What: On July 7, 2025, the Small Business Administration (SBA) published a proposed rule to modify or remove regulations that are obsolete, inefficient, or otherwise unnecessarily impede the licensing of small business investment companies (SBICs). In addition, SBA is proposing to amend its regulations applicable to subsequent fund applicants to streamline the licensing process for such applicants. SBA also seeks to remove certain barriers to investments in critical mineral extraction and processing and designated critical technologies.
Specifically, SBA proposes:
- To remove three regulations and one definition relating to Participating Securities (as defined in 13 CFR 107.50) and SBICs that issued Participating Securities (“Participating Securities SBICs”).
- To remove one regulation relating to a category of SBICs created in 2012 by regulation that require investors to invest at least fifty percent of their capital in early-stage small businesses.
- To remove or revise thirty regulations and four definitions deemed duplicative, redundant, or otherwise inefficient or unnecessary.
- To remove three eligibility requirements for subsequent fund applicants operating an active SBIC license and further clarify through revision two eligibility requirements pertaining to SBIC applicants under Common Control with one or more SBICs that wish to be considered under an “Expedited Subsequent Fund Evaluation Process.”
Why: SBA requests comments, data, and information on the scope of the proposed rule.
Action: Comments are due to SBA on or before September 5, 2025.
FEDERAL REGISTER NOTICE:
Small Business Investment Company Regulatory Amendments
CONTACT:
Will Purcell
EMAIL:
TOPIC(S):
SBA
Is your small business or entity being negatively impacted by a proposed rule? If yes, write a comment letter to the proposing agency.