H.R. 7127: Restoring the Secondary Trading Market Act

The "Restoring the Secondary Trading Market Act" aims to modify certain regulations concerning the trading of securities outside of traditional exchanges. Here are the primary components of the bill summarized in layman's terms:

Exemption from State Regulation

The bill seeks to amend the Securities Act of 1933 to exempt off-exchange secondary trading from state regulations, provided that the issuer of the securities makes specific current information publicly available. This means that if a company shares certain financial reports and information with the public, then trading its securities outside of conventional stock exchanges will not be subject to state-level rules or restrictions.

Requirements for Issuers

For a company to qualify for this exemption, it must make available:

• The information typically required in periodic and current reports as outlined by federal regulations.
• Documents specified under another section of federal regulations that detail necessary information for investors.

Implications for Secondary Trading

The act aims to facilitate easier trading of securities by reducing regulatory burdens. By exempting qualified issuers from state restrictions, the bill hopes to enhance market liquidity and accessibility for investors engaged in trading these off-exchange securities.

Overall Purpose

The overarching goal of the legislation is to strengthen the secondary trading market by simplifying the process for trading securities in certain instances, ultimately aiming to improve market operations and investor access.

Relevant Companies

None found