SEC Adjusts Revenue Threshold to Determine Emerging Growth Company Filer Status

September 2022

The Jumpstart Our Business Startups (JOBS) Act of 2012 created “emerging growth company” (EGC) filer status, which permits reduced disclosures in an initial registration statement and provides a temporary exemption from certain financial reporting and governance requirements thereafter. The JOBS Act requires the SEC to index to inflation the annual gross revenue amount used to determine EGC status every five years. Pursuant to this requirement, the SEC issued final rules that increase the annual gross revenue used to determine EGC status from $1,070,000,000 to $1,235,000,000. Similar inflation adjustments were made to certain offering and investment limits in the Regulation Crowdfunding rules as well (refer to the SEC’s Fact Sheet for a detailed summary).

The rules became effective on September 20, 2022, upon publication of the release in the Federal Register.