4 versions

CosmeticWhat changed in REFERRED IN SENATEcompared with ENGROSSED IN HOUSE (Jul 21, 2025)

Technical corrections only. The diff reflects the procedural update of H.R. 3382 passing the House and being referred to the Senate, including the addition of the House Clerk's name. There are no substantive policy changes between v3 and v4.

H.R. 3382119th CongressIntroduced May 14, 2025

Small Entity Update Act

Passed HouseFinance and Financial SectorMajor

View bill text

Sponsor: Rep. Wagner, Ann [R-MO-2]
Committees: Banking, Housing, and Urban Affairs Committee (primary)
Last action: Jul 22, 2025

Bottom line

The "Small Entity Update Act" aims to ensure the SEC's definition of "small entity" remains relevant and inclusive for regulatory flexibility purposes by requiring regular reviews, rule revisions, and inflation adjustments.

What it actually does

This bill mandates the Securities and Exchange Commission (SEC) to conduct periodic studies (every 5 years) on its definition of "small entity" under the securities laws, considering market growth and the alignment with the Regulatory Flexibility Act. Based on these studies, the SEC must revise its rules to potentially expand the number of entities covered by the "small entity" definition. Additionally, the bill requires the SEC to adjust any dollar figures in its small entity definition every five years to account for inflation.

Proponents argue

Proponents argue that the current definition of "small entity" used by the SEC may be outdated, failing to capture a meaningful number of businesses that genuinely require regulatory flexibility. They contend that regularly updating this definition, especially with inflation adjustments, will reduce compliance burdens for a broader range of smaller businesses, fostering economic growth and innovation without compromising investor protection. This bill ensures that regulatory relief intended for small entities actually reaches them.

Opponents contend

Opponents might argue that frequent revisions and expansions of the "small entity" definition could inadvertently exempt larger or more complex entities from necessary regulatory oversight, potentially increasing risks for investors and market stability. They might also raise concerns about the administrative burden and resource allocation required for the SEC to conduct these recurring studies and rulemakings, diverting resources from other critical regulatory functions.

The bill is very short and clearly written, making it highly accessible for a reader to understand its core provisions quickly.

Section 2(b)(1)

SEC Mandate for Periodic Studies

prominently featuredstraightforward

This provision requires the SEC to conduct a study of its "small entity" definition within one year of the bill's enactment, and again every five years thereafter. The study must assess how well the current definition aligns with the intent of the Regulatory Flexibility Act, consider the growth of financial markets since the last amendment, and recommend how to define "small entity" to include a meaningful number of entities.

GroupImpactMechanismScale

GroupSecurities and Exchange Commission (SEC)ImpactIncreased administrative workload and responsibility for conducting studies.MechanismStatutory mandate for recurring studies.ScaleOngoing, every five years.

GroupSmall businesses and organizations regulated by the SECImpactPotential for revised definitions that could expand eligibility for regulatory flexibility.MechanismStudies inform future rulemakings.ScaleBroad, affecting potentially thousands of entities.

Supporters argue

Supporters argue that regular, data-driven studies are essential to ensure that regulatory definitions remain relevant in dynamic financial markets. This provision ensures the SEC's "small entity" definition accurately reflects the current economic landscape and the intent of providing regulatory relief to truly small businesses.

Critics contend

Critics might argue that mandating frequent, detailed studies could be resource-intensive for the SEC, potentially diverting staff and funds from core enforcement and oversight activities. They might also question the necessity of such frequent reviews if market conditions do not change drastically.

Tradeoffs

The tension lies between the desire for up-to-date, inclusive definitions for regulatory flexibility and the administrative burden placed on the SEC to conduct these recurring analyses.

Section 2(c)

Mandated Rulemaking for Definition Revision

prominently featuredstraightforward

This provision requires the SEC, concurrently with or after each study, to revise its rules regarding the "small entity" definition. These revisions must be consistent with the study's results and aim to expand the number of entities covered by the definition, following public notice and comment procedures.

Section 2(d)

Automatic Inflation Adjustments

mentioned in summarystraightforward

After the initial rule revisions, this provision requires the SEC to adjust any dollar figures within its "small entity" definition every five years. These adjustments will reflect changes in the Consumer Price Index for All Urban Consumers (CPI-U) published by the Bureau of Labor Statistics of the Department of Labor.

About this analysis. AI-Generated from the official bill text and available committee reports. Gaps in available data are noted explicitly. Verify important details with the official Congress.gov record.

CosmeticWhat changed in REFERRED IN SENATEcompared with ENGROSSED IN HOUSE (Jul 21, 2025)

H.R. 3382119th CongressIntroduced May 14, 2025

Small Entity Update Act

Passed HouseFinance and Financial SectorMajor

View bill text

Sponsor: Rep. Wagner, Ann [R-MO-2]
Committees: Banking, Housing, and Urban Affairs Committee (primary)
Last action: Jul 22, 2025

Bottom line

What it actually does

Proponents argue

Opponents contend

The bill is very short and clearly written, making it highly accessible for a reader to understand its core provisions quickly.

Section 2(b)(1)

SEC Mandate for Periodic Studies

prominently featuredstraightforward

GroupImpactMechanismScale

Supporters argue

Critics contend

Tradeoffs

The tension lies between the desire for up-to-date, inclusive definitions for regulatory flexibility and the administrative burden placed on the SEC to conduct these recurring analyses.

Section 2(c)

Mandated Rulemaking for Definition Revision

prominently featuredstraightforward

Section 2(d)

Automatic Inflation Adjustments

mentioned in summarystraightforward