IB 

Union Calendar No. 59 

115TH CONGRESS 

1ST SESSION H. R. 910 

[Report No. 115–102] 

To direct the Securities and Exchange Commission to provide a safe harbor 

related to certain investment fund research reports, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 7, 2017 

Mr. HILL (for himself and Mr. FOSTER) introduced the following bill; which 

was referred to the Committee on Financial Services 

MAY 1, 2017 

Additional sponsors: Mr. HOLLINGSWORTH, Ms. BLUNT ROCHESTER, Mr. 

GOTTHEIMER, Mr. SHERMAN, and Mr. MESSER

MAY 1, 2017 

Reported with an amendment, committed to the Committee of the Whole 

House on the State of the Union, and ordered to be printed 

[Strike out all after the enacting clause and insert the part printed in italic] 

[For text of introduced bill, see copy of bill as introduced on February 7, 2017] 


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A BILL 

To direct the Securities and Exchange Commission to provide 

a safe harbor related to certain investment fund research 

reports, and for other purposes. 


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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 ‘‘Fair Access to Invest5 ment Research Act of 2017’’. 

6 SEC. 2. SAFE HARBOR FOR INVESTMENT FUND RESEARCH. 

7 (a) EXPANSION OF THE SAFE HARBOR.—Not later 

8 than the end of the 180-day period beginning on the date 

9 of enactment of this Act, the Securities and Exchange Com10 mission shall propose, and not later than the end of the 

11 270-day period beginning on such date, the Commission 

12 shall adopt, upon such terms, conditions, or requirements 

13 as the Commission may determine necessary or appropriate 

14 in the public interest, for the protection of investors, and 

15 for the promotion of capital formation, revisions to section 

16 230.139 of title 17, Code of Federal Regulations, to provide 

17 that a covered investment fund research report that is pub18 lished or distributed by a broker or dealer— 

19 (1) shall be deemed, for purposes of sections 

20 2(a)(10) and 5(c) of the Securities Act of 1933 (15 

21 U.S.C. 77b(a)(10), 77e(c)), not to constitute an offer 

22 for sale or an offer to sell a security that is the subject 

23 of an offering pursuant to a registration statement 

24 that is effective, even if the broker or dealer is particiVerDate Sep 11 2014 21:41 May 01, 2017 Jkt 069200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6203 E:\BILLS\H910.RH H910

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1 pating or will participate in the registered offering of 

2 the covered investment fund’s securities; and 

3 (2) shall be deemed to satisfy the conditions of 

4 subsection (a)(1) or (a)(2) of section 230.139 of title 

5 17, Code of Federal Regulations, or any successor pro6 visions, for purposes of the Commission’s rules and 

7 regulations under the Federal securities laws and the 

8 rules of any self-regulatory organization. 

9 (b) IMPLEMENTATION OF SAFE HARBOR.—In imple10 menting the safe harbor pursuant to subsection (a), the 

11 Commission shall— 

12 (1) not, in the case of a covered investment fund 

13 with a class of securities in substantially continuous 

14 distribution, condition the safe harbor on whether the 

15 broker’s or dealer’s publication or distribution of a 

16 covered investment fund research report constitutes 

17 such broker’s or dealer’s initiation or reinitiation of 

18 research coverage on such covered investment fund or 

19 its securities; 

20 (2) not— 

21 (A) require the covered investment fund to 

22 have been registered as an investment company 

23 under the Investment Company Act of 1940 (15 

24 U.S.C. 80a–1 et seq.) or subject to the reporting 

25 requirements of section 13 or 15(d) of the SecuriVerDate Sep 11 2014 21:41 May 01, 2017 Jkt 069200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6203 E:\BILLS\H910.RH H910

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1 ties Exchange Act of 1934 (15 U.S.C. 78m, 

2 78o(d)) for any period exceeding the period of 

3 time referenced under paragraph (a)(1)(i)(A)(1) 

4 of section 230.139 of title 17, Code of Federal 

5 Regulations; or 

6 (B) impose a minimum float provision ex7 ceeding that referenced in paragraph 

8 (a)(1)(i)(A)(1)(i) of section 230.139 of title 17, 

9 Code of Federal Regulations; 

10 (3) provide that a self-regulatory organization 

11 may not maintain or enforce any rule that would— 

12 (A) prohibit the ability of a member to pub13 lish or distribute a covered investment fund re14 search report solely because the member is also 

15 participating in a registered offering or other 

16 distribution of any securities of such covered in17 vestment fund; or 

18 (B) prohibit the ability of a member to par19 ticipate in a registered offering or other distribu20 tion of securities of a covered investment fund 

21 solely because the member has published or dis22 tributed a covered investment fund research re23 port about such covered investment fund or its 

24 securities; and 


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1 (4) provide that a covered investment fund re2 search report shall not be subject to section 24(b) of 

3 the Investment Company Act of 1940 (15 U.S.C. 80a– 

4 24(b)) or the rules and regulations thereunder, except 

5 that such report may still be subject to such section 

6 and the rules and regulations thereunder to the extent 

7 that it is otherwise not subject to the content stand8 ards in the rules of any self-regulatory organization 

9 related to research reports, including those contained 

10 in the rules governing communications with the pub11 lic regarding investment companies or substantially 

12 similar standards. 

13 (c) RULES OF CONSTRUCTION.—Nothing in this Act 

14 shall be construed as in any way limiting— 

15 (1) the applicability of the antifraud or 

16 antimanipulation provisions of the Federal securities 

17 laws and rules adopted thereunder to a covered invest18 ment fund research report, including section 17 of the 

19 Securities Act of 1933 (15 U.S.C. 77q), section 34(b) 

20 of the Investment Company Act of 1940 (15 U.S.C. 

21 80a–33), and sections 9 and 10 of the Securities Ex22 change Act of 1934 (15 U.S.C. 78i, 78j); or 

23 (2) the authority of any self-regulatory organiza24 tion to examine or supervise a member’s practices in 

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1 tribution of a covered investment fund research report 

2 for compliance with applicable provisions of the Fed3 eral securities laws or self-regulatory organization 

4 rules related to research reports, including those con5 tained in rules governing communications with the 

6 public, or to require the filing of communications 

7 with the public the purpose of which is not to provide 

8 research and analysis of covered investment funds. 

9 (d) INTERIM EFFECTIVENESS OF SAFE HARBOR.— 

10 (1) IN GENERAL.—From and after the 270-day 

11 period beginning on the date of enactment of this Act, 

12 if the Commission has not adopted revisions to section 

13 230.139 of title 17, Code of Federal Regulations, as 

14 required by subsection (a), and until such time as the 

15 Commission has done so, a broker or dealer distrib16 uting or publishing a covered investment fund re17 search report after such date shall be able to rely on 

18 the provisions of section 230.139 of title 17, Code of 

19 Federal Regulations, and the broker or dealer’s publi20 cation of such report shall be deemed to satisfy the 

21 conditions of subsection (a)(1) or (a)(2) of section 

22 230.139 of title 17, Code of Federal Regulations, if the 

23 covered investment fund that is the subject of such re24 port satisfies the reporting history requirements 

25 (without regard to Form S–3 or Form F–3 eligiVerDate Sep 11 2014 21:41 May 01, 2017 Jkt 069200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6203 E:\BILLS\H910.RH H910

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1 bility) and minimum float provisions of such sub2 sections for purposes of the Commission’s rules and 

3 regulations under the Federal securities laws and the 

4 rules of any self-regulatory organization, as if revised 

5 and implemented in accordance with subsections (a) 

6 and (b). 

7 (2) STATUS OF COVERED INVESTMENT FUND.— 

8 After such period and until the Commission has 

9 adopted revisions to section 230.139 and FINRA has 

10 revised rule 2210, for purposes of subsection (c)(7)(O) 

11 of such rule, a covered investment fund shall be 

12 deemed to be a security that is listed on a national 

13 securities exchange and that is not subject to section 

14 24(b) of the Investment Company Act of 1940 (15 

15 U.S.C. 80a–24(b)). 

16 (3) COVERED INVESTMENT FUNDS COMMUNICA17 TIONS.— 

18 (A) IN GENERAL.—Except as provided in 

19 subparagraph (B), communications that concern 

20 only covered investment funds that fall within 

21 the scope of section 24(b) of the Investment Com22 pany Act of 1940 (15 U.S.C. 80a–24(b)) shall 

23 not be required to be filed with FINRA. 

24 (B) EXCEPTION.—FINRA may require the 

25 filing of communications with the public if the 


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1 purpose of those communications is not to pro2 vide research and analysis of covered investment 

3 funds. 

4 (e) DEFINITIONS.—For purposes of this Act: 

5 (1) The term ‘‘covered investment fund research 

6 report’’ means a research report published or distrib7 uted by a broker or dealer about a covered investment 

8 fund or any securities issued by the covered invest9 ment fund, but not including a research report to the 

10 extent that it is published or distributed by the cov11 ered investment fund or any affiliate of the covered 

12 investment fund. 

13 (2) The term ‘‘covered investment fund’’ means— 

14 (A) an investment company registered 

15 under, or that has filed an election to be treated 

16 as a business development company under, the 

17 Investment Company Act of 1940 and that has 

18 filed a registration statement under the Securi19 ties Act of 1933 for the public offering of a class 

20 of its securities, which registration statement has 

21 been declared effective by the Commission; and 

22 (B) a trust or other person— 

23 (i) issuing securities in an offering 

24 registered under the Securities Act of 1933 


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1 and which class of securities is listed for 

2 trading on a national securities exchange; 

3 (ii) the assets of which consist pri4 marily of commodities, currencies, or deriv5 ative instruments that reference commod6 ities or currencies, or interests in the fore7 going; and 

8 (iii) that provides in its registration 

9 statement under the Securities Act of 1933 

10 that a class of its securities are purchased 

11 or redeemed, subject to conditions or limita12 tions, for a ratable share of its assets. 

13 (3) The term ‘‘FINRA’’ means the Financial In14 dustry Regulatory Authority. 

15 (4) The term ‘‘research report’’ has the meaning 

16 given that term under section 2(a)(3) of the Securities 

17 Act of 1933 (15 U.S.C. 77b(a)(3)), except that such 

18 term shall not include an oral communication. 

19 (5) The term ‘‘self-regulatory organization’’ has 

20 the meaning given to that term under section 3(a)(26) 

21 of the Securities Exchange Act of 1934 (15 U.S.C. 

22 78c(a)(26)). 


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Union Calendar No. 59 

115TH CONGRESS 

1ST SESSION H. R. 910 

[Report No. 115–102] 

A BILL 

To direct the Securities and Exchange Commission 

poses. ment fund research reports, and for other purto provide a safe harbor related to certain investMAY 1, 2017 

Reported with an amendment, committed to the Comand ordered to be printed mittee of the Whole House on the State of the Union, 


sradovich on DSK3GMQ082PROD with BILLS