Hedge Funds SEC Registration
Hedge Funds $150m+ Will Now Have to Register with SEC
Hedge funds with more than $150 million in assets under management will be under the oversight of the Securities and Exchange Commission. The top U.S. financial regulator voted to pass the long-anticipated legislation that brings private equity funds and hedge funds managing more than $150 million under its purview. Hedge funds and private equity funds of that size will have to register with the SEC, an estimated 750 funds will now face new regulations. For a related article, see
Asking If Hedge Funds Are Prepared for SEC Registration
Securities and Exchange Commission members adopted a proposal they introduced in November that requires hedge-fund and private-equity managers with more than $150 million in assets, or with 15 or more clients in the United States, to register with the agency. Roughly 750 big funds will now be subject to the new regulations.
The SEC also will conduct surprise examinations of these managers, who will be required to file reports about their funds and on any conflicts of interest starting in 2012.
The commission’s two Republican officials opposed a provision that requires some venture-capital managers to report information about their funds. They said that even though the rule exempts fund managers from registering with the agency, the costs of new reporting requirements will hamper capital formation and innovation.
“Congress gave us the authority to require certain reporting and record-keeping. But the release provides no substantial justification on public-interest or investor-protection grounds for the decision to impose these reporting requirements,” commented Commissioner Kathleen Casey. “Every dollar that is spent by a venture capital fund to satisfy the commission’s newly imposed regulatory requirement is a dollar that cannot be invested in the next Google, Apple or Amazon.” Source
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