The Restoring American Financial Stability Act of 2010 (the “2010 Bill”) introduced by Senator Dodd on March 15, 2010, seeks to limit the preemptive reach of Regulation D promulgated under the Securities Act of 1933. If enacted, the proposed revisions to the Securities Act would limit the types of securities that may be offered pursuant to Regulation D, and make the Regulation D offering process less efficient and more uncertain by subjecting Rule 506 filings to a 120-day SEC review period. The 2010 Bill promotes state regulation of certain securities which were previously immune from state oversight under Regulation D. The securities subject to state regulation under the revised Securities Act will include (i) securities defined by SEC rules as “non-covered” securities, and (ii) securities offered pursuant to Rule 506 filings that the SEC fails to review within 120 days.

For more details regarding the possible effects of the 2010 Bill on Regulation D, please see the Holland & Knight alert at: