FAST Act

Securities and Exchange Commission Adopts Final Rule That Provides New Exemptions From Investment Adviser Registration for Advisers to Small Business Investment Companies

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On January 5, 2018, the SEC adopted amendments to Rule 203(l)-1 under the Investment Advisers Act of 1940 (the “Advisers Act“) that defines a “venture capital fund” and Rule 203(m)-1 under the Advisers Act that implements the private fund adviser exemption under the Advisers Act. These amendments were adopted to reflect changes made by title LXXIV, sections 74001 and 74002 of the Fixing America’s Surface Transportation Act of 2015 (the “FAST Act“). That legislation amended sections 203(l) and 203(m) of the Advisers Act. The amendments are effective on March 12, 2018.

In particular, Title LXXIV, section 74001 of the FAST Act amended the exemption from investment adviser registration for any adviser solely to one or more “venture capital funds” in Advisers Act section 203(l) by deeming “small business investment companies” to be “venture capital funds” for purposes of the exemption. Accordingly, the SEC amended the definition of a “venture capital fund” in Rule 203(l)-1 to include “small business investment companies.”

Title LXXIV, section 74002 of the FAST Act amended the exemption from investment adviser registration for any adviser solely to “private funds” with less than $150 million in assets under management in Advisers Act section 203(m) by excluding the assets of “small business investment companies” when calculating “private fund assets” towards the registration threshold of $150 million. Accordingly, the SEC amended the definition of “assets under management” in Rule 203(m) to exclude the assets of “small business investment companies.”

SEC Adopts Amendment to Form 10-K

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On June 1, 2016, the Securities and Exchange Commission (SEC) approved an interim final rule implementing Section 72001 of the Fixing America’s Surface Transportation (FAST) Act. The rule allows Form 10-K registrants to provide a summary of business and financial information contained in the annual report, provided that each item in the summary includes a cross-reference by hyperlink to the material contained in the Form 10-K to which such item relates.  The rule will become effective once published in the Federal Register.  Rule.  Press Release.

SEC Approves Interim Final Rules Implementing Two Provisions of the FAST Act

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On January 13, the Securities and Exchange Commission announced that it approved interim final rules implementing two provisions of the Fixing America’s Surface Transportation (FAST) Act, adopted by Congress in December, that revise financial reporting forms for emerging growth companies and smaller reporting companies.

The Congressionally mandated rules revise Forms S-1 and F-1 to provide that as long as emerging growth companies’ registration statements include all required financial information at the time of the offering, they will be allowed to omit certain historical period financial information prior to the offering.  In addition, the rules revise Form S-1 to allow smaller reporting companies to use incorporation by reference for future filings the companies make under the federal securities laws after the registration statement becomes effective.

The interim final rules also include a request for comment on whether the rules should be expanded to include other registrants or forms.

The rules will become effective when published in the Federal Register and the public comment period will remain open for 30 days following their publication.