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ARTICLE · 11 JUNE 2024

Private Fund Rules Vacated

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On August 23, 2023, the Securities and Exchange Commission (the SEC) released final rules under the Investment Advisers Act of 1940 (the Advisers Act)...

United StatesFinance and Banking
Batya Nadler
Batya Nadler
Max Shakin
Max Shakin
Andrew Beck
Andrew Beck
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On August 23, 2023, the Securities and Exchange Commission (the SEC) released final rules under the Investment Advisers Act of 1940 (the Advisers Act), focused on private fund disclosures and sponsor practices (the Final Rules) as further detailed in this bulletin. According to the SEC, the Final Rules were designed to protect investors in private funds and prevent fraud, deception, or manipulation by investment advisers. Shortly following their adoption, the Final Rules were challenged by six associations representing private fund managers (the Private Fund Managers) in the United States Court of Appeals for the Fifth Circuit (the Fifth Circuit). On June 5, 2024, the Fifth Circuit vacated the Final Rules in their entirety based on the court's determination that the SEC did not have statutory authority under the Advisers Act to formulate the Final Rules.

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