Improving Disclosure for Investors Act of 2022
Bill: H.R.9570 | Sponsor: Rep. Huizenga, Bill (R-MI)
Policy area: Finance and Financial Sector

Summary:
Improving Disclosure for Investors Act of 2022
This bill requires the Securities and Exchange Commission (SEC) to propose and finalize rules to allow entities to deliver regulatory documents to investors electronically. The SEC must establish a mechanism for investors to opt out of electronic delivery and receive paper documents instead. If the SEC does not finalize rules within one year after enactment, the bill allows for electronic delivery of these documents.

To direct the Securities and Exchange Commission to promulgate rules 
      with respect to the electronic delivery of certain required 
                  disclosures, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Improving Disclosure for Investors 
Act of 2022''.

SEC. 2. ELECTRONIC DELIVERY.

    (a) Promulgation of Rules.--Not later than 180 days after the date 
of the enactment of this section, the Securities and Exchange 
Commission shall propose and, not later than 1 year after the date of 
the enactment of this section, the Commission shall finalize, rules, 
regulations, amendments, or interpretations, as appropriate, to allow a 
covered entity to satisfy the entity's obligation to deliver regulatory 
documents required under the securities laws to investors using 
electronic delivery.
    (b) Required Provisions.--Rules, regulations, amendments, or 
interpretations the Commission promulgates pursuant to subsection (a) 
shall:
            (1) With respect to investors that do not receive all 
        regulatory documents by electronic delivery, provide for--
                    (A) delivery of an initial communication in paper 
                form regarding electronic delivery;
                    (B) a transition period not to exceed 180 days 
                until such regulatory documents are delivered to such 
                investors by electronic delivery; and
                    (C) during a period not to exceed 2 years following 
                the transition period set forth in subparagraph (B), 
                delivery of an annual notice in paper form solely 
                reminding such investors of the ability to opt out of 
                electronic delivery at any time and receive paper 
                versions of regulatory documents.
            (2) Set forth requirements for the content of the initial 
        communication described in paragraph (1)(A).
            (3) Set forth requirements for the timing of delivery of a 
        notice of website availability of regulatory documents and the 
        content of the appropriate notice described in subsection 
        (h)(3)(B).
            (4) Provide a mechanism for investors to opt out of 
        electronic delivery at any time and receive paper versions of 
        regulatory documents.
            (5) Require measures reasonably designed to identify and 
        remediate failed electronic deliveries of regulatory documents.
            (6) Set forth minimum requirements regarding readability 
        and retainability for regulatory documents that are delivered 
        electronically.
            (7) For covered entities other than brokers, dealers, 
        investment advisers registered with the Commission, and 
        investment companies, require measures reasonably designed to 
        ensure the confidentiality of personal information in 
        regulatory documents that are delivered to investors 
        electronically.
    (c) Exemption From Certain Requirements.--Section 101(c) of the 
Electronic Signatures in Global and National Commerce Act (15 U.S.C. 
7001(c)) shall not apply with respect to a regulatory document 
delivered in accordance with this section.
    (d) Rule of Construction.--Nothing in this section shall be 
construed as altering the substance or timing of any regulatory 
document obligation under the securities laws or regulations of a self-
regulatory organization.
    (e) Treatment of Revisions Not Completed in a Timely Manner.--If 
the Commission fails to finalize the rules, regulations, amendments, or 
interpretations required under subsection (a) before the date specified 
in such subsection--
            (1) a covered entity may deliver regulatory documents using 
        electronic delivery in accordance with subsections (b) through 
        (d); and
            (2) such electronic delivery shall be deemed to satisfy the 
        obligation of the covered entity to deliver regulatory 
        documents required under the securities laws.
    (f) Other Action.--
            (1) Review of rules.--The Commission shall, within 180 days 
        of the date of enactment of this Act--
                    (A) conduct a review of the rules and regulations 
                of the Commission to determine whether any such rules 
                or regulations require delivery of written documents to 
                investors; and
                    (B) propose amendments to any identified rules or 
                regulations to eliminate the ``in writing'' 
                requirement.
            (2) Actions by self-regulatory organizations.--Each self-
        regulatory organization shall adopt rules and regulations, or 
        amend the rules and regulations of the self-regulatory 
        organization, consistent with this Act and consistent with 
        rules, regulations, amendments, or interpretations finalized by 
        the Commission pursuant to subsection (a).
            (3) Rule of application.--This subsection shall not apply 
        to a rule or regulation issued pursuant to a Federal statute if 
        that Federal statute specifically requires delivery of written 
        documents to investors.
    (g) Definitions.--In this section:
            (1) Commission.--The term ``Commission'' means the 
        Securities and Exchange Commission.
            (2) Covered entity.--The term ``covered entity'' means--
                    (A) an investment company (as defined in section 
                3(a)(1) of the Investment Company Act of 1940 (15 
                U.S.C. 80a-3)) that is registered under such Act;
                    (B) a business development company (as defined in 
                section 2(a) the Investment Company Act of 1940 (15 
                U.S.C. 80a-2(a))) that has elected to be regulated as 
                such under such Act;
                    (C) a registered broker or dealer (as defined in 
                section 3(a)(4) and section 3(a)(5) of the Securities 
                Exchange Act of 1934) (15 U.S.C. 78c(a)(4) & 
                78c(a)(5));
                    (D) a registered municipal securities dealer (as 
                defined in section 3(a)(30) of the Securities Exchange 
                Act of 1934) (15 U.S.C. 78c(a)(30));
                    (E) a registered government securities broker or 
                government securities dealer (as defined in section 
                3(a)(43) and section 3(a)(44) of the Securities 
                Exchange Act of 1934) (15 U.S.C. 78c(a)(43) & 
                78c(a)(44));
                    (F) a registered investment adviser (as defined in 
                section 202(a)(11) of the Investment Advisers Act of 
                1940) (15 U.S.C. 80b-1);
                    (G) a registered transfer agent (as defined in 
                section 3(a)(25) of the Securities Exchange Act of 
                1934) (15 U.S.C. 78c(a)); or
                    (H) a registered funding portal (as defined in 
                section 3(a)(80) of the Securities Exchange Act of 
                1934) (15 U.S.C. 78c(a)).
            (3) Electronic delivery.--The term ``electronic delivery'', 
        with respect to regulatory documents, includes--
                    (A) the direct delivery of such regulatory document 
                to an electronic address of an investor;
                    (B) the posting of such regulatory document to a 
                website and direct electronic delivery of an 
                appropriate notice of the availability of the 
                regulatory document to the investor; and
                    (C) an electronic method reasonably designed to 
                ensure receipt of such regulatory document by the 
                investor.
            (4) Regulatory documents.--The term ``regulatory 
        documents'' includes--
                    (A) prospectuses meeting the requirements of 
                section 10(a) of the Securities Act of 1933 (15 U.S.C. 
                77j);
                    (B) summary prospectuses meeting the requirements 
                of--
                            (i) section 230.498 of title 17, Code of 
                        Federal Regulations; or
                            (ii) section 230.498A of title 17, Code of 
                        Federal Regulations;
                    (C) statements of additional information, as 
                described under section 270.30e-3(h)(3) of title 17, 
                Code of Federal Regulations;
                    (D) annual and semi-annual reports to investors 
                meeting the requirements of section 30(e) of the 
                Investment Company Act of 1940 (15 U.S.C. 80a-29(e));
                    (E) notices meeting the requirements under section 
                270.19a-1 of title 17, Code of Federal Regulations;
                    (F) confirmations and account statements meeting 
                the requirements under section 240.10b-10 of title 17, 
                Code of Federal Regulations;
                    (G) proxy statements meeting the requirements under 
                section 240.14a-3 of title 17, Code of Federal 
                Regulations;
                    (H) privacy notices meeting the requirements of 
                Regulation S-P under subpart A of part 248 of title 17, 
                Code of Federal Regulations;
                    (I) affiliate marketing notices meeting the 
                requirements of Regulation S-AM under subpart B of part 
                248 of title 17, Code of Federal Regulations; and
                    (J) all other regulatory documents required to be 
                delivered by covered entities to investors under the 
                securities laws and the rules and regulations of the 
                Commission and the self-regulatory organizations.
            (5) Securities laws.--The term ``securities laws'' has the 
        meaning given the term in section 3(a) of the Securities 
        Exchange Act of 1934 (15 U.S.C. 78c(a)).
            (6) Self-regulatory organization.--The term ``self-
        regulatory organization'' means--
                    (A) a self-regulatory organization, as defined in 
                section 2(a)(26) of the Securities Exchange Act of 1934 
                (15 U.S.C. 78c(a)); and
                    (B) the Municipal Securities Rulemaking Board.
            (7) Website.--The term ``website'' means an internet 
        website or other digital, internet, or electronic-based 
        information repository, such as a mobile application, to which 
        an investor of a covered entity has been provided reasonable 
        access.
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