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ARTICLE · 11 JUNE 2024

SEC's Private Fund Advisers Rule Struck Down By Fifth Circuit

Seyfarth Shaw LLP
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The Fifth Circuit Court of Appeals (Fifth Circuit) today issued its ruling striking down the "Private Fund Advisers Rule" (the "PFA").

United StatesConsumer Protection
Evan T. Sarosi
Evan T. Sarosi
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The Fifth Circuit Court of Appeals (Fifth Circuit) today issued its ruling striking down the "Private Fund Advisers Rule" (the "PFA"). The proposed PFA was introduced on February 9, 2022 ("Proposed Rule"). The Securities and Exchange Commission (the "SEC") worked with the institutional investor and private investment fund manager communities to finalize the rule over an extended comment period. While the final rule ("Final Rule") scaled back the Proposed Rule, the Fifth Circuit ultimately struck down the Final Rule on the grounds that the SEC exceeded its statutory authority. The statutory authority on which the SEC relied on was contained in Section 211(h) and Section 206(4) of the Advisers Act.

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