On March 2nd, the SEC adopted amendments to two rules in order to implement congressionally mandated exemptions from registration for investment advisers who advise rural business investment companies (RBICs). These exemptions are part of the RBIC Advisers Relief Act of 2018, which amended the Investment Advisers Act.
The new amendments pertain to Rules 203(l)-1 and 203(m)-1. These rules implement exemptions from SEC registration for advisers to venture capital funds and private funds. RBICs will now be included in the definition of the term “venture capital fund”, and their assets will be excluded from the definition of the term “assets under management” for purposes of the private fund adviser exemption. Advisers to RBICs, which are licensed by the U.S. Department of Agriculture, use the equity raised in capitalizing their funds to make venture capital investments mostly in small enterprises that are located primarily in rural areas.
The amendments will be published on the Commission’s website and in the Federal Register. They will become effective immediately upon publication.
Sources:
SEC Amends Exemptions from Investment Adviser Registration for Advisers to Rural Business Investment Companies (www.sec.gov)
Exemptions From Investment Adviser Registration for Advisers to Certain Rural Business Investment Companies (www.sec.gov)
