Helping Startups Continue To Grow Act

Bill Number

H.R. 3323

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Finance and Financial Sector

Status

Introduced

Latest Action

2025-06-04: Placed on the Union Calendar, Calendar No. 102.

Last Updated

2025-10-29T01:35:15Z

AI-Generated Summary

Purpose

The Helping Startups Continue To Grow Act (H.R. 3323) aims to modernize the definition of an "emerging growth company" (EGC) under U.S. securities laws. An EGC is a type of smaller public company that receives certain regulatory relief to help it raise capital more easily. By updating the criteria, the bill seeks to extend these benefits to more companies for a longer period, supporting startup growth and innovation.

Key Provisions

• Revenue Threshold Increase: Raises the annual gross revenue limit for EGC status from $1 billion to $3 billion.
• Extended Stock Issuance Period: Changes the deadline for issuing stock to the public from the fifth anniversary of the company's first sale to the tenth anniversary.
• Simplified Criteria: Removes one criterion (related to the company's status as of December 8, 2012, under prior law) and streamlines the remaining ones, focusing on revenue, stock issuance timing, and total assets (under $2 billion, unchanged).
• Technical Fixes: Corrects paragraph numbering in the Securities Exchange Act of 1934 and updates a cross-reference in the Securities Act of 1933 for clarity.

These changes amend Section 2(a)(19) of the Securities Act of 1933 (15 U.S.C. 77b(a)(19)) and Section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).

Significant Changes to Existing Law

• Threshold Adjustment: The revenue cap, set at $1 billion since the JOBS Act of 2012 (a law that eased rules for smaller companies), is tripled to account for inflation and economic growth, allowing more mid-sized firms to qualify as EGCs.
• Time Extension: Extends the grace period for stock issuance from five to ten years, giving companies more time to mature before losing EGC benefits like scaled-back financial reporting and audit requirements.
• Streamlining: Eliminates an outdated subparagraph tied to the 2012 law, making the definition cleaner and more forward-looking without altering core asset or public float tests.

Potential Impacts

• On Businesses and Citizens: Enables more startups and growing companies to access public markets with fewer regulatory burdens, potentially lowering costs for going public and fostering job creation and economic innovation. Investors may benefit from easier entry into these companies.
• On Government Agencies: The Securities and Exchange Commission (SEC) will oversee a broader range of companies under EGC rules, possibly reducing short-term enforcement workload but requiring updates to guidance and forms.
• On International Relations: Minimal direct impact, though it could make U.S. markets more attractive to foreign startups, indirectly boosting competitiveness against international financial hubs.

Main Stakeholders Affected

• Emerging Growth Companies: Primary beneficiaries, including tech startups, biotech firms, and other innovative businesses that can retain EGC status longer.
• Investors and Financial Institutions: Gain from simplified disclosures, potentially increasing market participation.
• Securities and Exchange Commission (SEC): Must implement and enforce the updated rules.
• Congress and Regulators: Involved in ongoing oversight of securities laws to balance investor protection with business growth.

Notable Legal, Constitutional, or Political Implications

• Legal: Aligns with the JOBS Act's intent to reduce barriers for smaller issuers while maintaining investor safeguards; no conflicts with broader securities regulations like Sarbanes-Oxley Act requirements.
• Constitutional: No apparent issues, as it involves congressional authority over interstate commerce and securities under Article I, Section 8.
• Political: Supports pro-business policies by easing regulations, potentially appealing across party lines for economic development, but could raise concerns about reduced transparency for investors if EGC benefits are seen as too generous.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Steil, Bryan [R-WI-1]

Cosponsors (2)

Rep. Wagner, Ann [R-MO-2], Rep. Liccardo, Sam T. [D-CA-16]

Recent Actions

• 2025-06-04: Placed on the Union Calendar, Calendar No. 102.
• 2025-06-04: Reported (Amended) by the Committee on Financial Services. H. Rept. 119-133.
• 2025-06-04: Reported (Amended) by the Committee on Financial Services. H. Rept. 119-133.
• 2025-05-20: Ordered to be Reported (Amended) by the Yeas and Nays: 31 - 20.
• 2025-05-20: Committee Consideration and Mark-up Session Held
• 2025-05-13: Referred to the House Committee on Financial Services.
• 2025-05-13: Introduced in House
• 2025-05-13: Introduced in House

Bill Versions

• Helping Startups Continue To Grow Act — issued 2025-05-13 — PDF (2 pages)
• Helping Startups Continue To Grow Act — issued 2025-06-04 — PDF (6 pages)