I 
116TH CONGRESS 
2D SESSION 
H. R. 8786 
To amend the Investment Company Act of 1940 to prohibit limitations 
on closed-end companies investing in private funds, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 19, 2020 
Mr. GONZALEZ of Ohio introduced the following bill; which was referred to 
the Committee on Financial Services 
A BILL 
To amend the Investment Company Act of 1940 to prohibit 
limitations on closed-end companies investing in private 
funds, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Increasing Investor 
Opportunities Act’’. 
SEC. 2. CLOSED-END COMPANY AUTHORITY TO INVEST IN 
PRIVATE FUNDS. 
(a) IN GENERAL.—Section 5 of the Investment Com-
pany Act of 1940 (15 U.S.C. 80a–5) is amended by add-
ing at the end the following: 
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‘‘(d) CLOSED-END COMPANY AUTHORITY TO INVEST 
IN PRIVATE FUNDS.— 
‘‘(1) IN GENERAL.—The Commission may not 
limit a closed-end company from investing any or all 
of the company’s assets in private funds solely or 
primarily because of the private funds’ status as pri-
vate funds. 
‘‘(2) APPLICATION.—Notwithstanding section 
6(f), this subsection shall also apply to a closed-end 
company that elects to be treated as a business de-
velopment company.’’. 
(b) DEFINITION OF PRIVATE FUND.— 
(1) INVESTMENT COMPANY ACT OF 1940.—Sec-
tion 2(a) of the Investment Company Act of 1940 
(15 U.S.C. 80a–2(a)) is amended by adding at the 
end the following: 
‘‘(55) The term ‘private fund’ means an issuer 
that would be an investment company but for para-
graph (1) or (7) of section 3(c).’’. 
(2) INVESTMENT ADVISERS ACT OF 1940.—The 
first paragraph (29) (relating to ‘‘private fund’’) of 
section 202(a) of the Investment Advisers Act of 
1940 (15 U.S.C. 80b–2(a)) is amended to read as 
follows: 
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‘‘(29) The term ‘private fund’ has the meaning 
given that term under section 2(a) of the Investment 
Company Act of 1940.’’. 
(c) TREATMENT
BY NATIONAL SECURITIES EX-
CHANGES.—Section 6(b) of the Securities Exchange Act 
of 1934 (15 U.S.C. 78f(b)) is amended by adding at the 
end the following: 
‘‘(11)(A) The rules of the exchange do not pro-
hibit the listing or trading of securities of a closed- 
end company solely or primarily by reason of the 
amount of the company’s investment of assets in pri-
vate funds. 
‘‘(B) In this paragraph— 
‘‘(i) the term ‘closed-end company’ has the 
meaning given that term under section 5(a) of 
the Investment Company Act of 1940, and in-
cludes a closed-end company that elects to be 
treated as a business development company 
under section 6(f) of such Act; and 
‘‘(ii) the term ‘private fund’ has the mean-
ing given that term under section 2(a) of the 
Investment Company Act of 1940.’’. 
(d) INVESTMENT LIMITATION.—Section 3(c) of the 
Investment Company Act of 1940 (15 U.S.C. 80a–3(c)) 
is amended— 
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(1) in paragraph (1), by striking ‘‘subpara-
graphs (A)(i) and (B)(i)’’ and inserting ‘‘subpara-
graphs (A)(i), (B)(i), and (C)’’; and 
(2) in paragraph (7)(D), by striking ‘‘subpara-
graphs (A)(i) and (B)(i)’’ and inserting ‘‘subpara-
graphs (A)(i), (B)(i), and (C)’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall take effect after the end of the 2-year 
period beginning on the date of enactment of this Act, or 
such earlier date as the Securities and Exchange Commis-
sion may determine is necessary or appropriate in the pub-
lic interest or for the protection of investors, upon notifica-
tion of the Congress and the public. 
Æ 
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