STAND. COM. REP. NO. 2907

Honolulu, Hawaii

RE:    H.B. No. 2704

       H.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2016

State of Hawaii

Sir:

     Your Committee on Commerce, Consumer Protection, and Health, to which was referred H.B. No. 2704, H.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO CROWDFUNDING,"

begs leave to report as follows:

     The purpose and intent of this measure is to establish an exemption from Hawaii securities law for limited intrastate investments with Hawaii businesses.

     Your Committee received testimony in support of this measure from the Hawaii Food Industry Association, Chamber of Commerce Hawaii, and National Federation of Independent Business Hawaii.  Your Committee received testimony in opposition to this measure from the United Public Workers, AFSCME, Local 646, AFL-CIO.  Your Committee received comments on this measure from the Department of Commerce and Consumer Affairs.

     Your Committee finds that this measure provides for explicit statutory authority for the adoption of an intrastate crowdfunding exemption through rulemaking.  Such an exemption would provide a mechanism for start-up businesses based in Hawaii to obtain financing from local investors.  Your Committee further finds that this measure will encourage development of the startup and innovation section in Hawaii, which will positively impact Hawaii's economy.

     As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection, and Health that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2704, H.D. 2, and recommends that it pass Second Reading and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Commerce, Consumer Protection, and Health,

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ROSALYN H. BAKER, Chair