The Role of State Blue Sky Laws After the JOBS Act and the National Securities Markets Improvement Act

State securities laws—generally referred to as “blue sky laws”— contain both registration provisions and antifraud provisions.  Registration provisions require that a company offering its securities to investors in a particular state register its securities with the state or meet the requirements for an exemption from the state’s registration provisions.  State antifraud provisions prohibit fraud in connection with the offer and sale of securities.

Blue sky laws – in particular, state registration provisions—have been a significant, unfair and inefficient impediment to small business capital formation.  A small business offering its securities as a way to raise capital is required to meet … Read more