Eight U.S. lawmakers backed a bill that would allow closely held firms including Facebook Inc. and Twitter Inc. to have as many as 1,000 shareholders before being required to file public financial statements.

The legislation, introduced by Representative David Schweikert of Arizona, would also exclude employees and accredited investors from the rules, which currently set the ceiling at 500 investors.

"The underlying premise is that there is lots of capital sitting on the sidelines and for some reason it's not flowing into the market," Schweikert, a Republican on the Financial Services Committee, said in a telephone interview. "The current rules just seem to be out of date."

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