Regulation D

Regulation D is a Securities and Exchange Commission (SEC) regulation which oversees certain types of private placements .

Generally, any security offering must comply with the Section 5 of Securities Act , which requires the issuer to file a registration statement . Section 4(a)(2) , however, exempts “transactions by an issuer not involving any public offering,” i.e. a private placement, from the requirement to file a registration statement. Currently, Regulation D, 17 C.F.R. § 230.501 et seq. , governs how companies can conduct private placements of securities. Under Rule 504 companies may privately place up to $5,000,000 with minimal restrictions. Under Rule 506 there is no cap on the offering value, but issuers must meet a handful of other restrictions.

[Last reviewed in January of 2022 by the Wex Definitions Team ]

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