Report: SEC reviewing disclosure rules in light of Facebook, Twitter

The Securities and Exchange Commission has begun a review of its disclosure rules for private firms in light of recent deals that allow investors to purchase shares in privately-held Web companies like Facebook and Twitter, according to a report in The Wall Street Journal.

According to the report, the review is in an early stage and SEC officials have yet to conclude that recent deals involving the firms have violated rules governing private companies. Facebook has reportedly reached an agreement with Goldman Sachs that would allow some of Goldman's clients to buy as much as $1.5 billion of equity in Facebook.

Goldman also recently teamed with Russian investment firm Digital Sky Technologies to invest $500 million in Facebook. Currently companies with more than 499 shareholders must publicly disclose their financial results, but Goldman is attempting to structure the deals so all of its clients count as one investor.

The SEC may decide to update its rules in order to protect investors, but must consider the needs of private companies trying to raise capital. The review may also increase the pressure on Facebook to go public, though founder Mark Zuckerberg has indicated that an IPO is not forthcoming.

Facebook employees aren't allowed to sell any of their shares in the company, and employees hired since 2007 receive restricted stock units that have no value until the company goes public or is sold. Goldman clients interested in investing in Facebook have reportedly been told the minimum commitment is $2 million.