all regulation.”