Small Business Mergers, Acquisitions, Sales, and Brokerage Simplification Act of 2013by Representative Bill Huizenga
Posted on 2014-01-14
HUIZENGA of Michigan. Mr. Speaker, I rise today to encourage
passage of H.R. 2274, the Small Business Mergers, Acquisitions, Sales,
and Brokerage Simplification Act. Maybe we need to work on the titles
getting a little simpler, too. It is very complex. It is a very complex
set of laws and rules that have been put in place.
I do want to say thank you to my subcommittee chairman, Mr. Garrett, and Ranking Member Sewell for their work on this, as well as Chairman Hensarling and Ranking Member Waters, as we have explored this and dove headfirst, really, into this issue.
It has been estimated, Mr. Speaker, that there are approximately 10 trillion--that's ``trillion'' with a ``t''--privately-owned, small family-owned type of businesses that will be sold or potentially closed in the coming years as baby boomers retire.
Now, we want to see one of those things happen. We want people to see the fruits of their hard work over the years, and we want to see them be able to sell those companies. We don't want to see them close them unnecessarily, because we know the impact that happens to small communities, much like has happened in some of my hometown communities, when we have seen that happen.
Mergers and acquisitions are also known as M&A. Brokers play a critical role in facilitating the transfer of ownership of these smaller privately held companies. Currently, all M&A brokers are subject to costly, burdensome requirements which adversely impact and unnecessarily increase the cost that business owners incur when they buy or sell their businesses. Often we have heard anecdotally and statistically that they have to make a decision sometimes. They can't move ahead and can't really afford to sell that small--literally, sometimes--corner store, mom-and-pop-type operation, and so they end of closing it because they can't afford to go through the sale.
In fact, the issue has been highlighted by the SEC's Forum on Small Business Capital Formation, which, for the last 7 years--that is over the last two administrations, this current administration and the last administration--has repeatedly recommended that the SEC modernize and streamline the regulation of M&A brokers. But, unfortunately, the SEC has never acted on these recommendations.
Well, we think the time is up. We believe that 7 years is long enough. It is time that this body and hopefully our colleagues in the Senate, as well, will take this bill and finally put some closure to this issue. That is why I, along with Representatives Brian Higgins and Bill Posey, introduced H.R. 2274. This bipartisan bill would create a simplified system for brokers performing services in connection with the transfer of ownership of smaller privately held companies.
By simplifying the regulation and reducing the cost of these business brokerage services, these smaller privately owned companies would be able to safely, efficiently, and effectively transfer their company, preserving jobs currently in existence, while also allowing for continued economic growth and job creation to take place at these companies.
There is no risk to the public; there is no threat to the safety and soundness of our economic system; but it is very, very important to those communities that have those kinds of businesses in them and where they are located.
In October 2013, a piece in The Hill newspaper, Michael Nall, president of the Alliance of Merger & Acquisition Advisors, a leading international organization serving the middle-market M&A industry, stated: H.R. 2274, the Small Business Mergers, Acquisitions, Sales, and Brokerage Simplification Act of 2013 is an excellent bipartisan bill, one whose time has come. Congress should get it done before the end of the year.
Sorry, Mr. Nall. We are a little behind schedule, but we are getting there.
He goes on: It's not a sexy bill, not one that prime time TV will be talking about, and not one that will evoke a question in the next Presidential debates; but it is a bill that does have teeth, and it is a serious and substantive piece of small business legislation.
Well, maybe we can inject this into the next Presidential election because this ultimately is about the foundation of our country. It is about that ability for entrepreneurs to go out, strike out on their own, go become successful and then reap the rewards of that and, all the while, provide jobs to communities like we all represent.
Well, in today's highly charged political environment, it is nice to show the American people that a positive, effective initiative can be considered and passed with strong bipartisan support. In fact, this important legislation, as has been mentioned, overwhelmingly passed the Financial Services Committee by a bipartisan vote of 57-0. It is legislation like H.R. 2274 that demonstrates Congress can act in a bipartisan manner to positively impact the lives of Americans.
Mr. Speaker, with that I urge a ``yes'' vote on this legislation, and I look forward to working with my Senate colleague to see H.R. 2274 make it to President Obama's desk.
I want to thank Chairman Garrett for his leadership on this issue.