SEC Proposes Amendments To Investment Company Advertising Rules
The SEC has proposed rule and form amendments under the Securities Act of 1933 (the "Securities Act") and the Investment Company Act of 1940 to eliminate certain technical requirements governing fund advertisements and require more timely performance information in investment company ("fund") advertisements, among other changes. Specifically, the SEC is proposing to amend Rule 482 under the Securities Act to permit a fund advertisement to include information the substance of which is not contained in the fund’s prospectus and to rescind the provisions of Rule 134 under the Securities Act that apply to funds. As a result, under the proposed amendments, fund advertisements which would have otherwise complied with Rule 134, typically those without performance information, will need to comply with Rule 482 which, unlike Rule 134, entails liability under Section 12(a)(2) of the Securities Act.
