Amendment for Crowdfunding Capital Enhancement and Small-business Support Act of 2026; ACCESS Act of 2026
Summary
The Amendment for Crowdfunding Capital Enhancement and Small-business Support Act of 2026, also known as the ACCESS Act of 2026, aims to amend the Securities Act of 1933. The primary goal is to raise the offering amount threshold for when issuers using the crowdfunding exemption are required to file financial statements reviewed by an independent public accountant. This adjustment seeks to ease the regulatory burden on small businesses utilizing crowdfunding for capital raising.
The bill proposes increasing the threshold from $100,000 to $250,000, and allows the Securities and Exchange Commission (SEC) to further increase it to $400,000 based on recommendations from the Office of the Advocate for Small Business Capital Formation and the Office of the Investor Advocate. The bill also includes technical corrections to references within the Securities Act of 1933.
Sponsored by Senators McCormick and Kim, the bill has been introduced in the Senate and referred to the Committee on Banking, Housing, and Urban Affairs for further consideration.
Expected Effects
The ACCESS Act of 2026, if enacted, would primarily reduce the compliance costs for small businesses seeking to raise capital through crowdfunding. By raising the threshold for required independent financial statement reviews, it would make crowdfunding a more accessible and attractive option for early-stage companies. This could lead to increased participation in crowdfunding and greater capital flow to small businesses.
Additionally, the technical corrections would clarify existing references within the Securities Act, reducing potential ambiguity and streamlining regulatory processes. The SEC's discretionary power to further adjust the threshold provides flexibility to adapt to changing economic conditions and investor protection needs.
Overall, the bill is expected to encourage small business growth and innovation by lowering barriers to capital formation.
Potential Benefits
- Reduced Compliance Costs: Small businesses raising capital through crowdfunding would face lower accounting and auditing expenses.
- Increased Access to Capital: Crowdfunding becomes a more viable option for businesses needing smaller amounts of funding.
- Stimulated Small Business Growth: Easier access to capital can fuel expansion and job creation within the small business sector.
- Greater Flexibility: The SEC's ability to adjust the threshold allows for adaptation to market conditions.
- Simplified Regulations: Technical corrections reduce ambiguity and streamline regulatory processes.
Most Benefited Areas:
Potential Disadvantages
- Potential for Increased Investor Risk: Higher thresholds without independent reviews could increase the risk of fraud or mismanagement.
- Reduced Investor Protection: Less stringent financial oversight may leave investors more vulnerable.
- Information Asymmetry: Reduced review requirements could lead to less transparency for investors.
- Risk of Inefficient Capital Allocation: Without thorough reviews, capital might be misallocated to less viable projects.
- Possible Market Distortions: The changes could create an uneven playing field between companies using crowdfunding and those using other capital-raising methods.
Constitutional Alignment
The bill appears to align with the spirit of promoting economic activity, which can be argued as falling under the "general Welfare" clause of the Constitution's preamble. Congress's power to regulate commerce, as outlined in Article I, Section 8, includes the ability to set rules for securities and capital markets. This bill amends existing securities regulations related to crowdfunding.
There are no apparent conflicts with specific constitutional rights or limitations. The bill does not infringe on individual liberties, religious freedom, or any other protected rights. The adjustments to financial review thresholds are within the scope of Congress's regulatory authority over interstate commerce.
Overall, the bill seems constitutionally sound, as it falls within the enumerated powers of Congress and does not violate any constitutional prohibitions.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).