Regulation A

AAA

DEFINITION of 'Regulation A'

An exemption from the registration requirements mandated by the Securities Act, applicable to small public offerings of securities that do not exceed $5 million in any 12-month period. A company that uses the Regulation A exemption for a securities offering must still file an offering statement with the Securities and Exchange Commission. While Regulation A offerings share some characteristics with registered offerings, they have some distinct advantages over full registration.

INVESTOPEDIA EXPLAINS 'Regulation A'

The issuer of a Regulation A offering has to provide buyers of the issue with an offering document whose content is similar to the prospectus in a registered offering. However, the advantages of a Reg A offering over a fully registered offering make up for this somewhat onerous requirement. These advantages include - simpler financial statements that do not have to be audited, no Exchange Act reporting requirements until the company has more than $10 million in assets and more than 500 shareholders, and the choice of three formats to prepare the offering circular.

RELATED TERMS
  1. SEC Form F-4

    A filing with the Securities and Exchange Commission (SEC) required ...
  2. SEC Form F-3

    A filing with the Securities and Exchange Commission (SEC) required ...
  3. Regulation T - Reg T

    The Federal Reserve Board regulation that governs customer cash ...
  4. SEC Form 1-A

    A filing with the Securities and Exchange Commission (SEC) required ...
  5. SEC Form F-6

    A filing with the Securities and Exchange Commission (SEC) required ...
  6. SEC Form 2-A

    A filing with the Securities and Exchange Commission (SEC) required ...
RELATED FAQS
  1. How is free enterprise affected by monetary policy?

    Monetary policy is concerned with the quality, quantity and function of money instruments in an economy. Perhaps the best ... Read Full Answer >>
  2. In what types of economies are regressive taxes common?

    Regressive taxation systems are more likely to be found in developing countries or emerging market economies than in the ... Read Full Answer >>
  3. What financial regulation exist to control the secondary market?

    The secondary market, most commonly referred to as the stock market, is largely built on self-regulating exchanges that also ... Read Full Answer >>
  4. How do commercial banks us the 'money multiplier' to create money?

    In a fractional reserve banking system, commercial banks are permitted to create money by allowing multiple claims to assets ... Read Full Answer >>
  5. Are there any exceptions to the law of demand?

    The law of demand applies in market economies and may operate differently for different products, markets and industries. ... Read Full Answer >>
  6. Besides Porter's 5 forces, what other forces shape industry in the 21st century?

    Competition, potential new competition, supplier power, buyer power and the threat of new substitute products, also known ... Read Full Answer >>
Related Articles
  1. Personal Finance

    Reg AC: What Does It Mean To Investors?

    In 2003, the SEC issued a new regulation meant to hold analysts more accountable for their reports. Find out what it means.
  2. Fundamental Analysis

    Interpreting A Company's IPO Prospectus Report

    Learn to decipher the secret language of the IPO prospectus report - it can tell you a lot about a company's future.
  3. Personal Finance

    How To Identify A Micro-Cap Scam

    Discover how to distinguish a real investment opportunity from a fraudulent one.
  4. Investing Basics

    Policing The Securities Market: An Overview Of The SEC

    Find out how this regulatory body protects the rights of investors.
  5. Investing

    REITs 101: How They're Regulated

    Here's everything you need to know about REITs in less than five minutes.
  6. Mutual Funds & ETFs

    How To Start a Hedge Fund In the United States

    A general overview of how to start a hedge fund firm in the United States, including complying with state and federal regulations.
  7. Mutual Funds & ETFs

    How To Start A Hedge Fund In The UK

    Starting a new hedge fund in the United Kingdom is more complex than in the United States. We discuss UK laws and regulations for starting a new hedge fund.
  8. Mutual Funds & ETFs

    How To Start A Hedge Fund In Canada

    Would-be hedge fund managers in Canada need to understand the laws and regulations that must be followed in order to start a fund in the country.
  9. Taxes

    Is It Smart To Get Dual Citizenship?

    Does it ever make sense to be a citizen of the U.S. and somewhere else? Yes, so you can work minus a visa – not so much, if you get drafted into the army.
  10. Retirement

    Expat In America: Visas To Retire In the U.S.

    It isn't easy for non-citizens to retire in the United States unless a family member is already a citizen. But some visas will allow for longer visits

You May Also Like

Hot Definitions
  1. Fisher Effect

    An economic theory proposed by economist Irving Fisher that describes the relationship between inflation and both real and ...
  2. Fiduciary

    1. A person legally appointed and authorized to hold assets in trust for another person. The fiduciary manages the assets ...
  3. Expected Return

    The amount one would anticipate receiving on an investment that has various known or expected rates of return. For example, ...
  4. Carrying Value

    An accounting measure of value, where the value of an asset or a company is based on the figures in the company's balance ...
  5. Capital Account

    A national account that shows the net change in asset ownership for a nation. The capital account is the net result of public ...
  6. Brand Equity

    The value premium that a company realizes from a product with a recognizable name as compared to its generic equivalent. ...
Trading Center