In February 2022, the Securities and Exchange Commission proposed sweeping new regulatory requirements under the Investment Advisers Act of 1940, as amended for investment advisers that provide advisory services to “private funds.” At a meeting this past Wednesday, the Commission adopted those rules, with certain key changes, by a three to two vote. Those new regulatory requirements, as adopted, narrow the regulatory differences between SEC-registered investment companies and private funds and significantly increase the Advisers Act regulatory burdens associated with managing a “private fund.” The applicability of the new rules is not linked to the size of an investment adviser’s assets under management. 

You can read our Clients & Friends Memo here.