Fair Access to Investment Research Act of 2017

Bill: 115-s-327
Sponsor: full_name: Sen. Heller, Dean [R-NV]
Introduced: 2017-02-07
Policy area: Finance and Financial Sector
Subjects: Administrative law and regulatory procedures

Financial services and investments

Securities

Securities and Exchange Commission (SEC)
Latest action: action_date: 2017-10-06
text: Signed by President.

Summaries:
action_date: 2017-02-07
action_desc: Introduced in Senate
text: <p><b>Fair Access to Investment Research Act of 2017</b></p> <p>This bill directs the Securities and Exchange Commission (SEC) to establish and implement a "safe harbor" for certain investment fund research reports published by brokers and dealers. Such reports shall be deemed not to be "offers" under specified provisions of securities law, even if the broker or dealer participates in the registered offering of the investment fund's securities.</p> <p>In implementing the safe harbor, the SEC must prohibit a self-regulatory organization from maintaining or enforcing a rule that would prevent a member from: (1) publishing or distributing a covered investment fund research report solely because the member is also participating in a registered offering of the fund,&nbsp;or (2) participating in a registered offering of a covered investment fund solely because the member has published a research report about the fund.<strike></strike></p> <p>The bill restricts the SEC from conditioning the safe harbor upon specified requirements. </p>

action_date: 2017-03-13
action_desc: Reported to Senate with amendment(s)
text: <p><b>Fair Access to Investment Research Act of 2017</b></p> <p>(Sec. 2) This bill directs the Securities and Exchange Commission (SEC) to establish and implement a "safe harbor" for certain investment fund research reports published by brokers and dealers. Such reports shall be deemed not to be "offers" under specified provisions of securities law, even if the broker or dealer participates in the registered offering of the investment fund's securities.</p> <p>In implementing the safe harbor, the SEC must prohibit a self-regulatory organization from maintaining or enforcing a rule that would prevent a member from: (1) publishing or distributing a covered investment fund research report solely because the member is also participating in a registered offering of the fund,&nbsp;or (2) participating in a registered offering of a covered investment fund solely because the member has published a research report about the fund.<strike></strike></p> <p>The bill restricts the SEC from conditioning the safe harbor upon specified requirements. </p>

action_date: 2017-09-11
action_desc: Passed Senate amended
text: <p><b>Fair Access to Investment Research Act of 2017</b></p> <p>(Sec. 2) This bill directs the Securities and Exchange Commission (SEC) to establish and implement a "safe harbor" for certain investment fund research reports published by brokers and dealers. Such reports shall be deemed not to be "offers" under specified provisions of securities law, even if the broker or dealer participates in the registered offering of the investment fund's securities.</p> <p>In implementing the safe harbor, the SEC must prohibit a self-regulatory organization from maintaining or enforcing a rule that would prevent a member from: (1) publishing or distributing a covered investment fund research report solely because the member is also participating in a registered offering of the fund,&nbsp;or (2) participating in a registered offering of a covered investment fund solely because the member has published a research report about the fund.<strike></strike></p> <p>The bill restricts the SEC from conditioning the safe harbor upon specified requirements. </p> <p>The safe harbor shall generally&nbsp;not apply to reports about a business development company or a registered closed-end investment company published by a broker or dealer during a specified time frame. </p>

action_date: 2017-09-27
action_desc: Passed House without amendment
text: <p>(This measure has not been amended since it was passed by the Senate on September 11, 2017. The summary of that version is repeated here.)</p> <p><b>Fair Access to Investment Research Act of 2017</b></p> <p>(Sec. 2) This bill directs the Securities and Exchange Commission (SEC) to establish and implement a "safe harbor" for certain investment fund research reports published by brokers and dealers. Such reports shall be deemed not to be "offers" under specified provisions of securities law, even if the broker or dealer participates in the registered offering of the investment fund's securities.</p> <p>In implementing the safe harbor, the SEC must prohibit a self-regulatory organization from maintaining or enforcing a rule that would prevent a member from: (1) publishing or distributing a covered investment fund research report solely because the member is also participating in a registered offering of the fund,&nbsp;or (2) participating in a registered offering of a covered investment fund solely because the member has published a research report about the fund.<strike></strike></p> <p>The bill restricts the SEC from conditioning the safe harbor upon specified requirements. </p> <p>The safe harbor shall generally&nbsp;not apply to reports about a business development company or a registered closed-end investment company published by a broker or dealer during a specified time frame. </p>

action_date: 2017-10-06
action_desc: Public Law
text: <p><b>Fair Access to Investment Research Act of 2017</b></p> <p>(Sec. 2) This bill directs the Securities and Exchange Commission (SEC) to establish and implement a "safe harbor" for certain investment fund research reports published by brokers and dealers. Such reports shall be deemed not to be "offers" under specified provisions of securities law, even if the broker or dealer participates in the registered offering of the investment fund's securities.</p> <p>In implementing the safe harbor, the SEC must prohibit a self-regulatory organization from maintaining or enforcing a rule that would prevent a member from: (1) publishing or distributing a covered investment fund research report solely because the member is also participating in a registered offering of the fund,&nbsp;or (2) participating in a registered offering of a covered investment fund solely because the member has published a research report about the fund.<strike></strike></p> <p>The bill restricts the SEC from conditioning the safe harbor upon specified requirements. </p> <p>The safe harbor shall generally&nbsp;not apply to reports about a business development company or a registered closed-end investment company published by a broker or dealer during a specified time frame. </p>

tv_txt: II 115th CONGRESS 1st Session S. 327 IN THE SENATE OF THE UNITED STATES February 7 (legislative day, February 6), 2017 Mr. Heller (for himself and Mr. Peters ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs 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.

1. Short title This Act may be cited as the Fair Access to Investment Research Act of 2017 . 2. Safe harbor for investment fund research (a) Expansion of the safe harbor Not later than the end of the 45-day period beginning on the date of enactment of this Act, the Securities and Exchange Commission shall propose, and not later than the end of the 180-day period beginning on such date, the Commission shall adopt, upon such terms, conditions, or requirements as the Commission may determine necessary or appropriate in the public interest, for the protection of investors, and for the promotion of capital formation, revisions to section 230.139 of title 17, Code of Federal Regulations, to provide that a covered investment fund research report that is published or distributed by a broker or dealer— (1) shall be deemed, for purposes of sections 2(a)(10) and 5(c) of the Securities Act of 1933 ( 15 U.S.C. 77b(a)(10) , 77e(c)), not to constitute an offer for sale or an offer to sell a security that is the subject of an offering pursuant to a registration statement that is effective, even if the broker or dealer is participating or will participate in the registered offering of the covered investment fund’s securities; and (2) shall be deemed to satisfy the conditions of paragraph (a)(1) or (a)(2) of section 230.139 of title 17, Code of Federal Regulations, or any successor provisions, for purposes of the Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization. (b) Implementation of safe harbor In implementing the safe harbor pursuant to subsection (a), the Commission shall— (1) not, in the case of a covered investment fund with a class of securities in substantially continuous distribution, condition the safe harbor on whether the broker’s or dealer’s publication or distribution of a covered investment fund research report constitutes such broker’s or dealer’s initiation or reinitiation of research coverage on such covered investment fund or its securities; (2) not— (A) require the covered investment fund to have been registered as an investment company under the Investment Company Act of 1940 ( 15 U.S.C. 80a–1 et seq.) or subject to the reporting requirements of section 13 or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m , 78o(d)) for any period exceeding the period of time referenced under paragraph (a)(1)(i)(A)(1) of section 230.139 of title 17, Code of Federal Regulations; or (B) impose a minimum float provision exceeding that referenced in paragraph (a)(1)(i)(A)(1)(i) of section 230.139 of title 17, Code of Federal Regulations; (3) provide that a self-regulatory organization may not maintain or enforce any rule that would— (A) prohibit the ability of a member to publish or distribute a covered investment fund research report solely because the member is also participating in a registered offering or other distribution of any securities of such covered investment fund; or (B) prohibit the ability of a member to participate in a registered offering or other distribution of securities of a covered investment fund solely because the member has published or distributed a covered investment fund research report about such covered investment fund or its securities; and (4) provide that a covered investment fund research report shall not be subject to section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ) or the rules and regulations thereunder, except that such report may still be subject to such section and the rules and regulations thereunder to the extent that it is otherwise not subject to the content standards in the rules of any self-regulatory organization related to research reports, including those contained in the rules governing communications with the public regarding investment companies or substantially similar standards. (c) Rules of construction Nothing in this Act shall be construed as in any way limiting— (1) the applicability of the antifraud or antimanipulation provisions of the Federal securities laws and rules adopted thereunder to a covered investment fund research report, including section 17 of the Securities Act of 1933 ( 15 U.S.C. 77q ), section 34(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–33(b) ), and sections 9 and 10 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78i , 78j); or (2) the authority of any self-regulatory organization to examine or supervise a member’s practices in connection with such member’s publication or distribution of a covered investment fund research report for compliance with applicable provisions of the Federal securities laws or self-regulatory organization rules related to research reports, including those contained in rules governing communications with the public. (d) Interim effectiveness of safe harbor (1) In general From and after the 180-day period beginning on the date of enactment of this Act, if the Commission has not adopted revisions to section 230.139 of title 17, Code of Federal Regulations, as required by subsection (a), and until such time as the Commission has done so, a broker or dealer distributing or publishing a covered investment fund research report after such date shall be able to rely on the provisions of section 230.139 of title 17, Code of Federal Regulations, and the broker or dealer’s publication of such report shall be deemed to satisfy the conditions of paragraph (a)(1) or (a)(2) of that section if the covered investment fund that is the subject of such report satisfies the reporting history requirements (without regard to Form S–3 or Form F–3 eligibility) and minimum float provisions of such subsections for purposes of the Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization, as if revised and implemented in accordance with subsections (a) and (b). (2) Status of covered investment fund After such period and until the Commission has adopted revisions to section 230.139 of title 17, Code of Federal Regulations, and FINRA has revised rule 2210, for purposes of subsection (c)(7)(O) of such rule, a covered investment fund shall be deemed to be a security that is listed on a national securities exchange and that is not subject to section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ). Communications concerning only covered investment funds that fall within the scope of such section shall not be required to be filed with FINRA. (e) Definitions For purposes of this Act: (1) The term covered investment fund research report means a research report published or distributed by a broker or dealer about a covered investment fund or any securities issued by the covered investment fund, but does not include a research report to the extent that the research report is published or distributed by the covered investment fund or any affiliate of the covered investment fund. (2) The term covered investment fund means— (A) an investment company registered under, or that has filed an election to be treated as a business development company under, the Investment Company Act of 1940 ( 15 U.S.C. 80a–1 et seq.) and that has filed a registration statement under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) for the public offering of a class of its securities, which registration statement has been declared effective by the Commission; and (B) a trust or other person— (i) issuing securities in an offering registered under the Securities Act of 1933 and which class of securities is listed for trading on a national securities exchange; (ii) the assets of which consist primarily of commodities, currencies, or derivative instruments that reference commodities or currencies, or interests in the foregoing; and (iii) that provides in its registration statement under the Securities Act of 1933 that a class of its securities are purchased or redeemed, subject to conditions or limitations, for a ratable share of its assets. (3) The term FINRA means the Financial Industry Regulatory Authority. (4) The term research report has the meaning given that term under section 2(a)(3) of the Securities Act of 1933 ( 15 U.S.C. 77b(a)(3) ), except that such term shall not include an oral communication. (5) The term self-regulatory organization has the meaning given to that term under section 3(a)(26) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a)(26) ).

tv_txt: II Calendar No. 11 115th CONGRESS 1st Session S. 327 IN THE SENATE OF THE UNITED STATES February 7 (legislative day, February 6), 2017 Mr. Heller (for himself, Mr. Peters , and Mr. Perdue ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs March 13, 2017 Reported by Mr. Crapo , with amendments Omit the part struck through and insert the part printed in italic 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.

1. Short title This Act may be cited as the Fair Access to Investment Research Act of 2017 . 2. Safe harbor for investment fund research (a) Expansion of the safe harbor Not later than the end of the 45-day 180-day period beginning on the date of enactment of this Act, the Securities and Exchange Commission shall propose, and not later than the end of the 180-day 270-day period beginning on such date, the Commission shall adopt, upon such terms, conditions, or requirements as the Commission may determine necessary or appropriate in the public interest, for the protection of investors, and for the promotion of capital formation, revisions to section 230.139 of title 17, Code of Federal Regulations, to provide that a covered investment fund research report that is published or distributed by a broker or dealer— (1) shall be deemed, for purposes of sections 2(a)(10) and 5(c) of the Securities Act of 1933 ( 15 U.S.C. 77b(a)(10) , 77e(c)), not to constitute an offer for sale or an offer to sell a security that is the subject of an offering pursuant to a registration statement that is effective, even if the broker or dealer is participating or will participate in the registered offering of the covered investment fund’s securities; and (2) shall be deemed to satisfy the conditions of paragraph (a) (1) or (a) (2) of section 230.139 (a) of title 17, Code of Federal Regulations, or any successor provisions, for purposes of the Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization. (b) Implementation of safe harbor In implementing the safe harbor pursuant to subsection (a), the Commission shall— (1) not, in the case of a covered investment fund with a class of securities in substantially continuous distribution, condition the safe harbor on whether the broker’s or dealer’s publication or distribution of a covered investment fund research report constitutes such broker’s or dealer’s initiation or reinitiation of research coverage on such covered investment fund or its securities; (2) not— (A) require the covered investment fund to have been registered as an investment company under the Investment Company Act of 1940 ( 15 U.S.C. 80a–1 et seq.) or subject to the reporting requirements of section 13 or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m , 78o(d)) for any period exceeding the period of time referenced under paragraph (a)(1)(i)(A)(1) of section 230.139 (a)(1)(i)(A)(1) of title 17, Code of Federal Regulations; or (B) impose a minimum float provision exceeding that referenced in paragraph (a)(1)(i)(A)(1)(i) of section 230.139 (a)(1)(i)(A)(1)(i) of title 17, Code of Federal Regulations; (3) provide that a self-regulatory organization may not maintain or enforce any rule that would— (A) prohibit the ability of a member to publish or distribute a covered investment fund research report solely because the member is also participating in a registered offering or other distribution of any securities of such covered investment fund; or (B) prohibit the ability of a member to participate in a registered offering or other distribution of securities of a covered investment fund solely because the member has published or distributed a covered investment fund research report about such covered investment fund or its securities; and (4) provide that a covered investment fund research report shall not be subject to section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ) or the rules and regulations thereunder, except that such report may still be subject to such section and the rules and regulations thereunder to the extent that it is otherwise not subject to the content standards in the rules of any self-regulatory organization related to research reports, including those contained in the rules governing communications with the public regarding investment companies or substantially similar standards. (c) Rules of construction Nothing in this Act shall be construed as in any way limiting— (1) the applicability of the antifraud or antimanipulation provisions of the Federal securities laws and rules adopted thereunder to a covered investment fund research report, including section 17 of the Securities Act of 1933 ( 15 U.S.C. 77q ), section 34(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–33(b) ), and sections 9 and 10 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78i , 78j); or (2) the authority of any self-regulatory organization to examine or supervise a member’s practices in connection with such member’s publication or distribution of a covered investment fund research report for compliance with applicable provisions of the Federal securities laws or self-regulatory organization rules related to research reports, including those contained in rules governing communications with the public , or to require the filing of communications with the public the purpose of which is not to provide research and analysis of covered investment funds . (d) Interim effectiveness of safe harbor (1) In general From and after the 180-day 270-day period beginning on the date of enactment of this Act, if the Commission has not adopted revisions to section 230.139 of title 17, Code of Federal Regulations, as required by subsection (a), and until such time as the Commission has done so, a broker or dealer distributing or publishing a covered investment fund research report after such date shall be able to rely on the provisions of section 230.139 of title 17, Code of Federal Regulations, and the broker or dealer’s publication of such report shall be deemed to satisfy the conditions of paragraph (a) (1) or (a) (2) of that section 230.139(a) of title 17, Code of Federal Regulations, if the covered investment fund that is the subject of such report satisfies the reporting history requirements (without regard to Form S–3 or Form F–3 eligibility) and minimum float provisions of such subsections for purposes of the Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization, as if revised and implemented in accordance with subsections (a) and (b). (2) Status of covered investment fund After such period and until the Commission has adopted revisions to section 230.139 of title 17, Code of Federal Regulations, and FINRA has revised rule 2210, for purposes of subsection (c)(7)(O) of such rule, a covered investment fund shall be deemed to be a security that is listed on a national securities exchange and that is not subject to section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ). Communications concerning only covered investment funds that fall within the scope of such section shall not be required to be filed with FINRA. (3) Covered investment funds communications (A) In general Except as provided in subparagraph (B), communications that concern only covered investment funds that fall within the scope of section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ) shall not be required to be filed with FINRA. (B) Exception FINRA may require the filing of communications with the public if the purpose of those communications is not to provide research and analysis of covered investment funds. (e) Definitions For purposes of this Act: (1) The term covered investment fund research report means a research report published or distributed by a broker or dealer about a covered investment fund or any securities issued by the covered investment fund, but does not include a research report to the extent that the research report is published or distributed by the covered investment fund or any affiliate of the covered investment fund. ( 2 1 ) The term covered investment fund means— (A) an investment company registered under, or that has filed an election to be treated as a business development company under, the Investment Company Act of 1940 ( 15 U.S.C. 80a–1 et seq.) and that has filed a registration statement under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) for the public offering of a class of its securities, which registration statement has been declared effective by the Commission; and (B) a trust or other person— (i) issuing securities in an offering registered under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) and which class of securities is listed for trading on a national securities exchange; (ii) the assets of which consist primarily of commodities, currencies, or derivative instruments that reference commodities or currencies, or interests in the foregoing; and (iii) that provides in its registration statement under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) that a class of its securities are purchased or redeemed, subject to conditions or limitations, for a ratable share of its assets. (2) The term covered investment fund research report means a research report published or distributed by a broker or dealer about a covered investment fund or any securities issued by the covered investment fund, but does not include a research report to the extent that the research report is published or distributed by the covered investment fund or any affiliate of the covered investment fund. (3) The term FINRA means the Financial Industry Regulatory Authority. (4) The term research report has the meaning given that term under section 2(a) (3) of the Securities Act of 1933 ( 15 U.S.C. 77b(a) (3) ), except that such term shall not include an oral communication. (5) The term self-regulatory organization has the meaning given to that term under section 3(a) (26) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a) (26) ).

March 13, 2017 Reported with amendments

tv_txt: One Hundred Fifteenth Congress of the United States of America 1st Session Begun and held at the City of Washington on Tuesday, the third day of January, two thousand and seventeen S. 327 IN THE SENATE OF THE UNITED STATES AN ACT To direct the Securities and Exchange Commission to provide a safe harbor related to certain investment fund research reports, and for other purposes.

1. Short title This Act may be cited as the Fair Access to Investment Research Act of 2017 . 2. Safe harbor for investment fund research (a) Expansion of the safe harbor Not later than the end of the 180-day period beginning on the date of enactment of this Act, the Securities and Exchange Commission shall propose, and not later than the end of the 270-day period beginning on such date, the Commission shall adopt, upon such terms, conditions, or requirements as the Commission may determine necessary or appropriate in the public interest, for the protection of investors, and for the promotion of capital formation, revisions to section 230.139 of title 17, Code of Federal Regulations, to provide that a covered investment fund research report that is published or distributed by a broker or dealer, other than a broker or dealer that is an investment adviser to the fund or an affiliated person of the investment adviser to the fund— (1) shall be deemed, for purposes of sections 2(a)(10) and 5(c) of the Securities Act of 1933 ( 15 U.S.C. 77b(a)(10) , 77e(c)), not to constitute an offer for sale or an offer to sell a security that is the subject of an offering pursuant to a registration statement that is effective, even if the broker or dealer is participating or will participate in the registered offering of the covered investment fund’s securities; and (2) shall be deemed to satisfy the conditions of paragraph (1) or (2) of section 230.139(a) of title 17, Code of Federal Regulations, or any successor provisions, for purposes of the Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization. (b) Implementation of safe harbor In implementing the safe harbor pursuant to subsection (a), the Commission shall— (1) not, in the case of a covered investment fund with a class of securities in substantially continuous distribution, condition the safe harbor on whether the broker’s or dealer’s publication or distribution of a covered investment fund research report constitutes such broker’s or dealer’s initiation or reinitiation of research coverage on such covered investment fund or its securities; (2) not— (A) require the covered investment fund to have been registered as an investment company under the Investment Company Act of 1940 ( 15 U.S.C. 80a–1 et seq.) or subject to the reporting requirements of section 13 or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m , 78o(d)) for any period exceeding the period of time referenced under section 230.139(a)(1)(i)(A)(1) of title 17, Code of Federal Regulations; or (B) impose a minimum float provision exceeding that referenced in section 230.139(a)(1)(i)(A)(1)(i) of title 17, Code of Federal Regulations; (3) provide that a self-regulatory organization may not maintain or enforce any rule that would— (A) prohibit the ability of a member to publish or distribute a covered investment fund research report solely because the member is also participating in a registered offering or other distribution of any securities of such covered investment fund; or (B) prohibit the ability of a member to participate in a registered offering or other distribution of securities of a covered investment fund solely because the member has published or distributed a covered investment fund research report about such covered investment fund or its securities; and (4) provide that a covered investment fund research report shall not be subject to section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ) or the rules and regulations thereunder, except that such report may still be subject to such section and the rules and regulations thereunder to the extent that it is otherwise not subject to the content standards in the rules of any self-regulatory organization related to research reports, including those contained in the rules governing communications with the public regarding investment companies or substantially similar standards. (c) Rules of construction Nothing in this Act shall be construed as in any way limiting— (1) the applicability of the antifraud or antimanipulation provisions of the Federal securities laws and rules adopted thereunder to a covered investment fund research report, including section 17 of the Securities Act of 1933 ( 15 U.S.C. 77q ), section 34(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–33(b) ), and sections 9 and 10 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78i , 78j); or (2) the authority of any self-regulatory organization to examine or supervise a member’s practices in connection with such member’s publication or distribution of a covered investment fund research report for compliance with applicable provisions of the Federal securities laws or self-regulatory organization rules related to research reports, including those contained in rules governing communications with the public, or to require the filing of communications with the public the purpose of which is not to provide research and analysis of covered investment funds. (d) Interim effectiveness of safe harbor (1) In general From and after the 270-day period beginning on the date of enactment of this Act, if the Commission has not adopted revisions to section 230.139 of title 17, Code of Federal Regulations, as required by subsection (a), and until such time as the Commission has done so, a broker or dealer distributing or publishing a covered investment fund research report after such date shall be able to rely on the provisions of section 230.139 of title 17, Code of Federal Regulations, and the broker or dealer’s publication of such report shall be deemed to satisfy the conditions of paragraph (1) or (2) of section 230.139(a) of title 17, Code of Federal Regulations, if the covered investment fund that is the subject of such report satisfies the reporting history requirements (without regard to Form S–3 or Form F–3 eligibility) and minimum float provisions of such subsections for purposes of the Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization, as if revised and implemented in accordance with subsections (a) and (b). (2) Status of covered investment fund After such period and until the Commission has adopted revisions to section 230.139 of title 17, Code of Federal Regulations, and FINRA has revised rule 2210, for purposes of subsection (c)(7)(O) of such rule, a covered investment fund shall be deemed to be a security that is listed on a national securities exchange and that is not subject to section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ). (3) Covered investment funds communications (A) In general Except as provided in subparagraph (B), communications that concern only covered investment funds that fall within the scope of section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ) shall not be required to be filed with FINRA. (B) Exception FINRA may require the filing of communications with the public if the purpose of those communications is not to provide research and analysis of covered investment funds. (e) Exception The safe harbor under subsection (a) shall not apply to the publication or distribution by a broker or a dealer of a covered investment fund research report, the subject of which is a business development company or a registered closed-end investment company, during the time period described in section 230.139(a)(1)(i)(A)(1) of title 17, Code of Federal Regulations, except where expressly permitted by the rules and regulations of the Securities and Exchange Commission under the Federal securities laws. (f) Definitions For purposes of this Act: (1) The term affiliated person has the meaning given the term in section 2(a) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–2(a) ). (2) The term covered investment fund means— (A) an investment company registered under, or that has filed an election to be treated as a business development company under, the Investment Company Act of 1940 ( 15 U.S.C. 80a–1 et seq.) and that has filed a registration statement under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) for the public offering of a class of its securities, which registration statement has been declared effective by the Commission; and (B) a trust or other person— (i) issuing securities in an offering registered under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) and which class of securities is listed for trading on a national securities exchange; (ii) the assets of which consist primarily of commodities, currencies, or derivative instruments that reference commodities or currencies, or interests in the foregoing; and (iii) that provides in its registration statement under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) that a class of its securities are purchased or redeemed, subject to conditions or limitations, for a ratable share of its assets. (3) The term covered investment fund research report means a research report published or distributed by a broker or dealer about a covered investment fund or any securities issued by the covered investment fund, but does not include a research report to the extent that the research report is published or distributed by the covered investment fund or any affiliate of the covered investment fund, or any research report published or distributed by any broker or dealer that is an investment adviser (or an affiliated person of an investment adviser) for the covered investment fund. (4) The term FINRA means the Financial Industry Regulatory Authority. (5) The term investment adviser has the meaning given the term in section 2(a) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–2(a) ). (6) The term research report has the meaning given that term under section 2(a)(3) of the Securities Act of 1933 ( 15 U.S.C. 77b(a)(3) ), except that such term shall not include an oral communication. (7) The term self-regulatory organization has the meaning given that term under section 3(a)(26) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a)(26) ).

Speaker of the House of Representatives Vice President of the United States and President of the Senate

tv_txt: 115th CONGRESS 1st Session S. 327 IN THE SENATE OF THE UNITED STATES AN ACT To direct the Securities and Exchange Commission to provide a safe harbor related to certain investment fund research reports, and for other purposes.

1. Short title This Act may be cited as the Fair Access to Investment Research Act of 2017 . 2. Safe harbor for investment fund research (a) Expansion of the safe harbor Not later than the end of the 180-day period beginning on the date of enactment of this Act, the Securities and Exchange Commission shall propose, and not later than the end of the 270-day period beginning on such date, the Commission shall adopt, upon such terms, conditions, or requirements as the Commission may determine necessary or appropriate in the public interest, for the protection of investors, and for the promotion of capital formation, revisions to section 230.139 of title 17, Code of Federal Regulations, to provide that a covered investment fund research report that is published or distributed by a broker or dealer, other than a broker or dealer that is an investment adviser to the fund or an affiliated person of the investment adviser to the fund— (1) shall be deemed, for purposes of sections 2(a)(10) and 5(c) of the Securities Act of 1933 ( 15 U.S.C. 77b(a)(10) , 77e(c)), not to constitute an offer for sale or an offer to sell a security that is the subject of an offering pursuant to a registration statement that is effective, even if the broker or dealer is participating or will participate in the registered offering of the covered investment fund’s securities; and (2) shall be deemed to satisfy the conditions of paragraph (1) or (2) of section 230.139(a) of title 17, Code of Federal Regulations, or any successor provisions, for purposes of the Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization. (b) Implementation of safe harbor In implementing the safe harbor pursuant to subsection (a), the Commission shall— (1) not, in the case of a covered investment fund with a class of securities in substantially continuous distribution, condition the safe harbor on whether the broker’s or dealer’s publication or distribution of a covered investment fund research report constitutes such broker’s or dealer’s initiation or reinitiation of research coverage on such covered investment fund or its securities; (2) not— (A) require the covered investment fund to have been registered as an investment company under the Investment Company Act of 1940 ( 15 U.S.C. 80a–1 et seq.) or subject to the reporting requirements of section 13 or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m , 78o(d)) for any period exceeding the period of time referenced under section 230.139(a)(1)(i)(A)(1) of title 17, Code of Federal Regulations; or (B) impose a minimum float provision exceeding that referenced in section 230.139(a)(1)(i)(A)(1)(i) of title 17, Code of Federal Regulations; (3) provide that a self-regulatory organization may not maintain or enforce any rule that would— (A) prohibit the ability of a member to publish or distribute a covered investment fund research report solely because the member is also participating in a registered offering or other distribution of any securities of such covered investment fund; or (B) prohibit the ability of a member to participate in a registered offering or other distribution of securities of a covered investment fund solely because the member has published or distributed a covered investment fund research report about such covered investment fund or its securities; and (4) provide that a covered investment fund research report shall not be subject to section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ) or the rules and regulations thereunder, except that such report may still be subject to such section and the rules and regulations thereunder to the extent that it is otherwise not subject to the content standards in the rules of any self-regulatory organization related to research reports, including those contained in the rules governing communications with the public regarding investment companies or substantially similar standards. (c) Rules of construction Nothing in this Act shall be construed as in any way limiting— (1) the applicability of the antifraud or antimanipulation provisions of the Federal securities laws and rules adopted thereunder to a covered investment fund research report, including section 17 of the Securities Act of 1933 ( 15 U.S.C. 77q ), section 34(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–33(b) ), and sections 9 and 10 of the Securities Exchange Act of 1934 ( 15 U.S.C. 78i , 78j); or (2) the authority of any self-regulatory organization to examine or supervise a member’s practices in connection with such member’s publication or distribution of a covered investment fund research report for compliance with applicable provisions of the Federal securities laws or self-regulatory organization rules related to research reports, including those contained in rules governing communications with the public, or to require the filing of communications with the public the purpose of which is not to provide research and analysis of covered investment funds. (d) Interim effectiveness of safe harbor (1) In general From and after the 270-day period beginning on the date of enactment of this Act, if the Commission has not adopted revisions to section 230.139 of title 17, Code of Federal Regulations, as required by subsection (a), and until such time as the Commission has done so, a broker or dealer distributing or publishing a covered investment fund research report after such date shall be able to rely on the provisions of section 230.139 of title 17, Code of Federal Regulations, and the broker or dealer’s publication of such report shall be deemed to satisfy the conditions of paragraph (1) or (2) of section 230.139(a) of title 17, Code of Federal Regulations, if the covered investment fund that is the subject of such report satisfies the reporting history requirements (without regard to Form S–3 or Form F–3 eligibility) and minimum float provisions of such subsections for purposes of the Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization, as if revised and implemented in accordance with subsections (a) and (b). (2) Status of covered investment fund After such period and until the Commission has adopted revisions to section 230.139 of title 17, Code of Federal Regulations, and FINRA has revised rule 2210, for purposes of subsection (c)(7)(O) of such rule, a covered investment fund shall be deemed to be a security that is listed on a national securities exchange and that is not subject to section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ). (3) Covered investment funds communications (A) In general Except as provided in subparagraph (B), communications that concern only covered investment funds that fall within the scope of section 24(b) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–24(b) ) shall not be required to be filed with FINRA. (B) Exception FINRA may require the filing of communications with the public if the purpose of those communications is not to provide research and analysis of covered investment funds. (e) Exception The safe harbor under subsection (a) shall not apply to the publication or distribution by a broker or a dealer of a covered investment fund research report, the subject of which is a business development company or a registered closed-end investment company, during the time period described in section 230.139(a)(1)(i)(A)(1) of title 17, Code of Federal Regulations, except where expressly permitted by the rules and regulations of the Securities and Exchange Commission under the Federal securities laws. (f) Definitions For purposes of this Act: (1) The term affiliated person has the meaning given the term in section 2(a) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–2(a) ). (2) The term covered investment fund means— (A) an investment company registered under, or that has filed an election to be treated as a business development company under, the Investment Company Act of 1940 ( 15 U.S.C. 80a–1 et seq.) and that has filed a registration statement under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) for the public offering of a class of its securities, which registration statement has been declared effective by the Commission; and (B) a trust or other person— (i) issuing securities in an offering registered under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) and which class of securities is listed for trading on a national securities exchange; (ii) the assets of which consist primarily of commodities, currencies, or derivative instruments that reference commodities or currencies, or interests in the foregoing; and (iii) that provides in its registration statement under the Securities Act of 1933 ( 15 U.S.C. 77a et seq.) that a class of its securities are purchased or redeemed, subject to conditions or limitations, for a ratable share of its assets. (3) The term covered investment fund research report means a research report published or distributed by a broker or dealer about a covered investment fund or any securities issued by the covered investment fund, but does not include a research report to the extent that the research report is published or distributed by the covered investment fund or any affiliate of the covered investment fund, or any research report published or distributed by any broker or dealer that is an investment adviser (or an affiliated person of an investment adviser) for the covered investment fund. (4) The term FINRA means the Financial Industry Regulatory Authority. (5) The term investment adviser has the meaning given the term in section 2(a) of the Investment Company Act of 1940 ( 15 U.S.C. 80a–2(a) ). (6) The term research report has the meaning given that term under section 2(a)(3) of the Securities Act of 1933 ( 15 U.S.C. 77b(a)(3) ), except that such term shall not include an oral communication. (7) The term self-regulatory organization has the meaning given that term under section 3(a)(26) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a)(26) ).

Passed the Senate September 11, 2017. Secretary