SEC Offers Relief to M&A Brokers


The Office of the Chief Counsel of the Division of Trading and Markets of the Securities and Exchange Commission recently issued an important “No-Action” Letter providing regulatory relief for participants in certain mergers and acquisitions transactions. The letter permits persons who qualify as “M&A Brokers” to facilitate the sale of private companies without registering with the Commission as a broker-dealer, subject to a number of restrictions. While many questions and considerations remain, the M&A Broker designation has the potential to relieve some of the burdens of registration for advisors specializing in private business combinations.

Introduction -

On January 31, 2014, the Office of the Chief Counsel of the Division of Trading and Markets of the US Securities and Exchange Commission (“the Commission”) issued a “No-Action” Letter permitting “M&A Brokers,” a term generally defined to mean persons that intermediate the sale of private companies to persons that intend to operate those companies, to effect securities transactions in connection with the transfer of ownership of privately-held companies without registration as a broker-dealer under the terms and conditions described below.

Please see full memo below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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