‘‘(B) For the purposes of subparagraph (A)(ii),
a fund is described in this subparagraph if such fund
is a pooled income fund, collective trust fund, collec-
tive investment fund, or similar fund maintained by
a charitable organization exclusively for the collective
investment and reinvestment of one or more of the fol-
lowing:
‘‘(i) assets of the general endowment fund or
other funds of one or more charitable organiza-
tions;
‘‘(ii) assets of a pooled income fund;
‘‘(iii) assets contributed to a charitable or-
ganization in exchange for the issuance of chari-
table gift annuities;
‘‘(iv) assets of a charitable remainder trust
or of any other trust, the remainder interests of
which are irrevocably dedicated to any charitable
organization;
‘‘(v) assets of a charitable lead trust;
‘‘(vi) assets of a trust not described in
clauses (i) through (v), the remainder interests of
which are revocably dedicated to a charitable or-
ganization, subject to subparagraph (C); or
‘‘(vii) 
such 
assets 
(including 
assets
revocably dedicated to a charitable organization)
as the Commission may prescribe by rule, regu-
lation, or order in accordance with section 6(c).
‘‘(C) A fund that contains assets described in
clause (vi) of subparagraph (B) shall be excluded
from the definition of an investment company for a
period of 3 years after the date of enactment of this
subparagraph, but only if—
‘‘(i) such assets were contributed before the
date which is 60 days after the date of enactment
of this subparagraph; and
‘‘(ii) such assets are commingled in the fund
with assets described in one or more of clauses
(i) through (v) of subparagraph (B).
‘‘(D) For purposes of this paragraph—
‘‘(i) a trust or fund is ‘maintained’ by a
charitable organization if the organization serves
as a trustee or administrator of the trust or fund
or has the power to remove the trustees or ad-
ministrators of the trust or fund and to des-
ignate new trustees or administrators;
‘‘(ii) the term ‘pooled income fund’ has the
same meaning as in section 642(c)(5) of the In-
ternal Revenue Code of 1986;
‘‘(iii) the term ‘charitable organization’
means an organization described in paragraphs
(1) through (5) of section 170(c) or section
501(c)(3) of the Internal Revenue Code of 1986;
‘‘(iv) the term ‘charitable lead trust’ means
a 
trust 
described 
in 
section 
170(f)(2)(B),
2055(e)(2)(B), or 2522(c)(2)(B) of the Internal
Revenue Code of 1986;
‘‘(v) the term ‘charitable remainder trust’
means a charitable remainder annuity trust or
a charitable remainder unitrust, as those terms
are defined in section 664(d) of the Internal Rev-
enue Code of 1986; and
‘‘(vi) the term ‘charitable gift annuity’
means an annuity issued by a charitable organi-
zation that is described in section 501(m)(5) of
the Internal Revenue Code of 1986.’’.
(b) DISCLOSURE BY EXEMPT CHARITABLE ORGANIZA-
TIONS.—Section 7 of the Investment Company Act of 1940
(15 U.S.C. 80a–7) is amended by adding at the end the
following new subsection:
‘‘(e) DISCLOSURE BY EXEMPT CHARITABLE ORGANI-
ZATIONS.—Each fund that is excluded from the definition
of an investment company under section 3(c)(10)(B) of this
Act shall provide, to each donor to such fund, at the time
of the donation or within 90 days after the date of enact-
ment of this subsection, whichever is later, written informa-
tion describing the material terms of the operation of such
fund.’’.
SEC. 3. AMENDMENT TO THE SECURITIES ACT OF 1933.
Section 3(a)(4) of the Securities Act of 1933 (15 U.S.C.
77c(a)(4)) is amended by inserting after the semicolon at
the end the following: ‘‘or any security of a fund that is
excluded from the definition of an investment company
under section 3(c)(10)(B) of the Investment Company Act
of 1940;’’.
SEC. 4. AMENDMENTS TO THE SECURITIES EXCHANGE ACT
OF 1934.
(a) EXEMPTED SECURITIES.—Section 3(a)(12)(A) of
the Securities Exchange Act of 1934 (15 U.S.C.
78c(a)(12)(A)) is amended—
(1) in clause (iv) by striking ‘‘and’’ at the end;
(2) by redesignating clause (v) as clause (vi);
and
(3) by inserting after clause (iv) the following
new clause:
‘‘(v) any security issued by or any interest
or participation in any pooled income fund, col-
lective trust fund, collective investment fund, or
similar fund that is excluded from the definition
of 
an 
investment 
company 
under 
section
3(c)(10)(B) of the Investment Company Act of
1940; and’’.
(b) EXEMPTION
FROM
BROKER-DEALER
PROVI-
SIONS.—Section 3 of such Act (15 U.S.C. 78c) is amended
by adding at the end the following new subsection:
‘‘(e) CHARITABLE ORGANIZATIONS.—
‘‘(1) EXEMPTION.—Notwithstanding any other
provision of this title, but subject to paragraph (2) of
this subsection, a charitable organization, as defined
in section 3(c)(10)(D) of the Investment Company Act
of 1940, or any trustee, director, officer, employee, or
volunteer of such a charitable organization acting
within the scope of such person’s employment or du-
ties with such organization, shall not be deemed to be
a ‘broker’, ‘dealer’, ‘municipal securities broker’, ‘mu-
nicipal securities dealer’, ‘government securities
broker’, or ‘government securities dealer’ for purposes
of this title solely because such organization or person
buys, holds, sells, or trades in securities for its own
account in its capacity as trustee or administrator of,
or otherwise on behalf of or for the account of—
‘‘(A) such a charitable organization;
‘‘(B) a fund that is excluded from the defi-
nition of an investment company under section
3(c)(10)(B) of the Investment Company Act of
1940; or
‘‘(C) a trust or other donative instrument
described in section 3(c)(10)(B) of the Invest-
ment Company Act of 1940, or the settlors (or
potential settlors) or beneficiaries of any such
trust or other instrument.
‘‘(2) LIMITATION
ON
COMPENSATION.—The ex-
emption provided under paragraph (1) shall not be
available to any charitable organization, or any
trustee, director, officer, employee, or volunteer of such
a charitable organization, unless each person who, on
or after 90 days after the date of enactment of this
subsection, solicits donations on behalf of such chari-
table organization from any donor to a fund that is
excluded from the definition of an investment com-
pany under section 3(c)(10)(B) of the Investment
Company Act of 1940, is either a volunteer or is en-
gaged in the overall fund raising activities of a chari-
table organization and receives no commission or
other special compensation based on the number or
the value of donations collected for the fund.’’.
(d) CONFORMING AMENDMENT.—Section 12(g)(2)(D)
of such Act (15 U.S.C. 78l(g)(2)(D)) is amended by insert-
ing before the period ‘‘; or any security of a fund that is
excluded from the definition of an investment company
under section 3(c)(10)(B) of the Investment Company Act
of 1940’’.
SEC. 5. AMENDMENT OF THE INVESTMENT ADVISERS ACT
OF 1940.
Section 203(b) of Investment Advisers Act of 1940 (15
U.S.C. 80b–3(b)) is amended—
(1) by striking ‘‘or’’ at the end of paragraph (2);
(2) by striking the period at the end of para-
graph (3) and inserting ‘‘; or’’; and
(3) by adding at the end the following new para-
graph:
‘‘(4) any investment adviser that is a charitable
organization, as defined in section 3(c)(10)(D) of the
Investment Company Act of 1940, or is a trustee, di-
rector, officer, employee, or volunteer of such a chari-
table organization acting within the scope of such
person’s employment or duties with such organiza-
tion, whose advice, analyses, or reports are provided
only to one or more of the following:
‘‘(A) any such charitable organization;
‘‘(B) a fund that is excluded from the defi-
nition of an investment company under section
3(c)(10)(B) of the Investment Company Act of
1940; or
‘‘(C) a trust or other donative instrument
described in section 3(c)(10)(B) of the Invest-
ment Company Act of 1940, or the trustees, ad-
ministrators, settlors (or potential settlors), or
beneficiaries of any such trust or other instru-
ment.’’.
SEC. 6. PROTECTION OF PHILANTHROPY UNDER STATE
LAW.
(a) REGISTRATION REQUIREMENTS.—A security is-
sued by or any interest or participation in any pooled in-
come fund, collective trust fund, collective investment fund,
or similar fund that is excluded from the definition of an
investment company under section 3(c)(10)(B) of the In-
vestment Company Act of 1940, and the offer or sale thereof,
shall be exempt from any statute or regulation of a State
that requires registration or qualification of securities.
(b) TREATMENT OF CHARITABLE ORGANIZATIONS.—
No charitable organization, or any trustee, director, officer,
employee, or volunteer of a charitable organization acting
within the scope of such person’s employment or duties,
shall be required to register as, or be subject to regulation
as, a dealer, broker, agent, or investment adviser under the
securities laws of any State because such organization or
person buys, holds, sells, or trades in securities for its own
account in its capacity as trustee or administrator of, or
otherwise on behalf of or for the account of one or more
of the following:
(1) a charitable organization;
(2) a fund that is excluded from the definition
of an investment company under section 3(c)(10)(B)
of the Investment Company Act of 1940; or
(3) a trust or other donative instrument de-
scribed in section 3(c)(10)(B) of the Investment Com-
pany Act of 1940, or the settlors (or potential settlors)
or beneficiaries of any such trusts or other instru-
ments.
(c) STATE ACTION.—Notwithstanding subsections (a)
and (b), during the 3-year period beginning on the date
of enactment of this Act, a State may enact a statute that
specifically refers to this section and provides prospectively
that this section shall not preempt the laws of that State
referred to in this section.
(d) DEFINITIONS.—For purposes of this section—
(1) the term ‘‘charitable organization’’ means an
organization described in paragraphs (1) through (5)
of section 170(c) or section 501(c)(3) of the Internal
Revenue Code of 1986;
(2) the term ‘‘security’’ has the same meaning as
in section 3 of the Securities Exchange Act of 1934;
and
(3) the term ‘‘State’’ means each of the several
States of the United States, the District of Columbia,
the Commonwealth of Puerto Rico, the Virgin Islands,
Guam, American Samoa, and the Commonwealth of
the Northern Mariana Islands.
SEC. 7. EFFECTIVE DATES AND APPLICABILITY.
This Act and the amendments made by this Act shall
apply in all administrative and judicial actions pending
on or commenced after the date of enactment of this Act,
as a defense to any claim that any person, security, interest,
or participation of the type described in this Act and the
amendments made by this Act is subject to the provisions
of the Securities Act of 1933, the Securities Exchange Act
of 1934, the Investment Company Act of 1940, or the Invest-
ment Advisers Act of 1940, or any State statute or regula-
tion preempted as provided in section 6 of this Act, except
as otherwise specifically provided in such Acts or State law.