On March 13th, the SEC announced regulatory relief for funds and investment advisers whose operations may be affected by the coronavirus. This relief information covers in-person board meetings and certain filing and delivery requirements for particular investment funds and investment advisers. The effects of the coronavirus may delay or prevent funds and advisers who operate in affected areas from complying with some regulatory obligations due to restrictions on large gatherings, travel and access to facilities, the potential limited availability of personnel. The SEC’s relief is intended to allow funds and advisers to meet those obligations and to continue their operations, given that there may be temporary disruptions outside of their control.
The SEC has issued the orders having due regard for the needs and safety of registered investment companies, other funds, and investment advisers impacted by coronavirus while also considering the importance of markets and investors receiving materially accurate and timely information. For an entity seeking to rely upon an order, attention is directed to the various conditions, including, if applicable, the requirements to notify SEC staff of the intention to rely upon the order and to disclose information on its website about this reliance.
Subject to conditions, the orders generally provide the following temporary exemptive relief:
Relief Related to the Investment Company Act of 1940
- Registered management investment companies, business development companies, and any investment adviser or principal underwriter of such companies are relieved from Investment Company Act sections and rules requiring certain agreements, plans or arrangements be approved by the company’s board of directors by an in-person vote due to circumstances related to the current or potential effects of coronavirus.
- Registered management investment companies and unit investment trusts affected by coronavirus are relieved from Form N-CEN and Form N-PORT filing deadlines.
- Registered management investment companies and unit investment trusts affected by coronavirus are relieved from annual and semi-annual report transmittal deadlines.
- Registered closed-end investment companies and business development companies are relieved from the requirement to file Form N-23C-2 at least 30 days prior to calling or redeeming securities.
Relief Related to the Investment Advisers Act of 1940
- Registered investment advisers and exempt reporting advisers affected by coronavirus are relieved from filing an amendment to Form ADV or file reports on Form ADV part 1A, respectively.
- Registered investment advisers affected by coronavirus are relieved from requirements to deliver amended brochures, brochure supplements, or a summary of material changes to clients where the disclosures are not able to be timely delivered because of circumstances related to coronavirus.
- Private fund advisers affected by coronavirus are relieved from from Form PF filing requirements
Again, these exemptions are temporary and conditional. Please see the SEC’s official orders for more information.
Delivery of Fund Prospectuses
As described in the orders, if a registered fund does not deliver to investors the current prospectus of the registered fund because of circumstances related to coronavirus, this would not necessarily result in SEC action. This is subject to the conditions described in the orders.
Division of Investment Management Contact Information
For general questions or concerns related to impacts of coronavirus on the operations or compliance of funds and advisers, including questions about Form N-MFP and Form N-CR, filers can email IM-EmergencyRelief@sec.gov.
For questions regarding Form N-LIQUID, filers can email IM-N-LIQUID@sec.gov and simultaneously contact: Tim Husson, Associate Director, at (202) 551-6803 and Jon Hertzke, Assistant Director, at (202) 551-6247.
For questions regarding Form ADV, email IARDLive@sec.gov.
For questions regarding Form PF, email FormPF@sec.gov.
Sources:
SEC Takes Targeted Action to Assist Funds and Advisers, Permits Virtual Board Meetings and Provides Conditional Relief from Certain Filing Procedures (www.sec.gov)
Order Under Section 206A of the Investment Advisers Act of 1940 Granting Exemptions from Specified Provisions of the Investment Advisers Act and Certain Rules Thereunder (www.sec.gov)
Order Under Section 6(c) and Section 38(a) of the Investment Company Act of 1940 Granting Exemptions from Specified Provisions of the Investment Company Act and Certain Rules Thereunder; Commission Statement Regarding Prospectus Delivery (www.sec.gov)
