The Commodity Futures Trading Commission (the “CFTC”) and the Securities and Exchange Commission (the “SEC”) have announced the adoption of new rules under the Commodity Exchange Act and the Investment Advisers Act of 1940 (the “Advisers Act”) requiring SEC-registered investment advisers to private funds (including private equity funds, hedge funds and liquidity funds) to periodically file Form PF with the SEC. The stated purpose of the new rules is to implement provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) designed to assist the Financial Stability Oversight Counsel (the “FSOC”) in monitoring potential systemic risks to the United States financial system. As discussed below, the timing and types of information that an adviser is required to disclose on Form PF depends on whether such adviser manages private equity funds, hedge funds or liquidity funds and the size of those funds. [click to continue…]
RESCHEDULED for Tuesday, October 25, 2011
12:45 – 2:00 PM ET
Since its passage in July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act — and more specifically, Section 619 and its implementing rules — has worried financial industry executives and their legal advisers because of the potential impact on proprietary trading operations, merchant banking arms, and fund management teams embedded inside of large banks.
An interdisciplinary panel covering private equity fund formation, M&A, and financial institutions regulatory will address [click to continue…]
Recently, the Securities and Exchange Commission (“SEC”) issued a proposed rule (the “Proposed Rule”) implementing changes to the permitted thresholds used to define “qualified client” and above which investment advisers can charge performance fees pursuant to Rule 205–3, promulgated under the Investment Advisers Act of 1940 (the “Advisers Act”). Under the Proposed Rule, a “qualified client” must have either a net worth of at least $2 million or a minimum of $1 million under management with the investment adviser. Going forward, the SEC will adjust these thresholds every five years, with the first revision to occur in 2016.
Performance fee arrangements entered into under the previous rules will not be affected by this proposed change. Furthermore, new investments made under existing performance fee arrangements will also not be affected. The Proposed Rule only applies to clients entering into new investment advisory contracts.
The Dodd-Frank Wall Street Reform and Consumer Protection Act provides that a swap or security-based swap (collectively, “Swaps”) otherwise subject to mandatory clearing is not required to be cleared if one party to such Swap (1) is not a financial entity, (2) is using such Swap to hedge and or mitigate commercial risks, and (3) notifies the Commodity Futures Trading Commission (the “CFTC”) or Securities and Exchange Commission (the “SEC” and, together with the CFTC, the “Commissions”), as applicable, how it generally meets its financial obligations associated with entering into non-cleared Swaps (such exception, the “End-User Clearing Exception”).
The Commissions have each proposed new rules to specify requirements [click to continue…]