Private equity firms are facing increased disclosure
requirements and new restrictions on giving certain investors
special treatment. Are current market policies sufficient to limit
exposure in this new environment?
The New Rules
On August 23, 2023, the United States Securities and Exchange
Commission ("SEC") adopted new rules
and amendments governing the $27 trillion private funds sector.
Among the new rules, private fund advisors registered with the SEC
will be required to provide investors with quarterly statements
detailing fund fees, expenses, and performance. The new rules will
also require private fund advisors to obtain and distribute to
investors an annual financial statement audit of each private fund
it advises and a fairness opinion or valuation opinion in
connection with any advisor-led secondary transaction. Finally, the
rules will prohibit private fund advisors from providing investors
with preferential treatment regarding redemptions and
