Small Entity Update Act

HR 2792, the Small Entity Update Act, requires the Securities and Exchange Commission (SEC) to periodically review and update its definition of "small entity" for regulatory purposes. The bill mandates that the SEC, working with advisory committees, conduct a study every five years to assess whether the current definition aligns with existing rules, reflects market changes, and ensures a meaningful number of entities qualify as "small." After each study, the SEC must submit a report to Congress with specific recommendations for updating the definition, followed by a proposed rule within 180 days and a final rule 180 days after that. This process directly affects SEC-regulated entities (like small businesses and organizations in capital markets) by potentially expanding their eligibility for certain regulatory exemptions.