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The U.S. Commodity Futures Trading Commission’s (“CFTC”) Market Participants Division (the “Division”) issued No-Action Letter No. 25-50 (the “No-Action Letter”) on December 19, 2025, effectively temporarily reinstating former CFTC Regulation 4.13(a)(4) (the “QEP Exemption”), which was rescinded by the CFTC in 2012.  The No-Action relief is available until the CFTC promulgates rules addressing the reinstatement of the QEP Exemption.  This No-Action Letter affords options to reduce compliance burdens for a private fund manager that is a registered investment adviser with the Securities and Exchange Commission (“SEC”) that currently is also either registered as a commodity pool operator (“CPO”) with the CFTC or relies on CFTC Regulation 4.13(a)(3) with respect to its commodity interest trading for private funds. 

Beginning on June 29, 2026 (the “Effective Date”), SEC-registered investment advisers charging performance-based fees (e.g. carried interest or performance allocation) and in certain cases exempt reporting advisers[1] (collectively, “Advisers”) must ensure that clients or private fund investors (“Investors”) meet updated “qualified client” thresholds under Section 205-3 of the Investment Advisers Act of 1940 (the “Advisers Act”). In April 2026, the SEC issued a final order that adjusts these dollar thresholds to account for inflation, affecting fee arrangements for many investment advisory relationships. Section 205(a)(1) of the Advisers Act generally prohibits investment advisers from entering into advisory contracts that compensate Advisers with performance-based fees based on a share of capital gains unless their Investors qualify as a “qualified client” under the Advisers Act.

As discussed in our previous article, “Raising Capital Through Private Placements Under Regulation D”, Regulation D provides exemptions to streamline capital raising and avoid the rigorous public disclosure requirements associated with public offerings. To perfect an offering under Regulation D, companies must file a notice of their offering with the Securities and Exchange Commission…

The U.S. Court of Appeals for the Fifth Circuit ruled that the meaning of “limited partner” under Section 1402(a)(13) of the Internal Revenue Code of 1986, as amended (the “Code”), is determined under state law. This ruling, Sirius Solutions LLP v. Commissioner, overturned a recent Tax Court decision, Soroban Capital Partners LP…

When a company is looking to raise third-party capital, it will frequently sell equity in the form of securities issued by the company.  The U.S. Securities Act of 1933 (as amended, the “Securities Act”) prohibits the sale of securities unless such securities are registered with the Securities and Exchange Commission (the “SEC”).  The registration process…

Under Regulation D Rule 506(c) of the Securities Act of 1933, private funds may generally solicit and advertise their offerings, but all purchasers must be verified as accredited investors before being allowed to invest. The requirements for verification go beyond self-certification (such as checking a box in the subscription documents), which is the common practice…

Introduction

The Financial Crimes Enforcement Network (“FinCEN”), a bureau of the U.S. Department of the Treasury (the “Treasury”), issued a final rule (the “Final Rule”), adding investment advisers to the definition of “financial institution” under the regulations that implement the Bank Secrecy Act (the “BSA”).  The Final…

As financial markets and investors increasingly rely on instant access to data online, financial professionals are publishing more analyses through websites and social media than ever before.  Yet many financial professionals may be unaware of the fine line the Investment Advisers Act of 1940 (the “Advisers Act”) draws between (i) a bona fide…

In 2023, the Securities and Exchange Commission (the “SEC”) adopted amendments and issued guidance to modernize the rules governing beneficial ownership reporting under Sections 13(d) and 13(g) of the Securities Exchange Act of 1934 (the “Exchange Act”) when a person acquires more than 5% beneficial ownership of a voting class of equity securities registered under Section 12 of the Exchange Act.