The real issue is the fact that it's entirely selective. They gave CC a /14, which clearly wasn't warranted. And they gave Cloudflare a /12, which is somewhat against the NRPM they are quoting to other, smaller companies for justification purposes (you are supposed to show immediate need and/or at most a 3 month requirement, which is based entirely on historical IP utilization rates). Then they make smaller guys jump through hoops and cite an "IP shortage" as being justification for demanding very detailed client information. If they had a more appropriate screening process in place to begin with, then not only would the system make sense but it would actually WORK.
They are simply delaying the IPv4 shortage by making people jump through hoops that take weeks to complete when the process normally would take days. They kept asking for information, I'd give it, they'd take 2 days to reply, and then they'd demand more information unrelated to the initial information request they made. Artificially slowing it down by making people annoyed isn't really solving anything, and just causes more headaches and work for those with legitimate requests.
The whole process should have been streamlined with appropriate NRPM requirements for information we as a company collect years ago. Technically speaking we aren't required by any law or business structure to maintain and validate the accuracy of client information. I ended up throwing them an Excel spreadsheet SQL dump with the information they asked, and none of it was in order. Thank god they accepted it, I fear the amount of work I would have had trying to put it all in order.
-----------------------------------------
Relating to @
Virtovo, I do not believe (and I could be wrong, so someone please correct me if I am incorrect) that ARIN has a requirement that the business be legally registered in the United States. "The primary role of RIRs is to manage and distribute public Internet address space within their respective regions." I'd suggest researching that bit before you take a dive at a US LLC registration solely for the purpose of ARIN IP allocation.
The basic requirements for a single-homed ISP is demonstrating utilization of 16 /24's. The requirement as multi-homed when applying for a /22 of space is efficient utilization of a minimum contiguous or noncontiguous /23 (two /24's). There was discussion to amend the NRPM 4.2.2 policy in the ARIN public discussion email groups, to make the single-homed requirements similar to that of multi-homed, but there hasn't been a whole lot that has come about of that as of yet.