SEC Proposes Registration Exemptions, but Also Reporting Requirements, for Certain Private Fund Advisers

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) effected fundamental changes in the Investment Advisers Act of 1940 (Advisers Act) that will result in many previously unregistered advisers, such as advisers to certain private funds, having to register with the U.S. Securities and Exchange Commission (SEC) or one or more state regulators, absent an exemption. At an open meeting on November 19, 2010, the SEC voted to propose rules that would implement registration exemptions and reporting requirements for certain advisers, as required by the Dodd-Frank Act. In two companion releases, the SEC set forth proposals to adopt registration exemptions for venture capital fund advisers, private fund advisers, and foreign private advisers (Exemptions Release), and also proposed a new rule requiring such exempt private fund advisers to file public reports on an expanded version of Form ADV (Reporting Release).