II 

111TH CONGRESS 

1ST SESSION S. 1276 

To require investment advisers to private funds, including hedge funds, private 

equity funds, venture capital funds, and others to register with the 

Securities and Exchange Commission, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 16, 2009 

Mr. REED introduced the following bill; which was read twice and referred to 

the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To require investment advisers to private funds, including 

hedge funds, private equity funds, venture capital funds, 

and others to register with the Securities and Exchange 

Commission, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Private Fund Trans5 parency Act of 2009’’. 


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1 SEC. 2. DEFINITION OF FOREIGN PRIVATE ADVISERS. 

2 Section 202(a) of the Investment Advisers Act of 

3 1940 (15 U.S.C. 80b–2(a)) is amended by adding at the 

4 end the following: 

5 ‘‘(29) The term ‘foreign private adviser’ means 

6 any investment adviser who— 

7 ‘‘(A) has no place of business in the 

8 United States; 

9 ‘‘(B) during the preceding 12 months has 

10 had— 

11 ‘‘(i) fewer than 15 clients in the 

12 United States; and 

13 ‘‘(ii) assets under management attrib14 utable to clients in the United States of 

15 less than $25,000,000, or such higher 

16 amount as the Commission may, by rule, 

17 deem appropriate in accordance with the 

18 purposes of this title; and 

19 ‘‘(C) neither holds itself out generally to 

20 the public in the United States as an invest21 ment adviser, nor acts as an investment adviser 

22 to any investment company registered under the 

23 Investment Company Act of 1940, or a com24 pany which has elected to be a business devel25 opment company pursuant to section 54 of the 


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1 Investment Company Act of 1940, and has not 

2 withdrawn its election.’’. 

3 SEC. 3. ELIMINATION OF PRIVATE ADVISER EXEMPTION; 

4 LIMITED EXEMPTION FOR FOREIGN PRIVATE 

5 ADVISERS. 

6 Section 203(b)(3) of the Investment Advisers Act of 

7 1940 (15 U.S.C. 80b–3(b)(3)) is amended to read as fol8 lows: 

9 ‘‘(3) any investment adviser that is a foreign 

10 private adviser;’’. 

11 SEC. 4. COLLECTION OF SYSTEMIC RISK DATA; ANNUAL 

12 AND OTHER REPORTS. 

13 Section 204 of the Investment Advisers Act of 1940 

14 (15 U.S.C. 80b–4) is amended— 

15 (1) in subsection (a), by adding at the end the 

16 following: ‘‘The Commission is authorized to require 

17 any investment adviser registered under this title to 

18 maintain such records and submit such reports as 

19 are necessary or appropriate in the public interest 

20 for the supervision of systemic risk by any Federal 

21 department or agency, and to provide or make avail22 able to such department or agency those reports or 

23 records or the information contained therein. The 

24 records of any company that, but for section 3(c)(1) 

25 or 3(c)(7) of the Investment Company Act of 1940, 


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1 would be an investment company, to which any such 

2 investment adviser provides investment advice, shall 

3 be deemed to be the records of the investment ad4 viser if such company is sponsored by the investment 

5 adviser or any affiliated person of the investment ad6 viser or the investment adviser or any affiliated per7 son of the investment adviser acts as underwriter, 

8 distributor, placement agent, finder, or in a similar 

9 capacity for such company.’’; and 

10 (2) adding at the end the following: 

11 ‘‘(d) CONFIDENTIALITY OF REPORTS.—Notwith12 standing any other provision of law, the Commission shall 

13 not be compelled to disclose any supervisory report or in14 formation contained therein required to be filed with the 

15 Commission under subsection (a). Nothing in this sub16 section shall authorize the Commission to withhold infor17 mation from Congress or prevent the Commission from 

18 complying with a request for information from any other 

19 Federal department or agency or any self-regulatory orga20 nization requesting the report or information for purposes 

21 within the scope of its jurisdiction, or complying with an 

22 order of a court of the United States in an action brought 

23 by the United States or the Commission. For purposes of 

24 section 552 of title 5, United States Code, this subsection 


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1 shall be considered a statute described in subsection 

2 (b)(3)(B) of such section 552.’’. 

3 SEC. 5. ELIMINATION OF PROVISION. 

4 Section 210 of the Investment Advisers Act of 1940 

5 (15 U.S.C. 80b–10) is amended by striking subsection (c). 

6 SEC. 6. CLARIFICATION OF RULEMAKING AUTHORITY. 

7 Section 211(a) of the Investment Advisers Act of 

8 1940 (15 U.S.C. 80b–11) is amended— 

9 (1) by striking the second sentence; and 

10 (2) by striking the period at the end of the first 

11 sentence and inserting the following: ‘‘, including 

12 rules and regulations defining technical, trade, and 

13 other terms used in this title. For the purposes of 

14 its rules and regulations, the Commission may— 

15 ‘‘(1) classify persons and matters within its ju16 risdiction and prescribe different requirements for 

17 different classes of persons or matters; and 

18 ‘‘(2) ascribe different meanings to terms (in19 cluding the term ‘client’) used in different sections 

20 of this title as the Commission determines necessary 

21 to effect the purposes of this title.’’. 

Æ 


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