STAND. COM. REP. NO. 1134

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 1071
                                     S.D. 1
                                     H.D. 1




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Economic Development and Business
Concerns, to which was referred S.B. No. 1071, S.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO SECURITIES,"

begs leave to report as follows:

     The purpose of this bill is to enable small businesses to
obtain increased access to growth capital by allowing a new form
of equity financing through the Small Corporate Offering
Registration (SCOR) system, a uniform registration system that
allows a company to raise up to $1,000,000 by selling common
stock directly to the public for at least $5 per share.

     Testimony in support of this measure was submitted by the
Department of Business, Economic Development, and Tourism, the
Business Registration Division of the Department of Commerce and
Consumer Affairs, and the Hawaii Congress on Small Business.

     Your Committee notes that this bill is similar in general
purpose and intent to H.B. No. 1019, "A BILL FOR AN ACT RELATING
TO SECURITIES."

     Your Committee has amended this bill by deleting its
substance and inserting the substance in H.B. No. 1019.  As
amended, this bill provides that the prospectus required for
registration may be satisfied by the SCOR Form (Form U-7) adopted
by the North American Securities Administrators Association if
all qualifications in the instructions for use of the form are

 
 
                                 STAND. COM. REP. NO. 1134
                                 Page 2

 
fulfilled.  Additional technical, nonsubstantive amendments were
made for clarity.

     As affirmed by the record of votes of the members of your
Committee on Economic Development and Business Concerns that is
attached to this report, your Committee is in accord with the
intent and purpose of S.B. No. 1071, S.D. 1, as amended herein,
and recommends that it pass Second Reading in the form attached
hereto as S.B. No. 1071, S.D. 1, H.D. 1, and be referred to the
Committee on Consumer Protection and Commerce.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Economic
                                   Development and Business
                                   Concerns,



                                   ______________________________
                                   ROBERT N. HERKES, Chair