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February 27, 2022

SEC Proposes New Rule for Private Fund Advisors

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The SEC’s proposed rule sets forth several new requirements for private fund advisors. The rule would require private fund advisors to provide more information regarding the funds they advise.¬†Under the rule, advisors would face additional quarterly reporting requirements and would would be required to obtain an independent fairness opinion for some transactions facilitated by the advisor. The new rule also prohibits six activities that were previously permitted.

In particular the SEC mentions transparency and disclosure of the “full cost of investing in private funds and the performance of such private funds.” This rule will correspond with amendments to the Advisers Act books and records rule, and the Advisers Act compliance rule.

Click here to learn more about RIN 3235-AN07

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