Back to Wyoming

HB0041 • 2021

Intrastate crowdfunding exemption-amendments.

AN ACT relating to intrastate crowdfunding; increasing the dollar amount qualifying for an exemption from securities regulation; removing the dollar limit on funding received from nonaccredited investors; removing and amending reporting requirements; and providing for an effective date.

Technology
Enacted

This bill passed the Legislature and reached final enactment based on the latest official action.

Sponsor
BlockChain/Technology
Last action
2021-04-05
Official status
enrolled
Effective date
7/1/2021

Plain English Breakdown

The official source material does not specify requirements for providing financial information to purchasers or the state secretary, so this claim was removed.

Changes to Intrastate Crowdfunding Rules

This law changes rules for crowdfunding within a state, raising limits on how much money can be raised and reducing reporting requirements.

What This Bill Does

  • Increases the amount of money that can be exempt from securities regulation when raising funds through intrastate crowdfunding to $3 million if the company does not provide audited financial statements.
  • Raises this limit to $10 million for companies providing audited financial statements.
  • Removes the cap on how much a single non-accredited investor can contribute, increasing it from $10,000 to $25,000.
  • Eliminates quarterly reporting requirements but requires that information be available upon request and posted online.

Who It Names or Affects

  • Companies raising money through intrastate crowdfunding
  • Investors participating in these crowdfunding campaigns

Terms To Know

Intrastate Crowdfunding
Raising funds from people within the same state for a business or project.
Securities Regulation
Rules set by the government to protect investors and maintain fair markets when selling financial products like stocks.

Limits and Unknowns

  • The law does not specify how it will be enforced.
  • It is unclear what happens if a company fails to provide requested information.
  • There are no details on penalties for non-compliance with the new rules.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

HB0041HS001

Standing Committee • House Judiciary Committee

Adopted

Plain English: The amendment changes the dollar amount for intrastate crowdfunding exemptions from securities regulation and alters reporting requirements.

  • Increases the exemption limit from securities regulation to $10 million dollars.
  • Removes the previous funding limit of $35,000 for nonaccredited investors.
  • Reduces a specific reporting threshold from $35,000 to $25,000.
  • The amendment text does not provide details on all changes to reporting requirements, so the full extent of these alterations is unclear.

Bill History

  1. 2021-04-05 LSO

    Assigned Chapter Number 89

  2. 2021-04-05 Governor

    Governor Signed HEA No. 0060

  3. 2021-04-01 Senate

    S President Signed HEA No. 0060

  4. 2021-04-01 House

    H Speaker Signed HEA No. 0060

  5. 2021-04-01 LSO

    Assigned Number HEA No. 0060

  6. 2021-03-31 Senate

    S 3rd Reading:Passed 30-0-0-0-0

  7. 2021-03-30 Senate

    S 2nd Reading:Passed

  8. 2021-03-29 Senate

    S COW:Passed

  9. 2021-03-26 Senate

    S Placed on General File

  10. 2021-03-26 Senate

    S01 - Judiciary:Recommend Do Pass 5-0-0-0-0

  11. 2021-03-17 Senate

    S Introduced and Referred to S01 - Judiciary

  12. 2021-03-04 Senate

    S Received for Introduction

  13. 2021-03-03 House

    H 3rd Reading:Passed 54-6-0-0-0

  14. 2021-03-02 House

    H 2nd Reading:Passed

  15. 2021-03-01 House

    H COW:Passed

  16. 2021-03-01 House

    H Placed on General File

  17. 2021-03-01 House

    H01 - Judiciary:Recommend Amend and Do Pass 8-0-0-1-0

  18. 2021-02-05 House

    H Introduced and Referred to H01 - Judiciary

  19. 2021-01-12 House

    H Received for Introduction

  20. 2021-01-06 LSO

    Bill Number Assigned

Official Summary Text

Bill Summary - 21LSO-0156
Bill No.:

HB0041

Effective:

7/1/2021 12:00:00 AM

LSO No.:

21LSO-0156

Enrolled Act No.:

HEA No. 0060

Chapter No.:

89

Prime Sponsor:

Select Committee on Blockchain, Financial Technology and Digital Innovation Technology

Catch Title:

Intrastate crowdfunding exemption-amendments.

Subject:

Intrastate crowdfunding exemption limits and reporting requirements.

Summary/Major Elements:

This bill increases the amount of money that can be raised and still be exempt from certain securities registration requirements in an offer or sale of a security by an issuer.

From two million dollars ($2,000,000.00) to three million dollars ($3,000,000.00)

if the issuer has not made available audited financial statements as specified;
From four million dollars ($4,000,000.00) to ten million dollars ($10,000,000.00) if the issuer has made available audited financial statements as specified;
From ten thousand dollars ($10,000.00) to twenty-five thousand dollars ($25,000.00) funds accepted from a single non-accredited investor.

This bill removes quarterly reporting requirements when an issuer is exempt under W.S. 17
‑
4
‑
203, instead requiring that the previously reported information be available upon request to purchasers, be available on an internet website and upon request of the secretary of state.
The above summary is not an official publication of the Wyoming Legislature and is not an official statement of legislative intent.

While the Legislative Service Office endeavored to provide accurate information in this summary, it should not be relied upon as a comprehensive abstract of the bill.

Current Bill Text

Read the full stored bill text
21LSO-0156

ORIGINAL House

Bill No
.
HB0041

ENROLLED ACT NO. 60,

HOUSE OF REPRESENTATIVES

SIXTY-SIXTH LEGISLATURE OF THE STATE OF WYOMING
2021 General Session

AN ACT relating to intrastate crowdfunding; increasing the dollar amount qualifying for an exemption from securities regulation; removing the dollar limit on funding received from nonaccredited investors; removing and amending reporting requirements; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1
.

W.S. 17
‑
4
‑
203(a)(iii)(A) and (B), (iv), (b)(intro), (i) through (iii), (iv)(intro) and (A) is amended to read:

17
‑
4
‑
203.

Intrastate crowdfunding exemption.

(a)

Except as otherwise provided in this act, an offer or sale of a security by an issuer is exempt from the requirements of W.S. 17
‑
4
‑
301 through 17
‑
4
‑
306 and 17
‑
4
‑
504 if the offer or sale meets all of the following requirements:

(iii)

The sum of all cash and other consideration to be received for all sales of the security in reliance on this exemption does not exceed the following amounts:

(A)

Two million dollars ($2,000,000.00)
Three million dollars ($3,000,000.00)
, less the aggregate amount received for all sales of securities by the issuer within the twelve (12) months before the first offer or sale made in reliance on this exemption, if the issuer has not made available to each prospective purchaser and the secretary of state audited financial statements or reviewed financial statements for the issuer's most recently completed fiscal year, prepared by a certified public
accountant, holding a certificate pursuant to W.S. 33
‑
3
‑
109, in accordance with the statements on auditing standards of the American Institute of Certified Public Accountants or the statements on standards for accounting and review services of the American Institute of Certified Public Accountants, as applicable;

(B)

Four million dollars ($4,000,000.00)
Ten million dollars ($10,000,000.00)
, less the aggregate amount received for all sales of securities by the issuer within the twelve (12) months before the first offer or sale made in reliance on this exemption, if the issuer has made available to each prospective purchaser and the secretary of state audited financial statements or reviewed financial statements for the issuer's most recently completed fiscal year, prepared by a certified public accountant, holding a certificate pursuant to W.S. 33
‑
3
‑
109, in accordance with the statements on auditing standards of the American Institute of Certified Public Accountants or the statements on standards for accounting and review services of the American Institute of Certified Public Accountants, as applicable.

(iv)

The issuer has not accepted more than
ten thousand dollars ($10,000.00)
twenty
‑
five thousand dollars ($25,000.00)
from any single purchaser unless the purchaser is an accredited investor as defined by rule 501 of securities and exchange commission regulation D, (17 C.F.R. 230.501) who comes within any category listed in the definition of that rule or who the issuer reasonably believes comes within any category listed in the definition of that rule, at the time of the sale. The issuer may rely on confirmation that the purchaser is an accredited investor from information provided by the purchaser, a
licensed broker
‑
dealer or another third party in making a determination that the purchaser is an accredited investor;

(b)

If the offer and sale of a security of an issuer is exempt under this section, the issuer shall provide
a quarterly report to
the
information described in paragraph (iv) of this subsection upon request of the
issuer's purchasers until none of the securities issued under this section are outstanding. All of the following apply
:
to the quarterly report described in this subsection:

(i)

The issuer shall provide the
report
information
free of charge to the purchasers;

(ii)

An issuer may satisfy the
report
information
requirement under this subsection by making the information available on an internet website
;
if the information is made available within forty
‑
five (45) days after the end of each fiscal quarter and remains available until the next quarterly report is issued;

(iii)

The issuer
shall file each report with the secretary of state and
must provide a written copy of the
report
information
to any purchaser
or the secretary of state
on request;

(iv)

The
report
information provided
must include all of the following:

(A)

The compensation received by each director and executive officer of the issuer, including cash compensation earned
since the previous report and
on an annual basis and any bonuses, stock options, other rights to receive securities of the issuer or any affiliate of the issuer, or other compensation received;

Section 2
.

This act is effective July 1, 2021
.

(END)

Speaker of the House

President of the Senate

Governor

TIME APPROVED: _________

DATE APPROVED: _________

I hereby certify that this act originated in the House.

Chief Clerk

1