SEC Proposes Reforms Relating to Investment Advisers Operating Exclusively Through the Internet
The SEC proposed amendments to modernize the rule for internet-based investment advisers, requiring an operational interactive website and eliminating the de minimis exception.
The SEC proposed amendments to the internet adviser registration rule, requiring an operational interactive website for ongoing digital advisory services to multiple clients and eliminating the de minimis exception. The changes aim to modernize the 2002 rule to better reflect current technology and improve oversight. The proposal is open for public comment for 60 days after publication in the Federal Register.
The Securities and Exchange Commission (SEC) proposed amendments to the rule permitting certain investment advisers to register with the Commission, aiming to modernize the internet advisers exemption. The proposed amendments would require an investment adviser to have an operational interactive website providing digital investment advisory services on an ongoing basis to more than one client. The de minimis exception from the current rule would be eliminated, mandating that an internet investment adviser provide advice to all clients exclusively through the website. The changes aim to close regulatory gaps created by technological advancements since 2002 and align registration requirements with current industry practices. The proposal was made as part of the SEC's effort to improve oversight of registered investment advisers. The public comment period will remain open until 60 days after the date of publication of the proposing release in the Federal Register. The amendments would also make certain corresponding changes to Form ADV.
Exhibits & Attached Documents (2)
Extracted insights
- person de minimis exception
- person federal register
- person internet advisers exemption
- person proposing release
- agency Securities and Exchange Commission
- Securities And Exchange Commission Proposed Amendments Rule Permitting Certain Investment Advisers To Register With The Commission
- Proposed Amendments Would Require Investment Adviser To Have Operational Interactive Website
- Proposed Amendments Would Eliminate De Minimis Exception
- Proposed Amendments Would Require Internet Investment Adviser To Provide Advice Exclusively Through Operational Interactive Website
- SEC Granted Narrow Exception Allowing Internet-Based Advisers To Register In 2002
- Today’s Proposal Would Modernize Internet Advisers Exemption
- Proposing Release Will Be Published Federal Register
- Public Comment Period Will Remain Open Until 60 Days After Publication Of Proposing Release
The Securities and Exchange Commission today proposed amendments to the rule permitting certain investment advisers that provide investment advisory services through the internet to register with the Commission. The proposed amendments generally would require an investment adviser relying on the internet adviser registration rule to have at all times an operational interactive website through which the adviser provides digital investment advisory services on an ongoing basis to more than one client. The proposed amendments would also eliminate the de minimis exception from the current rule by proposing to require that an internet investment adviser provide advice to all of its clients exclusively through an operational interactive website, and make certain corresponding changes to Form ADV. “In 2002, the SEC granted what was intended to be a narrow exception allowing internet-based advisers to register with the Commission instead of with the states,” said SEC Chair Gary Gensler. “A lot has changed in the 21 years since, and I believe an exemption written in 2002 allows gaps in 2023. Thus, today’s proposal would modernize the internet advisers exemption to better align registration requirements with modern technology and help the Commission in the efficient and effective oversight of registered investment advisers.” The proposing release will be published in the Federal Register. The public comment period will remain open until 60 days after the date of publication of the proposing release in the Federal Register.
The Securities and Exchange Commission today proposed amendments to the rule permitting certain investment advisers that provide investment advisory services through the internet to register with the Commission. The proposed amendments generally would require an investment adviser relying on the internet adviser registration rule to have at all times an operational interactive website through which the adviser provides digital investment advisory services on an ongoing basis to more than one client. The proposed amendments would also eliminate the de minimis exception from the current rule by proposing to require that an internet investment adviser provide advice to all of its clients exclusively through an operational interactive website, and make certain corresponding changes to Form ADV. “In 2002, the SEC granted what was intended to be a narrow exception allowing internet-based advisers to register with the Commission instead of with the states,” said SEC Chair Gary Gensler. “A lot has changed in the 21 years since, and I believe an exemption written in 2002 allows gaps in 2023. Thus, today’s proposal would modernize the internet advisers exemption to better align registration requirements with modern technology and help the Commission in the efficient and effective oversight of registered investment advisers.” The proposing release will be published in the Federal Register. The public comment period will remain open until 60 days after the date of publication of the proposing release in the Federal Register.