Following the enactment of the Sarbanes-Oxley Act in 2002, many observers predicted that regulatory burdens would drive US companies to go public outside of the United States. The evidence supports this phenomenon, although the absolute numbers are not large and the trend has recently reversed despite the imposition of additional requirements by the Dodd-Frank Act in 2010.
Offshore IPOs by US companies grew from barely 1% of all US company IPOs worldwide between 1996 and 2001 to nearly 9% of all US company IPOs worldwide between 2003 and 2010. Since then, however, this percentage has declined to 5% in 2011 and only 1% in 2012, despite the additional burdens imposed by Dodd-Frank. Looking ahead, offshore IPOs may become less attractive to emerging growth companies because of the availability of reduced disclosure requirements for IPOs in the United States as a result of the JOBS Act.