Small Entity Update Act

IIB 118TH CONGRESS 1ST SESSION H. R. 2792 IN THE SENATE OF THE UNITED STATES MAY 31 (legislative day, MAY 30), 2023 Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs AN ACT To require the Securities and Exchange Commission to carry out a study and rulemaking on the definition of the term ‘‘small entity’’ for purposes of the securities laws, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 02:55 Jun 01, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2792.RFS H2792 kjohnson on DSK79L0C42PROD with BILLS 2 HR 2792 RFS SECTION 1. SHORT TITLE. 1 This Act may be cited as the ‘‘Small Entity Update 2 Act’’. 3 SEC. 2. STUDIES, REPORTS, AND RULES REGARDING SMALL 4 ENTITIES. 5 (a) DEFINITIONS.—In this section— 6 (1) the term ‘‘Commission’’ means the Securi- 7 ties and Exchange Commission; and 8 (2) the term ‘‘small entity’’— 9 (A) has the meaning given the term in sec- 10 tion 601 of title 5, United States Code, with re- 11 spect to the activities of the Commission; and 12 (B) includes any definition established by 13 the Commission of the term ‘‘small business’’, 14 ‘‘small organization’’, or ‘‘small governmental 15 jurisdiction’’ under paragraph (3), (4), or (5), 16 respectively, of section 601 of title 5, United 17 States Code, with respect to the activities of the 18 Commission. 19 (b) STUDIES AND REPORTS.—Not later than 1 year 20 after the date of enactment of this Act, and again 5 years 21 thereafter, the Commission shall— 22 (1) conduct a study of the definition of the 23 term ‘‘small entity’’ with respect to the activities of 24 the Commission for the purposes of chapter 6 of 25 title 5, United States Code, which shall consider— 26 VerDate Sep 11 2014 02:55 Jun 01, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2792.RFS H2792 kjohnson on DSK79L0C42PROD with BILLS 3 HR 2792 RFS (A) the extent to which the definition of 1 the term ‘‘small entity’’, as in effect during the 2 period in which the study is conducted, aligns 3 with the findings and declarations made under 4 section 2(a) of the Regulatory Flexibility Act (5 5 U.S.C. 601 note); 6 (B) the amount by which financial markets 7 in the United States have grown since the last 8 time the Commission amended the definition of 9 the term ‘‘small entity’’, if applicable; and 10 (C) how the Commission should define the 11 term ‘‘small entity’’ to ensure that a meaningful 12 number of entities would fall under that defini- 13 tion; and 14 (2) submit to Congress a report that includes— 15 (A) the results of the applicable study con- 16 ducted under paragraph (1); and 17 (B) specific and detailed recommendations 18 on the ways in which the Commission could 19 amend the definition of the term ‘‘small entity’’ 20 to— 21 (i) be consistent with the results de- 22 scribed in subparagraph (A); and 23 (ii) expand the number of entities cov- 24 ered by such definition. 25 VerDate Sep 11 2014 02:55 Jun 01, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2792.RFS H2792 kjohnson on DSK79L0C42PROD with BILLS 4 HR 2792 RFS (c) RULEMAKING.—After the completion of each 1 study required under subsection (b), the Commission shall, 2 subject to public notice and comment, revise the rules of 3 the Commission consistent with the results of such study. 4 (d) INFLATION ADJUSTMENTS.—As soon as prac- 5 ticable following the date of enactment of this Act, and 6 every 5 years thereafter, the Commission shall adjust all 7 dollar figures under the definition of small entity estab- 8 lished by the Commission to reflect the change in the Con- 9 sumer Price Index for All Urban Consumers published by 10 the Bureau of Labor Statistics of the Department of 11 Labor. 12 Passed the House of Representatives May 30, 2023. Attest: CHERYL L. JOHNSON, Clerk. VerDate Sep 11 2014 02:55 Jun 01, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2792.RFS H2792 kjohnson on DSK79L0C42PROD with BILLS