RACE Act of 2025
Key claim: The RACE Act of 2025 would allow issuers who previously offered securities under Regulation A to issue an additional class of substantially similar securities without full registration, subject to specified dollar limits.
Abstract
(HR3135 · 119th Congress) Regulation Advancement for Capital Enhancement Act of 2025 or the RACE Act of 2025 This bill allows issuers with offerings that were previously exempted from securities registration requirements to issue an additional class of securities if certain criteria are met. Specifically, this bill allows an issuer who issued securities under Regulation A (a small offering of securities exempt from registration requirements) to issue an additional class of securities if the securities in the additional class are substantially similar to the original class and the offering amount does not exceed specified dollar limits. However, the securities offered in the additional class are not required to have the same nature or terms. Latest action (2025-05-01): Referred to the House Committee on Financial Services.
Why this matters
Regulation A is the primary ‘mini-IPO’ exemption for smaller issuers, and expanding it to permit additional classes of substantially similar securities without full registration would let repeat Reg A users tap capital markets more flexibly at lower legal cost. For investors, it means more Reg A securities available with the same tier-based investor protections and disclosure regime rather than full Securities Act registration. The change is incremental — it builds on the existing exemption ceiling rather than creating a new offering channel — and remains a proposal until enacted.