Regulation A is a type of exemption from the registration requirements of the Securities Act of 1933 that allows small and emerging companies to raise capital by selling securities to the public. It is sometimes referred to as a "mini-IPO" because it allows companies to sell securities to the public in a manner similar to a traditional initial public offering (IPO), but with less stringent disclosure and reporting requirements.Regulation A was updated in 2015 by the Jumpstart Our Business Startups (JOBS) Act, which created two tiers of Regulation A offerings: Tier 1 and Tier 2.Tier 1 offerings are limited to $20 million in any 12-month period and are subject to state registration and qualification requirements. Tier 2 offerings are limited to $50 million in any 12-month period and are exempt from state registration and qualification requirements, but are subject to ongoing reporting requirements under the Securities Exchange Act of 1934.To conduct a Regulation A offering, a company must file a Form 1-A offering statement with the Securities and Exchange Commission (SEC) and provide certain financial and other information about the company and the offering. The offering statement must also be reviewed and qualified by the SEC before the offering can proceed.
