Fund Finance Partners Co-Founder and Managing Director, Richard Wheelahan III, teamed up with Haynes and Boone, LLP Partner, Holly Loftis to summarize the portions of the SEC’s “Final Rule” adopted on August 23rd they consider to be of interest to fund finance market participants. In their view, net-net it brings relatively little disruption for the fund finance market.
Introduction
On August 23, 2023, the Securities and Exchange Commission (the “SEC”) adopted new rules under the Investment Advisers Act of 1940 that apply, in certain cases, only to registered private fund advisers and in others, to all private fund advisers (such adopted rules, collectively, the “Final Rule”). The adoption of the Final Rule was a long time coming. More than 18 months earlier on February 9, 2022, under Chairperson Gary Gensler, the SEC published a historically sweeping proposal of rules to further regulate the private funds industry in a 342-page document including discussion, commentary, legal basis, questions for consideration, proposed rule text, economic analysis and alternative rules considered (the rules included in such earlier proposal, collectively, the “Proposed Rule”).