Exempt Reporting Adviser Q&A

The staff of the Securities and Exchange Commission's (SEC) Division of Investment Management (Staff) recently supplemented its "Frequently Asked Questions on Form ADV and IARD" (FAQ) webpage to provide additional guidance for exempt reporting advisers (ERAs) under section 203(l) and 203(m) of the Investment Advisers Act . The new FAQ addresses reporting by an ERA on Form ADV on behalf of special purpose entities (SPEs) that oversee an ERA's investment advisory services.

The FAQ explains that an SPE may satisfy its reporting obligation under section 203(l) or 203(m) by including all information concerning the SPE on an ERA's Form ADV report, provided that the SPE:
(i) does not exercise discretionary authority over a fund's assets other than the hiring or firing of the adviser to the fund and does not engage in any other activities that would cause the SPE to be an investment adviser as defined in section 202(a)(11); and (ii) acts as the SPE only for private funds or