Corporations Securities Act Of 1933

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Corporations
Securities Act of 1933

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requires that any offer or sale of securities using the means and instrumentalities of interstate commerce be registered pursuant to the 1933 Act, unless an exemption from registration exists under the law

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Corporations
Securities Act of 1933

Two basic objectives:

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* to require that investors receive significant (or “material”) information concerning securities being offered for public sale; and

* to prohibit deceit, misrepresentations, and other fraud in the sale of securities to the public.

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Corporations
Securities Act of 1933

Exemptions from Registration

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Under Section 4(2), private placements may be made to institutions or other "accredited investors" deemed to be able to "fend for themselves" without a full registration. Regulation D codifies this statutory principal and offers more clearly defined safe harbor rules for those seeking a private placement exemption. Section 3(a)(11) offers the little used exemption allowing issues made only within one state to avoid registration. Rule 147 creates a clearly defined safe harbor for intra-state offerings.

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Corporations
Securities Act of 1933

Rule 144

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permits, under limited circumstances, the sale of restricted and controlled securities without registration

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Corporations
Securities Act of 1934

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Created to provide governance of securities transactions on the secondary market (after issue) and regulate the exchanges and broker-dealers in order to protect the investing public.

Investopedia Says... All companies listed on stock exchanges must follow the requirements set forth in the Securities Exchange Act of 1934. Primary requirements include registration of any securities listed on stock exchanges, disclosure, proxy solicitations and margin and audit requirements.