What is FACTA and who is affected by it? The Foreign Account Tax Compliance Act (FATCA), coming into effect in July 2014, requires any Foreign Financial Institution (FFI) that elects to comply with the Act to do three things: 1) identify its U.S. account holders; 2) annually report the account holders to the IRS; and 3) withhold…
Category: Blog Articles
Microsoft Ventures: A Three Pronged Benefit Program
Through venture capital, many small startup tech businesses have been able to obtain the necessary funds to start their business. The success of these startups provides investors with not only an opportunity to profit on the new organization’s success, but also allows many large corporations to invest in startups as a means to spread their…
A New York State of Mind: In-State Private Equity Program Invests in New York Start-Ups
Originally founded by the State of New York Comptroller’s office in 1999, New York’s In-State Private Equity Program has certainly made an impact on the state’s best and brightest new businesses.1 Since its creation, the program has intended to support native New York businesses while also generating hopefully solid returns for the state.2 Historically, and…
REITs v. Private Equity Real Estate
For institutional investors such as public pensions or insurance companies, real estate can play an important part of an investment portfolio. As an asset class, real estate has several qualities that make it an attractive alternative to more traditional investments like stocks or bonds. Real estate can generate attractive current income yields, and as a…
Conflict of Interests in Private Equity Funds
Until recently, the SEC’s Division of Enforcement focused its enforcement efforts on hedge fund managers who breached their fiduciary duties to clients or engaged in other types of fraudulent conduct. However, the growth of the private equity industry has not gone unnoticed by the SEC, and there have been a wave of enforcement actions against…
Strategic Deregulation: Potential Impacts of Allowing Foreign Private Equity Fundraising in China
How the Chinese government chooses to open up sectors of its financial industry will dictate the returns that investors may receive. Recent deregulation is beneficial because it affords Chinese investors an alternative avenue to invest savings, but significant hurdles remain before domestic private equity (PE) funds will be able to reinvest in domestic startups. The…
Should You Form an LLC or C-Corporation?
If you are considering this question, you already have a business concept, a business plan (hopefully), and have done enough market research to ensure that your idea will have some traction and solve some pain point. But, you are unsure of which business entity to choose. Both entity types have their pros and cons, which…
Legal Barriers to Japan’s Venture Capital Industry
Although Japan is one of the leading countries in the world in terms of GDP, the success of its venture capital industry is questionable, especially when compared to that of the US. In Japan, there are about 1,500 venture capital deals annually, valued at $1.9 million per deal, whereas in the US, there are about…
This Isn’t What We Voted For: Will the JOBS Act Spur Fraud?
In an era of oversight, regulations are being reigned in to help startups obtain funding. The JOBS Act, signed into law in 2012, increases investment opportunities. Specifically, the Act permits “crowdfunding” through a provision allowing sales of certain unregistered securities in small amounts. Effective crowdfunding depends on a startup company’s ability to target the right…
The SEC’s Lift on the Ban on General Solicitation
On July 10, 2013, the Securities and Exchange Commission lifted an 80-year old ban on the general solicitation of private securities offerings to individual investors. The decision came as a response to Section 201(a) of the Jumpstart Our Business Startups (JOBS) Act of 2012, which amends Rule 506 of Regulation D under the Securities Act…