180621 hr5970 hr6130 hr6139 hfsc hensarling waters


June 21, 2018


Dear Chairman Hensarling and Ranking Member Waters:

The U.S. Chamber of Commerce supports three bills the Committee is scheduled to
markup on June 21, 2018, which would improve U.S. capital markets and implement policies
that would help more business go and stay public.

H.R. 5970, the “Modernizing Disclosures for Investors Act,” would require the
Securities and Exchange Commission (SEC) to produce a report to Congress determining
whether filing a form 10-Q should be optional for emerging growth companies (EGCs), which
could lead to reduced burdens upon small public companies while still ensuring investors receive
material information on a company’s operations.

H.R. 6130, the “Helping Startups Continue to Grow Act,” would extend many of the
on-ramp provisions of Title I of the 2012 Jumpstart our Business Startups (JOBS) Act from five
years to ten years. The JOBS Act included important and useful provisions designed to ease
certain disclosure and other requirements for EGCs. No evidence exists to show that these
scaled disclosure requirements have compromised investor protection. We believe that as
companies continue to mature five years after going public, extending the exemption would be a
further incentive for businesses to go public.

H.R. 6139, the “Improving Investment Research for Small and Emerging Issuers
Act,” would require the SEC to examine why many small and pre-IPO companies lack research
coverage, and to produce recommendations that would help increase coverage for these
companies. Recent studies have shown that approximately 2/3 of companies with less than a
$100 million market cap have no research coverage at all, which provides a disincentive for
market makers to trade in these stocks and deprives the market of useful information.

We look forward to working with the Committee and Congress as these bills advance
through the legislative process.


Neil L. Bradley

cc: Members of the House Committee on Financial Services

180621 hr5970 hr6130 hr6139 hfsc hensarling waters