SEC Extends Rules for Safe Small Business Crowdfunding Platforms
Published Date: 6/11/2025
Notice
Summary
The SEC is asking to keep the current rules for crowdfunding platforms that help people invest in small businesses. These rules make sure platforms are registered, check that companies follow the law, and protect investors by requiring accounts and clear info. This extension means no big changes or new costs, just more time to keep things running smoothly.
Analyzed Economic Effects
6 provisions identified: 3 benefits, 3 costs, 0 mixed.
Estimated industry compliance burden and cost
The Commission staff estimates 135 intermediaries are subject to Rules 300-304, with an annualized industry burden of 27,732 hours and total annual costs of $16,960,716 to comply. These are the SEC's estimated time and dollar compliance impacts for the industry.
Platforms must register and join FINRA
If you run a crowdfunding platform (an intermediary), Rule 300 requires you to be registered with the SEC as a broker or as a funding portal and to be a member of a registered national securities association (FINRA is currently the only one). This is a standing requirement for intermediaries participating in Section 4(a)(6) crowdfunding offerings.
Platforms must confirm issuer compliance
Rule 301 requires intermediaries to have a reasonable basis to believe that any issuer using the platform meets the Section 4A(b) requirements and related Regulation Crowdfunding rules before the offering proceeds. Platforms must perform and document this compliance evaluation as part of participation in crowdfunding offerings.
Platforms must post issuer info for 21 days
Rule 303 requires intermediaries to make the issuer's required crowdfunding information publicly available on the platform for at least 21 days before any securities are sold, and the information must be savable or downloadable. The rules also require investor acknowledgements, questionnaires, communication channels, and notifications and confirmations for transactions and cancellations (Rules 302-304).
How investor funds must be handled
Rule 303 and related text require that brokers comply with Exchange Act Rule 15c2-4 for transmission or maintenance of payments, and funding portals must direct investors to send funds to a qualified third party that will hold and promptly transmit or return funds as required. This sets how your investment money is held and moved during crowdfunding transactions.
You must open an account before investing
Rule 302 says an intermediary may not accept an investment commitment in a crowdfunding offering until you have opened an account with the intermediary and given consent to get materials electronically. This means you must complete account setup and consent steps before your investment commitment can be accepted.
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